How to Plan Your Life

Following our two-part series on getting started as an investor ("Best Brokers for Newbies,” July 1 and “An Investment Primer,” June 17) quite a few readers had follow-up questions. A number of you asked about the planning tools available at various brokers and how useful they really are, so let’s take up that topic.

This piece originally appeared only on Barron’s Online and was posted somewhat stealthily. 

A couple of years ago, TD Ameritrade launched a life-planning resource called Life 2.0. I like the way the advice is displayed based on various life stages : Starting Out (under 30), Gaining Traction (30-55), Almost There (55-64), and Retiring Soon (65+). For the young’uns, the site recommends ways to avoid going deeply into debt, and whether to buy or rent a home. For those nearing retirement, the article, “Solutions for Retirement Setbacks” addresses problems that the loss of a job or prolonged recessions may have on meeting savings goals. An essay on caring for aging parents helps guide you through a series of questions that may help clarify your thinking on this difficult topic.

Of course, Life 2.0 relentlessly pushes you to open an account with TD Ameritrade, but that’s to be expected. What I appreciate about the site is that it doesn’t focus only on retirement, but also presents the other financial challenges that face many of us—saving for college, for example.

Merrill Edge has an intriguing feature called “Face Retirement” (faceretirement.merrilledge.com) that may at first frighten you. Using your computer’s webcam, Face Retirement takes your picture and then shows you how you’ll look in the future, and what your cost of living will be. When this tool was launched last December, Alok Prasad, the head of Merrill Edge, said, “In a Stanford University experiment, people who saw age-enhanced images of themselves were more likely to save more for retirement, compared to those who weren’t exposed to their future selves. Face Retirement is designed to minimize that gap by giving consumers a preview of their future self, encouraging them to take control of long-term financial planning.”

The photos can be powerful stuff. When you see what you could look like at age 70, you may have an urge to put aside money for cosmetic enhancement. Or you may be inspired to go through some of the planning exercises on the page, and start saving more.

E*Trade also has life stage planners, but the focus is on investing for retirement. This includes useful advice about moving your 401(k) when you change jobs. Fidelity’s Guidance and Retirement section has a well-thought-out Having a Child Checklist, prompting you to think through health coverage, life insurance, college savings, and enhancing your retirement savings.

Trading Contests: Would you like to pit your trading savvy against a bunch of strangers, and perhaps win some money? Here are a couple of contests running now.

Kapitall (kapitall.com) offers the Market Master Tournament, which runs every week. You start out with $100,000 in virtual money, and the top three gainers each week win cash prizes, which are deposited in their brokerage account. You can play the game without opening an account, just by signing up for a free membership, but the cash prizes are only awarded to those who have accounts.

The site offers a game-like view of investing, with all activity taking place on what the founders call “the playground.” Originally launched as a Web application to help site members explore their investing ideas, Kapitall added trading capabilities last year. Rather than seeing menu items and a lot of data, you see a collection of icons that represent your practice portfolio and stocks that might interest you. You organize your experience by dragging and dropping the icons, which could represent individual stocks, groups of stocks, or a portfolio.

StockViews (http://www.stockviews.com), a recently-launched social site for traders and investors, offers a $250 prize to the winner of its monthly stock picking challenge. The August contest is in progress; a new one will be started in September.

To join the contest, you must become a member of the StockViews site (which is free), then rate and review at least three stocks. Your rated stocks will then be compared to returns on the S&P500, and the best performer will win the money. Enjoy!

Posted by on 08/17 at 11:22 AM

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