Thursday, 06 June 2013 12:11

Going back to work and Investing

Written by  Dave Ramsey
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Q. I’m a stay-at-home mom now, and my husband brings home $2,600 a month. We’re trying to get out of debt, but we need more money coming in. I want to go back to work, but emotionally part of me feels like I should stay home with our 2-year-old daughter. What do you think?

 

 

A. I understand the feelings involved, especially if you’ve spent all of your time home with your child. But don’t make the mistake of blaming the debt if you simply want to go back to work. You’re not a bad person if you have kids and you work outside the home.

 

I have several ladies on my team who have young children, and they work 40 hours a week. Guess what? They’re excellent mothers! Anyone who says a woman can’t be a great mom because she works outside the home is full of it. On the other hand, if anyone says you’re not fulfilling yourself as a person or you’re stunting your intellectual development because you’re a stay-at-home mom, they’re full of it, too!

 

I’d advise you and your husband to sit down, talk about this a lot, and pray about the situation. Don’t worry about what anyone else thinks, because it’s none of their business. You guys are in charge of your lives and your family. That makes it your job to decide what’s best.

 

If you want to stay at home, and you guys can make it happen financially, that’s a great thing. If you can’t right now, or you simply want to go back into the workforce, that’s fine too. It’ll help solve your debt problem. Then after you’ve got your money under control, you might find you want to come home again. The option will be there.

 

For now, I think you should go back to work. Why? Because you want to!

 

 

Q. I’d like to start investing in mutual funds, but I have no idea how they work. Could you explain about them please?

 

 

A.  First of all, don’t rely solely on my answer here. You should never invest in anything you don’t fully understand. Before you do anything else, sit down with a good mutual fund broker, someone who has the heart of a teacher, who will help you find what’s best for you and your specific situation and goals.

 

Simply put, a mutual fund—if it’s a stock mutual fund—is a group of 90–200 stocks. If it’s a growth stock mutual fund, then it’s a group of 90–200 growth stocks. Analysts buy the stocks they think will increase in price and sell the stocks they feel will go down in price. When the analysts buy growth stocks, it turns it into a growth stock mutual fund. If they buy bonds instead, it becomes a bond mutual fund. Several people put money into these groups, and that’s where you get the name “mutual fund.” They’re mutually funded.

 

These types of investments are much safer than single stock investing because your money is spread across several different stocks. Plus, you’ve got people who know what they’re doing picking the stocks. My advice would be to take a hard look at mutual funds that have been out there for 10 to 20 years and have a good track record for a long period of time. I have one that has been open since 1934, and that kind of longevity and stability gives me confidence that over time they’ll be just fine!

 

 

Last modified on Thursday, 06 June 2013 12:15
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