Given the volitility of the markets today, I would not recommend investing the the market until the US goes through it's mess with the sub-prime mortage debacle in the next year or two. Foreclosures, defaults, and late payments are reaching an all time high because of this. Today the markets were up over 250 points while on Friday they were down over 250. I believe that the US market is set for a correction that will bring it down to 10,000 or below. As the US goes, so does the rest of the world.
When I left Japan at it's peak in 89, the Nikkei was at about 39,000 because of land speculation. By 1992 it was at 14,000, a more than 60% drop! The US is going thjough the same exact thing right now with the boom in housing and land prices these past several years and a correction is forthcoming.
Although investing in stocks is legalized gambling, if you're going to do it you should check into Mutual Funds as Mike mentioned as they are spread among a wide variety of stocks and decreases your risk. You might also want to check into Stock Index Funds where you invest in a certain sector like technology or commodities.
Before you select a mutual fund make sure the fund has been open at least 5 years and check their 3, 5, and 10 year rate of returns. I would not suggest getting into one that does not have at least a 5% return for a minimum of 5 years. Most of all do your homework before investing! Invest wisly and you can average at least an 8% return.
Your best bet these days would be in commodities or precious metals mutual funds or index funds.
Have you guys earned some money with buying stocks?
Yes. I made much money during the technology boom of the late 90's that enabled me to pay off my house in 6 years. However, the crash in 2001 took most of my profits away and it took three years to regain those profits as I was invested heavily in individual tech stocks and agressive mutual funds. Big mistake. With the volitility in the world today and the problem with sub-prime mortages in the US, I have been out of the market for two years and am just sitting around waiting for the crash before I get back in. This time I will be more conservative. However, investing in the market is still a wise choice if you do your homework.
However, your money can still grow. With all the on-line banking going on today they are offering great interest rates of more than 5% for CD's and money market accounts and some even allow you to invest in overseas CD's or currency. Many are also insured against losses. Whether you can invest in one while living in Japan I do not know, but you can send them an e-mail to inquire as all it will take is an electronic transfer. The on-line bank I use for my yen savings accounts and CD's and such is
Everbank. Through them one can also invest in the market.
Dave and maushan3, you are still young, so if you start investing wisely now, you will be more than comfortable by the time you retire. If I had started investing at your age instead of waiting till my early 40's I would be wealthy beyond imagination now. Also, to give you an idea of how much you will need to save for retirement check out
this link at Bloomberg and play around with their retirement calculator. They also have other calculators that you can play with. It's in dollars, but you can still figure it out in yen.
Most of all, to gain wealth don't spend more than you make (if you can't pay cash for it, then you can't afford it), stay completely out of debt except for your mortage, buy a used car (as it is a depreciating asset), save money on a regular basis and invest wisely. Easier said than done I know, but it can be done. Good luck.
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