I do not know where to start

[Karune]

Hi all,

I am in my late 20s, and I have just recently moved in with my gf, which has gotten me really thinking about my finances going forward. I have always had an interest in getting into investing and building wealth, but it just seems extremely overwhelming and I honestly have no idea where to start.
I have spoken to a 'financial advisor' as part of a free consultation, and they have recommended me some investors trust, but the fees are way to high for my liking (plus they charge a management fee). I am still talking to them now moreso just to get free advice, but it is highly unlikely I will actually do anything with them.

I heard everyone talk about IBKR and positive things about it (I believe they are portable as well), but I am unsure how to go about starting an account, what to buy etc., which is why I am posting here. Any advice or tips for absolute beginners would be greatly appreciated.

PS; I know NISA and IDECO exist, but since I don't see myself in Japan long-term (will only be here for the next 5-7 years), I don't believe it will be worthwhile to open them.

Thanks in advance and looking forward to chatting with you all!

[adamu]

Welcome.

Pick one of these:

https://www.bogleheads.org/wiki/Getting_started
https://www.bogleheads.org/wiki/Getting ... _investors

If you're not from the US, I think NISA is worth it for you anyway - there are no penalties for selling later and it's tax free in the mean time. Once you have over ¥3.6M/year to invest, you can consider other options.

[Tkydon]

At your age, I think you should think about things in this order:

Insurance: Life and Long-Term Disability Insurance. You can't live and invest if you are out of work due to disability. While you don't have very much, you need protection for your family; wife and children, in case something happens to you, the major bread-winner... This is as or more important than investing at this time in your life.

If you are not a US Citizen or Greencard Holder:

And if you plan to be in Japan for the long haul:

iDeCo: Individual Defined Contribution Personal Pension Plan: If you invest in iDeCo, you get a Tax Deduction which pays 30% of your Premiums, but you cannot access the funds until retirement.
If you pay from your paycheck they will already take into account the Tax Deduction when withholding tax, so it will be invisible to you (it's still there), but if you pay from your Bank Account, the tax will have been withheld from your paycheck before you pay the contribution (think of this as additional forced saving), and so you can claim the Tax Refund for the Tax Withheld through the year, either at the Year End Adjustment - Nenmatsu Chosei, or through Tax Return - Kakutei Shinkoku.

NISA: Tsumitate or Growth Portion. You don't get any Tax Deduction, but you can withdraw the money any time you like completely tax free.

If you were to divide the money you have to invest every month and pay 2/3 to iDeCo and 1/3 to Tsumitate NISA, then at the end of the year, you will get the Refund of Tax Withheld on the 2/3 iDeCo Contribution, which you can immediately sweep into Growth NISA completely Tax Free.
You would end up with about 50/50 split between iDeCo for your Retirement, and NISA which you could withdraw Tax Free if you needed money at various life stages.

Then, you have to decide which Funds to choose in the iDeCo and NISA.
The opinion of many people here is to buy an All World All Country Index Fund such as the eMaxisSlim All World Al Country, and Dollar Cost Average through thick and thin, and over the years you will reduce you Average Buy Price and accumulate Units that will add up over the years.

[RetireJapan]

And if you plan to be in Japan for the long haul:

OP said they plan to be in Japan 5-7 years, ie not the long haul.

Please try to respond to the actual posts rather than generically.

[Tsumitate Wrestler]

What are your nationalities?

Do you have brokerage accounts in your home countries?

General advice for 5 years is:

1.Skip ideco
2. Strongly consider NISA (non-Americans)
3. Consider a strategy you can replicate back in your home country.
4. Have a home country brokerage setup as well.
5. I would say 100% diversified global equities is fine at 20.

[Tkydon]

And if you plan to be in Japan for the long haul:

OP said they plan to be in Japan 5-7 years, ie not the long haul.

Please try to respond to the actual posts rather than generically.

I didn't get as far as the P.S. My bad.

[david]

I would add the caveat it might be worth taking care of any high interest debt you have first and building up a quickly accessible emergency fund as things to add pretty high on the list if you havent taken care of them already.

[Tsumitate Wrestler]

And if you plan to be in Japan for the long haul:

OP said they plan to be in Japan 5-7 years, ie not the long haul.

Please try to respond to the actual posts rather than generically.

You you consider adding a mandatory "Are you a US taxpayer/citizen" to forum applications and automatically flaring those users?

I think r/Japanfinance does this.

[RetireJapan]

You you consider adding a mandatory "Are you a US taxpayer/citizen" to forum applications and automatically flaring those users?

I think r/Japanfinance does this.

I do not have the technical skills to even consider this

We could ask people to include that info in their signature though I guess.

[Karune]

What are your nationalities?

Do you have brokerage accounts in your home countries?

General advice for 5 years is:

1.Skip ideco
2. Strongly consider NISA (non-Americans)
3. Consider a strategy you can replicate back in your home country.
4. Have a home country brokerage setup as well.
5. I would say 100% diversified global equities is fine at 20.

Thanks for the tips. I am from Australia, but I have no brokerage account, just a generic savings one with extremely low interest rates. I am looking to change this however.

For NISA, is it as easy as just opening an account with my current bank (in this case, Resona), or is there a better way that I should be aware of?