Tim Ferro

To steal a phrase from the legendary Jim Cramer, “Buy, Buy, Buy”! I have been watching this crazy market very closely for a number of years now. My analysis of the S&P 500 leads me to believe that we are hovering just above the bottom and now is a great time to buy back into the market. I know that, like me, numerous people have been sitting on the sideline waiting to get back into the game. With money tight and the bills from the holidays coming due soon, most people do not have the cash to being investing again. This is one of the mistakes that investors make that the professionals don’t. Pros always have cash on hand for times like this. But I digress, sometime early in the new year the market will dip a little and that is when you should buy.

“What should I buy?” you might be asking yourself. The easiest way to take advantage of this market right now is to invest in an S&P 500 Index Fund. They are cheaper to own that mutual funds and perform slightly better based on performance minus fees. Hey, if it’s good enough for Buffet, it’s good enough for me.

If you are a little more daring, then I will recommend a couple of stocks. Disclaimer: purchase stocks at your own risk. Done. First I would recommend Caterpillar Inc. (CAT). With Obama’s electio, comes a commitment to America’s infrastructure and CAT is a global leader. Next I will recommend a biotech stock that has consistantly beat the S&P 500 and is a great play because biotech stocks are not as leveraged to market movement. They move more based on drugs and clinical trials. Gen-Probe Inc. (GPRO) is a fantasticly run company and a stock that I personally own. I have listened to the quarterly conference calls for the past two quarters and they are exactly what you would look for in any company: great finanaces and business pipeline. Finally I will recommend stocks that have high dividends. Buying these stocks and reinvesting the dividends are a great way to grow your portfolio in tough economic times.

What do you think? Leave comments about financial advice for 2009.

– Tim Ferro

2008 was a crazy year for me financially. I changed jobs twice, bought a house, saw my 401k and the stock market fall, and refinanced my mortgage. On the last day of the year I am taking financial stock of the situation and making some goals for 2009. I encourage everyone to do the same. Here are my goals:

1. Pay off my mortgage faster.
2. Play the drugstore game.
3. Save more to take advantage of compound interest.
4. Max out my 401k and IRA contributions.
5. Donate more to charity.

These are my main goals for the year. As I am now established financially, these are appropriate goals. If you are newer to this, check out my previous post about getting set up financially for retirement. Leave comments about your goals or if you have questions.

– Tim Ferro