So say I have some extra cash and want to invest it, say $5000-$7500. What would be a good thing to invest in? Stocks? Mutual funds? CD?  Should I do something risky or conservative?  I have some stocks and other stuff, but it was set up by my folks when I was a kid. I really don't have that much knowledge when it comes to investing, and tend to just sit on what I have, fearing I would mess it up and lose it.  I took a big hit over the last few years when Lucent and AT&T each took a turd and never quite recovered. Lost probably 35-40% of my value.  I don't think I want to go back to the broker that holds my current investments, mainly not to put all my eggs in one basket so to speak.  Looking for some short term return, but mainly long term.

Machineguns are probably the best investment going

Go conservative, bonds above Baa/BBB (investment grade).  If it isn't something you are going to pay someone to manage don’t put yourself in a situation where you are going to lose a lot of money.  It is a sure fire way to make a safe amount of $.  Another option is preferred stock in a company with a strong history of paying dividends.  Preferred stock always has current dividend preference and generally has cumulative dividend preference.  This means you get paid before the common stock holders, and for years hat dividends aren't paid that amount adds up and when they do pay dividends you get the money.  Preferred stock typically has a fixed dividend rate stated as a percentage of the par value of the stock.  Both of these option are very very safe.  Chances of losing money are next to none.  If you want to put your money in a professionally managed mutual fund you have a good chance of making more money.

I used to be a financial advisor with Series 7 (stocks, options and mutual funds) and Series 66 (can charge just for advise) licenses.

I strongly recommend you read "A Random Walk Down Wall Street" by Malkiel.

That being said, most people tend to have unrealistic or contradictory expectations when it comes to investing.

There is no one size fits all portfolio or investment. Your time line, % of total investment this particular chunk of money represents, your expectations and adversity to risk all impact what the asset allocation (% of stocks, bonds and cash) of your portfolio should be. Bear in mind that mutual funds can be a basket of stocks, basket of bonds or basket of both.

You can find investor surveys/questionaires online that ask about 6-8 questions to determine your asset allocation. The more detailed the results e.g. 20% large cap value, 20% large cap growth, etc, the better.

The conundrum is finding a financial advisor worth a damn. Bear in mind that they are salemen first. At the Monday morning meetings, no one gets praised for their grasp of Modern Portfolio Theory or how much they increased a clients portfolio. They get praised for how much they sell.

That being said a relatively conservative portfilio can be had with a "balanced mutual fund". Those tend to have both stocks and bonds.  I tend to favor passive aka index funds vs actively managed funds. Nothing comes for free. Actively managed funds have higher operating expense ratios (OER's) which means the fund manager takes a larger cut, but generally underperform their indices. In other words you're paying more for underperformance.

Sorry this isn't the classic "plastics" or "buy amalgamated flyswatter" advice most tend to look for, but the goal is to make money for you, not your broker.

I hope this helps. Also, be prepared for tons of advice that contradicts what I just said.

If you are young, put it in an IRA that has a Guaranteed interest rate and the Principal is Guaranteed.You can do this best with an Insurance company. Look up Independant Agents (they have more resources ) and also call some Captive companies too (Nationwide, State Farm, etc. Go with the best rate / low risk. Any questons, IM me for help.  blade409

With $5-7K, you want to invest in broadly diversified, low cost, "no-load' stock and bond mutual funds.

Go to www.Vanguard.com and peruse their investment educational 'basic' items and then invest with them----Vanguard is owned by the investors, as compared to the vast majority of other funds, brokerage houses &/or investment professionals who will try to hose you with commissions and charges. Another good low cost source is TIAA-CREF, the (former) Teacher's Insurance and Annuity Fund-College Retirement Equities Fund.

Thanks for the info.  I have some homework to do now.

[Gremlins]I suggest you invest all you have in canned food and shotguns.[/Gremlins]