As chief strategist/consumer education for Charles Schwab & Co. Inc., Schwab-Pomerantz is a leading advocate for individual investors. She speaks and writes extensively about personal finance issues and is a driving force in the movement to improve financial literacy in America. As president of the Charles Schwab Foundation, she also oversees the company's philanthropic strategy and resources.
With her father, company founder, chairman and CEO Charles R. Schwab, Schwab-Pomerantz co-authored "It Pays to Talk: How to Have the Essential Conversations With Your Family About Money and Investing," which Publishers Weekly called "a well-rounded primer that provides one-stop shopping for the many phases of financial understanding and planning."
Schwab-Pomerantz is a sought-after speaker whose public appearances have included appearances on "The Today Show," CNBC and NPR. In 2001, Working Woman magazine recognized her as one of four “Market Movers” in America who are “rewriting the rules of finance,” and she was also recognized as one of the “25 power Elite” in the financial services industry by Investment News. For four consecutive years, The San Francisco Business Times has named her one of the San Francisco Bay Area’s 100 Most Influential Women in Business.
A graduate of the University of California, Berkeley, with a bachelor’s degree in Political Science, Schwab-Pomerantz later earned a master’s degree in business administration from George Washington University. She holds NASD Series 7, 63 and 8 registrations.
Carrie Schwab: I would say the best place to start for the young person or any person is in asset allocation mutual fund. Mutual funds are really great, are perfect for somebody who doesn’t have the time to really follow their investments, nor really have the knowledge.
An asset allocation mutual fund invests in diversified portfolios, stocks or in cash. Depending in the asset allocation that you choose, or the mutual fund you chose, depends on your risk tolerance, how much risk can you accept internally and what your time frame is for investing.
Another alternative that’s becoming very popular is the Life-Cycle Fund. It is similar to the asset allocation fund, where again it is in a diverse portfolio of stocks, bonds and cash. As time goes on it readjust the amount of stocks in bond as you get closer to your target date. So, becomes more conservative.
Those are two really good examples. But keep in mind that anybody who plans to invest, you need to set that money a side or you mentally set that money aside for at least five years. Other wise you risk selling at a time when the market might have a short term dip.
Recorded on: March 27, 2008