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Starting early: Joseph Schmal

by Community Manager

‎07-31-2014 10:09 AM

Joe SchmalName: Joseph Schmal


Age: 35


Title: Senior business support analyst


Served in: Air Force


When did you start investing? I started investing every month once I started earning a paycheck after college.


How did you start investing? I just stuck everything into a Standard & Poor’s 500 index fund (after tax) and didn’t pay much attention to it until I separated from the military. At that point, I opened a USAA Roth IRA and had to pick some funds. That prompted me to do some research. Since joining USAA as an employee, I’ve converted my Roth into a brokerage account and have been more active. Now, it even includes a few individual stocks that I’ve researched, although they make up a small percentage of the total.


What is your risk appetite? I’m still fairly aggressive and invested mostly in equities. In 2008, I watched my savings shrink as the market dropped, but I continued to invest in equities and watched the market recover to record levels. If I hadn’t stayed the course, I would’ve missed out on regaining my unrealized losses.


Are you investing with a specific goal? I leave my 401(k) in the hands of active portfolio managers and put it in an asset allocation fund, which automatically changes the allocation of assets as you get closer to retirement. My Roth IRA is the account I like to trade with. It’s a huge bonus that none of the trades have tax implications since capital gains and reinvested dividends are tax deferred. On the advice of my advisor here at USAA, I’ve shifted some from U.S. equities to emerging markets, which have lower price-earnings ratios and seem to be a good value for the long term.


Any advice for new investors? For young investors and those on active duty who have less taxable income due to tax-free allowances (combat pay, etc), I’d say to contribute the maximum amount to a Roth IRA every year. The only higher priority for me would be if your company matches 401(k) contributions — that’s money you should take advantage of.



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