d what i ca your discretionary mad money pfile. icis a big reasonhy i wrote get richarefully to begin with. even if you don't own individual stksctly you probably ha some of exp t the ock maet. a 1( planhere you kepthe bulkf your retirement fun, which i want to take a moment to talk about retireme. for thos you living in a cave40k)plan a e main merans se.they're offered byyour employeandy're ahere fe iesent vicles there, along with the i.r.a. i'mlking out the individual requirement ccou. wait for those of you whore about to flasleep or change t channel becahe whe id of savi foretiremtuts you to sleep, hea me out. because you need toknow thi f. m going to tel you some things that u wot hear from e soalled perts. is shois differe. at thipoint, it'setty mch become coonal wisdoth you have to invesn you 401(k). th a idi would not contribute to a 401(k) plan. you to max out your 401(k) if you me engh money for tt to befeasible. the maximum coribution tds toe ingup over tie. 17,25, 1800 in 2015. that's a big chunkf change. ey come from yourpretax income. however, i am not one ofthe people who thinks you should max out your 401(k). i'm not someone who is gog sing the pises oth401(k) and tell youit the keyo your financial salvation. because the truth is 4(k) pls can be a rl mixed ba booing ] with a couple really great fees and a t ofad ones too. and those bad features will eat ay atou returns ar after year, metimes in fees thatre most totally hien fromou that are actually e upsetting to me. lete lay o the good, the bad and th uglf 401(k) pls, and then i'll tell you wheth it mes stontbutemoreoney t your own01( or put tash toetter use somee else. first the good. e st thgb a01(k) is it's a tax deferre investment vehicle. in. you never a penny o capital ins taxes on therots you maken y401(k) which allows your mey to cmpnd year after year. nd being fantasc. decade aer decade. tolly x-free unl y de to starmaking withdrals. regular viewers ofhis show and reers of my books know i'm a huge believer in the per of compoundin let give you an example here. suppose yo ears old an start ivesting $5,000 a year to ur 401(k). memberyou're paying any me taxthat pretax inco if you choe your iestments wise, you should be able t generate perha as ch as 7% retu on average. over the course of the next 3 yes y'll be contributing $150,000 t 401) plan beuse that money ble to coou yea afr year ou any capital ga taxes, by the time you're 60, that $5,00 preyear tax come, that could be worth oer 11,0. if you had to pay taxeon dividends and capital gains, it much as $110,000 lower that's how important compoundin is. and oiding, lllet's say e tax defd ture of the ing. on have tpay taxesn your 4(k) mey ce that's when u decideo thdrawt. th's when taxes ordinary income a since u'll lely beretired then, most o you will e up paying a lower rate than if you had been taxed on the higher rate levels so tt's o mor reason to like 401(k) pla.e second, many, b not all emoys will match or partially match your 401(k) contributions. in other words, for every dollar you inst in your 401(k)plan, your employer might throw in 50 cents up to a ceain int tat isree money. d you must almost never want to walkaw fm free y. especially again, when is aso untaxed. but ifou don't getfree money fr your employer for contributing ta 401(k), i think it's auch le compelling option, fnkly. as i said befo, there are a lot of things about a 401(k) plan tt caneelybad. which is why if aga y don't get a matchrom your employer, ve for rirent via the indi requirementaccount, or a. the same exact tax deferre stats a401(yo can only ntribute 5500 or 65 i you're er50. en y chae job youan roll over alth money in your 40k) to an ira. that'sxactly wat you should do every time you switch employs or fin yrself out of work. whdo think an ira is a better option? 401(k) plansary widely from company to company. some ge you terrifi range o choices andven you pick indidual stocks. t ma more mpans gi y a 401(k) plawith lited option sometimes you only get to cho betwn a dozen, maybe a couple dozen at most different mutu fus. so for those o you who can't pick your own stocksh yo 401(k), my number one rule fore you contribute money t your 401(k) plan, haveo make se it gives you th o putyo cash into something tha is actually worth investing in. ll make th very simple. you can't pick your own stos in a 1(k), then you want a nice low expense index fund tha mimics the s&p 500. howevef your 401(k) don't compan then go with the self-direc ira from e full svice discount prra i talkbout fidelity so you can have ctrol over your money. one more negative. within a01(k) when you invest a mutual fundou, have you to pay that mutual fund's fees thiss realmptant. but your 401(k) administrator, the coany you're - the people yo employeris to run these ans, they will ao charge fees. [ booing aning at all the mon 40k) saves youn taxes, a great deal of th canctually be called back by t fees.you er looke ayo stement d wonderedhy the heckour 4(k)ngsn't increasi ilue ke t should e,eearrobly the reas. whe doe ls ave yo here is my bottom line on retirement insting. the coany you workforffer anmployee match, youant to t money to your 401(k) til at match is maxedut. no reason to pass up onree money. afr that put any ditional retiment savings intan ira. an employer match b your 40k) doesn giveyou any options to iest, i u would do better to skip the 401(k) a go saito anra mediately. derah in california, dboh? >> caller: , jim. thks forng my call. >> quite wcome. >>alr: have a two-part queson regdinghe value of stening to a coany's earngs conferenc calls. >> okay >> cr: the first part isow n didwhatto , oerords, wha weant to takbased on the eags report sincehe st frequently will behave a ntradictorfashion to th report. for example, compananeport good eng b guide lower on revenue and ern going rwar andhe ock . theconwhere u might think it sul do th second part of mion i onhe wt coast. 7:00 and 8:00 a.m. eastern time. soor me, the value of listeng to thealls diminished because'm notin get up at 4:00 or 5:00 a.m. >> right. >> to listen to t. so i'mot ry to take anacon on that. >>he is the solution , this deborah. you have n gun tyour head, unli t hedgefunds. you calisten at your leure. i' not ng to t anody to quart touy a stock ahead of a quarter you c d . whatou want to do i take a loer torrow viewn t comforof your home wiou any noise. go listen to the cll or read it. goo yao financ get some of the research, street.comcnet some research. matcthe expectations with what was said. take a longerterm vie 's thedvantage of the individuestor. you don't ha to pl ttay >>aller: yeah, my queion is i i hve a 401 that is fairly substantial. would it be advisable for meo chan that to a sdirected ira? >> okay. well, what matters is the match. if you hav-- t empls is tching, no. yowa to gthe max mah, soo speak. and aftethat, yes. but if it's ju six and a half or one-half dozeof the other ane funds aren't tatgood thatoue allod to ben urk), then ye i wt yo to coshe serected e ra ire ra ira. whent cometoetirement, if ur cpany matches the coribution to 1(, max that out. thateally importt. but ifoutet match, youon't have investful option, go straight the ira. on"mad" tonight, y just got your ploma, sonow what? don't ss mynvtmt advice forecent grads. i'll p yr mone behind th best g. healthy retime. let' chart your ast. stick wi cramer. >>on't ms a second of "d y. follow @jam onitter. have a qustion? twee cr, #mad tweetssend a el at cnbc.m gives a call a 800-743-cnbc. ss somng? head to madmoneynbc.co i'm i'm going to share a photo of my eggo waffle when it pops up that'so interestinhoney because i'm going to sre a photo of my eggo wfl en it popsp. l'eggo my eg l'eggoy eggo hii know you're there, 'cause i can see you. i'm caing you to tell you to l'eggo my eggo! anncr: some things are too delicious to sre. golden crispy,armd flfy eggo ffles. l'eggo meggo. i take prieach mor my fquenheartburn beusyou can't at zero heartbu ahhh theet taste of victory! prilec o. one pill each morning. hours. zero heartburn. ea lovmega bue 3s ishro merekrl. unlike fish oil, megared is easily abed r wh cigaret cravings t,all i cathink about is gettingelief. on nicorette mini haa patented st-dissolving formula. it starts to relieve sudden cravings . i neve when i'll need relief. that why i ochree ni. happy anniveary dier, rl' n th mh lobeleed by aittle t ofawn ultra? oh yeah. one bott has t grease cleaning power of two bottlesf this bargain and. a drop of da and grease is gone. ere's a more enjoyle wo t yo fibery ilpsfir goodumes pl energy pport. it's a n fiber supplement that helps support regularity and includes b vitamins to help convert food to energy. mmmmm, tse aood! ce work, phillips! the tasty side of fiber, boo- boo-yah! if everyone in this country nt insane and decid to turn americannto crameca me as your ki o grand pooh-bah, you betterelieve i'd be makin changes and on. because this is a show about money, i'm go to stick to financial element to the rime. it drives me nuts that don't really teach our yopeople about how to handle money. talking earlt. t jucolge nce before you graduatrom high schl? i think should be mandory. like the awkward health classes. sadly,'m nobody's dictator. i don't he aninfluence over educational polic but control abou whawe talkbout on the how. can take a momentto spe some words that we all believe but very rarelyet to say nvertion , money important s remp. and cang abouthe state of your finaes does not me you some kind of scial bourges nster. let's y you hava real lousedit score andou w to getmarried. congtutions. you just inflicted yourrible credit on your new spuse. now ither you nor yourpart will bo quafy future a loan to buy a me or jt get daedit say moneatrs inlife buthat's the nvenal sdom at best since being broke ised a major buzz kill i spent living in my 1978 ford fairmont. i sure wish i had an expert to guide through all this stuff way ck then. so let me answer one ofhe mo important questither what the heckhod young people do with their oney? first and remost alws, u ne to inst that thenly way you'reng to be able to achieve financial freedo by freedom, what imean is livi a life where you're not totally 0% dendent on your paycheck. i'm alway thrilled when i see members of the younger demograpwhe taking an own money. too many people s saving and investing way too late that makes their liv a lot more dficu than ey need to . but ilso kno ung op fl kehey have all the in the wo many moretart iting bfore they'r truly ready when they arn fact betr thingsor em to doinstuff with thmoney. so we have to really drill wn. is i'm going to give you three lessons, and a caveat forl coege. t's start wi thecavea investigatg,ou nee t pay f your credit card debt. thissomethg ientiod before.but 'sspeciay trueor unople,particular nccredit car cpaes have gotten really agsiut offering cret to college students. no mte h muchone y ra up inhe stocmarket,f you're carrying a balance on ur credicard'soing to eat into your returns. i know this myself firsthd. and ng-term the intest on thcredit cards will probably grter than t profits you can make fro vesting. at ln a percentagbasis. soust pay your darncrit cardalance in full every nth. automa it with your cedit card company. yoll be tempted noto. i can't defeat that credit cd debt with n matter how my great stock ideas i hav on the show thlessons fo young investorrst, this is really for allg opho recently graduate and act for everne o there, rardless of a and edgendition leve u need the savne but iecogniot everyone has annhent edispotion t sa. can't all b natural cheapstes. ani acowledge that telling you to save over andver agai however, the stock mket is a great way the trick yoursel into savi apart of yr paycheckt youight otherwe spen insting in stoks can actuall beot of fun. we ied thaon the show.we try t do someentertainment within the teaching, ereas aving moneyn a savin account or sticking it in a deposit els kif joyless for a lot of people. not menti that the returns so-so smal that they'ryes, inde, i'll use the word meaningless. ifounvestigate your snaifgs the market it will be a lot easier to resist the tion to snd ttoneyn things th you might not eed. because it will be sitng in stocks that yo like. you' he to sell t stocks getur mon beco. and there is a naral predilecti to not se once you bu not only is tis a terrif way to t yoself into saving, but also t a aantage ing the smartest place put yourmoney traditional savingicles money maet funds, w you seethe rates? ch them ery week,ds, ey ve you hardly any retut all. it's a wte when the h could owni stocks in brokage account and worng with you mo get your hands dirty wi yr money. second lesson for yog investors, this muchmore target piece of adice. whe yore still young, you can afford to te a lot more sk tn an oldogy li myself. when yr in yur us can get ay witreeckless wre thpoteial upeould b huge. but so is thent wnsi. orlayingith options a rally ing a l more aggressive wityour money. why is that? it's notecae yog people are naturall btt speculators. nott all. it's simply cause when you ma a mistake in your 20s with your money, yoha the whole st of yourife to fix it. you can afforuy more h risk stocks andnd up losing your mon when you're you because you hve49 years to earn back your lses. so you have to take the risks. der investors, you to be mor cautious. thloser youget t rerement the more coervative ur insting strategy has. more nds, fewer speculate if you're in your ou shouldnvestike a young rs, an pern. forg about bonds t is n ason f someone in their 20s have bond expore when that money could be investein stoc which will make you a higherurn yar after year. young people, i want you to tke is advi t heart. especily because isusp that thecent collerads st like t invstn the rket are also e ones tha the most responsiblee most prude about their money. arand prudenc is great when putting together a budg to liveithin ur meanor decing much your paycheck t save every month. but for young investsein toorunt is actually bei ckless. 20-sometngs, live a little, at least if yourock portfolio. take some risks. ay arouwith sme specativnes maybbiec anies th lot of poteial. even if they bl up on you and all the way to you'veot yr whole liftomake that ybacfinal lesson for young instors, it's never too early to startnvesting for use your 401(k) if yo job has one. especially put some money in roth ira whh ideal for young investors. re on thatter. for young ople just out of coege, invesng is a eat wato tckoursf into ving money y might otherwise spend that mone beyond that, member tha when yore young, you canfford take a l more risks in yo rtfolio. anit's never too son to srt contbuting to your 401(k) o ira. ciallyf that ira is a roth. les goo mike in tennessee. mi, mik ke? >> calle hey, w yo doing? lve you sho thankou >> caller: we watch it a the me. >> thank you. >> cler: my question is a few epodes a, yo said that you d not li buying a sto if the patio is aove right. >> caller: i'm woering ether orot y use peg a sell signal an y do,ow hll you let it gbefore y pull trigged sel ? >> mo than two times the grth rate, i do get nervous. now the are scks that an youe got tbe careful, like a cold stock there is a bunch coldstocks. but the tycal stock it trades for lower, great. lower than twoimes that rate of growth, i'm fin th it. buit is a redflag oce it ts higher. a penny sav is a penny rned. investinis gat wayo trick yourself into saving money. it's'sever too soon to cobuteo your ira or your 401(k). i have a lot more tonight on this deep dive into thepros and cons of index funds. hey, which way do i come out? don't miss m case. and incomes a huge factor in retireme. i'going to pus you inhat direction right here right now. plus, i would wouldn't wish studt debt on my worstenmy. i'el potect your famil from this expensive burden. t go away. stay with cramer. it just kinda like...wiped everything cle. cleaning teeth are glowing.they are so white. 6xhining i actually really like the 2 steps. step 1, cleans step 2, whitens. ...leaving the deisoffice. t hd. 6x caning, 6x whening i would switch to cres hd over what ias using before. a hearattack doesn'tare if you run everyy, or if yore young or old. no matter who you are a heart attack can hn without warning. you'vhaa heart ta, a bayer aspirin regime cahelp prevent other one. be sure tk your door before you begin an aspirin regimen. r as th say when mr. clean saw l the different things hisew smart phone does... ...it nded h of hi c erer. 's nusfor marks alls it's tgh on kitcngr... and baroom grime too. he'sour... ...allund-tough-eaner, mr. clean. man (sternly): wre do u in mr. mucus: to mr. s: to work, wi you. it'saco tuesday. ma you're not ming. goodll day. [announcer:] mucinex keeps les end th we li in aworld where yo have mor cho about where to invest your ney than ever be virtual infinity ofetfs, mutual funds, but more choice isn't always tter. metimes having me optio just kes it impossible to decide which ones are right and which ones are wng for you and yove never had mre optionwhen it meicking exchange traded funds and mutual funds you do right now. th're everywhere. at thi pointtherere so many different kis etfs that it camake your ad spin. as sid note, i hat the way ma of e sector bad fs, ththatet y b sell an tire group like banks way theyave be warping the y the whole s market trades. that's something you canind t more about in et rich quickly." i have to ge you to findut about them. but the importaning is this, you have all rts etfs and tual fds out there and ey n advertise. the companies that run the funds, they want yr mone one of thebiggest miskes you can makes an iidual investor is ive it to them wi a few ceptions. unfortunately, this is o of the mt common money mstakes out ther many peoplen theoury simply equate investing with tting their ney mutual funds. me 8 mion people ve exposu to autuafu. ma of don hav a oi a lot 40k)ns donet you pickndividu stock. th jt give you a mu of mual funds to choose from. whh is one majoreason i ink all else be equal,an invidu require aount or ira is a better way to invest for retirement for you what exactly is badbout most mutual in this country? simple ou're investing in mutual funds,ou're most likely well to put becse let'say you'r gettg hosed. now, ion't want t pain with too brd a us here. e are so worthwhiual funds, and i'll tell y h to find them in a minute. bufirst, you need understa the problem with the mutu fund model. main be here is at wit actively maged mutu funds, mutu fds where there peopleecinghich stocks or other secuties to bu and sell, wee t some problems. unlike he funds, mutual fund gers don't getpaid for deliry of perrmce. they collect fs fr the investors, pe like you. d the amount money ty make den entiry on t size of theirnvestments under management. aum, we call which means the biggest incent notecessarily to do ll, something at good performance can reay help th. but what they're really being id todo is bring i more moy omore investo, salespeoe forthe fund and that partf the reason study afr study, year actively maged mutual funds unerfoed theirenchrk likehe&p500. inther wds, if you invested in actively managedu large capitalizion s. stocks, then its performance willos likely fall short, fa short of the&p 500. to me matters orse, even ou activel mnaged fund consisntly uperfm the mark, they he me of the highest feese busine. w do y le tht? they don'to as wl as the benchmk, andthey charge more. [ booing ] n if you fund es manage to beat benchmark, it could be eaunde up byfe you'll end up with underpforminrk of course, the is some actively managed funds with fabulo managers who consiste driveterrific result i'll telyou how find t another time. a tu funelivers such grearesults r a longif a manager is adecent pson, ey'lopep new instnts. ceain point it becom credibly difcult to at the market. that's theaw o lge nbers. as a general re,if yore going iesinutl fus, yodaytonwanttoe in an actively manad e the areohi. and e eviden tt the bulk them unform i frankly o staggering to ep goi that w you ow tt i t yurbest stragy ito man your ow portfolio of iividual scks. at's wha i talk about t te nht on "mad mone" for tse who don't hav time to rearch individl coanies, or your 401) an w't l y o th, let tl emartay investn mutual funds you want,ou c writhis down. a cheap lost indefund tt mirrors the markeas a whe, onthat micthe&p500. index funds of ultraow fees and with an s&p indexnd, y have a vehicle that willet you participate is the strength of e stock mark whout having to spend the time picking individual stks. now th may sound like a real mple sution. don't overt it. thehole pnt of ptingou the tim a eor tmage your own portlio stocks. at's why think it insane when peoe art owningltlefunds. its very nature, a fund should bdiversifie ly the i really no reason for members like yo to he y exposu tth. if you're goin toake the time to try toplayidual sectors that at that time would really bmuchterent picking dividual stocks. asor etfs, tse vehi are r trading, not nvesng. idon' lik em. ma etfs rebalanc evy day d atanake a toll on a ng perfmae. th'reet u for long-term performance. ineneralif you're not a pro and no managing a rtfolio of dierenstocks and not d trg every singleday, you probably sul'te fooling oundith the etfs either re is the boomine. athe end ofhe d i k a s&p 5ndex fund i the let ba wayo manage yr money betterhan the vas bulk of managed mual funds. the od, the d and theugly. youo have te time, you can be the performance of an index nd by picking scks yourself. whh ishente reason i do the ow ery night. if y don't have ttime, don't ovthinkit. st one cheap s&p index fund is inde the best way to go. mary in maryland, ry? calle >> caller: boo-y, jim. jim, i sarted ling to you a ilba then i srted buyinstks on your adv >> thank you. >> caller: now'm looking at my portlio here. imm, mi eye hav seen t gly. soan toget attle fancier and perhbume ina stks. wever,'m cious about a and possle poreto freign so c you u-kramer o exge rate expore? >> re. we havthbatt hy of t republic goingves. i don't know if watf you wantn individu stocks andhe bunesses are goodi don't rally ce where they are. idon't ev care about t cucy. if the business is that e, the stock will go higher if you're buyingadrnd it's a european company an the euro is being weaked by central baissues, you wnot d ll even if the stockoes well. all things bng neutral and you don'have a countr or content ting toebase e concerns circumstances i'm fe th it. if tare, you have to stay away and stay in theood ' us . which is a mart way to in. mattw in new york? tthew? >> cler:ba--boo-y, jim. >>ba-ba-boyahback at you. >> calr: i'm3 yearsold, a recent clegerad d new to the workforce d i just ard to max ou my ir reing wantind of go for an aessive allocation fo growth to ta on s. tly. i wantget your suggest for some starng out to the tirement invesng w would you go aut doing ? you want to have theastest young growth stocks and thosere --tendto be found in technology sector. but alo, course, in biec now,on't go ocrazy. i'll have e or two stocks of coy tass are mking money. me than hat. osare the mo fertile areas. junior growth ock, compies thatre worth a bilon dollars or less. a lot them that are to sma to talk bout. one of those two. the are all fine. you can do those because if you lose money, you've gothe rest of your life to make it back. not so much mutua lve here. ckin stocks is still thebest way to manage your money.if dent ha me, ju please, please, please go with eheap s&p 500 over most actively managed funds w there is much more "mad money" ahead, including how to find the best path to a healthy retirement depending on your en don't forget your kids, please. precting your cilen from student loan debwi put them in a betterosition to build their future. us finngour twee withouhe 140-characte reriction that so hemmes in. stick withrar. ce'n easy. we only makthe mo real natural lookincolor. soven reangunlight, it doesn't look like hair color at all. it looksike, is a hundred percent u. and isn't that the most butiful part? i've beeon fi've been on my feel all day. i'bushed! yea me t. ride t gelavof comfo with dr. scholls ssagg geinsoles. they're pren toive you coort. which helps you feel morenergiz ...a day lg. i want what he has. olay total effects a skin transrmation thativals the ading department store moisturizer. ves skin tfigh7 sis ging. laou age less, so you ce agess. olay. els. think we should've ten a left at the rivetarzan know where tarzan go! taan does not know where ta go. hey, excuse me,do you know where the waterfall is? waterfall? , me tarzan, if you're a couple, yofight over directions. it what you do. you switch to geo. ohhhhh it's what yodo. ohhhh! do you have do that ght in mea let leme tl yo abo whetr itmake sense forou ira, or for you to go a ro, whic is a term i'm su you'veeard couleimes but y not undstand. i know i taed endlessly about the benefits usingn individual retiment account and a 401(k plan to iestor retirement i'm not ing to beat a dead horse here. this is thsubject i get a ton of quest about. should i put mymoney in a rot account or a regularone? so why don'te start with a roth ireaira. itay be the single greatest thing our government sone for low-inme famils since the en of hewarn povert which at best ended in a dra verty pssibly winning. told you how about a regular ira lets you take preincome tax vested and then your ga after year,ade after decade totally tax-free until you decide to witraw that moy whenou retire. a roth ira s different.with the roth, u ma contributions with after tax income. regular ira, ttg mone into aoth won't decrease your tax bill. on the other hand, once your moy is in a roth ira, you will ner y taxes on it again. as lg as your caremai in your account, you don't pay catagains tax. you don't pay divides tax. when you withdraw it which you ndo whout penal ag 59 1/2,ou don'tay y income tax on yur widrawal. is is fabulo in other wor, with roth, you y taxes now that youon't have to p income tax 30 40 yes om nowhen you retire. ther o more positive point about roth. youan withdraw the money you' invested, note your gains, justhe amount you contributed anyou won't ge hit with 10% penalty,s what happens whenou to withdraw money from a regular ira before yo hit that magic age of 59 that's veryifferent from a regular iere you don't pay anyax or contributionsnow, and yo gains don't get ted within the account. but once you start whdrawing the money, every penny you out is taxeds ordinary income. toecideetween a rra and (k) a regular ira and 401(k), you're basically ciding whether itmakes mo sense to pay income ta n wth a roth or pay income tax ce you retire with regu account. yohave to figure out if you'll be in the higher tax bet after you retire or aow one. this is a complicated estion and has a lot todo whhe ecifics of your situation, ur career how old y are. auick rule thumb. for anyone'arginal taxate is 25% orless, wics mos of erica, i thiou oht to go wi a . bettere take the hi up front aowr roth ira compound x- the rest of your life. remember, for those wh doha to pick their o diveied portfolios of sa ve ten stocks, park your retirement money in a low cost indexundhat mirrors the s&p 500. as you get oer, you caadd meonds. burll until you reire, stoc should make up the majori of yur investment. i noticed this bore. untilhey m offheair. so isessa. but it's conar to convtional wisd. i want stocks,ot bds uil later. hoabout roth 401(? this wks like ira. ing you makeonutio and ner pay taxes ag except that it's a 4(k) plan, has a muc higher coribuon l an an ira. the governmenys the01(k) contribuon limit is $,000. wheas ira al coritions arapp a a re $5,500. and the otherig ce. aoth duhave any ofome. no maow much ney yo earn, canakevante of e along asour player dedes to give u the optn. coue, a thisds on whatnk the future is going look like. if youhink taxes ar heaed higher or the cose of yo lifetime, then a roth 401(k) where you pay taxes now and not in fuats so the way to. en if you'r ming a loof y in t present fo tho o yun peoe whlyeme policall cociour theob s ere o way p thde of higrtaxes. t histores ifferent.d believe we can os deficit ou substantially ising tax,ut lil as'm gng to gets onhis show the endf day, thi is boeyond our control and therefore beyond o abilityto pred the bottom lin tlower your present inme, the lower yo xes. a ro 1(k) oro ira lts yoy oseow ratesno, and never rry outs again for ur riremt moey. the less youe, the me likely ts th ifou. it that simple anwh you're savingor tire, dory about at could go caro justorry aut ming e be chois rit now. ad money" isack after th break.y,orgot e mi! that's lacta that's l. right.00% real milk, just without l so you d all wan.. ..ith no dcoort? exactly. here, try some... mmm,t is real . see? delicious. hoof bump! oh. right here girl, bm lactaid . 100% real mi. no dismfort and r a creamy a delicious trt,ry lacta ice cam i've bn on feel l day. i'm bushed! yea me too. excuse me.mi through! de the gel wave of cfort thr. scholls massaging geinsos. the en toive yocomft. whichelps yofe more energized ...allay long. i want whe h. (couing) cougng disrus everne's lif that's w there's delsym. lsym advanced time release formula s silence cohs for a full 12 urs. all nigh.. > ead a lotf sties about the crden of student loan ebt. right now 1 billions of owe more than trillion dla istuden . th's an credibly hig gure it'ust that re stino graduate fromlege or grae hool and immediatel realize that it t take decades to pay back e . in s aftertudy kids who gruateith no bt end up being woh a l mreon thanhe classm who he outsg studenloans. now i'm aig believern social mobili whh is w i'm condently coming o here and teaching u how to use thetock mart beusit's the test enge of wealth everycrea and i nt helyou useit to mak seoumone r y ofou w pants orhiing of cong paents, leme tellyo rht n there e very few things you c do r your chin than tter thang for asmuch their colle eduon you n afford.we know coege graduas ve a much btertime getting jobs, especially incurren is still too high. and we alsoknow theltimately make mor ney. ifereabe maslow style erarchy, y c gogle t, it is more important r y to nd invest fo retirement, whh is talabt r inshow. forhose of you who are rentow culd your own rereme posbly more imrtant than ming sure you kids have the beste poss? sile. becabelievme, if youea retirentgend d't havegh mon pay yo kids who do you think is going to suort you? yo kids. you n't want to beurde o . take care yourself first. afr youavedenou retirement, then it's time to starthking about colleg even if yr kid is on atoddle heck, ev if your d is nd of a gleam in your soo speak. and the st way to save for coe hands-dow is what is own as a29 plan. these plans do vary by sta. t ne s ar tr some states letuse a529 way to hedge against tuition by uition credits atay's prices can be ud in the futur that not wha i'm talking out, thoh. i wantou t ehe 529 savis lan. thar r bhe ates, and theules ffer fm sta t state. t generall speaking a9 doesn't let you mana your own portfolio. you have to pick between a mix of dfere mutuafun, jt like with ma01k) pls. is irely t favorite way too thngs. pfer u to have ntrol of ur asts a the slectn of h stocks touy a wh actual instruments, but 52s have so mu going fthem, i'm going towall ts e. remember, when you can on oo between fuds, go for a low cost fund that mirrors the market. either the s&p 500 orhing ke the vangudtotal market ndwhich you'll see in ma ofthese 529 pls. it literally ow the stos tr, t this perfe what thees for this 52 an? t's you ju had you first child. congtulaons! if you canafrd it, you should start a 529 with your kid as the beneficiary right then and right there. anyoneho is stet aic knows ialkedboutrading alcoa toughou the bg. not e myest moments. contons are not tax duible. so ye pa fors ouof ter tince. that n te. re he good rt on your mey i in t 529, you dopay anyon the gain. you let them compou really, 's lot like a roth exceptor clege rather retirement cause of federal gift x laws, you cn only contribute $14,000 a yar if yo ngle, $28,000 if you're married. anyou fe your tas ointly. stl, that's heckf a lot o money en you think ouit. yourhildresanarentsan ntribute to theam9pl too. if you d't have emoney, a your kids the benefiary alou for financi aid res,s bett toave a parent do it. now let's say for some ason you or your parts are sttg a rlly hu sofmoy. e of the olhing out a 529 an isou can ont loa five years w of contributions without inrring the federal gift tax. long as you don't write any to the plan'seficiary over the nexfive years. in oer words single nt or grapare cou pottial vest$77,000 into a 529 rightomhe srt. if youe rrying, yould contribute $140,000. for the next fe years a at you won be ae to contrite athing without ing t by the gift tax whi is somhing yo don' want. but honestly, once you op that ki of ney into a529, you won'teed to make too ma more contrions. the key re, if you want t get that mney into yo kid's 529 as eaas se. th becse the greest of these plans is all about the power of compoding remember, you don't pay s within 529 iu can so contve money ina low cost index fund thatrorshe mket,he rule o umbs over me you' mak rough 8% a year. i know t stockket a acally a lot more vola than that. but jt as a thoug experimentif stocks gally perforlihey have histically you could double yourestment abou years. so if you start sang rig when yr kid borby the ti h she isle is,he luefour plan will have doubled and doubled n. after 1 years, barring catastroph y could ve as muchs $280,000. thatnough for aancy expensive colleg eduti and a decent law scol. know most peole c't front load a 529, especially with all raisg a kid. butt's wth keeping inind stragy. forandparents thisy sound gr, but your 529 cibutions won't count stards your estate any 529 plan you dent use you can trafer to anothe lati,siblings,pare, en first cousins. and ou save all this mon an yourgratefuls des not to go to coe, you can with the mon from the plan. in that caou have to pay tas on any of your gains, along tha penalty. so heris the botm line. pyi foks' college education isn't as important as providing foyourself in retirement. if you have chilen and after you made enough retint contributions for a year, putting money in a 529 college savings planhoulbe th nt item on your enda. 's the btay to protect ur kid from the crushin buen of student an debt. "mad money" is back after e break. a mouthbreher! hocan anyone sleepike that? , ju put on a breathe rit stand po it instaly ope your nose to % more than cold mecine alone. your uth and say goodnight moutatrs. breathe right the'vi. d there's moving me freeltra it has triple-actiport for yours, rtilage annes. unlike big oste flex pis,lln onti p mo fe tr e . ths a more enjay t get er. try phillips' fiber good gummies us energy support. it's a new fiber supplement th helps support regularity and includes b vitamins help convert food to energy. mmmmm, the are good! ni wk, phillips! the tasty side of fiber, omhiips'. shoulders don't just carry ps.they carry your fa' paions,hopes, and dreams and maybe, a chance at greaess... holy cow. 've t toet to so of yr eetshat you ve been sending @jimkraemer, includinones that ar very nicend smart. kenneth tweets i love you, jim. i leyou, kenne stegan 23 how is that? it's ited. some people call me jack tater. no i'm aweet gu jw gen ndscorwants to know the following. why careut shoerm hit if you have aong-rm investment strategy amen. how many times have said i like xyz stock? it goes down that da or people want to burn me in scalding oil itsn't have to be that day. think little longer term. here we he we have @ dii go, w wants to know what other books should he investors have under their belts to help them trade/manageetter. one up on wall stre and b the street, peter lynch. one up o wall stet and beat the street. you might want to look a sme of david darsch's books. those are available on amazon. i use those a grea and he taught me a lot at goldman sachs and moved on. but david garth's books are very go. up next, doou eer sleep o did one of your biechs provide you withcloneso assist? nkie ce. nkie fe presumingmeans like an emoji thin no, i don't sleep. ok. now we have answered that qution. now, give me a heads up. btw, which i thinknds for by the way, w following your know what you own moo. kwyo. cleanmy portfoliothis week. yo -- you on live once. i totally brinith you. i'm in the market because eas b bo- teachin us what th want to grow, jim. let give you a little heads up. i lo the hters. i wouldn't be doing tis i weren'for them. iuld ve gotten out years ago. i'a spiteful, driven guy to the haters. d eeryone in my personal life knows that. so has, y'rewhy i'm in this game. cotulations,nd stick with cr!>> crame cramer, you are super,ou e awesome. >> i'm afirst-time investor. >> tha youor inspiring meto get in thegame. >> youshow isthe best. glad you're tv. >> i want you to kat you have transformed me. thank you, cramer. one day a rider made a decision. the decision to ride on and se money. ride on, ride proud. geico motorcycle,grrafor great rides. net? cougif you can hear me. don't evennkbo i i took mucinex dm r my phlegmy ug yeah.b what about ? it workshiugh too. ug ksn cough too. mux relieves wet an coughs for 12 s. s enis. stress sweat. it can happen anytime to aone. stress sweat is fferent than ordinary sweat, it smells worse. get 4 mes the prottiagnst stressweat >>i li > i likeoaytheis alys bl market omewhere. i promise to to yo find it justor you rgh here ond mone" next time. it'stuesy,ebruary th. coming uonarly today." as the nasty name callg and personal attacks get e more bare knkles. >> ted cr is theost dishonest guy i think ie met i' ner heard another -- >> when bo marco rubioand naldrump scream liar, liar, li. then t music's bigge night. at hneto adesretu nce?and e ltiplerites th brghdown the house. >>uskeathe causes around the u.s. >>d a creature from the depths o the polar vortex. "early today" startsight now. go morning, i' dara brown. the battle lis have been drawn beeen democrats and republicans over who suld fille supreme court jusce positi after antonin s nrksantonins skia's call. allow it to happen. on the other side of the aisle, democrati are holding true that it's present obama's responsibility. >> for the president this boils down to something mple, doing hijob and we expect the sente do the >> the w >> the whi hse adsat the president will not announce a nominee unl congress return om break weekd does not plan makecess appointmt,t least for t time being. tracie potts joins us fr washington. >> reporter: we have to find out who the president is considering. but the top decrat ss that he does have a lisd names to talk abo with president a. but whver the nominee is, republans have firmly ated

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