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Subject:  Re: IRA investing Date:  3/19/2001  3:47 PM
Author:  jrr7 Number:  28510 of 88053


Remember that in a Roth IRA,
1- If you lose the money, it's gone, and you won't get a tax deduction
2- you can only add $2000 a year (unless they change it)
3- If you gain money, it's never taxed (with a very very few exceptions)

Because of #1 I don't think it's a good idea to go with something super-concentrated or super-aggressive. Because of #3, don't be too conservative. So being somewhat diversified and somewhat aggressive is the best policy in my mind.

However, diversification can be expensive with a small account balance. There are some funds that are set up for precisely this situation -- "balanced" funds which have some allocation to stocks, some to bonds, and some to cash. Vanguard has the LifeStrategy series of funds.
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