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Investing/Strategies / Retirement Investing
|Subject: Re: Investing ideas for rollover 401k into ira||Date: 8/14/2012 9:08 PM|
|Author: joelcorley||Number: 70879 of 75339|
You wrote, I have about 30k from my 401k that i am rolling into an ira where ican choose all the investment options. Would appreciate investment ideas.
You'll probably want to come up with your own investment ideas based on your own reading. Until then, I'd recommend either a market index fund or a target retirement fund.
I assume your roll over is to a stock broker. If so, perhaps one or two ETFs that meet these basic goals. If a fund family (like Vanguard), look for a similar open-ended fund. Of course with Vanguard, you can trade their ETFs without any commissions.
The Target Retirement type fund is an easy choice, especially for a young investor. It lets you pick a target retirement date (in 5 or 10 year increments) and the fund automatically adjusts its holdings from aggressive to conservative as you get closer to retirement. It deals with rebalancing and diversification issues transparently to you, though some of these funds cost more than they should.
Picking an index isn't quite as simple as you might think. At least at some point you will want to mix bonds vs. stocks and conservative vs. aggressive. That's something you can't do with just a single purchase. However if you're young and just starting out, buying something like a broad stock market index is probably a reasonable first choice - at least until you come up with a better plan. (For instance, you can buy shares of IVV at TD Ameritrade for with no transaction fees and it has an incredibly low annual expense ratio.)
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