No. of Recommendations: 0
You are smart to consider transaction costs when dealing with 2 $5000
Roth investments per year. You want to be careful with this is real after tax money in hand with no employer match. Believe me it hurts to lose it.

The input you receive re how to invest the yearly Roth contributions will vary according to the advisor's interests. Because you plan to make annual contributions you might want to consider putting money into a CD ladder. Yes, current interest rates are low (online banks are only paying about 2.5% on a 5 year CD), but rates are expected to rise. If you buy a 5 year CD every year each CD will be at ever higher rates, and when your 2011 CD rolls over in 2016 you simply renew at 2016 rates. This is dollar cost averaging at its simplest.

If you want a little more action, buy into a dividend etf with 1/2 of the money each year. Just one transaction cost, lots of diversity. My favorite is SDY, the S&P 1500 dividend will follows the Dividend Aristocrats.
Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.