Hi, i would like to open/start Roth Ira. I've read several books, 'Jim Cramer, Suze Orman, and Dave Ramsey,' I'm confused on which company an or stock to go with. Suze suggest Vanguard vexmx until you reach $25,000 and than add vgtsx. Any help would be greatly appreciated Thanks
You're really asking two questions.As to starting a Roth IRA, you can do this with any IRA custodian, including mutual funds, banks, insurance companies or a brokerage.After you set up the Roth IRA, you can contribute to it, in cash, up to $5,000 per year, plus another $1,000 if you are 50 or older in the year you make the contribution for. You have up until April 15th in 2010 to set up and contribute to a Roth IRA for 2009. The only catch here is that you must have earned income (from salary or wages or from self employment income) that at least equals the amount you contribute.If you wish to invest in Vanguard mutual funds, you'd probably be best served to open your Roth with Vanguard, as other IRA custodians will likely charge you to purchase Vanguard funds, as Vanguard generally does not pay other brokerages/banks/insurance companies to offer their funds.As to which mutual fund, it depends on your investment objective. Is this for long-term savings? Medium term? Short term? If this is for your retirement years (which is the most common, but not only, reason), you would probably be better off to invest in Vanguard "target date" retirement mutual funds, where the target date on the fund equals (approximately) your projected retirement date. This kind of fund will rebalance towards more conservative investments as you approach this retirement year.BruceM
Hi, i would like to open/start Roth Ira. I've read several books, 'Jim Cramer, Suze Orman, and Dave Ramsey,' I'm confused on which company an or stock to go with. Suze suggest Vanguard vexmx until you reach $25,000 and than add vgtsx.Any help would be greatly appreciated You might take a look at Fidelity. Low $7.95 commission and they now offer a total of 25 I-Share ETFs commission free.If I were starting today (I'm seventy years old and already comfortably retired) I would build a well diversified portfolio with the no commission I-Shares at Fidelity.Something like this:20%------IVV20%------IVE20%------IJR20%------IJS20%------EFA Well diversified with no minimums and no commissions. As You grow older you could consider adding bonds.OxBeaux
Thanks for the help, could you tell me a little more about the Fidelity I shares.
Fidelity and iShares are separate brands in the investment world. Check out their Web sites to learn more:Fidelity.comiShares.comIn short, Fidelity is a mutual fund firm with a discount brokerage arm that offers some Exchange Traded Funds (ETFs) commission-free. Well, iShares (owned now by BlackRock) is a money manager as well, but it does not have a brokerage. It engages in ETF manufacturing and asset management. There are 300+ iShares ETFs and they offer investments in different sectors of stock, bond and other markets. As mentioned by OxBeaux, Fidelity is offering some iShares ETFs commission-free. Normally, brokers like Fidelity, Scottrade and TD Ameritrade charge commission for stock and ETF transactions.Hope that helps.
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