As newly Foolish, I've noticed that the Large-Cap Growth fund my father and I have been Contributing to as our Roth IRA is not keeping up with the S&P (surprise surprise...) Is there any way I can take the earnings from my current Roth IRA and ROTH conversions (amounting to close to $10,000) and reinvest them in a more Foolish manner while maintaining the tax benefits?
Well, you could move them to an index fund which is in line with step 4 of the 13 Steps, or go another route. Large-cap growth was great in the late 1990s and then in 2000 it got sucky(Look here for the details: http://www.spglobal.com/trdec00.html ) so now what? I still think indexing is a good way to go if you don't want to get too deep and if you want something else go explore it as I'm still on the notion of indexing as a good thing and that various index combinations may work well.If you doubt the large-cap growth dominance mentioned above, notice how from 1994-1999 in each year, Vanguard's Growth index beat the S & P 500: http://quicktake.morningstar.com/Fund/TotalReturns.asp?Country=USA&Symbol=VIGRXJB
If your current Roth custodian does not offer the investment you would like your Roth money in, get a different custodian. A custodian-to-custodian transfer may take awhile but will allow you to invest in a more Foolish manner. It maintains all tax benefits. Your old custodian may assess a fee for moving, commonly about $50. Good luck! Chris
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