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Good christ, he should not be day trading with your poo poo. Maybe he's done well so far, but this is a classic trouble situation - you feel guilty about hassling him for it because he's family, and you and he both likely have unrealistic ideas about how well he can do in the long term. To buy and hold something cheap is a pretty sound gambit that can still be "aggressive". Sounds like you think that's a good idea and you're not so sure about your dad's approach - well, same here, and I think you should just have the difficult conversation and do it.
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Dec 2, 2009 20:48
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| # ¿ May 12, 2024 22:01 |
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An IRA is another tax-advantaged account that is independent of your employer and can contain most any type of investment. It's good thing to look into if you have more money for long-term investments. It's intended to be accessed once you turn old, but there are some cases when you can get into it earlier without paying a ton of taxes.
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Dec 3, 2009 06:10
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Vanguard and others have these "Target Retirement 20XX" funds that automatically re-allocate for you over time... it might be reasonable to dump your entire IRA into one of those. That's what I'm doing with my 401k.
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Dec 14, 2009 16:31
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ETFs are exchange-traded funds. You can get the same portfolio with ETFs that you could get with Vanguard funds, plus you have more options. The fee structure and how you maintain it is different (I would say more complex but I'm not sure because I've never used ETFs). It is different from picking individual stocks because an individual ETF is like an individual mutual fund, invested in potentially numerous stocks and bonds. It is easy to set up an automatic monthly investment into an IRA in a mutual fund like VFORX that doesn't require any interaction from you. I'm not sure how that would work with an ETF.
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Dec 27, 2009 18:28
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80k posted:- Use limit orders, especially on less liquid ETF's. Even for longer term investments? Can you give an example of how this becomes important for something like an IRA? I'm following the rest of what you said but this I didn't understand.
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Dec 28, 2009 18:39
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that one guy posted:I'm in the process of transferring a Traditional IRA account from State Farm to Vanguard. It's in the vicinity of 4k. I'm thinking I want to convert it to a Roth IRA once the money is finally transferred but I'm a bit wary of the possible costs involved. Is it worth it to convert it? That's not a very large amount. You can always just keep it and put future money into a Roth, of course. fool.com has a calculator for this: http://www.fool.com/calcs/calculators.htm#roth
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Jan 3, 2010 16:46
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^^^ Yes and no. Adding $500 per month forever is great. However, long term investing and emergency savings are incompatible goals. And if you want it specifically for the kids' education, have you looked into 529 plans? Furthermore, you should be ignoring yesterday's (or last year's) return on the Roth and only paying attention to the allocation. CornHolio posted:I see that I've had a 3% return on my investments Your lovely fund company has been getting far more than their fair share of this. slap me silly fucked around with this message at 16:52 on Jan 7, 2010 |
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Jan 7, 2010 16:49
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CornHolio posted:I can't find them. Are they called something else? No. You're looking for these tidbits: Expense or Expense Ratio Sales Charge, Redemption Charge, or Load 12B-1 or Management Fee It's in the prospectus. Or you can look up the short name (like PLSAX) on google finance and it should all be there.
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Jan 7, 2010 23:40
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Something similar happened to me. On the advice of my parents' church friend who was moonlighting as a New York Life representative, I started an IRA with 100% in the large-cap fund MCSCX. The rep charged a fee up front, plus the fund had 2% ER and 5% back-end load. I was really pissed when I found out how lovely it was and how expensive it was going to be to get out. Worse, that happened right around the time of the tech bubble crash, and the fund managers were chasing returns so it suffered badly relative to the market. Nowadays I'm starting to learn what the gently caress. I'm hopefully learning in time - my parents got kind of hosed because they were doing the same thing but were much closer to retiring.
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Jan 9, 2010 09:01
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Your 403b is through your employer. My employer lets me pick from a wide range of funds, some of which are at Vanguard. Normally you can use any of all of the funds your employer makes available, but not any others. Pretty much the same as a 401k. Also, these guys: http://www.403bwise.com/
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Jan 16, 2010 06:19
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http://www.bankrate.com/calculators/retirement/mutual-funds-fees-calculator.aspx
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Jan 18, 2010 18:53
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Well. If I were getting that much out of the 401k I wouldn't be too worried about missing the Roth opportunity.
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Feb 12, 2010 17:28
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Haha, you have Vanguard too. Sucks to be anybody else Edit: strwrsxprt posted:I'm contemplating opening a Roth IRA to contribute for 2009, but I already filed my income taxes. Will I need to file an amendment? As I understand it, all contributions are after tax and are non-deductible, so I don't think I will. Any help? No need to amend unless your income is low enough to get the credit. Just get the money in there before April 15 and make sure you mark it as a prior year contribution. slap me silly fucked around with this message at 23:55 on Feb 12, 2010 |
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Feb 12, 2010 23:50
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You have misread them, or something. You can contribute a maximum of $5000/yr to any combination of Roth and traditional IRAs. Otherwise, hot daaamn.... http://www.irs.gov/retirement/participant/article/0,,id=188232,00.html
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Mar 2, 2010 17:14
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Ironically enough, the tax pros are bitching about the quality of that source of info in the other thread! But I'm pretty sure it's correct on this count.
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Mar 2, 2010 18:54
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Well, I am overstating the case - there are probably some situations where the pubs aren't good guidance for navigating the tax laws, but I hardly think that would apply in common situations like this or the 1000 other questions people always ask here.
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Mar 2, 2010 21:29
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That seems like a good place to start. At any point you care to, you should learn a little more and see if you want to tweak things - having finally read The Four Pillars of Investing, I can wholeheartedly recommend it as an easy but very informative book for this purpose. In any case, you shouldn't have to mess with it more than once a year. I'm not 100% sure about the rollover, but I think you would use a traditional IRA and it wouldn't affect your contribution limits or generate any taxes. I hope you have the 401k in something decent, not company stock?
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Mar 5, 2010 18:03
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Unless they're matching your 457 contributions, I'd suggest prioritizing the Roth IRA - you'll have more control. What do the expense ratios look like on your 457 options?
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Mar 6, 2010 20:36
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Because of the matching, your return on the 401k contribution is more than the CC rate even if the market stays flat. So yeah, keep doing it. See if you can find some other ways to make money or cut expenses if you want to speed up the loan payoff, but three years of self-discipline won't kill you. :)
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Mar 15, 2010 19:56
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Also, he could use a money-market fund in the 401k and remove most of the volatility while still getting the 20% match. Not that I think that's a good idea.
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Mar 16, 2010 01:10
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I did exactly that for exactly that reason. I put the money in my IRA, but in a money market fund so it is subject to minimal risk in case I have to withdraw the contributed portion for an emergency. I would say put as much in the Roth as you can, as long as you're pretty sure you won't need to take it out again. The down side of this is that if you use the money market, you are getting the contribution in but you aren't capturing the low prices of stocks.
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Mar 17, 2010 17:40
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In general, yes. But if it's a money market fund within a Roth IRA, there is no penalty for withdrawing the contribution amount, and there is minimal risk. The benefit is that you get that year's contribution in and hopefully get to keep it there, and that only applies if you would miss that year's opportunity otherwise.
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Mar 17, 2010 17:53
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Haha, to be honest when I saw myself type "the low prices of stocks" I was pretty sure that was gonna be a cue for someone to jump in and make that point.
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Mar 17, 2010 22:14
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Or maybe they're just gouging him... I got the same crap from Mainstay when I dumped their poo poo a long time ago. $80 "transfer fee" plus of course all the back-end sales charges. Cocks
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Mar 20, 2010 01:12
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It is literally my father's retirement plan. It's also one of my options, but I decided to put most of my money in the market instead. If you're going to reduce your risk (and expected return) with an annuity type of thing, TIAA is one of the best places to go. Your family members' experiences may have been bad luck, poor planning, or both - and they may or may not be a good reason for you to avoid stock market index funds. If you have the energy for it, learn up on portfolio planning. A little knowledge can get you a long way, and the book "Four Pillars of Investing" recommended in the retirement thread is quite good. Edit: This is the retirement thread... slap me silly fucked around with this message at 20:34 on Mar 20, 2010 |
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Mar 20, 2010 20:24
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Yeah, Target 2050 is a decent place to park it until you're ready to tweak the allocations.
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Mar 26, 2010 18:40
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Do you know about bankrate.com? 1.4% is about the best you're going to do right now, though.
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Mar 29, 2010 16:19
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Do you think the Schwab fund's performance will be enough better than VFIFX to justify being over 4x the price? (calculator) VFIFX and SWERX aren't quite similar though: VFIFX is 68% stocks in 2040, whereas SWERX is 40% stocks in 2040. Vanguard has VTTHX and VFORX that are more similar to SWERX. For what it's worth, I'm using a Vanguard target fund right now, but will gradually switch over to three index funds: US stock, non-US stock, and bond. Expense ratios at Vanguard are low for these, 0.18% to 0.40%. I kind of doubt anybody is good enough to outperform those over the long term, not enough to justify extra expense. And Vanguard has VIVAX and VIGRX at 0.27% for the next most obvious allocation adjustment. Fidelity has a pretty similar set of stuff as well, say FLGEX at half the price of SWLSX for example. Overall, though, good for you for shoving some money in there in the first place.
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Mar 30, 2010 05:05
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grumpy posted:100% in equities Personally, I'm 33, my portfolio looks like this: 77% US stocks 10% non-US stocks 5% bonds 8% cash (long story) My goal over the next 5 years is something like 35% US stocks 35% non-US stocks 30% bonds Not to be "safe", but because I want more money in asset classes that are somewhat uncorrelated with US stocks.
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Mar 31, 2010 18:52
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More to the point, the max IRA contribution is too small if you make more than $40k or so. If you want another tax-deferred investment, you are probably limited to some sort of annuity, which is a little depressing...
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Apr 1, 2010 16:30
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Financially the smartest thing to do is not depend on your parents for interest-free loans.
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Apr 5, 2010 01:51
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Keeping enough cash to handle your own emergencies and down payments is more responsible towards your family. Lending you money interest-free is a raw deal for them. Even if they offered unprompted, their position may have changed by the time you need it. They're also under no obligation to leave you anything when they die. It's kind of presumptuous of you to take that stuff for granted. There are also risks in depending on them. They may need to spend a lot on health care, or they might get conned. Those are both common unpredictable expenditures among the elderly. In short, having enough liquid cash available is the wisest way to use your money. The meaning of "enough" depends on your expenses and plans, but doesn't have to depend on your parents maintaining their financial status quo.
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Apr 5, 2010 03:33
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Yup, with a 7% loan and no 401k match that's probably what I would do, too.
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Apr 11, 2010 20:30
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ynotony posted:I just opened a Roth IRA and threw in $5k for 2009. To take advantage of my last minute 2009 contribution, would I need to dump in another $5k into 2010 as soon as possible? Because would waiting until April 2011 to contribute be the same as if I missed the 2009 deadline and just dumped $5k into 2010, then $5k into 2011 a year from now? I am self employed so I'm trying to figure out a good contribution schedule. You are overthinking this. Just contribute another $5k before the 2010 tax year deadline, which is April 15, 2011. If you want to get on a regular schedule, contribute $625/mo for the rest of 2010 (that's your 2010 contribution), then contribute $416/mo thereafter. Someone who bought VFIFX in Oct 2007 and regrets it had better diversify his contributions in the future.
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Apr 15, 2010 20:32
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You can use a money market fund in your Roth, but that sacrifices possible returns. A Roth IRA really isn't good for "standard" emergency money because your contribution opportunities are so limited.
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Apr 16, 2010 06:16
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Yes there is more potential for return, but you pay for it with risk. Suppose you contribute $5000, then its value drops to $3500 one month later - like VFIFX in Sep 2008 - then you lose your job. Such things happened to many people recently. And it's not just market risk; once you withdraw a contribution from a Roth IRA, you can never make it up. In other words, yes, I think it's a bad idea. Edit: That said, you may judge that 3 months expenses is enough to cover a job loss. Kind of depends on your situation. I would suggest planning not to dip into the IRA for foreseeable stuff like that, though. slap me silly fucked around with this message at 06:55 on Apr 16, 2010 |
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Apr 16, 2010 06:41
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Variance vs. expected return is a fundamental tradeoff. You just need to find the point on the curve that you're comfortable with. If you're single and life is uncomplicated, you might not need a ton of cash. My rule of thumb has ranged from 3 to 6 months' expenses, but always accounting for the fact that I can drastically trim a lot of expenses for a while if I need to. At least the online savings accounts are more or less keeping up with inflation. If you're renting month to month and can go stay with your parents in an emergency, the story is different than if you just took on a mortgage with a 95% loan, etc.
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Apr 17, 2010 20:51
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Want it for retirement? Back to the 401k if you have decent options. Want it sooner? Start saving cash for your next car or house. Or buy an ipad. Or give it away
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May 2, 2010 08:43
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DreadCthulhu posted:looking for the cheapest wilshire 5000 fund I can possibly find. How can I compare costs and various hidden fees of all funds out there? You could start by comparing them with Vanguard's VTSMX: no load, 0.18% expense ratio, and turnover of 5.3%. Koirhor, you should read the 4 Pillars book. You can get very good diversification with three index funds: bonds, US stocks, non-US stocks. The page you linked is a refinement that tweaks the value/growth weighting and adds REIT.
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May 3, 2010 16:54
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| # ¿ May 12, 2024 22:01 |
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It's costly and short-sighted. The primary flaw is that you'd be giving up tax-advantaged retirement savings to buy part of an apartment. The better alternative is use your sharp budgeting skills to contribute additional money to a regular savings account (or CDs, monkey market, GOOG, whatever suits you). In 5 or 10 years, buy an apartment you can afford without tapping into your retirement accounts.
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May 7, 2010 00:54
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