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I just started working this summer and am ready to max out my 2008 and 2009 roth IRAs. I don't have a matching 401k, and since I started in July and am quitting in February I have little income tax so I'm pretty sure this is the right move. I'd just like to see if I'm doing anything terribly wrong before I dive in here. A little background, I'm 23 and will be leaving for the peace corps in March. I should have enough to max out my 2008 and 2009 IRAs. I was thinking about going with Scottrade, the motley fool link shows they have pretty low fees. Does anybody have any other recommendations for a broker? Here's what I was thinking for my portfolio. How does it look? And when I go to the branch office, do I just bring this in and tell them that's what I want my money in? Can I combine my 2008 and 2009 IRAs or do they need to be seperate? VFINX 25% Vanguard 500 Index Fund VEXMX 20% Vanguard Extended Market Index Fund VGTSX 25% Vanguard Total International Stock Market Index VEIEX 20% Vanguard Emerging Markets Stock Index Fund VBMFX 10% Vanguard Total Bond Market Index Fund
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Jan 12, 2009 16:31
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| # ¿ Apr 29, 2024 12:55 |
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Thanks for the info. I guess I'll roll both my international and domestic into toal funds. One last question, I'm tempted to allocate more towards bonds to make sure I don't get burned. Is this being overly conservative or a good way to mitigate the risk? Here's what I have now: VTSMX 40% Vanguard Total Stock Market Index Fund VGTSX 40% Vanguard Total International Stock Market Index VBMFX 20% Vanguard Total Bond Market Index Fund
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Jan 12, 2009 20:48
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Just got back from Scottrade, apparently they charge $7 for online trades except for mutual funds and index funds, which they charge $17 for. They say ETFs are only $7. Is there any significant difference between ETFs and index funds? Should I just pony up the additional $10 for the index funds? I also figure since I'll be funding my 2008 and 2009 IRAs at the same time, I'll just put all my bond funding and half my stock into 2008, and the other half of my stock and all my world into 2009 so I only pay 4 trading fees instead of 6. 20% Total Bond Market ETF 40% Total Stock Market ETF 40% Total World Market ETF Dance McPants fucked around with this message at 15:21 on Jan 14, 2009 |
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Jan 14, 2009 15:12
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I assumed I needed to, if I can avoid it all the better.
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Jan 14, 2009 15:54
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Thanks for the advice everyone. Since I'm making 2 lump-sum investments, one for 2008 and one for 2009, I think ETFs are the right way to go - at least going by the fees. That CNN article says the mutual fund fees are 0.15% while the ETFs are 0.07 (Although the Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) has a fee of 0.07 also.) Since I'm maxing out both IRAs at $5k each, that's $8/year of extra fees. So I'll pay $28 up front to avoid an extra $8 in fees a year. Fake edit - I just checked Vanguard, and the fees for the ETFs I was looking at are 0.11 for the bond (BND), 0.07 for the stock (VTI), and 0.25 for the world (VT). That doesn't sound too good. As far as I can tell, the only qualification for reduced commissions is the amount you are investing, and it doesn't look like I have enough to qualify. From what I see I will have to pay a $20 annual fee for each fund account under $10,000, so that's an extra $60/year if I'm not mistaken (does fund account mean my total IRA or each fund I have in it?) Also, do I pay these fees regardless of whether I go through Vanguard directly, or if I go through Scottrade? (At Scottrade I was told there are no annual fees as long as I do everything electronically.) Since the ETFs I'm looking at have similar expense ratios as the index funds I was considering, I think that's what my decision will come down to.
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Jan 14, 2009 19:16
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Okay, I think I'm mostly straight. Since the fees are pretty close for the index funds and similar ETFs I'm looking at, I think I'm gonna go with index funds directly through Vanguard. Also, if I change my mind and want to trade my funds around, I don't have to worry about accruing fees. The only issue I have now are the minimum investments. Each fund I want to invest in has a $3k minimum, but if I allocate the way I wanted I would only be putting $2k into bonds. Is the $3k minimum for the total IRA or for each fund? I plan on maxing out my 2008 and 2009 IRAs for a total of $10k. Here's what I'm going with: VTSAX 40% Vanguard Total Stock Market Index Fund Admiral Shares (expense ratio: 0.07%) VGTSX 40% Vanguard Total International Stock Market Index (expense ratio: 0.27%) VBMFX 20% Vanguard Total Bond Market Index Fund (expense ratio: 0.19%)
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Jan 14, 2009 21:25
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| # ¿ Apr 29, 2024 12:55 |
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I just opened my Roth IRA with Vanguard and was able to make contributions to both 2008 and 2009.
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Jan 17, 2009 05:22
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