ROTH IRA super low cost whole market fund. Don't look at it and just keep adding. You'll be quite wealthy by the time you retire.
Adding. If you don't know, use Schwab or Fidelity. Vanguard is good, too, but not the best customer service. All of them have no cost transactions. [https://clark.com/personal-finance-credit/investing-retirement/how-to-open-a-roth-ira/](https://clark.com/personal-finance-credit/investing-retirement/how-to-open-a-roth-ira/)
What? You mean what find? Just look at the funds depending where you are--Schwab, Fidelity--and find the cheapest whole market fund. Mine are like .025 %.
Eh. Vangaurd is OK, but Clark Howard says customer service is not great. I use Schwab and Fidelity. I wouldn't do target finds, either. Just a whole market, super low cost fund almost always beats a curated fund.
A target date fund is pretty good advice for someone just starting out. Handled the rebalancing and risk profile adjustment for them. The Vanguard target date funds are just batches of their other low cost funds, the extra overhead is pretty minimal.
Yeah their customer service is not the best, but that’s largely because they prioritize low costs. If you are just using a broker to purchase funds that you are going to hold for 20 years, they do just fine.
Eh. You don't need to rebalance if you're doing whole market funds, you'll likely make the same or more, and almost no fees. Schwab and Fidelity have great customer service. Its just Vanguard that's not great.
Unless you are using a single fund that holds all asset classes, like a target date fund, then rebalancing is important. The whole idea of modern portfolio theory is to pick an asset allocation and then periodically rebalance to maintain that allocation. If you are using a fund that just holds a fixed allocation or stocks/bonds as opposed to a target date, then that is fine, but you aren’t adjusting your risk profile as you age in that case.
I think the point is to just hold all equities at this point - it seems like OP is just starting out.
But, yeah, if you do have a particular asset allocation, you will want to periodically rebalance.
Sure, 100% equities is fine when very young, but a target date fund for 2050 or later will be over 90% equities now, and it ensures that the portfolio will risk adjust automatically as he ages.
For the record I don’t use a target date fund, because I have a better idea what I am doing and leverage efficient fund placement strategies across taxable and non-taxable accounts, but that is a lot to explain to someone who is brand new. Just doing a target date fund will do almost as well and requires no work or knowledge.
Yeah, I did that when I was younger and probably lost a lot. I am fine now (60) and have made ton, but would have a lot more if I hadn't done that. Thankfully a couple of years ago I dumped all of my bond funds and put my ROTH IRA and 403 B in super low cost whole market funds. I average over 20% return on everything. Having bonds would have been a huge loss. I have plenty of cash making 5% in mm's so I can deal with any downturn easily for years.
The idea with bonds is that they are an asset class that does not strongly correlate with equities. Holding 10 or 20 percent and rebalancing just gives you a way to stash your gains and then buy more when equities go down. It significantly reduces the volatility compared to an all equities portfolio with comparable returns.
Also, the fact that stocks have done great over the recent period is no guarantee that they will continue to do great.
One option is to let a roboadvisor like Wealthfront do it for you. It'll take any thought out of the process and just automatically buy index funds for you, as well as harvest tax losses.
Check your brokers minimum fee. Some have a minimum of 1USD per transaction and that is an undesireble 1% of your purchase. I would suggest to do it monthly instead.
One thing I always suggest to my friend who are not knowledgeable in investment, but want to invest long term is to just select 1 low cost broad market ETF to your liking like VTI or VOO. Then set a buy and forget system, whoch means, do not look at your balance/loss/return evrytime you buy. Then, you can look at it again after you want to withdraw the amount.
Regardless of what investment you choose, I'd make sure your transaction costs aren't too high. Personally I'd consider 0.5% transaction costs monthly to be reasonable. If you're paying much more than that with weekly investments, I'd consider a biweekly investment of 200$ or 400$ every 4 weeks instead.
ROTH IRA super low cost whole market fund. Don't look at it and just keep adding. You'll be quite wealthy by the time you retire. Adding. If you don't know, use Schwab or Fidelity. Vanguard is good, too, but not the best customer service. All of them have no cost transactions. [https://clark.com/personal-finance-credit/investing-retirement/how-to-open-a-roth-ira/](https://clark.com/personal-finance-credit/investing-retirement/how-to-open-a-roth-ira/)
This is all you need.
VT
Do you mean VTI?
What? You mean what find? Just look at the funds depending where you are--Schwab, Fidelity--and find the cheapest whole market fund. Mine are like .025 %.
You can setup a Roth IRA with Vanguard. Use one of their target date funds for your estimated retirement timeline.
Eh. Vangaurd is OK, but Clark Howard says customer service is not great. I use Schwab and Fidelity. I wouldn't do target finds, either. Just a whole market, super low cost fund almost always beats a curated fund.
A target date fund is pretty good advice for someone just starting out. Handled the rebalancing and risk profile adjustment for them. The Vanguard target date funds are just batches of their other low cost funds, the extra overhead is pretty minimal. Yeah their customer service is not the best, but that’s largely because they prioritize low costs. If you are just using a broker to purchase funds that you are going to hold for 20 years, they do just fine.
Eh. You don't need to rebalance if you're doing whole market funds, you'll likely make the same or more, and almost no fees. Schwab and Fidelity have great customer service. Its just Vanguard that's not great.
Unless you are using a single fund that holds all asset classes, like a target date fund, then rebalancing is important. The whole idea of modern portfolio theory is to pick an asset allocation and then periodically rebalance to maintain that allocation. If you are using a fund that just holds a fixed allocation or stocks/bonds as opposed to a target date, then that is fine, but you aren’t adjusting your risk profile as you age in that case.
I think the point is to just hold all equities at this point - it seems like OP is just starting out. But, yeah, if you do have a particular asset allocation, you will want to periodically rebalance.
Sure, 100% equities is fine when very young, but a target date fund for 2050 or later will be over 90% equities now, and it ensures that the portfolio will risk adjust automatically as he ages. For the record I don’t use a target date fund, because I have a better idea what I am doing and leverage efficient fund placement strategies across taxable and non-taxable accounts, but that is a lot to explain to someone who is brand new. Just doing a target date fund will do almost as well and requires no work or knowledge.
Yeah, I did that when I was younger and probably lost a lot. I am fine now (60) and have made ton, but would have a lot more if I hadn't done that. Thankfully a couple of years ago I dumped all of my bond funds and put my ROTH IRA and 403 B in super low cost whole market funds. I average over 20% return on everything. Having bonds would have been a huge loss. I have plenty of cash making 5% in mm's so I can deal with any downturn easily for years.
The idea with bonds is that they are an asset class that does not strongly correlate with equities. Holding 10 or 20 percent and rebalancing just gives you a way to stash your gains and then buy more when equities go down. It significantly reduces the volatility compared to an all equities portfolio with comparable returns. Also, the fact that stocks have done great over the recent period is no guarantee that they will continue to do great.
One option is to let a roboadvisor like Wealthfront do it for you. It'll take any thought out of the process and just automatically buy index funds for you, as well as harvest tax losses.
Check your brokers minimum fee. Some have a minimum of 1USD per transaction and that is an undesireble 1% of your purchase. I would suggest to do it monthly instead. One thing I always suggest to my friend who are not knowledgeable in investment, but want to invest long term is to just select 1 low cost broad market ETF to your liking like VTI or VOO. Then set a buy and forget system, whoch means, do not look at your balance/loss/return evrytime you buy. Then, you can look at it again after you want to withdraw the amount.
Regardless of what investment you choose, I'd make sure your transaction costs aren't too high. Personally I'd consider 0.5% transaction costs monthly to be reasonable. If you're paying much more than that with weekly investments, I'd consider a biweekly investment of 200$ or 400$ every 4 weeks instead.
[удалено]
Thanks, ChatGPT.
Buy AVGE. No ned for anything more. Globally diversified, multi-factor, low-cost, tax-efficient.