Investing in Vanguard S&P 500 for Roth IRA

[QueHuong]

I'm planning on putting $1000 in Vanguard's S&P 500 index fund, for the Roth IRA. Wise choice?


The main question is, should I do it now, before the year ends, or wail until January O six?

 

[brunswickite]

Why would you wait until January?

 

[Achtung]

I think you have until April 15th to put it in and count it on your 2005 tax return.

 

[robothouse77]

Originally posted by: QueHuong
I'm planning on putting $1000 in Vanguard's S&P 500 index fund, for the Roth IRA. Wise choice?


The main question is, should I do it now, before the year ends, or wail until January O six?

i believe the minimum for Vanguard's 500 is 3000. Check it out.

 

[Mermaidman]

Originally posted by: Achtung
I think you have until April 15th to put it in and count it on your 2005 tax return.

Does it even matter if it's a Roth?

 

[robothouse77]

Originally posted by: Achtung
I think you have until April 15th to put it in and count it on your 2005 tax return.

are you allowed to take Roth IRA deductions? i thought you could only deduct IRA contributions....

 

[iwantanewcomputer]

i usually try to wait until the market has dropped a lot over the past week or month, but that doesn't always work well.

 

[Achtung]

Originally posted by: Mermaidman

Originally posted by: Achtung
I think you have until April 15th to put it in and count it on your 2005 tax return.

Does it even matter if it's a Roth?

Only in terms of if he wants to max it out. Otherwise, I don't think there are actual tax implications per se.

 

[Hubes]

Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

 

[robothouse77]

Originally posted by: Hubes
Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

i think that particular index fund has outperformed all of the mutual funds for the last 20 years. but i can't back that up with a link at this time...

 

[JS80]

Originally posted by: robothouse77

Originally posted by: Hubes
Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

i think that particular index fund has outperformed all of the mutual funds for the last 20 years. but i can't back that up with a link at this time...

I'm pretty sure midcap and smallcap outperformed the S&P

 

[Achtung]

Originally posted by: robothouse77

Originally posted by: Hubes
Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

i think that particular index fund has outperformed all of the mutual funds for the last 20 years. but i can't back that up with a link at this time...

Hmm, maybe I should get out of Fidelity then...

 

[brunswickite]

Originally posted by: JS80

Originally posted by: robothouse77

Originally posted by: Hubes
Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

i think that particular index fund has outperformed all of the mutual funds for the last 20 years. but i can't back that up with a link at this time...

I'm pretty sure midcap and smallcap outperformed the S&P

links?

 

[QueHuong]

Yep, Vanguard's minimum is $3000; what do you guys recommend?


So I should invest ASAP? Does 1 month matter in terms of returns?

 

[blues008]

Shouldn't matter - you really shouldn't access your Roth IRA until you're ready to retire.

A month here or there isn't going to make too much of a difference in the long run regardless of distributions.

Good luck!

 

[robothouse77]

Originally posted by: QueHuong
Yep, Vanguard's minimum is $3000; what do you guys recommend?


So I should invest ASAP? Does 1 month matter in terms of returns?

well, what's your plan?

1) how long are you investing for?
2) what are your goals for investing?
3) why are you investing? retirement? get rich-quick?

 

[QueHuong]

Originally posted by: JS80

Originally posted by: robothouse77

Originally posted by: Hubes
Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

i think that particular index fund has outperformed all of the mutual funds for the last 20 years. but i can't back that up with a link at this time...

I'm pretty sure midcap and smallcap outperformed the S&P

As this is for retirement, I'm looking at it from a long-term perspective. The S&P have outperformed 80% of funds in the long run.

This $1000 will be my very first investment. Once I save more, I'll go for the more aggressive funds with a shorter financial goal in mind.

 

[Hubes]

Originally posted by: robothouse77

Originally posted by: Hubes
Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

i think that particular index fund has outperformed all of the mutual funds for the last 20 years. but i can't back that up with a link at this time...

Im not saying it hasnt done well, since inception it has been up 12.5% that is since 1976, but for the price, of over 100 dollars a share you are better off investing in a midcap or smallcap like js80 also noted.

VEXMX has the all power google, and has done very well since inception up 10% But has been really going well as of late.

 

[QueHuong]

Originally posted by: robothouse77

Originally posted by: QueHuong
Yep, Vanguard's minimum is $3000; what do you guys recommend?


So I should invest ASAP? Does 1 month matter in terms of returns?

well, what's your plan?

1) how long are you investing for?
2) what are your goals for investing?
3) why are you investing? retirement? get rich-quick?

1) I'm 21, so maybe about 50 years
2) For this individual investment, it's for a fully self sufficient retirement for a guy with expensive hobbies and a wife
3) same as 2

 

[Hubes]

1 month wont matter as far as returns. It takes times with mutual funds, thats really the entire point of them. Just let you money sit for long periods of times without touching it.

 

[drsafety]

For an IRA $1,000 is the minimum

 

[JS80]

Originally posted by: brunswickite

Originally posted by: JS80

Originally posted by: robothouse77

Originally posted by: Hubes
Yes it is 3000 and I would choose a different fund then the s&p if it was me. At a price of $116.81 a share that seems pretty high if your just starting to invest. Look over there website and you will see many sites that have done much better in the past 5 years that are around the 35 dollar range. One fund I am in is the Windsor II which has done pretty good for me.

i think that particular index fund has outperformed all of the mutual funds for the last 20 years. but i can't back that up with a link at this time...

I'm pretty sure midcap and smallcap outperformed the S&P

links?

S&P vs Russell 2000 (small cap)
Very similar, but small cap beats it.
http://finance.yahoo.com/q/bc?s=%5ERUT&t=my&l=off&z=m&q=l&c=%5EGSPC

 

[robothouse77]

Originally posted by: QueHuong

Originally posted by: robothouse77

Originally posted by: QueHuong
Yep, Vanguard's minimum is $3000; what do you guys recommend?


So I should invest ASAP? Does 1 month matter in terms of returns?

well, what's your plan?

1) how long are you investing for?
2) what are your goals for investing?
3) why are you investing? retirement? get rich-quick?

1) I'm 21, so maybe about 50 years
2) With this individual investment, it's for a fully self sufficient retirement
3) same as 2

well, its good your starting early, don't get me wrong. so go ahead, and start putting away a few grand for retirement. but, you may want to consider saving some money aside in a more liquid account (rather than an IRA), then use this money aggressively in some higher return investment. but, get some investment strategy books. a bunch of them. learn as much as you can, because the more you know about it, the better you'll be able to recognize good risk.

 

[Aegeon]

My advice would be to consider the Vanguard Total Market Index Fund instead. Its a little bit more in yearly fees, but it effectively gives your portfolio much better balance with midcap and small cap stocks as well and not just the big ones.

 

[JS80]

Originally posted by: Aegeon
My advice would be to consider the Vanguard Total Market Index Fund instead. Its a little bit more in yearly fees, but it effectively gives your portfolio much better balance with midcap and small cap stocks as well and not just the big ones.

No, if you're young, put 50% into the mid cap index, and 50% into the small cap index.