I know there's an IRA but I opened up a sharebuilder account and have about 7 ETFs in my portfolio. I invest $100/month into this particular account. Question is, am I better off with an IRA?
Looking to invest for long term
- Thread starter LuckyTaxi
- Start date
What is your investment strategy? How is each ETF going to help you implement that strategy?
Unless you're constrained by investment choices (like I am in my 401(k) and Roth IRA) I don't see a reason for anyone to hold more than two or three mutual funds. Any more than that and you're duplicating holdings and racking up fees.
i agree and what you said about my investment choices is exactly why i am looking elsewhere.
off the top of my head i have the following ETFs.
- BKF (china, russia, india, etc..)
- Aerospace
- Metal
- Energy
- Technology
- Mid-Cap (USA)
- (I forgot the 7th one)
What I do is take the $100 each month and apply it to one fund. I rotate it each month.
off the top of my head i have the following ETFs.
- BKF (china, russia, india, etc..)
- Aerospace
- Metal
- Energy
- Technology
- Mid-Cap (USA)
- (I forgot the 7th one)
What I do is take the $100 each month and apply it to one fund. I rotate it each month.
Absolutely Roth IRA. A plus of that (besides the good interest rates you might get, even though variable) is that you're taxed on the money you put in, but not what comes out of it.
Roth IRA. You can still put in money for 2007 until April 15, even if you've already filed your taxes.
The Roth IRA grows tax-free (no 1099 every year) and you pay no taxes when you take out the money at retirement.
A Target <year> fund at Vanguard.com will give you a set of very good domestic and foreign stock index funds, plus a little in bonds, with just one mutual fund. Pick the farthest <year> out to keep the bonds % close to 0.
The Roth IRA grows tax-free (no 1099 every year) and you pay no taxes when you take out the money at retirement.
A Target <year> fund at Vanguard.com will give you a set of very good domestic and foreign stock index funds, plus a little in bonds, with just one mutual fund. Pick the farthest <year> out to keep the bonds % close to 0.
Capt Caveman
Lifer
- Jan 30, 2005
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To the OP: Yes - roth ira. get one.
To Spartan: If you're so inclined, you could always just flip stock sin your roth(i'm sure you already knew this though).
are there transaction fees for sharebuilder for each month you invest?
last I checked, they had $4 fees, so for $100, you would already be -4%.
last I checked, they had $4 fees, so for $100, you would already be -4%.
I think that was per mutual fund, such as VFINX vs. VEURX, not for each share of VFINX.
But if you buy their mutual funds and set up the account for all-electronic delivery of paperwork then the purchase cost is $0 and the account maintenance fee is also $0.
Also, like I said above, a Roth IRA doesn't hit you with a tax bill every year like a regular brokerage account does.
Right, not per share but per mutual fund.
I think I better think this through. While I would love to save for long term, I would like the flexibility of being able to pull the money out if i need it (i.e. house, car, etc) many years from now. I forgot with ETFs, if i sell my shares, I'm paying capital gains w/ that. I totally forgot about that whereas Roth IRA I can pull out w/o being taxed but taxed on earnings? Can someone explain this?
With a Roth you can withdraw your original contributions tax-free, it's withdrawing the growth in value that's usually taxable.
So after 5 years of putting in (say) $2K/year, you could take out $10K without any problems, you'd just need to leave in the (for example) $6K in growth.
So after 5 years of putting in (say) $2K/year, you could take out $10K without any problems, you'd just need to leave in the (for example) $6K in growth.
Awesome example, I think I better look at IRAs instead of ETFs. Ok, so my next question would be why would someone want an IRA as supposed to an index/mutual fund? You figure IF you pick the right fund, you can get a huge gain from year-year but I understand if times are bad (like now), your funds wouldnt do too well.
Better you pay your capital gains now than when a democrat gets into office.
With a Roth IRA, you can withdraw your principal after 5 years if needed be.
I doubt you have that much capital gains to begin with anyway as you only invest $100/month.
Open a Roth IRA, let your money grow tax free.
You won't be taxed on ANYTHING with a Roth IRA as long as you follow the rules.
You can use your IRA to buy ETF's and index/mutual funds.
An IRA is nothing more than an investment vehicle.
An IRA in itself is not an investment unless you do something with it(buy stocks/bonds/ETFs/mutual/index funds)
7 different ETF's is likely covering a large chunk of the total market. You could just buy one market tracking fund or ETF and reduce your fees by a factor of seven. Use EFTs to buy a specific market that is experiencing a bad period, like financials or homebuilders.
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