IRA
I have 10000.00 in savings where it’s really just sitting there. I want to take some and put maybe into an IRA, or I was looking at Betterment? What do you suggest?
Terry Says
Well, wait. I think you need some basic lessons in investing first!
You can only contribute to an IRA if you are working. You must have earned at least as much as you contribute –but the money can come from other savings. So if you are young and working, an IRA would be a good idea. I would suggest opening a Roth IRA (you don’t get a tax deduction for your contribution, but the money grows tax-free). And to keep things simple, I would open the Roth IRA at Vanguard, and put the money in their S&P 500 stock index fund. The market will go up and down over the coming years, but ride it out — and keep contributing more every year. You’ll be happy you did that in the long run.
Betterment is another low-cost place to open your Roth IRA. They will give you guidance about diversifying your investments.
BUT if this is your only money I would be cautious about putting it all in the stock market. You never know when you’ll need emergency funds. So you might start with half of this in a long-term IRA investment and keep adding to it every year.
