ROTH launch! Choosing a Vanguard mutual fund

[J.Apple902]

Hey guys,

Right now I have a healthy EF and 401k with good company match. I'm ready to take the next step in my portfolio which is starting a ROTH. I'm going to choose one of the better $3k min investment funds. I want to focus on growth because I'm 26 years old, but I want to intelligently select a fund such (maybe one that expands my diversification on top of my 401k). Below is my current situation:

EF: $5k (+$3k waiting to start ROTH)
Fidelity 2055 Target date 401k: $6k
Asset class: 52% Domestic Stock
25% International Stock
9% Bonds
12% Short term funds
1% Other

I can break down the stock distributions further if needed. Just looking for a little insight as to what to go with. Thanks!

[J.Apple902]

Really my concern can be eased with some simple info. Next year I can start a new mutual fund and add it to the mix correct (still under the ROTH)? And the next year after that I can continue to diversify, adding more funds if I choose, and distribute the annual $5.5k into whichever funds I decide? Right?

If this is true, it makes the starting fund of lesser importance. Don't get me wrong, I know I have to choose a good one, but I'm very anxious about this first fund choice. Thanks!

[Petunia 100]

Yes, you can hold multiple funds inside your Roth IRA.

I suggest you buy a Vanguard Target Retirement Fund (such as TR 2050) and put all of your Roth money into it. The VG TR funds hold total stock market index, total international stock market index, total bond market index, and total international bond market index.

[feh]

OP - I suggest you start here: http://www.bogleheads.org/wiki/Bogle...g_start-up_kit

[J.Apple902]

What's nice is that the target date funds have a min investment of $1k and the other funds I'm interested in are $3k, so I think I'll start two this year

Thanks all! On top of 2055 TD, I'll probably get a mid-cap growth fund which has seen 10% 10 year, and 20%+ YTD with expense ratio of under 0.50% - Vanguard has many funds which fit these criteria.

[feh]

On top of 2055 TD, I'll probably get a mid-cap growth fund which has seen 10% 10 year, and 20%+ YTD with expense ratio of under 0.50%

"Past performance does not predict future returns".

That's very true. Don't lean toward funds that have done well in the past - there's no way to know they'll continue to do well.

[J.Apple902]

"Past performance does not predict future returns".

That's very true. Don't lean toward funds that have done well in the past - there's no way to know they'll continue to do well.

I understand that, but a 10 year reflection of 10% growth is pretty solid confidence for me. If there were two diversified mutual funds, one getting 10% over the last 10 years vs 5% over the past 10 years, which do you choose?

[Petunia 100]

I understand that, but a 10 year reflection of 10% growth is pretty solid confidence for me. If there were two diversified mutual funds, one getting 10% over the last 10 years vs 5% over the past 10 years, which do you choose?

That's not enough information to make a decision.