401k/Roth IRA Investment Options

[Ryan410]

Im looking to open up a new Roth IRA account. Being that I'm still new to the investing world, Im unsure of the best fund options to invest in with the new IRA. Im currenly contributing 10% to my 401K and have 100% of my allocation going to a Target Date 2055 fund (TRRNX). With this being a diversified fund option I'm kind of lost on what type of funds to select for the Roth. Any help would be appreciated.

Thanks,
Ryan

[stoney508]

I am not sure if you have a provider of the ROTH or you are doing it yourself but a certified finacial planner may be able to help you out with that if you dont get ideas from everyone on here(make sure you know the fees associated with the finacial planer as well as the provider).

I personally went through Fidelity and the guy talked me into investing mine into emerging markets I am not sure if it was the best choice but he made the argument that with the economy of the world markets going down right now that it would be a good idea to start off there because this fund I am being a very aggressive with.

My 401(k) is my "safe" investments with a target date fund like yourself. I had a reletivly small amount to invest and am waiting to accumulate some more to diversify my allocations.

Everyone is different in how they want to invest and im not sure if its good advice but you have to decide how aggressive you want to be beforehand as well as do some research.

I believe this is a good choice to take advice and learn from I have learned a lot from this forum in a short amount of time and wish I knew about it before I started my ROTH.

[Ryan410]

Both funds have relatively small amounts in them at the moment. I was hoping to do another "set it, and forget it" type fund until I can do more research, and become more educated...

[jIM_Ohio]

If you had $100k, what would you be invested in? Identify the fund or funds in the finished portfolio, and choose one of them as the starting point.

[nyczarnold27]

Both funds have relatively small amounts in them at the moment. I was hoping to do another "set it, and forget it" type fund until I can do more research, and become more educated...

I'm pretty much in the same situation as you.. newbie ROTH. That said, I've read that the most simple way "set it and forget it" type fund is just putting all your ROTH money into a life-cycle fund. It's basically an auto-pilot investment fund that puts your money into well diversified index funds and reallocates and maintains it for you accordingly to market conditions and your age at a relatively low expense ratio.

All you have to do is just contribute money regularly and forget it.

Life-cycle funds automatically allocates types of investment based on your age. For example, I'm 26 years old and since I'm young and can handle some risk since i have plenty of time to recover, the fund is about 95% stocks / 5% bonds. As I get older, lets say I turn 40 years old, my allocation would be automatically set to 70% stocks/30% bonds

This is what I'm planning on doing when I open my Roth IRA soon.. at least until I get more experienced for starting advanced investments.

Any input from experienced investors is appreciated.

[Ryan410]

^ Thats what I was thinking. Only I wasnt sure if it was a wise move or not, due to the fact my 401k is already invested in a target date fund. Essentially both funds would be invested the same.

[stoney508]

I would say it is up to you if you want to do the target date fund and just set it and forget it but I do see the point of taking a little more aggresive stance if you already have a 401(k) thats invested that way.