Once Roth is Maxed out...

ICMoney · #1 11-11-2007, 09:35 PM

I just got a job and will have more money to put away in 2008.

There is no 401k offered at my job.

After I put 5k into my Roth, I will have about $10k to invest in 2008.

Are there other tax-free/deferred options for mutual funds?

Thanks.

napkins · #2 11-11-2007, 09:45 PM

So there's no job benefits whatsoever towards retirement? If you do have something, I'd take a look at investing in that.

Otherwise, just start up a taxable account. You can still invest in funds that are very tax efficient like a TSM.

mtgordon · #3 11-11-2007, 09:47 PM

I assume you've already put money in for 2007?

ICMoney · #4 11-11-2007, 09:53 PM

[ QUOTE ]
I assume you've already put money in for 2007?

[/ QUOTE ]

I will have 4k in my Roth by the end of this year.

Got the job a little while ago so don't have much more money to play with this year.

econophile · #5 11-11-2007, 11:43 PM

you can also max out a traditional IRA

ICMoney · #6 11-12-2007, 12:07 AM

[ QUOTE ]
you can also max out a traditional IRA

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Are you saying I can squirrel away 5k in a Roth and then another 5k in a traditional IRA next year?

Thanks.

ICMoney · #7 11-11-2007, 09:51 PM

It's a small company and no retirement benefits are offered.

I was thinking about opening a Vanguard targeted retirement date fund with the extra money.

It automatically adjusts the portfolio based on how many years left until retirement.

Is this a good option, even if I'm taxed on it?

Thanks.

prohornblower · #8 11-12-2007, 04:40 PM

[ QUOTE ]

I was thinking about opening a Vanguard targeted retirement date fund with the extra money.

Is this a good option, even if I'm taxed on it?

[/ QUOTE ]

Yeah. This is the fund I own in my Roth anyway.

Also, to re-iterate what other posters have said, I don't believe you can max out a traditional as well as a Roth in the same year. If it has the "IRA" tag on it, it's $4k max. ($5K next year). I believe you could do any combination though. Such as 2 in a traditional, and 2 in a Roth but it can only add up to 4.

prohornblower · #9 11-12-2007, 04:48 PM

OT: Those of you who max out your Roth...do you lump sum it in there on Jan. 1, or DCA it?

I'm planning on throwing all of mine in there on Jan. 1. Just wanted to know what others' strategy was.

ilikeaces86_ · #10 11-12-2007, 05:29 PM

[ QUOTE ]
OT: Those of you who max out your Roth...do you lump sum it in there on Jan. 1, or DCA it?

I'm planning on throwing all of mine in there on Jan. 1. Just wanted to know what others' strategy was.

[/ QUOTE ]

Ya I have pondered this before too. Lump Sump or dollar cost averaging. Which is more ideal?