What funds and allocations should I pick for a new Roth IRA?
Setting up a new retirement account requires deciding on specific mutual funds and asset allocation ratios without knowing how to structure them. This leaves investors stuck trying to figure out the right mix across multiple accounts like a 401(k), Roth IRA, and brokerage.
What people tried
Every workaround mentioned in the threads below. We haven’t tested any of them — and nobody here is claiming they worked.
- 1Gathering opinions from online forums and reviewing community wiki links on retirement accounts.
- 2Keeping cash reserves or a 3 to 5-year bucket of expenses in an HYSA or treasury bill ETF while leaving the rest invested in index funds
- 3Following the 4% rule and adjusting withdrawals based on inflation
- 4Purchasing bonds, T-bills, and TIPS directly to generate reliable income without selling principal
- 5relying on a three-fund portfolio strategy
- 6starting asset allocation adjustments about a decade away from retirement
- 7selecting specific high-growth ETFs and thematic sector funds
- 8referencing standard wiki guides on retirement accounts and handling money
- 9Reading the personal finance investing wiki
- 10Switching to self-managing by picking low-fee index funds to avoid management fees
- 11Consolidating old 401ks into a Roth IRA instead of the current employer plan
- 12Reading general wiki guides on 401k fund selection and general personal finance management.
- 13Asking for feedback and portfolio reviews on online forums
- 14Combining multiple index funds to mimic a total market portfolio
- 15Opting for a single target date fund as an all-in-one choice
- 16Holding the entire world at market weight using a single global fund like VT
- 17Simplifying asset allocation to a two-fund portfolio like VTI and VXUS
- 18Automating monthly investments without making complex sector bets
- 19Manually managing self-directed accounts differently from professionally managed accounts
- 20Allocating the same asset mix across all retirement accounts to maintain collective diversification
- 21Placing bonds in traditional accounts and stocks in Roth accounts for tax efficiency
- 22opening a Roth IRA
- 23rolling over a previous employer 401(k) plan to an individual IRA
In their words
Unedited, most upvoted first, each linked to the thread it came from.
“I make 65k per year, 30 y.o., and have about $17k in a 401k account from previous employer. Does it make sense to keep adding to the 401k post tax or start a new investment account like a Roth IRA? Would appreciate any advice.”source ↗
“I have both a Traditional IRA and a Roth IRA that are professionally managed here.”source ↗
“However, looking closely at my managed accounts, I just noticed that the managed Roth IRA is invested exactly the same way as the managed Traditional IRA.”source ↗
“Is it standard practice for a managed program to completely mirror these two account types? Since they have vastly different tax treatments and future RMD rules, shouldn't they be invested differently?”source ↗
“I started at a new company back in February and just got around to getting my 401k sorted out.”source ↗
“I was wondering if I should roll them into my current 401k or into a Roth IRA.”source ↗
“I have no clue what I'm doing.”source ↗
“I'm currently 20 and I'm a server (although that's not where I want to always stay in life) I've been practicing tattooing and trying to get that kindled into a real career, as well as go to college at some point in my life for the basics at the very least.”source ↗
“Lately I've been thinking about getting my finances in order but I need advice.”source ↗
“Which account should I invest in first, and if it's both which one should I invest in more? If neither is suitable for at the moment, should I just focus on setting aside money long term and opening a savings account with interests attached?”source ↗
“I also need some money for 55-62 do you think it would make sense to fund a brokerage with similar investments to the ira?”source ↗
“I've never really invested before, and when I got 30 options I ended up with decision paralysis.”source ↗
“I just told my advisor to have the Roth account managed too and it was done the same way as traditional IRA. I wonder is this is because they want all account to be same, or it was an oversight.”source ↗
“I'm working on setting up a Roth IRA with Fidelity, and looking for some input on the funds and allocations.”source ↗
“Between my 401k, Roth IRA, Brokerage and savings account, I am expecting to have ~$3.5M by the time i retire. Most of this money is invested in index funds (VTI, SCHD & SPMO). Nobody has a crystal ball, but historically, would it be wiser to: 1) Keep this money invested and take withdrawals as needed throughout the year. (I would only intend to take out $80k per year after taxes). 2) Put this $3.5M into an HYSA at 3.75% and live off the interest, which would be ~$130k annually 3) Some combination of the 2?”source ↗
“curious in what milestones do people move away from growthjng the account to purchasing safer security. Do you do it every few years do you look for other investments at that point ?”source ↗
Where this came up
People with this problem also raised
- 7Should I max my IRA or 401k first after a raise?
- 5Should I do a Roth conversion or stick to traditional 401k?
- 3How to save money for a future nonprofit tax-free
- 5Should I invest extra savings in a brokerage account or a Roth IRA?
- 3When is the best time to do a retirement account rollover?
- 3Should I lower my retirement contributions to save for a house?