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Roth IRA Investment Question 

getagrip
Posts: 29

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6/29/2016
getagrip
Posts: 29
I won't go into the pluses and minuses of utilizing a financial professional, however I will say if you have three accounts and three separate people handling those accounts chances are you are going to pay more in fees than if you have one person handling all three accounts. Fees, especially when you are trying to initially grow your nest egg, will hinder you more than anything else and you should pay attention to the fees they are collecting and what that is costing you and that should be a consideration in your decision since for all we know it might actually turn out better to have the Roth managed away from the 401K.
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njhowie
Posts: 77

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6/12/2016
njhowie
Posts: 77
retire4lyfe wrote:

Ultimately, my personal belief is that no one will look after my money as well as I will.


Nothing more than this needs to be said.

Nothing against you stephen2tea, but you need to really take this to heart and understand the meaning.

You work hard for your money. An investment advisor is in business to make money. The advisor makes money from you - regardless how his recommendations or your investments turn out. At the end of the day, whether your objectives are met or not, the advisor is going to collect his fees. If you decide to leave the advisor, there are lots more folks out there for him to replace you with.

Early on, I understood the situation, the implications, and what it meant to me personally. When I ran my own business 25 years ago and was setting up a retirement plan for the employees through our bank and the "advisor" was looking to put us into mutual funds with 5% front-end loads I raked him over the coals. I never heard from him or had any of my calls returned again. No doubt, within 6 months of initiating the retirement plan through the bank, it was moved to one of the larger mutual fund institutions.

I've worked my entire life to build my investment portfolio. I've done it on my own specifically because of what retire4lyfe has said - in the end, I am responsible for my money, nobody else.

You also need to understand, investing and making your money grow over time is not rocket science and does not require any degree or special certifications. Many in the financial planning industry will use the logic that if you needed medical or legal advice you'd go to a doctor or lawyer - no? And that's not the same at all.

If you lose money being with the advisor today, who do you blame? I say you are the one to blame - not the advisor. The advisor did what you hired him for...you chose the advisor and not to do it yourself.

Anyhow, as you can see, I have very polar feelings on this topic. Instead of giving all of your money to the advisor to manage, why don't you take a small portion and manage it yourself, just to get educated and comfortable? If it doesn't work out, no harm done. If you get comfortable, see the benefit of managing yourself, the money/fees to be saved, and the satisfaction of doing it yourself, then you've gained a great deal.
edited by njhowie on 6/12/2016
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retire4lyfe
Posts: 4

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5/31/2016
retire4lyfe
Posts: 4
What ever you decide, take a look at paulmerriman.com. He has a very good article called the Ultimate Buy and Hold Strategy where he starts with a portfolio of 100% in the S & P 500 index and then adds other asset classes and shows the affects on the risk and returns. At the very least it will offer some insight into what a properly diversified portfolio should be. It looks like you might already have a Vanguard account and he does offer several free portfolios for various brokerages, Vanguard being one. You would only need to decide your risk tolerance and pick one to follow. He is a retired investment advisor who just likes sharing what he has learned over the years.

Ultimately, my personal belief is that no one will look after my money as well as I will. The key I believe to investing is keeping fees low and diversify across asset classes. With all the index funds available now at reasonable fees it has never been easier to do it yourself. Even if you don't make quite as much as the paid advisor you can still have more money in the end, because you won't have to pay them their fees on top of any funds they recommend, which most likely will have higher fess than the low cost index funds you could choose.
edited by retire4lyfe on 5/31/2016
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stephen2tea
Posts: 3

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5/28/2016
stephen2tea
Posts: 3
I question whether the DIY strategy will work for me. I would rather trust in someone that my investments are being handled by a seasoned professional. Plus there would be a learning curve for me vs someone with decades of experience.

My goal is to hit 1mil+ by 45 years old. In order to get there I have to get at least 6% growth.
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licid9
Posts: 45

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5/27/2016
licid9
Posts: 45
I highly recommend the bogleheads.org method of setting up a basic index fund portfolio (this means doing it yourself). If that sounds greek to you, don't worry! It is easier than it sounds and the people at the Bogleheads forum are extremely helpful.

I'm sure someone on NetworthShare is better able to explain your options and will chime in too.
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stephen2tea
Posts: 3

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5/27/2016
stephen2tea
Posts: 3
I currently have $10,927 in my Roth IRA which is invested in the Vanguard Russel 3000 and Vanguard S&P 500.

I have a firm managing my solo401k ($69,764) right now but no one helping with my Roth.

Would you guys recommend finding someone else to manage the Roth or let current 401k firm manage it? Or figure it out myself (would prefer not to do this)?

I'll be getting married this summer too, I'm 32 soon to be wife is 28. Need her to be maxing out a Roth too. Any help or advice would be greatly appreciated! Thanks
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