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Vanguard or fidelity. 500 mutual fund with a growth attitude. Keep putting money in don't pay attention to it. 20 years it will average 10 t0 22 % return. Easy peasey

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Meant 10 t0 12

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Originally Posted by gregintenn
Do some reading and educate yourself. Also, jump in and make some mistakes like the rest of us! Just learn from them. Screw an advisor! They are after your money. Nobody has the vested interest in taking care of your money that you do.

I'm squarely in the "do it yourself" camp, myself......... HOWEVER.

People who are not familiar with the stock market, mutual funds, etfs, REITS, IRAs, Roths, After-tax IRAs, etc, etc TEND to be susceptible to fear the volatility of their investments. Some, far too many, will end up pulling their money out at the lows and jumping in at the highs.

For those not familiar with market volatility and nervous about "losing everything in the market", an advisor that can keep them from doing something irrational will be cheap at twice the price.

The key word, however, is advisor. Not someone who tells you what to do, or worse, does it for you; someone who gives you advice on what you should do.


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Originally Posted by Dutch
You don’t need a financial advisor.

Start today by creating a ROTH Ira at one of the majors (vanguard, fidelity, etc). Fund the Roth from your checking account and invest the money in something like the S&P 500 or the Total Stock Market Index. Set up an automatic monthly draft from your checking into the account.

That will get you 99.9% there.

ROTHs are great, but I'd advise most people with normal income to max out the 401K first. It's almost always better to pay taxes later. Right now, what goes into my 401K would be taxed at 32%. I'd much rather have that money invested for long term growth than give it to the government. Investing pre tax also allows you to invest more and have the same disposable income. Most likely, when I withdraw it my rate will be well below that 32%. Of course, everyone has different needs and goals and a ROTH may be the perfect thing. Whatever you do, do it. Fund your retirement first.

In short, pay taxes when your tax rate is lower and take tax deferments when your tax rate is higher. For most people, you pay higher rates while working full time and lower rates when retired. Of course, it's a gamble that future tax rates won't change significantly, but it's still good odds retirement tax rates will be lower.


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At the very least, putting in the company match on a 401K is the first move. But maxing a 401K contribution, IMO, is the third move.
Second move is to max contributions to a ROTH IRA. Spouse should do the same. If spouse is not working set up a spousal ROTH IRA and max it.
If one's MAGI is exceeding the contribution limit, then skip to step #3.

I'd have to think if one is in a 32% bracket they are well over the MAGI limit for ROTH contributions.

The ROTH IRA has multiple benefits over simply maxing out 401K contributions.

I am not a CFP.

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Originally Posted by WTM45
At the very least, putting in the company match on a 401K is the first move. But maxing a 401K contribution, IMO, is the third move.
Second move is to max contributions to a ROTH IRA. Spouse should do the same. If spouse is not working set up a spousal ROTH IRA and max it.
If one's MAGI is exceeding the contribution limit, then skip to step #3.

I'd have to think if one is in a 32% bracket they are well over the MAGI limit for ROTH contributions.

The ROTH IRA has multiple benefits over simply maxing out 401K contributions.

I am not a CFP.

As to which to do first, or second that is, does depend on your current tax bracket. I expect to be in a 10% lower bracket in retirement, so the tax deferment is the best bang for my buck now. If I was expecting the same or even higher tax bracket in retirement, the ROTH would certainly be a better option after meeting the employer contribution limit. Some ROTHs are limited by salary and others aren't. Most ROTH 401K or similar plans don't have the same restrictive salary limits of a ROTH IRA. There is still the limit for overall 401K contributions, so again it depends on tax status as to which is the better investment.

One thing a lot of people miss is the ability to do a solo 401K when self employed. Many people just assume a version of ROTH is the only option, but the limit for the solo 401K is higher than normal because you get to contribute your portion plus the employer portion.

Regardless of which route, just do it. Most people wait until close to retirement age to even think about retirement finances. You should be thinking of retirement in your 20s and pick a job and plan to get you there. Start thinking of it in your 50s and you're probably working til you're 75.


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We’re getting pretty deep in the weeds here, but a few points.

1). If you are above the income limit for ROTH, just do a back door ROTH.

2). If you do the math, the total you end up with in your pocket is pretty close to the same between traditional IRA and ROTH.

There are two important differences. First, if you max out a ROTH VS a traditional, the net effect is that you invest more in the ROTH, as much more as your marginal tax rate. If you have the funds, or you need to play catch up, that gives ROTH the nudge.

Second, no RMD’s. So you can let it ride as fits you best.

Now, the interesting part is when you combine the two. Putting half in ROTH means that come withdrawal time, you can set your own income by drawing from one or a combination of both. Half in Traditional means the RMD’s are half. If you draw, for example, 50/50, your reportable income drops by that much. If you have a year with one time income, take the (small) RMD and use the ROTH to keep the taxable income down.

Same goes on the savings side. In a good year ( bonus, severance, short term cap gains, recapturing depreciation on a sold asset, etc) max out the 401K traditional and an individual and spousal IRA. Bad year? Toss it in a ROTH. Really bad year? ROTH conversion.

In other words, using both the ROTH and the traditional gives some options that are handy to have.


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One strategy is to do your conversion from Trad 401K to Roth in early retirement when you can really keep your income down and stay in a low tax bracket when paying for the tax on the conversion.

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Originally Posted by atomchaser
One strategy is to do your conversion from Trad 401K to Roth in early retirement when you can really keep your income down and stay in a low tax bracket when paying for the tax on the conversion.

It's the route I'm taking.

I retired 31DEC this year, due to pensions I'll be in the 22% tax bracket (down from 24%). In theory this will be my lowest earning year, so I'll convert about $100K this December, then probably $25-50K each DEC for the next few years at least. I'll start collecting SS next year and that will put me about in the middle of the 22% bracket, so I've got a little room to maneuver. I'll use a high yield savings account to pay the taxes, so the conversion remains 100% rather than pay withholding taxes from it.

The retirement funds aren't really needed, I'm just moving stuff around to tax free income/dividend funds.


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Originally Posted by atomchaser
One strategy is to do your conversion from Trad 401K to Roth in early retirement when you can really keep your income down and stay in a low tax bracket when paying for the tax on the conversion.

Everyone keeps assuming I have a 401 k….. I do not. I have a pension plan that we are not able to contribute to.

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Congratulations on the pension. They are not common anymore. I told you there’d be debate about Roth vs Traditional IRA’s. They are both good. Vanguard is the low cost standard for investing. Others may be good too. Use mutual funds. Stock picking is for experts and fools. You’re neither of those.

And the basics still apply. Pay off consumer debt first and avoid it in the future. Keep an emergency fund readily available. Be sure you have the right amount of the right insurance. Be sure the house is paid off before retirement.
Best wishes. It sounds like you’ll do fine.

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Originally Posted by hardway
Originally Posted by atomchaser
One strategy is to do your conversion from Trad 401K to Roth in early retirement when you can really keep your income down and stay in a low tax bracket when paying for the tax on the conversion.

Everyone keeps assuming I have a 401 k….. I do not. I have a pension plan that we are not able to contribute to.


You can still invest. My wife and I both have military as well as federal civilian pensions, plus what we have invested. The pension is great but it's still nice to have another source of income if needed. I really don't plan to use my investments on a monthly basis. More for big expenses, like when the HVAC goes out or when it's time for a new car.


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Definitely start saving for retirement no matter what age you are or what savings plan to use. If you are looking for a good guide to get started I recommend that you read the book The Simple Path to Wealth by JL Collins. Your library probably has a copy that you can read for free.


"Delight yourself in the Lord and He will give you the desires of your heart." Psalm 37, verse 4.


"The lazy do not roast any game, but the diligent feed on the riches of the hunt." Proverbs 12:27
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I am using Fidelity and they have been great for my company 401k but I was always a self investor chosing the mutual funds I want. After I retired I realize I have all of my money in 401k and cannot touch it lol. So my advice is to put some money in dividend stocks and earn regular income the more you add over time. This is what I am doing. But of course I do not have to touch my 401k for now so this helps.

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Once you consider the lack of purchasing fees, yearly capital gains tax, and advisor fees, I've found it very hard to beat an index fund like S&P 500 or NASDAQ for total realized returns. It's also so easy a caveman could do it. Just open a Fidelity account, choose a fund, and set it up to make equal monthly withdrawals from your checking account. Set it and forget it.

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