I am 23 and have $3,000 should I invest in a Roth IRA?

Question

So I finally decided to sell my stock that I had bought through a Employee Stock Purchase and after tax thats what I was left with. Now I have not invested in a retirement plan yet and was very interested in doing so now. I was looking through Fidelity Investments since thats who I sold the stock through. Anyone have any advise on retirement plans? Assuming I retire at 65.

Answer 1

Yes, yes, yes...open a ROTH IRA with Fidelity...even if it's just half or two thirds of what you've got. It's a great start...and when you get some positive results, you will add more...( ...and you've got years and years to do that ! )

Read up on some funds or ETFs ...and get into something " international" for some decent returns to get your ball rolling.

It will grow..it will always be there for you...and when the time comes to withdraw, IT'S TAX-FREE...( you have NO IDEA how important that is in the lonnnnng run....no accounting, no cut to the politicians, a simple, simple path to a nice nest-egg.)

P.S. The target date funds are just a little conservative for a while...look instead to some sector funds ..energy, metal/mining, materials, chemicals ( agriculture)... those things are returning in the high teens, low twenties... just to get off to a running start.

Answer 2

This is definately the right decision. I cant advise any particular retirement plans but i can tell you that at an average growth of 8.5% your mere $3,000 investment would turn into over $92,000!

Answer 3

The Roth IRA is ideal for young investors since you have a long time to go before retirement.  You'll make a nice profit on your tax exempt earnings.

As for brokers, Fidelity, T Rowe Price and Vanguard are all excellent borkerages.

Answer 4

Yes, do it!  It's a great time to invest.

If your investment grows at 10%, you could invest $200 a month from age 20 to 40, and it would be worth $1 million at age 60.  10% is not at all conservative, though.

Look for some  mutual fund that has performed well for a long time.  Morningstar ratings are useful for that.

P.S. If you don't know, offering "40% guaranteed interest" is the traditional way to get people into a Ponzi scheme.  Stay away from that!

Answer 5

Fidelity is great. I recommend a target date fund: Freedom 2040. The investments will get progressively conservative (safer) as you approach your target retirement year.

Starting at 23 is awesome. The earlier you start socking money away, the richer you'll be at retirement. You will sleep at night and amass a nice nest egg. Try to max out the IRA every year ($5000).

Answer 6

A Roth IRA is your best choice since you are young.  Using Fidelity, you can purchase a Fidelity mutual fund at no cost.