Vanguard Roth IRA - I need some financial advice?

Question

I'm very new to investing. So please forgive me.

I just opened a Roth IRA with Vanguard. $3,000k to start. I picked the default investment option at this time, since I don't know what else to invest in. It looks like my money is invested in a Vanguard Prime Money Market Fund. It looks to be very safe and not going to make me a lot? I'm not terribly risky, but would like to expect more than a 2.18% ROI.

I plan on contributing $5k per year to my Roth and am only 25 years old...so I think I can afford to be a little more risky than what Vanguard defaulted me on? Any suggestions as to what Vanguard accounts I should put my money into? Or ones good for someone my age?

Thanks so much.

Answer 1

Vanguard has the perfect fund for you:

Target Retirement 2050

https://personal.vanguard.com/us/JSP/Fun...

This fund gives you a mix of risky/less risky investments that cater to your age group.  As you get closer to retirement the investments will automatically become safer.  You don't need to do a thing except keep investing.

The ROTH is a great choice, and it sounds like you're taking your retirement investments seriously.  You are doing great for being 25 years old, keep up the good work!

<edit> Vanguard is also a great choice.  Aside from my company retirement plan, I use Vanguard for all my investing.  They have the lowest fees, a great track record, and their customer service is amazing if you ever need help.