4 ms·

What's your investment strategy? I recently started a Roth IRA and started maxing it out each year, but I don't know what else to do with my savings (that are e

What's your investment strategy? I recently started a Roth IRA and started maxing it out each year, but I don't know what else to do with my savings (that are extra over my ~6mo salary buffer + emergency fund, I mean). Dumping it all into something like VTSAX is something I've thought about for a while, but I'm not sure how well it works for long-term investment/"making my money work for me".

sokoloff 9y ago
This is my go-to post on advice for US taxpayers: https://forum.mrmoneymustache.com/investor-alley/investment-order/msg1333153/#msg1333153 https://forum.mrmoneymustache.com/investor-alley/investment-... (I didn't write it, but I generally agree with it and I like that it's very concise, fairly approachable, and you can readily act on the advice.)
avn2109 9y ago
Read https://www.amazon.com/dp/B002QX44IS https://www.amazon.com/dp/B002QX44IS The sibling comment's Mr. MM recommendation is better than nothing but not as good as a real book IMHO.
- astrange 9y ago
  This book is 3 words “buy Vanguard ETFs” in 300 pages.
astrange 9y ago
https://www.reddit.com/r/personalfinance/wiki/investing https://www.reddit.com/r/personalfinance/wiki/investing
rpazyaquian 9y ago
Looks like for the most part, it's "dump it all into VTSAX". That works for me.
sigstoat 9y ago
i haven't read the suggested bogleheads book, i expect it's good. but there's also a bogleheads wiki with a bunch of stuff for free. https://www.bogleheads.org/wiki/Main_Page https://www.bogleheads.org/wiki/Main_Page
thaumasiotes 9y ago
> I recently started a Roth IRA and started maxing it out each year Huh? There's no limit on how much you can put into a Roth IRA each year, as far as I've ever heard. http://www.rothira.com/what-is-a-backdoor-roth-ira http://www.rothira.com/what-is-a-backdoor-roth-ira
- rpazyaquian 9y ago
  The IRS website says its $5500 contribution max per year. https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits https://www.irs.gov/retirement-plans/plan-participant-employ...
  - sokoloff 9y ago
    Yes, but read the "mega backdoor Roth" technique. It allows many people to effectively contribute much larger sums into Roth IRAs, even though there is a $5500 "front door" limit. If you have a low current marginal rate and a lot of money to stash away for retirement (that might be a semi-uncommon combination), it's absolutely something to look into. I have a high marginal rate, so I haven't done it.
    - rpazyaquian 9y ago
      So it's basically opening a Trad IRA, putting money into it, then immediately rolling it into a Roth IRA? I thought the contribution limit was across all IRAs you own, so you still wouldn't be able to put any extra into the IRAs in general? This is complicated and weird. I might hold off until I understand it better.
      - sokoloff 9y ago
        Mega backdoor Roth primer is here: http://www.madfientist.com/after-tax-contributions/ http://www.madfientist.com/after-tax-contributions/ Don't get hung up/paralyzed into doing nothing for fear that something slightly better might be available if you did hundreds of hours of research. The most important thing is to get started, IMO.

sokoloff 9y ago

This is my go-to post on advice for US taxpayers: https://forum.mrmoneymustache.com/investor-alley/investment-order/msg1333153/#msg1333153 https://forum.mrmoneymustache.com/investor-alley/investment-... (I didn't write it, but I generally agree with it and I like that it's very concise, fairly approachable, and you can readily act on the advice.)

avn2109 9y ago

Read https://www.amazon.com/dp/B002QX44IS https://www.amazon.com/dp/B002QX44IS The sibling comment's Mr. MM recommendation is better than nothing but not as good as a real book IMHO.

astrange 9y ago
This book is 3 words “buy Vanguard ETFs” in 300 pages.

astrange 9y ago

https://www.reddit.com/r/personalfinance/wiki/investing https://www.reddit.com/r/personalfinance/wiki/investing

rpazyaquian 9y ago

Looks like for the most part, it's "dump it all into VTSAX". That works for me.

sigstoat 9y ago

i haven't read the suggested bogleheads book, i expect it's good. but there's also a bogleheads wiki with a bunch of stuff for free. https://www.bogleheads.org/wiki/Main_Page https://www.bogleheads.org/wiki/Main_Page

thaumasiotes 9y ago

> I recently started a Roth IRA and started maxing it out each year Huh? There's no limit on how much you can put into a Roth IRA each year, as far as I've ever heard. http://www.rothira.com/what-is-a-backdoor-roth-ira http://www.rothira.com/what-is-a-backdoor-roth-ira

rpazyaquian 9y ago
The IRS website says its $5500 contribution max per year. https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits https://www.irs.gov/retirement-plans/plan-participant-employ...
- sokoloff 9y ago
  Yes, but read the "mega backdoor Roth" technique. It allows many people to effectively contribute much larger sums into Roth IRAs, even though there is a $5500 "front door" limit. If you have a low current marginal rate and a lot of money to stash away for retirement (that might be a semi-uncommon combination), it's absolutely something to look into. I have a high marginal rate, so I haven't done it.
  - rpazyaquian 9y ago
    So it's basically opening a Trad IRA, putting money into it, then immediately rolling it into a Roth IRA? I thought the contribution limit was across all IRAs you own, so you still wouldn't be able to put any extra into the IRAs in general? This is complicated and weird. I might hold off until I understand it better.
    - sokoloff 9y ago
      Mega backdoor Roth primer is here: http://www.madfientist.com/after-tax-contributions/ http://www.madfientist.com/after-tax-contributions/ Don't get hung up/paralyzed into doing nothing for fear that something slightly better might be available if you did hundreds of hours of research. The most important thing is to get started, IMO.