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 Posted: Fri Mar 23, 2007 4:38 am Post subject: Roth..... no load....... diy..... use a planner.....??? |
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Greetings. I'm 56. I need to get some $$$ out of savings
and get it into "retirement" accounts. I can do a Roth for
'06 ( until April 15 ) and '07 and that takes care of $10 K.
I know I could just call Vanguard, Fidelity or ING or whatever
and they'll be happy to do it. But I've talked with 4 people
now -- 2 went with Merrell Lynch and 2 with Morgan Stanely.
They've all done far better than they did on their own. Yet
the radio and TV $$$ shows all say "no load only".
I know you prolly need lots more info but maybe you have
some recommendations from this little bit.
thanks |
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PeterL
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| Posted: Fri Mar 23, 2007 5:23 am Post subject: Re: Roth..... no load....... diy..... use a planner.....??? |
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On Mar 22, 4:38 pm, kapp...@yahoo.com wrote:
| Quote: |
Greetings. I'm 56. I need to get some $$$ out of savings
and get it into "retirement" accounts. I can do a Roth for
'06 ( until April 15 ) and '07 and that takes care of $10 K.
I know I could just call Vanguard, Fidelity or ING or whatever
and they'll be happy to do it. But I've talked with 4 people
now -- 2 went with Merrell Lynch and 2 with Morgan Stanely.
They've all done far better than they did on their own. Yet
the radio and TV $$$ shows all say "no load only".
I know you prolly need lots more info but maybe you have
some recommendations from this little bit.
thanks
|
How much are these people paying Merrell and Morgan for their services? |
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jIM
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| Posted: Fri Mar 23, 2007 8:45 am Post subject: Re: Roth..... no load....... diy..... use a planner.....??? |
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On Mar 22, 7:38 pm, kapp...@yahoo.com wrote:
| Quote: |
Greetings. I'm 56. I need to get some $$$ out of savings
and get it into "retirement" accounts. I can do a Roth for
'06 ( until April 15 ) and '07 and that takes care of $10 K.
I know I could just call Vanguard, Fidelity or ING or whatever
and they'll be happy to do it. But I've talked with 4 people
now -- 2 went with Merrell Lynch and 2 with Morgan Stanely.
They've all done far better than they did on their own. Yet
the radio and TV $$$ shows all say "no load only".
I know you prolly need lots more info but maybe you have
some recommendations from this little bit.
thanks
|
If you are willing to do about 3-5 hours worth of research, you can
save yourself the fees your friends paid.
Here's the things you'll need to "think about".
I'll follow this up with a brief "how to".
You need to know how much risk to take. You have two risks playing
"tug of war". One is inflation (increase of prices of the things you
need to buy- milk, gas, bread, meat etc...), the other is principal
(the idea that if you invest 10k right now, it might drop to 9k
tommorrow).
Higher returns come with principal risk, but "usually" those risks are
rewarded by beating inflation (over 10, 20 30 year periods).
The risk you take will be answered with % equities/ % bonds/ % cash.
100% equities/ 0% bonds is highest principal risk...
80%/20% is moderate risk (to principal)
60%/40% is average risk (to principal)
30%/70% is below average risk (to principal)
100% equity is probably a 9-11% annual return (based on past, measured
over 30 years)
80-20 is probably a 8-10% annual return (based on past, measured over
30 years)
60-40 is probably a 6-9% annual return (based on past, measured over
30 years)
30-70 is probably a 3-6% annual return (based on past, measured over
30 years)
How to get started:
Go to T Rowe Price web site, go to calculators section, take the
"getting started" questionaire. It will ask you questions, then
suggest an allocation, and even further will suggest some of their
funds.
Vanguard and Fidelity have similar functions. I am familiar with T
Rowe Price. Their fees for managed funds are among the lowest out
there. Excellent performance, good company.
If you are told 60-40 is your suggested allocation (after answering
questions), the 60% will be broken down (into large cap stocks, mid
cap stocks, small cap stocks, international stocks) and the 40% will
be broken down (into short term bonds, international bonds, real
estate and corporate bonds).
There is no one right answer, each person will do something different.
I can tell you I am 34 yo, and my allocation is 100% equity/0% bond
The 100% equity is 75% domestic (US based companies) and 25%
international (non US companies)
The 100% equity is broken down into:
45% domestic large cap
15% domestic mid cap
15% domestic small cap
15% international large cap
10% international small cap
I am 100% equity because when market dips, I don't lose sleep, as I
have 30 years before I need the money. Because my money is spread
around across different assets, I should do well "over time".
The risk you take is primarily based on age, how much you already have
saved, how much you are contibuting and how you'll react to bad news. |
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rono
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| Posted: Sun Mar 25, 2007 1:14 am Post subject: Re: Roth..... no load....... diy..... use a planner.....??? |
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Howdy kapp,
Cripes, do it yourself and by all means go with a Roth IRA and max it
for both yourself and your spouse (separate accts). Contact the
better noload mutual fund families such as Vanguard, T Rowe Price and
Fidelity and ask for their New Investors Kit, IRA Kit and
Prospectuses. Get it ALL and read it ALL. Choose one. Now go over
their stuff on Goals & Objectives, Time Horizon and Risk Tolerance as
these three variables help to determine YOUR asset allocation (mix of
types of mutual funds).
Then fill out their paperwork and mail them your check. As for the
specific funds, early on you don't need to fret too much because each
fund has a minimum investment and you have an annual contribution
limit. Together they will limit the number of funds you can use to
make up your Allocation. You might be better off initially to choose
one of their Target Retirement funds or Life Strategy funds. You
could do that for a couple of years and then with $10K you could divy
it up into your chosen asset allocation funds.
Really, this is NOT hard. Why on earth pay some planner or bank or
brokerage house 6% off the top to do this for you. Silly waste of good
money.
peace,
rono
On Mar 22, 7:38 pm, kapp...@yahoo.com wrote:
Greetings. I'm 56. I need to get some $$$ out of savings
| Quote: |
and get it into "retirement" accounts. I can do a Roth for
'06 ( until April 15 ) and '07 and that takes care of $10 K.
I know I could just call Vanguard, Fidelity or ING or whatever
and they'll be happy to do it. But I've talked with 4 people
now -- 2 went with Merrell Lynch and 2 with Morgan Stanely.
They've all done far better than they did on their own. Yet
the radio and TV $$$ shows all say "no load only".
I know you prolly need lots more info but maybe you have
some recommendations from this little bit.
thanks |
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