Schwab roth with Index funds

[bdelgaud]

Hey guys,

I just opened a roth IRA at schwab. I did not have alot to get started but they waive the minimum requreiment if you contribute at least 100 a month to the roth. So i am contributing 25 a week for now and will increase in the future but just want to get started.

I am going to invest in Schwab Index funds. I would like to do something like a 3fund portfolio with them. ( schwab toal stok market, intertantioal, s and p 500) However, the funds need a $100 minimum to start. Should in contribute cash until i can buy the percentage of the funds i want or just buy an index fund when i have 100 and auto invest it. Then worry about the alocation between funds when there is more money inveted.

[kork13]

I would like to do something like a 3fund portfolio with them. ( schwab toal stok market, intertantioal, s and p 500) However, the funds need a $100 minimum to start. Should in contribute cash until i can buy the percentage of the funds i want or just buy an index fund when i have 100 and auto invest it. Then worry about the alocation between funds when there is more money inveted.

First, you should reconsider the 3 funds you're looking at. Typically, a "3-Fund Portfolio" includes a Total Stock Market fund, Total International Stock fund, and a Total Bond Market fund. Holding both Schwab's Total Stock Market fund & an S&P 500 fund would be a mistake -- you would be duplicating your investments, because everything in the S&P 500 will already be held by the Total Stock Market fund. For an excellent discussion on the 3-Fund Portfolio, check out this "Three Fund Portfolio" thread from the Bogleheads forum.

As for the method of how to do it, I would recommend that you just start out by contributing only to the Total Stock Market fund, then as you build up enough funds to expand into the other funds, do that. Once you've got enough in your account to hold all 3 of your funds, THEN you can adjust your asset allocation to match what you're looking for.

[bdelgaud]

i worried that funny. i am aware of the 3 fund portfolio and meant to add total stock marek, intertnational, and bond.

Thanks for your response. That is kinda what i thought but wanted to make sure.