Where to open RothIRA/IRA Rollover

[bdizzle]

I'm 27 and finally in a decent financial position and want to open up a RothIRA for 2009 and 2010, but I'm not sure where to open up my account at. My bank offers RothIRA accounts, but I also know I can go through Vanguard and T. Rowe Price as well; but I'm not sure with which location I should open it up with.

Also I have ~7k in a 401(a) (public employee retirement) that I want to rollover to an IRA, but I'm not sure where I should open an account for that as well.

Thanks for any help

[disneysteve]

Stay away from your bank. They likely offer low-paying CDs and high-cost mutual funds.

Vanguard, T.Rowe Price and Fidelity are the 3 biggies in the field. I'd say you can't go wrong with any one of those. Personally, I'm a Vanguard fan. They can do your Roth and your rollover IRA as well.

How to invest is a whole other topic.

[Slug]

Schwab just dropped their trading fees today and offer commission-free trades on their ETF's. If I were where you are today, that's where I'd be headed.

[mmenard3]

I think I am on the same page with everyone else here. I just got myself and my sister started this past year and our choices were T Rowe Price an Vanguard. I went with T Rowe Price because they waived a minimum balance if you signed up for recurring monthly deposits. They do charge a small annual fee until it reaches 4k I believe, but in the grand scheme of things it isn't bad, and I am still out-earning any savings or checking account I could have stored the money in(interest wise).

I sent my sister over to Vanguard because she had the several thousand you needed for a minimum balance right out of the gate. Also, for the target retirement funds the expense ratio is something like .18%, which may be the lowest on the market.

Expense ratios may vary depending on what funds you end up purchasing in the Roth IRA, but I would like to say these two places are some of the best. Also, the service on both has been great and they are very easy to use.

As a quick aside, I've heard Fidelity is a bit higher in this respect, and there might not be any real reason to check them out unless you have a 401K there and find value in minimizing the different firms you invest with.

[nck4857]

I'm about 60/40 T-Rowe Price/Vanguard. They are the top two, IMO...

[bdizzle]

Thanks for the info guys, and sorry for the late post. I don't really check this board as frequently as I should.

I was going to go with my bank because I have absolutely no clue where to place my money within the Roth and IRA. Plus my banks have a financial advisor on staff that I can talk to about any questions and he said they'll invest the money for me. But I don't really trust advisors, which was the main reason I created this thread.

Honestly, it'll be best for me to learn about retirement investment anyway so can anyone recommend what I should start reading in order to be able to properly plan for my retirement?

Thanks!

EDIT: This might be a dumb question, but when I open acct with T Rowe or Vanguard, do I just transfer my money and their advisors will invest it for me, or I do I allocate everything myself and hope I know wtf I'm doing lol?

[Beppington]

Vanguard fan here.

[disneysteve]

I was going to go with my bank because I have absolutely no clue where to place my money within the Roth and IRA. Plus my banks have a financial advisor on staff that I can talk to about any questions and he said they'll invest the money for me.

Keep in mind that Advisor = Salesman. Why do you think he is so eager to talk to you and invest your money for you? He isn't doing it out of the goodness of his heart. He's doing it because he makes a ton of money off of your account for doing so. Stay away.

EDIT: This might be a dumb question, but when I open acct with T Rowe or Vanguard, do I just transfer my money and their advisors will invest it for me, or I do I allocate everything myself and hope I know wtf I'm doing lol?

Not a dumb question at all. With these companies, you would be in charge of making the investment decisions. If you look on their websites, I believe they have a ton of advice on investing, asset allocation, etc, but the ultimate decision is yours. Lots of folks here are happy to help along the way. What you could do is open the account and put the money into one of their money market funds and then post your financial details here and we'll suggest ways to allocate that money.

[Beppington]

Thanks for the info guys, and sorry for the late post. I don't really check this board as frequently as I should.

I was going to go with my bank because I have absolutely no clue where to place my money within the Roth and IRA. Plus my banks have a financial advisor on staff that I can talk to about any questions and he said they'll invest the money for me. But I don't really trust advisors, which was the main reason I created this thread.

Honestly, it'll be best for me to learn about retirement investment anyway so can anyone recommend what I should start reading in order to be able to properly plan for my retirement?

Thanks!

EDIT: This might be a dumb question, but when I open acct with T Rowe or Vanguard, do I just transfer my money and their advisors will invest it for me, or I do I allocate everything myself and hope I know wtf I'm doing lol?

You are right not to trust advisors that make money from the things they advise you to buy; they are obviously biased. Even if they're friendly, and maybe even are your actual friend, there will be some amount of bias. To get completely unbiased advice you need to visit a paid financial advisor who only gets paid by your for their advice and who has no financial products to try to sell you. Or you can keep reading a lot of info until you're confident in what you should be doing, the pitfalls, the scams, etc.

[Beppington]

EDIT: This might be a dumb question, but when I open acct with T Rowe or Vanguard, do I just transfer my money and their advisors will invest it for me, or I do I allocate everything myself and hope I know wtf I'm doing lol?

You can go to Vanguard's website, click open a new account, & one of the steps is to specify the type of account as "Roth IRA", "Rollover IRA", "Traditional IRA", "Individual", "Joint", etc. I have both a Roth IRA and a regular ol' taxable Individual Account at Vanguard.

Once your account is open, you need to "fund" it ... meaning send in some money. Once it's there you can allocate it into whichever funds you decide; You "exchange" money from say your intial Vanguard Money Market Fund into say an S&P 500 index fund.

This book is the one I used to establish my own portfolio: "Retire Early Sleep Well" (by Steven R. Davis). At Amazon: Amazon.com: Retire Early Sleep Well: A practical guide to modern portfolio theory, asset allocation and retirement planning in plain english, Second Edition (9780979303807): Steven R. Davis: Books

For one performance example, my parents opened their Joint IRA Feb 21, '07. The Dow is down 19.43% since that date, whereas their portfolio based on Davis' book is up 1.94%.

[bdizzle]

Keep in mind that Advisor = Salesman. Why do you think he is so eager to talk to you and invest your money for you? He isn't doing it out of the goodness of his heart. He's doing it because he makes a ton of money off of your account for doing so. Stay away.

Oh, I know that. The whole time I kept asking him questions I got the used car salesman vibe. Plus after years of watching Suze Orman's show, I know financial advisors pretty much make money off of selling my various products, which was why I made this thread.

Not a dumb question at all. With these companies, you would be in charge of making the investment decisions. If you look on their websites, I believe they have a ton of advice on investing, asset allocation, etc, but the ultimate decision is yours. Lots of folks here are happy to help along the way. What you could do is open the account and put the money into one of their money market funds and then post your financial details here and we'll suggest ways to allocate that money.

Cool, I'll be asking tons of questions because honestly I have no damn clue on where to start lol. But I love learning and I love money so I'm excited to learn about this stuff. Is there a retirement investment advice thread somewhere already?

You are right not to trust advisors that make money from the things they advise you to buy; they are obviously biased. Even if they're friendly, and maybe even are your actual friend, there will be some amount of bias. To get completely unbiased advice you need to visit a paid financial advisor who only gets paid by your for their advice and who has no financial products to try to sell you. Or you can keep reading a lot of info until you're confident in what you should be doing, the pitfalls, the scams, etc.

Yeah, I figured that as much, but it's just somewhat intimidating trying to prepare for something that's gonna happen 40 years on the future lol. Which was why I was considering going through my bank.