I am a 26 year old looking to open an IRA or another retirement account...?
I heard that Roth IRA is best... is this true? If so, what is best company to use for this- is ING good? Thanks
Public Comments
- Roth IRAs are great as long as you make less than the capped $105k/year salary. Sharebuilder.com has a decent Roth program, no fees, low $4.00 trade options.
- If you are 26 and thinking of a Roth, you are wise beyond your years. You must know that the profits in the IRA are not taxed at the time they occur, so the portfolio grows tax free until you take it out. What I prefer is a self-directed stock plan with someone like Charles Schwab. Just like a standard account (some limitations on what you can buy and do, but not much) and you make all the calls. You can be as conservative as a bank trust fund or as wild and crazy as you want. I really like that control, so I would look into that. Any good brokerage offers this setup, Schwab is just my choice.
- Yes this is a smart move on your part
- Good for you! You can never starting investing your retirement too early, and the more you invest now, the less you'll have to invest overall. Yes, the general consensus is that Roth IRAs are preferable for anyone who has more than 10 years to retirement, because although you are taxed on the money you put into the account (unlike a traditional IRA), you get to take the money out at retirement tax-free. So you pay taxes on the small amount you put in, instead of the big amount you take out. Any reputable financial instiution is fine - I'd suggest reading up a bit before you invest so you can choose which stocks/bonds/mutual funds you want to invest in within your IRA.
- The first think I would do would be to check with your employer and see if they do a 401(k) with a match. Most big companies will match your contribution to a certain percentage. A roth IRA is also a good idea. You can set one up in lots of different places. You will be amazed at how much compound interest will do over the next 45 years (or however long it is until you retire). When you retire you will be so glad that you did that!
