Hello, Just looking for some advice on what to do with a significant amount of cash. I am currently only 25 and have not setup a IRA, traditional or Roth. I looked into it a year or so ago and thought the roth was similar on withdrawal penalties to the traditional IRA. Correct me if I am wrong but I found out that a Roth IRA allows you to set aside 5000 a year after tax that grows tax free until you are 59 1/2. You can pull money out of it FOR ANY REASON as long as it has been in the account for 5 years but you will be taxed only on the growth. If you hold it till 59 1/2 you will not pay taxes on anything.
Next question, I already have an investment account through fidelity and was wondering how to invest a SIGNIFICANT AMOUNT OF CASH right now. I have heard mixed reviews on Mutual Funds, Index Funds, ETFS, HOT STOCK PICKS, etc... I enjoy investing + risk and currently own some mutual funds and individual stocks. I started researching mutual funds as I was looking to diversify my account. Does anyone have recommendations on some directions to take.
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posted: Nov. 17, 2009 @ 11:20p
tazzy531
Senior Member - 4K
posted: Nov. 18, 2009 @ 12:08a
Read more, post less. All this has been previously answered. And so many of the things you "believe" are incorrect.
ICMATULKASPRMKY said: You can pull money out of it FOR ANY REASON as long as it has been in the account for 5 years but you will be taxed only on the growth. You can withdraw your contribution penalty and tax free. Your gains will be penalized if you withdraw early. The 5 year rule is related to rollover IRA.
mercutio34
Member
posted: Nov. 18, 2009 @ 11:37a
Fidelity index funds are among the best, but I think most of them have $10k minimums, so not great for a first year Roth IRA. But they have plenty of other decent managed and semi-managed funds too. Really, I'd make an appointment at your nearest Fidelity office and talk to them, they're usually pretty good. They will steer you towards one Fidelity mutual fund or another, but that isn't a bad thing. I wouldn't buy individual stocks/ETFS etc with a Fidelity account though, as their fees are higher (get a Scottrade or other discount broker account if you want to do that).
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