Author Topic: High volatility, max out Roth IRA now or wait a bit?  (Read 593 times)

Retiredby2030

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High volatility, max out Roth IRA now or wait a bit?
« on: February 21, 2019, 11:28:08 AM »
With all the movement in the markets since October, does it seem reasonable to try and wait for another downturn in the market before maxing out mine and my wife's yearly Roth IRA contributions?  It's likely the largest one-time investment I expect to make this year (VTI).

I don't expect to time the market perfectly, but it seems abnormally risky to buy when there has been a 20% recovery in only two months.  Maybe I should contribute $3000 four separate times over the year and hope for a decent average?

PDXTabs

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Re: High volatility, max out Roth IRA now or wait a bit?
« Reply #1 on: February 21, 2019, 11:43:58 AM »
Mathematically, you should lump sum it. Can you stomach that? I can't, so I DCA.

JohnnyZ

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Re: High volatility, max out Roth IRA now or wait a bit?
« Reply #2 on: February 21, 2019, 02:34:41 PM »

 Novice investor here so keep that in mind, but I had the same dilemma in the beginning of the year. I had a sum to invest and had planned to dollar-cost average over a few months, but quickly after the first purchase my stocks rose quite a bit and I ended up investing the rest of the sum a couple weeks later. The market still went up after that but not investing the entire sum the first time cost me a few %.
 Long story short, the next lump sum I have will be invested immediately, unless the P/E ratio is over 40 or something.

Telecaster

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Re: High volatility, max out Roth IRA now or wait a bit?
« Reply #3 on: February 21, 2019, 03:37:20 PM »
With all the movement in the markets since October, does it seem reasonable to try and wait for another downturn in the market before maxing out mine and my wife's yearly Roth IRA contributions?  It's likely the largest one-time investment I expect to make this year (VTI).

What happens if there isn't another downturn this year?