Author Topic: Investmenet Advice  (Read 2536 times)

eljefe-speaks

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Investmenet Advice
« on: June 22, 2016, 01:33:56 PM »
I have $3k sitting in a Roth IRA. It's invested in IDGTX through Capital One Investing. I haven't touched this in a long time and I often forget I have it. Since it's in a Roth, should I just leave it alone until I retire? Or, could I get such a better return out of a Vanguard index fund that I should withdraw and re-invest? I also have a small amount of debt sitting at 4%. Would it make sense to knock that out with it? Thanks for any advice! Investments just aren't my strong suit.

Edit: I should also add that I attempted to roll this into a Vanguard account without withdrawing, but they gave me a call and for some reason this was not possible. I can't remember the specifics.
« Last Edit: June 22, 2016, 01:35:34 PM by eljefe-speaks »

MustacheAndaHalf

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Re: Investmenet Advice
« Reply #1 on: June 22, 2016, 07:40:54 PM »
From "expense" tab on morningstar.com I see a 1.26% expense ratio.  Very high, costing you money.
http://financials.morningstar.com/fund/expense.html?t=IDGTX&region=usa&culture=en_US
"Net Expense Ratio: Annual Report (10/31/2015) 1.26%"

I'd suggest selling that fund for two reasons: it's not diverse (100% real estate), and costly each year (1.26% annual fee that happens without you seeing it on a statement).  But keep the Roth.  After that money is sitting in cash, then you call Vanguard and start a "trustee to trustee transfer" to Vanguard.  They will pickup the Roth account and move the whole thing over, intact.

I suspect they couldn't transfer it because you inadvertently tried to keep the same fund.  But they should be able to transfer a Roth account with cash in it.  Then you can direct how that cash purchases a low cost index fund, which will keep it diversified and save you annual expenses.

PhysicianOnFIRE

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Re: Investmenet Advice
« Reply #2 on: June 22, 2016, 09:09:27 PM »
+1 to move it over to Vanguard or another low-cost provider. There's no reason you can't keep expenses under 0.1% in your Roth account. Over a long stretch of time, Fees can cost millions.

Best,
-Pof

Choices

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Re: Investmenet Advice
« Reply #3 on: June 22, 2016, 09:50:37 PM »
Agree w/ above.
Sell the fund, transfer the cash to Fidelity or Vanguard IRA, and buy a total market index fund. Then save every penny to pay off your debt before you invest more.

If you cash out a retirement account now, you'll pay taxes plus a 10% penalty if you're below retirement age.

Frankies Girl

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Re: Investmenet Advice
« Reply #4 on: June 22, 2016, 09:57:33 PM »
Do not cash out or remove the money from your Roth. What you should do if you would like to move your Roth IRA to someplace like Vanguard is to call up Vanguard and have them help you create a Roth IRA account with them, and then fill out the paperwork to transfer your existing Roth IRA into the new one and let them handle the transfer, and once the money/funds are moved over, then buy whichever fund you'd like (and agree with using a total market index fund at Vanguard).


eljefe-speaks

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Re: Investmenet Advice
« Reply #5 on: June 24, 2016, 11:13:09 AM »
Wow FG, J@CBL, POF, and MAH, thank you all SO MUCH for that intelligent advice! I will take these steps right away. I can pay the favor back whenever any or you have a question about the only 2 things of which I am knowledgeable: motorcycle and bicycles.