My ROTH IRA isn't doing good

[blackjack]

AM I complaining to early?

2.4% since starting roth ira vanguard 2013 Target Retirement 2040 Fund

[matchewed]

a) Your investment within your ROTH IRA had low returns

b) You should be worried about returns over the next 60 years, not what you got over two.

[Bracken_Joy]

You're complaining too early =) I suppose it depends on your age, but if anything you should be happy the market is staying low when you're first investing- it means you have more buying power.

My advice: don't check your account performance daily. Or even weekly. Possibly not even monthly- just do a check in quarterly, and remember that you're in for the long haul.

[mrpercentage]

Nope. Target dates suck. Just my opinion. For 2040 I wouldn't have bonds at all. I would wait until "interest rate normalize" before I began to incorporate them. Again just an opinion. There are plenty of things at vanguard that will give you a better return starting with 100% equities VINIX--- or [something I have been testing in simulators] 50% VIG 50%VYM or Mid Caps Growth/Value/or general. If you go 100% equities expect more volatility an possibly some initial loss but in two years I don't think you will be asking the same question.

[blackjack]

I'm 30, illl be happy with 7% over my investing career; who knows if i'll even get that anymore

[blackjack]

^ thanks i did consider switching to 100% (VTSAX) would that be wise?

[rugorak]

I'm older than you and I am in 100% VTSAX. All depends on your time frame. If your time frame is anything greater than 10 years without a doubt go all in. Even if it is less it could be argued to go all in. Jim Collins of http://jlcollinsnh.com/ is retired and almost all in.

Ultimately figure out what your risk threshold is, make a plan and stick to it. The market will go down. You will have bad years. But if you stick with your plan long term you will make the gains you are looking. Especially if you keep adding every chance you get. That is because if you stick with it you will have really great years too. If you haven't already read it go check out Jim's stock series - http://jlcollinsnh.com/stock-series/

[MDM]

^ thanks i did consider switching to 100% (VTSAX) would that be wise?

No way to know until you see how that does compared with what else you could have done.  Whatever you choose is likely not to be the best.

One thing you don't want to be doing is moving your money from one option to another "just because."  E.g., see https://www.bogleheads.org/wiki/Callan_periodic_table_of_investment_returns and https://www.bogleheads.org/wiki/Getting_started.

[blackjack]

thanx but i'll prolly move into VTSAX and leave it be then then when i have 20k maybe add in the bond fund at 10%

[pdxvandal]

I opened my first Roth IRA in 1999 and put in about 3k. One year later, it was worth about 2k due to the dot.com crash. That hurt a lot at the beginning of my career, but I survived and kept on slowly investing.

So, yes, you're complaining too early. ;)

[Shane]

thanx but i'll prolly move into VTSAX and leave it be then then when i have 20k maybe add in the bond fund at 10%

100% VTSAX would probably be best given your age. What would be the purpose of the 10% bonds? If you were no longer working and withdrawing from your accounts, having some bonds would allow you to rebalance and buy more stocks at cheaper prices when the stock market crashed. Since you're still working and contributing to your investments every month, the bonds are unnecessary IMO, just a drag on your portfolio returns...

[rugorak]

100% VTSAX would probably be best given your age. What would be the purpose of the 10% bonds? If you were no longer working and withdrawing from your accounts, having some bonds would allow you to rebalance and buy more stocks at cheaper prices when the stock market crashed. Since you're still working and contributing to your investments every month, the bonds are unnecessary IMO, just a drag on your portfolio returns...

I agree. You shouldn't worry about amount you have invested but instead time to FI. So keep going stocks until you are getting close to FI and then consider it. But again go read the stock series. Jim has walked the walk. He is retired and barely in bonds. And he is dependent on that money to live. You are still working so put it in the stock. You never know when things will shoot up. Or when larger dividends may be paid.

I'm hoping to FI in about 10 years and I am still all in stock. I probably won't go into bonds until I am close enough to say "I could retire today but if there was a bad year I might be too tight for comfort." Then I'll work another year or two and in that time slowly move a small percentage to bonds.

[matchewed]

Also...

Craft an Investment Policy Statement.

That way you have a plan about how you invest rather than hopping at proverbial shadows.