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Roth IRA Advice

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  • Roth IRA Advice

    Let me begin by saying that I am a novice when it comes to managing our finances. Please be patient with my questions. My husband has a 401K through his employer. Currently, it contains the bulk of our retirement savings. It is performing well and we are comfortable with the allocation.

    In addition, I have a small rollover account (Traditional IRA) worth about $28k with all of it invested in VTSAX.

    My husband has a small Roth IRA worth a little over $10k. It was recently transferred from Marsico to Vanguard. We plan to use that as a Backdoor Roth, but first we would like to invest it in something other than MFOCX. This brings me to the questions:


    Since this $10k fund is not a large part of our portfolio, we are comfortable investing it in something aggressive. I am thinking either VSGAX, VIGAX or VEMAX.

    - Do you have a favorite of the three?

    - Is there something else we should consider?

    Thank you in advance for taking the time to reply!

  • #2
    Personally I'd be more comfortable with the small cap growth fund you listed than the other two options, but that's up to you.  Good luck!


    • #3
      I'd probably split 50:50 between the international and the small cap but there is nothing wrong with  Craigy's suggestion, either.
      Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087


      • #4
        I'm assuming you're looking toward small cap in the Roth since your IRA has the total stock market covered with VTSAX.  I agree that adding some international stock (VXUS) would be a good addition if you're looking for a little more risk with potential for more reward (also contains some emerging markets). You're young so taking more risk at this point is a good plan.

        Good luck with your investing!


        • #5

          – Is there something else we should consider?
          Click to expand...

          To avoid having to continually ponder similar questions, decide on an overall asset allocation for your portfolio, and stick to it.

          Better yet, fully develop your investing plan into a simple IPS.


          • #6
            Thank you for the advice. I was looking over the information you provided about developing an IPS. Can you tell me more about the paying "$2000 to $4000 cash (to obtain tax credits)" portion? We have one son who is a sophmore in college (with another set to start next year.) So far, we have been using the 529 funds to pay for his tuition & rent in the fraternity house (which is actually less than what is allowed through the quoted room cost via the college.)  What tax credit are you referring to? Is it a state tax? Or, are you talking about the Tuition and Fees Deduction?