Newbie question about what account to have a $5,000 IRA?

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sumofable
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Newbie question about what account to have a $5,000 IRA?

Postby sumofable » Mon Jun 18, 2012 8:58 am

I'm new to IRAs. I'm 31 years old. Last year I opened my first IRA.. a traditional IRA. For months it's been sitting in my ShareBuilder / ING Direct account. It seems like there must be a better use for it. There is only $5,000 in it. I probably will not be able to contribute again this year. So I just intend to have the $5,000 until I'm employed again.

My first thought has been to invest in stocks.. but I've had terrible luck with stocks in the past. Or putting it into one of those Vanguard accounts that people think is good for IRAs. As I read investment forums though many folks feel it's a bad time to be investing in stocks due to a possible second global downturn.

Basically, I am just hoping to get some opinions. What are the best returns right now for an IRA account? I want to move the money somewhere or do something with it to get a return on it instead of it sitting there. I'm just honestly not sure what to do with it. I'm relatively new to investing and this is my first IRA.

Hoping to get some good ideas.

Thank you very much!

Savarel
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Re: Newbie question about what account to have a $5,000 IRA?

Postby Savarel » Mon Jun 18, 2012 9:04 am

Anything you put into the IRA is going to be there for at leat 29 years, probably more like 34 years. Fears of an upcoming global downturn shouldnt worry you for quite awhile.

You have to think in terms of decades. A global downturn means stocks are cheaper, time to buy if you are looking 30 years into the future.

sumofable
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Re: Newbie question about what account to have a $5,000 IRA?

Postby sumofable » Mon Jun 18, 2012 9:14 am

I'm still thinking at some point I may need to take it out earlier.. medical emergency sometime in the next 29 years, etc.. or if I can put it toward a house someday. So I just want to get some decent return. I'm not sure what the best options are for IRA accounts right now. Like I said, it's just sitting there now. I looked at some options. I was going to trade ETFs with eTrade. But eTrade decided to freeze my money for a month while they made me jump through hoops to unfreeze it. I just want to put the money into a good IRA account before my 60 days are up to get it back into one without penalty. I've got about 20 days left to decide.

Savarel
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Re: Newbie question about what account to have a $5,000 IRA?

Postby Savarel » Mon Jun 18, 2012 9:44 am

You can put the money into an IRA and then decide how to invest it. I would do that(if you havent already) ASAP.

As for taking the money out for a down payment or emergency, those are generally bad ideas. You should have separate savings for that type of thing.

sumofable
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Re: Newbie question about what account to have a $5,000 IRA?

Postby sumofable » Tue Jun 19, 2012 3:11 am

Thanks for the advice. There are just so many IRA choices. I'm really not sure which will offer the greatest investment options or returns. Some people say Vanguard. I'm more interested in ETFs. eTrade has some ETFs I want at no cost for trading. But eTrade screwed up and froze my funds for over 2 weeks for no apparent reason. Which is why I now want to get away from eTrade. Just trying to figure out which IRA to keep my funds.

dpixel
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Re: Newbie question about what account to have a $5,000 IRA?

Postby dpixel » Tue Jun 19, 2012 5:33 am

I opened up a TDameritrade IRA recently. They also offer some commission free ETF's. The transfer was a bit of a process, but so far so good.
I rolled it over from a standard Certificate of Deposit account at a local bank paying less than 2%.


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