No One Agrees on the Right First Investment Move
Young adults are overwhelmed and anxious about managing their finances, particularly investing and long-term savings. They struggle with understanding investment options, consistently saving, and feeling confident in their financial decisions, often seeking guidance and facing challenges with traditional tools like retirement calculators.
SOURCES (60)
“He just means invest automatically, such as into his 401(k) or via automatic contributions to a brokerage account or Roth IRA.”
“You're missing important words in your reply: If it is a Roth IRA, then taking it all out in year as late as possible wins hands down, unless you really need the money before then. This is because it allows all of the growth to be tax-free as well. Assuming the Roth r etirement account is traditional, your major choices are: A. Take it all out now. Terrible unless you are in a exceptionally low tax bracket this year. Agreed ^ B. Take it out in year 10. This is better than A, but the calculat”
“Hello all! 29 year old working at a DC based non-profit, making $93000 salary. I have been steadily increasing contributions to my 401K over the years, increasing contribution to my Roth IRA, and plan to continue on this path. At the moment, I am planning to get as close to maxing my 401K this year, getting it up to ~$125000 (employer matches $6%), have $27000 in my Roth IRA, and a $10K brokerage. I have an emergency savings of $40K and am reducing my expenses by moving in with roommates and beg”
“I maxed out my Roth IRA for 2026. With my extra income for the next 4 months, is it a better choice to invest in taxable brokerage or save in HYSA for a lump sum transfer into Roth IRA on Jan 1,2027 for next years contribution? submitted by /u/Presentation101 [link] [comments]”
“This may allow you to retire sooner than you had planned. Let it grow for 5+ years then retire. Should pay for your living expenses in the last few years (of the 10 year window). Let your own 401k grow. If you were 10 years younger, I’d just split it equally over the next decade.”
“SWYDX is Schwab's target date index fund for people retiring in 2025 (last year). It's a mutual fund that's about 40% stocks and 60% bonds, and it will slowly grow even more conservative over time.”
“I'm trying to help my fiance. He's not financially literate, so I'm trying to simplify this for him. He recently retired. His 401k was with Schwab, he was comfortable dealing with them. I year ago, his employer changed to Fidelity. He's trying to withdraw some funds and is finding Fidelity difficult to deal with because he has to do everything online or in an app and can't phone a human to talk to. He struggles with doing such things online. So I told him, since you like Schw”
“42M. Plan to retire from active employment and run my own gig in 5 years (current view; subject to change) 1.8MM Financial Assets. 50% in CDs. 20% in Stocks. 10% in TOPC, VTV, MGV (some in SQQQ for near term protection) 10% in Gold. 5% Series I Savings Bonds (I Bonds) 5% in Treasury Bond Started investing late... CDs allocation is still high.. I do track the markets and economic news and it seems the stock market is currently priced at a significant premium, making wholesale migration from CDs i”
“Hi! I’m trying my best to educate myself through other subreddits, videos, and searches, but I finally panic started different financial accounts and for my own peace of mind would love some insight on what to do to get a solid start until I feel more confident and understand what I’m looking at. Here are my 3 priorities in order: Adding funds to my HYSA account maxing out my Roth IRA early next year making small contributions to my…portfolio? So my main concern is what are solid safe investment”
“Hi! I’m just a girl trying my best to educate myself through other subreddits, videos, and searches, but I finally panic started different financial accounts and for my own peace of mind would love some insight on what to do to get a solid start until I feel more confident and understand what I’m looking at. Here are my 3 priorities in order: Adding funds to my HYSA account maxing out my Roth IRA early next year making small contributions to my…portfolio? So my main concern is what are solid saf”
“For the first few years, I'd take out relatively small amounts. Leave the bulk to grow tax-free inside the account. Then spread out the balance over the last few years to avoid going into a higher tax bracket. And of course, if you ever have a year with less job income, take that opportunity to make an IRA withdrawal in a lower tax bracket.”
“23m in college, shitty paying part time job Right now I have 13.4k iny fidelity account, 4k in my Roth, 1.5k in a hysa, and 2.4k in my regular bank account. I'm worried about having such a small emergency fund and feel like I should leave 10k in my investment account and move the rest over to my hysa just so I can be able to have the cash relatively quickly if something happens. I don't make much money at all and I'd much rather max out my Roth but that's unlikely for this year a”
“Hi! I'm in my mid 20s and I've been trying to get more financially smart and make use of the pretty decent savings I've built up through covid. Right now I have a Roth IRA with about 8k in it, an employer created 401k also with 8k, and then around 60k sitting in my bank savings account. The Roth IRA is new and I do plan on adding whatever my yearly maximum is to it going forward, but beyond that what should I be doing? I use Bank of America for my checking/savings and Ive heard its n”
“I’m 26, and retiring early intrigues me, the whole concept. But if I wanted to retire at 35, why would I use a 401k instead of a brokerage account? I’m sure this has been asked before but I couldn’t find it worded this way. Most people are still retiring close to 50. submitted by /u/Ok-Association-2995 [link] [comments]”
“As the title suggests, I'm looking for a place to put my Roth IRA. I currently have a Roth IRA through my credit union, but have recently realized that my money isn't really growing as the interest rate is super low and they don't offer a match or any form of investing options, at least that I'm aware of. For that reason, I'm looking to potentially move my Roth IRA somewhere else where I can invest the money into the S&P 500, or something similar. What I'm hoping to a”
“I’ve seen a lot of posts on here about the merits of vbil (or generally short-term treasuries) compared to longer term bond funds, especially in 2023 when short-term treasuries were doing really well. And generally people point out that VBIL is just a cash equivalent; it won’t earn a return above inflation like longer term bond funds will. However, I haven’t seen one specific point made so I want to throw it out there and see what people think. In the median future scenario, 100% VT is the best”
“What is a good ratio for brokerage account vs retirement accounts (Roth IRA+401k) for a 27 year old? I currently have roughly 1.5:1 ratio (ex. 75k in brokerage to 50k in retirement) for brokerage:retirement and am wondering if I am putting too much toward either one or if it is just right. Just curious what others think! submitted by /u/Odd_Ship_6089 [link] [comments]”
“22M, fresh graduate, about to start a well-paying job in tech. Currently have about 65k in student debt, 10.5k federal, 50k private. I'm aware about the avalanche method and will be tacking the private loans first. I'm aware it is also mentioned in the wiki start guide to tackle debts first. Question is, I want to enroll in an HSA, Roth IRA, and also contribute to my 401(k) the max my employer will also match. The reason I want to start a Roth IRA immediately is because within 5 years, I”
“We are married, 38 years old, no kids, homeowners. We both have 401(k)s and we each contribute 10% plus an employee match of 4%, but we're still pretty far from maxing our contribution. Our combined 401(k) balance right now is around $400,000. Our cash is just in traditional checking and savings, and I want to make better use of that money. l plan to keep about 2 months’ worth of expenses in our checking account and move about 6 months’ worth into an HYSA. Depending on how much money we deci”
“I have about $5K that I want to put into T-bills, but I’ve never bought them before. I already have a Fidelity account and would prefer to use that. For someone just starting out, is it better to invest the full $5K at once or split it up? I don't need the money now I would want to save for a downpayment on a house. My current HYSA has a 3.6% rate. So I would want something much higher than that Any advice on getting started would be appreciated! submitted by /u/No_Refuse9952 [li”
“I would be investing at least 15% of my income for retirment (this can be a combination of accounts like a Roth IRA, 401k, etc). Look up the Roth IRA income limits and verify you are under the limits. Opening the account and linking your bank account is step one, you must also select investment(s) within the Roth IRA. Youtube can be helpful (look up questions about the Roth IRA you may have including what are index funds). There is no best broker, your accounts performance will be based on the i”
“If you ever heard the stock SPY than thats an Index fund. which it tracks the S&P 500 which consists of 500 different companies like Microsoft, Nvidia, Apple, etc etc. and the price goes up and down based on the performance of those 500 companies on that trading day. So if 400 companies were green for the day and 100 were red than SPY would most likely be green for that day. This is just basic understanding of how index ETFs perform in day to day trading.”
“I just never found them to be worth the complication. There are no inflation adjusted annuities nowadays. Better to toss your money in a TIPS ladder. Like sure you can get as complex as you want.. add dual payout for spouse, add LTC riders, even add some death benefit for heirs.. all cut your payout, add or shift risk, while removing your control. That's assuming you're not completely robbed blind by an annuity salesman. Like maybe if you're a person with zero self control it makes s”
“So for context, I have an account that was set up when I was younger that currently has a Vanguard Active Management US Growth Fund with around 28k in LT capital gains. In the current year, the fund is underperforming the S&P by ~13% (which imo is quite inexcusable and takes too much tracking error), expense ratio is quite high, I don’t really believe in active management, and obviously mutual funds are way less tax efficient in general than an ETF. I’m leaning towards just taking my medicin”
“Talk to a tax expert, first, then an investment advisor. I investigated a similar issue. The advice I got was first max out your 401k contribution if you are not already doing that for each of you. Use money from the inheritance to cover the lost salary, if any. Second, if not already, put $8k each in a qualified IRA and use the inheritance to make up the lost salary. Based on your age the 401k limit will go up every few years or so. This lowers your taxable income, assuming you have room to con”
“Hey guys, title, I wanted to reach out for some help opening up my first Roth IRA account, I'm 26, I grew up pretty poor and do not have much financial literacy, so stuff like this is pretty intimidating. Is there like a "best" broker to open an account with? How does the account grow? How much should i be putting in regularly? Thank you guys for any information submitted by /u/drakey280 [link] [comments]”
“You are solidly in the 24% bracket. Lump sum would throw you into the 35% bracket. You can take out roughly $180k before hitting the next bracket, but anyone making 250k likely also has investment income so it's lowered by that amount. If you know your income is going to be lower in out years, you would want to push off withdrawals until then. Otherwise, in your situation the 1/10th, 1/9th, 1/8th, etc each year even withdrawal strategy is probably the best option.”
“This is an accurate assessment. Pulling $50k a year for the next 10 years will not move you into the next tax bracket as long at you don’t make an additional $103k in supplemental income and investments.”
“Hi all, I am working on revamping my portfolio and the vehicles Im saving in and was hoping for a sanity check. My plan: - Retirement is still a long ways away - Max contribute to my Roth IRA (Vanguard), stick the vast majority of the contribution into VASGX and then a couple individual stocks I already like and own - Contribute at least 10% salary split between my company Roth 401k and Trad 401k (we also get a 3% salary safe harbor employer contribution and also 7% salary profit sharing here to”
“Hi bogleheads! I recently completed grad school and am now at a point where I can actually max out my retirement account contributions. My new employer is offering a 403b plab through Vanguard. I'd like to get your recommendations on which funds would be best to select for a semi-diversified portfolio strategy. I'd like to go somewhat aggressive in my investments and need minimal bonds because I'm in my late 20s. I also have 30k that I am rolling over from an old 401k. Here's a l”
“Hi all! I am currently debating how much to invest for retirement. FIRE does not really interest me, as hopefully I will be working a job soon that I enjoy. Current stats: HYSA: $10K Checking: Balance fluctuates between $4k-7k Company 401k: $56k Roth IRA: $7.5k Brokerage: $39k I currently live in HCOL and make $102k a year. Expenses: Rent + Utilities and Misc.: $2000 Variable Spending: $1500 I am usually left with around ~$1000 based off what I do in the month. I am trying to build up my E-Fund”
“I'm really confused on what to do or if I should combine them or just contribute to one going forward... FXAIX $20k FZLIX $5k FZROX $22k VT $48k VTI $18k VXUS $7K submitted by /u/wallflower23020 [link] [comments]”
“I recently separated from the military and have been thinking about rolling my tsp into my Roth IRA to keep my retirement account together. I am currently in a 2065 lifecycle fund and would probably do an 80-20 VTI/VXUX split. Not sure if this is the right more or if I should just keep it in the tsp. submitted by /u/WatercressFuture5154 [link] [comments]”
“Mid-30s single income family of 6. I invest enough in my 401K to max the company match. Max out HSA, max out Roth (just started last year...). I have a sub 3% mortgage. I'm torn between investing vs paying down the mortgage... I really like the idea of getting rid of it, but I also know that doing pretty much anything else with that money will be a larger ROI... Thoughts or comments appreciated! submitted by /u/LimFinn [link] [comments]”
“I only make $25,000 a year but have been a good investor since age 30 and now have $31,000 in my 401k. I’m considering VTI and VXUS at 70/30 or 75/25 instead of VT because an 7% versus a 10% return over time might be the difference between me being able to retire comfortably or not. Is this a bad idea? submitted by /u/Renevatio5 [link] [comments]”
“I know fidelity has its version but don’t know what it is and wondering the drawbacks of using vt on a fidelity account? submitted by /u/Odd_Moment_566 [link] [comments]”
“I'm 39 and recently sold my home after a divorce. I have about $55k in a HYSA from the sale, and I'm trying to figure out how to best make it work for me. My salary = crap, but I love my job and it's unlikely to change any time soon. I don't think I can contribute any more to my 401k and still use my paycheck for daily expenses. I have an internal capital account at work that has about 15k, and my 401k is about $22k. According to calculators, my emergency fund should be around $3”
“Overview: Couple in early 30s, 1 baby, may or may not have 2nd in next few years HHI currently around $290k, employer 401k match of like 3-4%. Annual savings: Maxing out 2 x 401ks, DCFSA for Daycare ($5k), Inidivdiual HSA ($4.4k), $200/mo in 529 plan +1k gifted per year, and whatever we can contribute to Roth IRAs when seeing final income vs limits. Assets (NW around $1.1M, $1.3M w/ home equity): 401ks a little over $500k Rollover IRAs from previous jobs $115k Roth IRAs $180k Taxable Brokerage $”
“I have about $10k beyond my emergency fund and retirement contributions. I've been staring at my account for weeks like that will magically cause it to acrue interest without having to explore yet another investing channel. Most of my money is already in index funds, and real estate sounded interesting for diversification, especially at my age when I'm willing to take a little more of a risk. Here's the kicker. We all know a rental obviously isnt happening with $10k, which sent me do”
“I'm already investing 12% of my 105k year salary through my companies 401k plan where they match 6%. It's a schwab retirement account. I'm 36 and it has 104k in it after 5 years. Should I start funding my small Roth I have through vanguard more? I feel like I need to be playing catch up since I only really started saving for retirement at 30. submitted by /u/glizzler [link] [comments]”
“Is there a way to contribute more to my Social Security from each pay check? Asking specifically about SS, not investment plans. submitted by /u/TangerineOk743 [link] [comments]”
“Are you maxing your 401k? This year the limit is $24,500. If not, you could start maxing and use your cash pile to pay the bills. This effectively moves some of your cash into the 401k where you can invest in assets that will grow faster than 3%.”
“NO! You are 29 & if the market has a downturn you keep putting more in. No one can time the market. Remember this. In the last 100 yrs the market has gone on to make new highs after downturns 100% of the time.”
“No, at 29 leave them in. Even if the market drops leave them. The biggest mistakes people make is trying to time market or pull out during a drop.”
“My wife (41) and I (40) have around $500,000 in savings. Around 90,000 of that is in a HYSA and the rest is in a brokerage account (90% index funds, 10% bonds). We have no debt and are currently renting as it seems wiser to keep money in investments rather than property. Especially with interest rates on mortgages. We both live abroad and have 2 children. We plan on someday moving to the US, my wife’s home country. I’m from the UK. But, we are holding off for a few years due to my job and my wif”
“How did you choose a fiduciary, and what are those meetings like, in detail (as much as you’re comfortable sharing)? How much are you paying? I want to get set up with one this fall to evaluate the big picture of my finances and make major life and tax planning decisions, but find it hard to get advice on this. I have only one friend who is in on my wealth and don’t have social circles that are as wealthy as I (semi secretly) am, so I’m limited in who I ask about this IRL.”
“Hello all, Just recently discovered this sub and had a question about my Roth IRA. I opened my account when I was young and didn’t really know much. I have about 21k in FXAIX and 6.5k in VOO. I do understand that some of those have overlap in them? It’s something I don’t quite understand yet. I have seen people say they just go 100% VT in their Roth IRA. Would it be wise to sell everything and just start from there? Thank you :) submitted by /u/Loooofaboofa [link] [comments]”
“Traditional brokerage, buy VT. Keep buying more every month no matter what happens in the market. Max the Roth IRA every year, VT is good there too. Think about not buying a house until you really need one, like there's a kid on the way and schools are important.”
“Keeping cash savings in treasuries or a MMF is the wrong advice. That income will be taxed at the OP's marginal tax rate of 37% and get the additional NIIT tax of 3.8%, so interest income (from treasuries or MM) will be taxed at 40.8%.”
“If you live in a state with high taxes, you could consider SGOV or VBIL or other money market fund types that buy treasuries. I do SGOV and use the dividends to buy VOO. This way my principal stays the same but the earnings can earn more.”
“What else can I do to maximize my savings, minimize taxes, and plan for retirement? What I’m currently doing Early 30s making 90k living in a HCOL city. Traditional 401k (Fidelity) - I’m getting my employer’s match and contributing 15%, but I’m not maxing it out. Roth IRA (Charles Schwab) - maxing the contribution limits annually. HYSA (getting 3% APY) - I have enough to cover multiple months of expenses and a big home repair emergency. I feel like I have too much in a HYSA that I should put els”
“You can withdraw from 401k’s at 59 1/2 with no penalty. It sounds like he has no other savings.”
“1) at approx 9-10% returns the account should be at least $2m by the time I’m 52 - with continuing to contribute the max annually until I leave work. 2) permanent COLA - staying for another 5 years is a non-starter for me, I dislike what I do a great deal. And no, I cannot transfer or change what I do at my work for less pay and better QOL… or else I would 3) I lead a fairly simple life, besides lots of travel around the world - when I retire my pension should be enough to sustain me… and I inte”
“You can roll pension lumping sums into a traditional IRA. You make enough to max out your 401k and retire comfortably early. I dont know why you would think about gold or bitcoin.”
“You could match the contributions to his IRA to help explain why it's so critical to contribute to a 401k when he starts a career. Just make sure total contributions don't exceed his W2.”