First off, I’m not a financial advisor. I’m not telling you how to invest your money. This is just what we’ve done with ours.
Hubby is a badass, and between some of his personal funds and our joint savings, we contributed the max for 2020 and 2021 into his brand new Roth IRA. That’s a total of $12,000.
So what did we do with it? The spousal unit opposite me is not all that interested in active investing. The fact that he opened this actually surprised me. Because my Roth IRA is a lot of single stocks, a couple of index funds/ETFs, and even a handful of small trades, I opted for a more diversified and laissez-faire approach to his account.
I opened him an account with Vanguard because I only hear good things. My Roth IRA is with Fidelity, which I’m super accustomed to because I’ve been with them for over a decade now. I actually prefer the Fidelity user interface but wanted to get in on those VANGUARD ETFS without any extra charge another brokerage might tack on.
Here’s where I put the money, give or take a couple percentage points:
35% VYM Vanguard High Dividend Yield ETF (dividends!)
25% VOO Vanguard S&P 500 Index ETF (diversification!)
25% VTI Vanguard Total Stock Market ETF (even more diversification!)
8% VXUS Vanguard Total International Stock Index Fund ETF (international diversification!)
7% ARKK Ark Innovation ETF (because I like a little excitement and Cathie Woods IS A BALLERRRRRRR)
It’s pretty much “set it and forget it” at this point because the account is fully funded until next year. It’s way more diversified through the ETFs than my account, so it lessens our risk overall. Plus, Vanguard ETFs, guys.
How do you allocate your funds within your Roth IRA (or traditional IRA)?
-K