Is my investment strategy bad?

I know there’s really no such thing as a ‘bad’ investment strategy since it’s so personalized and goal-oriented.

I am 20M and have maxed out my IRA for 2024. My employer does not offer a 401k, and I do not have the option to invest in an HSA (ineligible). What do I do for the rest of the fiscal year? I’ve just been DCA investing into my taxable account and don’t have any intentions of selling those funds until retirement, but it sucks that I’ll be double-taxed on my money.

Any other options I am missing?

You’re going to need savings before retirement, so the taxable account isn’t a waste. You’re in an amazing position, so don’t sweat the tax man so much.

Taylor said:
You’re going to need savings before retirement, so the taxable account isn’t a waste. You’re in an amazing position, so don’t sweat the tax man so much.

Thanks, I appreciate the insight.

@Cody
I didn’t hear you say Roth IRA. Do that too.

If you’re investing long-term, don’t worry about the taxes. Keep your dividend plays in your IRA and your long-term growth in a taxable account. You’re only paying tax when you sell or off your dividends. There are no bad strategies. Long-term strategies are short-term strategies that went bad.

@Laine
What do you mean long-term strategies are short-term ones that went bad? It was always my belief that long-term ones mostly work out better in the end.

Go search on YouTube for the order of investing. There are videos listing the types of accounts available in the US and the ideal order to invest into them.

Also, there are ‘bad’ investment strategies. Don’t think there aren’t, and most of them involve incredible risks you don’t understand how to hedge for or excessive fees. As an example, the vast majority of people should never touch 3x ETFs of any sort.

There absolutely is such a thing as a bad investment strategy.

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Tru said:
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I have a Roth IRA maxed out for 2024.

Cody said:

Tru said:
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I have a Roth IRA maxed out for 2024.

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Tru said:
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Don’t you need a business to open a solo 401k?

Continue to max out your Roth IRA and contribute to your brokerage account. While you do that, I recommend looking for a higher-paying job that gives you the opportunity to contribute to a 401k.

You can set up a 529 and either use it for your own future educational needs or roll up to $35K of it into your Roth down the line.

Don’t forget to spend a little on yourself now. You’ll only be 20 once. Get in some of those magical road trips you’ll be telling the stories of for years.

Can you invest into a Roth vs a taxable account… at least until you reach the Roth max, then switch to your taxable brokerage?

Akira said:
Can you invest into a Roth vs a taxable account… at least until you reach the Roth max, then switch to your taxable brokerage?

Yeah, I wrote in my message that my Roth IRA is already maxed out.

@Cody
Sorry I missed that… poor attention to detail. Yes, definitely go with post-tax brokerage. I did, and today I am happy I did. IMO, since you are young, I would go with a diversified growth portfolio. I went heavy in tech, with Apple, Netflix, Nvidia, Google, Broadcom, Microsoft, IBM, Meta… then later in life near retirement, I converted most to dividend stocks. Good luck!!

Tru said:
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I just said, fam, I maxed out my IRA, and yeah, it was a Roth.

Cody said:

Tru said:
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I just said, fam, I maxed out my IRA, and yeah, it was a Roth.

Wow, my eyes must be going.

I’m a firm believer everyone should contribute to HSA. If only our government cared enough for the working class.