Hey everyone! I have a robo investor Roth IRA set up for retirement/growth (Schwab Intelligent Portfolios). I plan to leave it alone for the next 25 years. I don’t know much about investing, and I’m not super interested in learning, so the robo advisor seemed like a good fit for me. I just changed my risk profile to 85% stocks, 6% fixed income, and 8% cash, and started the account with $10k. I’m curious if this sounds good or if I should make any changes. Also, I have $20k in a high-yield savings account. Should I put some of that into the IRA?
don’t have much interest in learning
No one is going to care more about your money than you.
don’t have much interest in learning
No one is going to care more about your money than you.
Adding to this, I didn’t care much about learning until later. Future me really regretted not paying attention and making bad investment choices. Good decisions early on can make a big difference over time.
Whenever someone says ‘high risk,’ I have to wonder what they really mean by it.
Some might call putting 100% into S&P 500 index funds high risk. I’d call it a reasonable plan.
Some would say buying individual stocks is high risk. I think it depends on how you do it.
Active or day trading? That’s definitely high risk, and I’d agree with most people on that.
I’ve never used a robo-advisor, but before doing so, I’d want to know how it works. Overall, though, that risk allocation seems fine.
@Emerson
Yeah, defining risk is really important. For example, what stocks does this bot think are high risk, and why? Not knowing that is the real risk.
@Emerson
This setup is far from high risk. High risk would be things like options trading.
Kiran said:
@Emerson
This setup is far from high risk. High risk would be things like options trading.
Yeah, options and margin trading are definitely high risk. I forgot about those.
Kiran said:
@Emerson
This setup is far from high risk. High risk would be things like options trading.
Got it, thanks for the clarification!
@Emerson
Thank you so much!
Question here. Hypothetically speaking, how might the upcoming Trump administration’s economic policies affect retirement accounts? I have around $800k in Vanguard brokerage, some in a Roth, and a federal retirement fund. Most of it is tied to the market.
Should I leave it as is? All of them have been doing well, but the threat of tariffs and higher deficits has me worried. Any advice?
You could just go for Schwab Target Date Funds. They start with mostly stocks and shift toward fixed income as you get closer to retirement.
Or, you could try something like 80-100% VT (world index fund) and 0-20% BND for bonds.
AOA and AVGE are examples of low-cost funds that keep the same allocation. AOA stays 80% global stocks and 20% bonds, and AVGE focuses on small cap value but keeps costs low with broad market exposure. Factor exposure could be worth looking into, but it’s not for everyone.
If you’re happy with the robo-advisor, it’s probably doing a similar thing, though 8% cash seems high for retirement, especially with such a long timeline to grow.
You could just put your money into an S&P 500 ETF to avoid high fees and likely get better returns.
S&P 500 and Nasdaq 100 ETFs, set it and forget it. Less stress, just let it grow.
Toryn said:
S&P 500 and Nasdaq 100 ETFs, set it and forget it. Less stress, just let it grow.
I’ve heard this strategy too. What if I opened a second Roth IRA with just these stocks?
@Whitney
Just FYI, there are yearly contribution limits for Roth IRAs. For 2024 and 2025, it’s $7,000 total across all your IRAs if you’re under 50 years old.
My situation is pretty similar, except I’m aiming for 34 years, not 25. I’m not saying it’s the ‘best’ way, but it works well for me. I keep my 401K entirely in the S&P 500, which I consider my steady, moderate-risk foundation for retirement. I’ve been putting most of my contributions there, and it’s been doing well.
I also have an IRA I use for higher-risk investments, where I shift things around based on the market. This year, I’ve kept it in 100% semiconductors, which have been booming. I plan to stay there for a while until I see the trend slow down. I don’t do options or anything extreme, but I focus on high-risk, high-reward sectors when the outlook seems good.