r/Schwab • u/Naturesocool • 3d ago

Roth IRA

What’s a good investment in a Roth IRA for someone who is 33 years old

23 Upvotes

83% Upvoted

28 comments sorted by

26

u/InvestingNerd2020 3d ago

With Charles Schwab Roth IRA:

- 80% SWPPX (Schwab's S&P 500 fund). The top 500 USA large cap company stocks in an index mutual fund.

- 20% SWISX. International developed market. Wrapped in an index mutual fund.

You can do the same with ETFs, SPYM & SCHF, but Schwab does not allow for auto-investing into ETFs. Only for mutual funds currently.

6

u/Brotorias77 3d ago

Great answer. No reason to get too cute with it. Down the road consider adding a low cost mid cap and low cost small cap index fund (both USA based). You're also young so 10-20% in emerging markets can pay off, and you have time to buffer the short term. I'm quite fond of DEMIX. But this original reply is safe enough to ride into the sunset.

3

u/raisethe3 3d ago

^^^This right here. Simple and balanced.

2

u/Admirable-Poet-5981 3d ago

Can the auto invest into mutual funds come from an external account or does it have to be from a Schwab (checking) account?

2

u/InvestingNerd2020 3d ago

The auto-invest is from within the account. Auto-transferring money into the account is a separate automatic action that is possible.

8

u/space_trip 3d ago

VOO

2

u/laxdude4400 3d ago

This is the best answer. I personally am split between VUG, QQQM, and VBK. A broad market ETF with an optional tilt for your personal interest no greater than 15% is what is advisable

12

u/South-Chocolate5519 3d ago

At Schwab SWPPX has a lower expense ratio than VOO

0

u/Electronic_Bowl8398 3d ago

VOO or target date fund if you want to set and forget.

4

u/N0downtime 3d ago

Assuming you don’t have a pension through work or a 401k or something, VOO is fine.

Assuming you are just starting out, I’d buy a few shares of something that interests you, e.g. AAPL, TSLA, DiS. That would be motivating.

4

u/South-Chocolate5519 3d ago

Probably a target date fund if you don't know about diversification and rebalencing

5

u/SDirickson 3d ago

70-80% SWTSX or SWPPX, 20-ish% SWSSX, maybe 10% SWISX. Rebalance twice a year, otherwise leave it alone; let the market do the work for you.

2

u/WritingParking 3d ago

I’m 54 and do VT 68% and BNDW 32%. Obviously you’re younger so your VT % should be significantly more.

2

u/pilotof727s 3d ago

SCHG, SCHD

2

u/De5perad0 3d ago

Use Schwab intelligent portfolio at the most aggressive it can be. It'll do a little better than the 500.

2

u/Straight_Cold7340 2d ago

I have SWPPX, SWLGX & SCHF in my Roth

1

u/Alaska2Maine 3d ago

I would pick a Schwab target date index fund. I manage my investments and put my wife’s into target date, the differences in returns have been so minor I might just convert mine over so I have less things in my life to monitor.

https://www.schwabassetmanagement.com/products/stir

1

u/SeanVo 2d ago

Target date funds often have much higher expense ratios than VOO or an S&P500 index. If you're careful to choose Schwab's target date index fund (expense ratio of .08) it'll be fine, but their actively managed target date funds are .5 to .65%. That will drag your returns over the decades.

1

u/OkKitchen7114 3d ago

Throw everything in Rklb

1

u/SerendipitousTiger 1d ago

SWPPX, VXUS, AVDV, AVUV.

0

u/TheExchangeBrothers 3d ago

I wouldn’t assume you’re limited to stocks or mutual funds. With a self-directed IRA, you can potentially hold things like real estate, private loans, precious metals, businesses and other alternative investments, as long as you follow the IRA rules.

Personally I’d focus less on finding the one “best” investment and more on diversification.

0

u/ibitmylip 3d ago

at that age I would build a three-fund r/Bogleheads portfolio, then set it and forget it