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Small Account - What to do?
Old 02-07-2012, 08:16 AM   #1
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Small Account - What to do?

I have a very small Roth IRA account. Account Value is 5000 and my income does not let me contribute to this dormant account any longer.

What are my options? 5000 is not a lot for investing purposes. Are there any good options to combine into my 401k rollover account (IRA) without fees and taxes?

I fear that if I buy 1 or 2 securites in this account, and can never give more to the account, it will forever remain tiny
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Old 02-07-2012, 08:36 AM   #2
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Not sure I see your concern, a 10% return is a 10% return. Yes this account could be wiped out by a poor purchase, but you have to look at total of all your accounts. If you want low risk, I would trade funds in this account, not a single company. If your more risky, then buy long term calls on solid companies to leverage your $.
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Old 02-07-2012, 08:44 AM   #3
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Do you have any tIRAs, and if so are the pre-tax money or post-tax money?

If not tIRA, then you could establish and fund a tIRA with post tax money and then convert it to a Roth (aka back-door conversion). Ditto for tIRA with only post tax money in it.

If you have a tIRA with pre-tax money then you can still do a conversion but there would be tax on the amount transferred.
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Old 02-07-2012, 08:54 AM   #4
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Small or not, a Roth IRA is good to have. Put it into one fund at VG and let it ride. I strongly believe someday Roths will be gone, but one like your will be grandfathered in.
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Old 02-07-2012, 09:04 AM   #5
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Quote:
Originally Posted by pb4uski View Post
Do you have any tIRAs, and if so are the pre-tax money or post-tax money?

If not tIRA, then you could establish and fund a tIRA with post tax money and then convert it to a Roth (aka back-door conversion). Ditto for tIRA with only post tax money in it.

If you have a tIRA with pre-tax money then you can still do a conversion but there would be tax on the amount transferred.
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Old 02-07-2012, 09:34 AM   #6
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It's not about the value of of each account, it's all about the value of ALL your accounts. Let it sit in the Roth and grow tax free, unless of course you have major fees that go against that small account. That is the only case where I see that you might want to roll it into something else.
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Old 02-07-2012, 09:58 AM   #7
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Originally Posted by RockyMtn View Post
It's not about the value of of each account, it's all about the value of ALL your accounts. Let it sit in the Roth and grow tax free, unless of course you have major fees that go against that small account. That is the only case where I see that you might want to roll it into something else.
Even then, just move it to a Vanguard Roth account. Never transform a Roth to anything else. A Roth is the Mercedes Benz BMW Porsche Lamborghini of the retirement account world.

Don't trade it for a Chevy.

Ha
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Old 02-07-2012, 10:06 AM   #8
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Even then, just move it to a Vanguard Roth account. Never transform a Roth to anything else. A Roth is the Mercedes Benz BMW Porsche Lamborghini of the retirement account world.

Don't trade it for a Chevy.

Ha
Agreed...can you even roll a Roth into something like a 401K or tradional IRA? Thought you could only do that if you were recharacterizing from a previous conversion from a tIRA or 401k.
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