Originally Posted by ddeennis
can i put 125,000 cash into an ira? is there a limit
whats the dif between roth ira and ira
i have 125,000 bucks and i want to invest it somewhere and watch it grow. but i need returns of at least 10%
this is lump sum i want to start out with
Welcome to the board.
Roth IRA: Post tax but grows tax free and withdrawal of principal is allowed without penalty.
Traditional IRA: Pre tax, but grows tax deferred, with any withdrawal causing a taxable and penalty accruing event.
Traditional IRA and Roth IRA Contribution Limits
You cannot drop a flat 125k into an ira due to contribution limits. Depending on your income of course, but it is likely to be a good idea to drop 4k into a roth ira this year, and DCA the 125k into a taxable stock account (indexes at Vanguard) over the next year.
As for "at least 10%"
... the stock market is not guaranteed by the FDIC =D Some years you will break even and be lucky, some years you will lose money, some years you will gain money. The average over a "long enough period of time" seems to be 10%, but this does not imply that each year you gain 10% =D
I am so not touching the "What should I invest in" question there but look at Vanguard's indexes and pick some low cost ones that have returns and risk that is likely to be a good idea for you and your family.