Gyroscopic Investing

Tom wrote: I would stray away from putting a stock fund in your roth IRA.  Unless it earns you heavy dividends, you're not going to get taxed on stocks until you sell.  You can avoid this by just contributing to the losing asset classes each month and avoid having to sell to rebalance.

You'd be better off for tax purposes to max out your roth IRA with regular interest accruing assets like bonds and short term t-bills for the cash portion.  Open a regular brokerage account to purchase your stock index fund and keep it there.

melveyr wrote: Yeah some people make the argument to put the highest expected returning asset in tax deferred (like EM equities or something).

Pointedstick wrote: Welcome! Here's my recommendation:

1. Sell the silver, buy a gold coin.
2. Open a Roth IRA with Schwab.
3. Contribute the $5,000 cash into the Roth IRA for the 2012 tax year, which you can do until April 15th, so hurry.
4. Take the money in your Sharebuilder account and withdraw $1,000, then contribute that to your shiny new Roth IRA for tax year 2013. Now your Roth IRA will have $6,000 in it.
5. In the Roth IRA, buy the following:
$2,000 worth of SCHB (commission-free stock index fund ETF)
2 $1,000 30-year bonds
2 $1,000 1-year T-bills

Now you have a fantastic PP that generates zero taxes! But you're a bit underweight gold. Take the remaining $500 in your Sharebuilder account and set that aside. Whenever you have more money to contribute, put 1/4 aside and buy another gold coin with it when you have enough. Put the remaining 3/4 in your Roth IRA and buy more of the stuff in there when you have enough. Good luck!

sophie wrote: I'm with Pointed Stick.  Feed the Roth and sell the silver.  As your Roth grows, you might want to add a gold ETF up to 1/3 of the total allocation, for rebalancing purposes.

Pointedstick wrote: That's why the Roth IRA should be with Schwab: SGOL is commission-free.

Pointedstick wrote:

Tom wrote: I would stray away from putting a stock fund in your roth IRA.  Unless it earns you heavy dividends, you're not going to get taxed on stocks until you sell.  You can avoid this by just contributing to the losing asset classes each month and avoid having to sell to rebalance.

You'd be better off for tax purposes to max out your roth IRA with regular interest accruing assets like bonds and short term t-bills for the cash portion.  Open a regular brokerage account to purchase your stock index fund and keep it there.

I think this over-complicates things. One could just as easily say to not waste tax-sheltered space with T-bills that are yielding basically nil. And those stock funds are yielding about 2% right now. Furthermore, rebalancing out of stocks will incur a heavy tax bill if stocks have appreciated a lot (like, say, right now). So if anything, I'd think a stock fund would be a better candidate for tax sheltering.