Index fund advice, please.

JamesJD — Sun, 15 Jun 2008 17:54:21 -0800

Should I put my savings into an index fund? If so, how? I have about $25,000 in savings, and I don't know all that much about investing. I'm looking to invest the money over a pretty long period of time (20 years or possibly even longer). I should also mention that I'm pretty young.

One thing I have heard time and again is that index funds are usually a pretty good bet (and that they almost invariably beat mutual funds) for anyone who doesn't want to invest actively because (a.) they're about as diversified as it gets (b.) the fees are lower since they aren't actively managed.

Here's what I'm wondering:
(i.) I've heard there are different types of index funds. Where can I learn about which type to pick?
(ii.) Once I've picked one, how do I go about putting my money into it?
(iii.) Are there any reasons why investing mostly in an index fund might be a bad idea?

Help me choose an index fund.

Pontius Pilate — Mon, 04 Sep 2006 20:16:01 -0800

Help me choose an index fund and a financial institution. So, after reading all the helpful threads about the importance of Roth IRAs and and the benefits of investing in your retirement as early as possible, I am ready to take the plunge. I have about $2k to put away now, and I should easily be able to put away another $2k before next April to max out my Roth IRA contribution for this year.

The last step is selecting my financial institution and the particular index fund I'm going to invest in. From comparing rates and user reviews, I have heard good things about Vanguard, Sharebuilder, and Fidelity. However, I'm kind of a novice to investing, so I am not sure that I am absolutely fully aware of all the fine print and miscellaneous fees that will reduce my return. I would really like to hear people's personal experiences with these three companies (suggestions for other companies gladly welcomed, of course), and what has worked out best.

As far as index funds - I am starting out young, so I'm strongly considering something more aggressive than the standard S&P 500, DJIA, NASDAQ, etc. Would something like Emerging Market Value / Emerging Small Cap be appropriate? Would it be totally foolish of me to invest only in the higher-risk indices, ignoring the safer but lower-return conservative index funds?

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Index fund advice, please.

Help me choose an index fund.