Hello,
My Mom (who is 71) has expressed interest in investing. My father who is 75 is indifferent and just does what my mom wants. This is the first time they have expressed an interest in investing, probably because they have seen the success I have made with Vanguard. They have always been very secretive about their finances and I don't believe they have ever invested their money in anything - they just keep it in a savings account at the bank earning virtually nothing. I have told them multiple times they should be investing their money but they never did anything about it. The reasons for this are because they never had much disposable income to invest and are adverse to risk. I do not know how much money they have to invest but my mom mentioned $10,000. Their goal is preservation of their assets but also some growth.
With this in mind, the way I think I need to approach this is to walk my mom through the Vanguard website, and educate her about the different investment vehicles. I am a novice myself and still learning about investing and money. My question is what should I invest their money in. I am thinking we could take the risk assessment tool that's on the Vanguard website to see what her risk tolerance is. That might be able to suggest a few funds and an allocation to follow.
I thought about opening a Roth IRA for them, but this might not be a good idea because you have to have the account for five years before you can withdraw from it, and I think they want access to their money at any time. So a taxable brokerage account might be the only option, which means we need to invest in funds that are tax efficient.
In terms of funds I thought about putting their money into the Target Retirement Income fund (VTINX) which is easy and intended for people their age. But this fund might not be appropriate for a taxable account, correct? So we may have to just invest their money into tax efficient funds like the California Long Term Tax Exempt (VCITX), and Total Stock Market (VTSAX). My mom wanted a 50 - 50 split so this might be the way to go.
Just wondering if anyone had any thoughts. Thank you!
My Mom (who is 71) has expressed interest in investing. My father who is 75 is indifferent and just does what my mom wants. This is the first time they have expressed an interest in investing, probably because they have seen the success I have made with Vanguard. They have always been very secretive about their finances and I don't believe they have ever invested their money in anything - they just keep it in a savings account at the bank earning virtually nothing. I have told them multiple times they should be investing their money but they never did anything about it. The reasons for this are because they never had much disposable income to invest and are adverse to risk. I do not know how much money they have to invest but my mom mentioned $10,000. Their goal is preservation of their assets but also some growth.
With this in mind, the way I think I need to approach this is to walk my mom through the Vanguard website, and educate her about the different investment vehicles. I am a novice myself and still learning about investing and money. My question is what should I invest their money in. I am thinking we could take the risk assessment tool that's on the Vanguard website to see what her risk tolerance is. That might be able to suggest a few funds and an allocation to follow.
I thought about opening a Roth IRA for them, but this might not be a good idea because you have to have the account for five years before you can withdraw from it, and I think they want access to their money at any time. So a taxable brokerage account might be the only option, which means we need to invest in funds that are tax efficient.
In terms of funds I thought about putting their money into the Target Retirement Income fund (VTINX) which is easy and intended for people their age. But this fund might not be appropriate for a taxable account, correct? So we may have to just invest their money into tax efficient funds like the California Long Term Tax Exempt (VCITX), and Total Stock Market (VTSAX). My mom wanted a 50 - 50 split so this might be the way to go.
Just wondering if anyone had any thoughts. Thank you!
Statistics: Posted by captain hero — Fri Dec 29, 2023 11:59 am — Replies 5 — Views 233