Investment for young Adults?

I am twenty years old and looking for long-term investment fund to put my money in. My job offers a 401k plan, which I am going to sign up for next week. I am also interested in opening up an ira account with e-trade. What鈥檚 the difference between a Roth ira and a traditional ira? which should i consider? Also are there any other investments funds I should consider? Or is having a 401k and ira all the investment I need at this time?

not a doubt in my mind you need to do the 401K that is free money (most companies match) someone your age should probably do the Roth i doubt you need the up front tax break unless you are paying a lot in taxes for whatever reason. pick a growth mutual fund or an age based fund fidelity has funds i think they are called outlook find one that is titled about the year you turn 60 (something like outlook 2060 or whatever) bottom line max your 401k and then put whatever you can afford up to the 4,000 annual limit onto the Roth and retire rich my man

That's great you're starting investing while young, compounding will make you rich. Definitely do the 401k, companies usually match some of it and you get tax breaks. Roth IRA taxes you now not later when you withdrawal. Reg IRA taxes now not later. Experts seemed to have flipped their opinion which is better, they say Roth is better but I'm not sure I agree, one is losing out on compounded money. I wouldn't invest in Mutual Funds, they have poor track records most of the time. Invest in individual small cap, low debt companies.

When you are young invest in small caps, they have the greatest chance for growth. Large caps will suprize you every once in awhile, like Boeing and apple.

Watch fox news on Saturday mornings and pay attetion to anything tobin smith mentions, he has made me money in like two years I made 400% of of some of his stock picks.

You're smart to start investing so early. Keep in mind that once you invest in a 401(k) or IRA, that money is basically inaccessible to you until you're 59 1/2 years old without paying penalties to the IRS, so only invest what you can afford. That said,the first thing to do is take full advantage of your 401(k) employer match. That's free money your employer is offering you, so assuming you can afford it, invest the full amount to maximize your employer's match. As for the Roth vs. the Traditional IRA, the reason why nobody is sure which is better is that it depends on your tax bracket. With a Traditional IRA, you don't pay tax now, but will be taxed on all withdrawals when the time comes. With a Roth IRA, you pay tax on the money before it goes in, but will nevre be taxed on any earnings from your investments. Most people feel like they'll be in a lower tax bracket in retirement than now, so for them the Traditional IRA is best. For you at age 20, there's a good chance you're in a very low tax bracket right now, so the Roth IRA might be a good idea.

Nice work getting started...when we are older who knows about SS and all those good things. As for these guys telling you to avoid mutual funds is stupid. You have to have quite a bit of money to invest in single stocks to diversify your portfolio enough to avoid serious losses. What happens if small cap company you pick goes bankrupt...your screwed. Also these "experts" on tv tell you to invest in stocks to create an interest in them which drives the stock price up...making them money because i guarantee you they already own these stocks before they pass on this friendly advice. What if you own a smallcap fund that invests in hundreds of these companies and one goes bankrupt...not much. They are right to invest in your 401k up to your employers match, also most company plans dont let you invest in securities (stocks) unless its their own...hence its too risky and they could be liable for losses. Then go with a roth if you have enough money after your 401k contributions. When you retire chances are you will be in a higher tax bracket than you are now, also you can't contribute to a roth if you make alot of money like 90k. So later if your makin some money you can start lowering your taxable income through a regular IRA. Still the most you can contribute to these plans is 4k a year and the only way to protect yourself against risks with this much money is mutual funds. I would pick 2 aggressive funds if your maxing out your 4k contribution. A fund that invests in foreign markets (china or europe) and one that invests in technology or natural resources.

Those are all fine and dandy but Its being more accepted that young adult should take on more risk than mutual funds, IRA's, 401ks..

Im young and I invested in 5 stocks that I check a few times a week. My returns are much larger than than those other investment tools..of course its more risk but to each his own.

Download a free copy of my book at http://www.invest-for-retirement.com and go straight to chapter 24 which explains the various retirement accounts.