Roth IRA investment type

[Guest Nancy52]

I was hoping to be able to put some Roth IRA funds in I Bonds. I checked the Treasury Direct website but there was no mention of putting Roth IRA funds there so I guess I can't. Can anyone recommend a similar investment -- safe, easy, no fees, good return. I'm guessing maybe I could look at CDs. Thanks.

[John G]

Nancy, what makes you think I bonds or CDs are safe? Guarentee return of principal is only one type of risk that you face in long term investing. A huge risk is that you can't reach your investment goals because your money is deployed too conservatively and you are not staying ahead of inflation. The more "guarentee" attached to an investment, the less likely you will get a good return. That is how capital markets work. You don't get much return when there are guarentees.

You did not indicate your age, investment experience, future monetary objectives or your current assets. That makes it difficult to offer general advice. You asked for "safe, easy, no fees, good return" - well would you be willing for 2 out of 4? There really is no such thing as a perfect investment, but there are hundreds of very good investments. Post again with some background info and I will try to give you a few suggestions.

Most folks are much better off by starting a systematic program of investing using mutual funds. That gives you over 8,000 choices and a wide range of portfolio concepts. Over half of these funds are NO LOAD, meaning they do not charge any front end or exit commissions. With a fund you get a reasonable amount of diversification. Any you can find funds with very low annual expenses. The annual Roth/IRA fees at mutual funds are often $10-15 and can be zero if you committ to a systematic investment program that sends money from your checking account each month... or if your assets get above a threshold like 10K or 20k.