Reply to Just opened up a Roth IRA

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[quote=Anonymous]Congratulations you did something great by opening a retirement savings account in your early 20s. 
Time and regular contributions are your very powerful friends.
I opened my first IRA in my early 20s with about $1200, while temping. Now it is 20 years later and those retirement savings (now including 401k, traditional and roth ira) are $500k.

Here's what I have learned:
- buy the market with a cheap index fund. This means you may never out perform the market, but you will never lose more money than the market either. This is why a broad index is a better choice for the overwhelming percentage of your savings than individual stocks which may go to zero. The market itself will not do that.
- holding down the cost of investing is extremely important - compare the cost of the etrade fund to comparable funds at fidelity and vanguard. pick the cheapest and, if necessary, roll your account over. 
- make your regular contribution to the fund automatic so you don't have to remember to do it or make yourself do it
- when you get a raise or better job, up your contributions
- besides contributions, just leave it alone
- NEVER withdraw or take a loan from retirement accounts
- never tell people in real life your details, though of course do encourage them to get on top of their savings

Meanwhile read up gradually to build knowledge. I recommend bogleheads, get rich slowly, Eric Tyson's 'for dummies' books, Richard Bach, Where are the Customer's Yachts, Richest Man in Babylon, and at the least, the economic sections of Extraordinary Popular Delusions and the Madness of Crowds, because human nature has not changed.

That's all I've got. Nothing fancy, but solid building blocks.

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