So I set up a Fidelity account but the options are pretty overwhelming. I was looking at the Index Funds or the actively managed funds as I have over the 5k starting amount available if it was better. I have a 401k through work I just started that's held/managed by them. Mostly want to start building overall wealth. What would you start with? I don't plan on checking it every day or day trading or anything. If I get to ignore it and let it do it's thing, the happier I am. Risk tolerance on the day-to-day is low/moderate and I don't want to pull any funky tactics.
Where would you start? I can also transfer my ROTH IRA CD, held by my bank in a fixed interest account, not a stock-based thing, over if it helps. Comes up next May so not for a while.
First thing's first – Fidelity
byu/Safe_Valuable_5683 ininvesting
Posted by Safe_Valuable_5683
8 Comments
Age? When do you need/want the money you’re investing?
If you’re low risk better stick with CD’s
Is this a taxable account?
[https://www.bogleheads.org/wiki/Three-fund_portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio)
1 Total US/1 Total Intl fund, or just pick 100% VT
For the Roth IRA CD, you have to open a Roth IRA at Fidelity. Call the and they’ll walk you through transferring it, may even do it all for you. You could also just take the $5k and use it to max your IRA this year if the CD didn’t or contribute the majority of 2026 contribution in January.
Fxaix Fncmx Schd Schg you will be fine long term
I go to the mutual fund search and pick the highest return on the 3 year and the five year. find one that you might like. Right now the top is FSELK….
But there are a tin. FXAIX should be what you compare everything too…which is the index 500, so when you look at the charts it will compare it to the 500.
Any of the top 20 are good picks. Start with 2 funds, and work from there.
be a boglehead
Obligatory “not a financial advisor,” but I have been doing this a while. I’ll skip the “pay off debt, have an emergency fund, build a budget, etc.” You didn’t ask that so, I’ll stick to what you’re looking for.
Keep it simple. You’re starting out, so here are some simple options and one essential habit. Starting with the habit: getting started is *WAY more important* than optimizing how you start right now. So, pick something and just get it going with automated monthly contributions. If you can do that, then you can move on to considering these options. If you cannot do that, then don’t bother reading further.
As for the smart ways to get started, you should find at least one target date fund within your companies available options. The date is your approximate retirement (age 67) date. You could go all in on that, it’s diversified and pretty cheap. This is a great way to start. You wanted lower risk, and this is a good low-risk way to go. Target funds are rebalanced over time to become less risky as you approach retirement. They are excellent starting points. You get exposure to both the stock and bond markets, and if you’re younger it’ll be heavily weighted towards stocks starting out. You could literally go with this and call it good. One fund to rule them all.
Alternatively, you could consider a three-fund portfolio, which are also very popular. The three funds are basically a foundational fund, an international OR growth fund, and a bond fund OR Dividend fund.
The Foundational is typically one that tracks the S&P 500 (FXAIX) or the total stock market (FSKAX?). Both are hilariously cheap, either is a great choice.
Fund 2 is more focused on international markets OR just a more aggressive fund focused heavily on growth. (Some people suggest that most S&P companies already provide some international exposure so a international fund might not be necessary, I can’t say for sure.)
Fund 3 has traditionally been a bond fund. However, the bond market has been dog shit for years, so choose at your own discretion. Bond funds are very low-risk, though right now they are so shitty they became high risk due to being useless/negative drag in a portfolio. A good alternative is a value fund, which is a fund that tracks an index heavily weighted toward very well-established and “safe” stocks, like Coca-Cola. They don’t grow much, but they do generate dividends that you should be rolling back into the fund to reinvest in more of it as the distributions pay out. This works great in a 401(k) ’cause you don’t pay taxes on those dividends (in a taxable account you absolutely do, as I found last year when I started writing checks to the IRS!).
Until you’re a multimillionaire, you don’t need to be more sophisticated than this. Anyone who says otherwise is probably trying to take your money or troll you. Lastly, if they offer a *Roth* 401(k) option, go that route until you have to start paying taxes out of pocket, or split your contributions to go half into a Roth, half into a Traditional. (Or, just do a Roth IRA for the Roth-half of your portfolio.)
TL;DR Start with a target date fund, get the automated contributions going, then look into a 3-fund portfolio after a few months.
Q1 do you know what your bank is paying on the ROTH IRA CD? It may be so low that the penalty to pull it now will be negligible. I just checked SPAXX at Fidelity is paying 3.96% and is what they put your cash in. Kind of like an interest paying checking account. There are also XX funds that will avoid state taxes which can be great if you are in a high tax state.
Re self managing. You will have a lot of tickers thrown at you. My suggestion would be to note a handful of them then learn about what they are and how they have performed over the last few years. Look at 5, 10, 20 years – whatever interests you.
Here is a link that compares two issues mentioned already. FXAIX and VT
[https://totalrealreturns.com/n/FXAIX,VT](https://totalrealreturns.com/n/FXAIX,VT)
I like looking at the total return of an issue because it combines price changes AND dividends.
Personally I am a SP500 guy and my choice has been VOO because its a big fund and being an ETF trades in real time unlike a mutual fund.
Good luck and have fun.
Art
Total market index fund or s&p 500 index fund