After maxing out Roth IRA, where is the next best place to invest?

Investing
#1

Hi all, I am currently on track to max out my 2020 Roth IRA. After maxing it out, where should I begin to invest next? I am 19 years old (including age because I’m not sure If advice would differ based on age).

#2

Welcome @Liam2218!

Without knowing more about your situation, I would suggest the #1 best return you can get on your money right now is an investment in yourself. Getting a good degree, with good internships in a field that is in high demand will generate much larger returns than putting some more money in an investment account.

So, that said, I would prioritize those things, and doing so while not racking up debt. If you just pile up your money in a savings account, get through college debt free, relocate, get a job, etc, and still have cash left over THEN you dump it in the market. Keeping it on the sidelines for a couple years is no big deal.

Are you in or going to college? Are you working?

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#3

Yes I currently am working part time at Target and going to a local community college to get my associates degree and save a bit of money (I plan to obtain my bachelors degree after completion). I’ve gathered advice that the next best place I can invest is my company’s 401k plan. Target currently offers a $1 match up to 5% of earnings. I am in 12% tax bracket and 19 years old with a single marital status. It’s been recommended to me to contribute to targets Roth 401k, and was wondering if this makes sense over contributing to a traditional 401k.

#4

Do you have any debt? The few bucks you can invest right now really won’t make a huge difference in your life. I’d probably save all that in cash, and put 100% focus on getting a great degree and great career. If you get through school 100% debt free and still have that pile of cash, then you can dump it in the market. No big deal :slight_smile:

#5

No I don’t currently have any debt. I appreciate the advice though, thank you!

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#6

That’s awesome! It sounds like you’re killing it. Debt free, conscious about spending on college, already learning about money. Keep it up. You’re a future millionaire.