Which Roth-IRA is the best for a 21 year old who has about $1500?

[StealthRabbit]

You do need to get educated on investing and now is as good of time as any.

Listen to some financial programs (like Bob Brinker, 3 hrs on weekends, can stream or get archives (1-4pm Sundays) from KSFO). GaryK on business talk radio keeps daily tabs on markets (both rant WAY too much...podcast will save you about 50% of the time required to listen), With your smaller investment and desire to not spend too much time managing, you will probably want to open a self directed ROTH IRA at a Mutual fund company like Vanguard or Fidelity. I don't think you want to be trading individual stocks in this volatile market. ETF's are losing luster too, tho I use them in place of mutual funds so I can do options and trade inter-day (with Mutual funds you are stuck w/ 'close price').

You can only contribute 2011 up to the amount of EARNED income in 2011 (as mentioned). If you are getting a W2 or a 1099 you can use that amount. For students I always recommend ROTH's even in lieu of 529s. I set my kids up at age 12 (farm income from work + market / 4H animals) They had about $20k by college and were well adept at trading, nice thing is FAFSA didn't consider ROTH as a college contribution even tho all contributions (not earnings) can be withdrawn after they have been 'in' 5 yrs. ROTH will be ever so important in the future (tax free income). I would seriously fund a ROTH 401k once employed (like $15k / yr). In the future... dollar cost average IN (i.e. buy throughout the yr, your AVERAGE COST will be below median price, as you buy MORE shares when price is lower. Watch the moving averages and read IBD. I buy and sell based on 50 and 200DMA /trends of charting / market conditions. IBD advocates FOLLOWing the big money (institutions) so they track price and volume and give scoring to stocks on 'relative strength' (including industry outlook). They also publish an IBD 100 (which usually performs pretty good, for individual stocks). Remember, stock is priced based on PROJECTED earnings, thus is it forward discounted based on company expectations, performance / history, growth potential... a sudden change in CEO, or a significant lawsuit (EPA) or the indictment of the CFO (or a rumor) can quickly destroy you projected earnings in a single stock.

Thus mutual funds are the conglomeration of MANY stocks and trouble in any one stock or day will not destroy your whole investment. But growth is not as robust either.

There are several good mutual fund websites. I recommend bogleheads.org (vanguard 'centric', the forums are a good education).

In your investment future, consider diversification. I made far more wealth on my real estate investments, than my stocks, and for a whole lot less risk / loss of sleep. I would NOT buy a primary residence UNTIL you have some real estate investments that are WORKING for you. It is better to have your tenants paying your rent, that you having to flip burgers to do so (or to pay for your landlord's rent / house payment). I bought my first home at age 19, but I should have bought a 4plex, and lived in my car. (I had to leave home at 16, and was sick of paying rent by 19). In the future I think LOTS of people will be renting (especially active seniors). You don't have to settle on a permanent spot to buy, just BE SURE to only buy something you can sell TOMORROW for at least 110% what you pay today. (I try to buy 30% UNDER current market). Location... . unique / desirable places can be more $$, BUT you will have not trouble selling or trading via 1031 exchange.

Be wise, good luck, don't get bogged down with the details, find a mentor and buy him / her lunch.