What up what up! I know it hasn’t been all too long since I announced the Ultimate IRA Test the other month, but some of y’all have been asking about it, and honestly I’d be just as curious too ;) I’d be lying if I said I don’t check it every day to see who’s winning the race! Haha…
For those who missed it – I decided to convert my $180k worth of 401(k) money right into Traditional IRAs. Originally I had planned to drop it all into 1 account (to make it nice and easy), but after talking w/ USAA reps, and getting asked 101 questions as to *how* to invest it, I decided to just do ALL of them and see what happens. With the notion of picking the BEST one after a year (was gonna be 6 months – but y’all made a good point that it’s not enough to truly test it out).
I know it’s a bit extreme/crazy, but then again it’s not like I can really go wrong here anyways. Each of the routes are perfectly fine investment choices, some just have higher fees than others, and invest in different like-minded funds. So really, I’d be okay with dumping my money in *either* of them. I just can’t make up my mind, and figured I’d put them all to the test and have them prove that they’re the true champions ;) Haha… at the very least it gets me excited and learning!
Okay, so after almost 7 weeks, here is where each account stands:
|IRA #1 (Not Managed)||$55,354.30|
|IRA #2 (USAA Managed, their funds only)||$55,243.33|
|IRA #3 (USAA Managed, ALL funds)||$56,033.99|
$15,000 off from initial investment due to the economy, but comparing the accounts side-by-side what do you think? Is this what you would have guessed? I had my money on IRA #1, personally. I thought buying and sitting on ’em would beat out all of options :) 2nd place isn’t too bad, but then again it’s only been a month and a half. I’m SUPER surprised #3 is in the lead for sure. That’s a big difference there for sure. Maybe not in the grand scheme of things (it’s what, a 1% lead?) but comparing side to side like that it’s def. the current winner.
Something else to consider is the fees to keep these guys running. #3 may be in the lead right now, but it also has the highest %! Probably not enough to knock it down into 2nd or 3rd place (not in the mood to calculate right now), but it’s still something to keep in mind. And which is the reason why it was hard for me to make the huge decision in the beginning anyways ;) I don’t know which is better in the long run?? I could research and make a better informed guess, but at the end of the day I learn much faster by PUTTING IT into real-life action. That’s enough for me to go on in this stage of life (aka 30-40+ years from “retirement”).
All being said though, please don’t take this as advice to follow suit :) This may be perfectly fine for ME to test out, and go a bit extreme with here, but it def. doesn’t mean it’s good for you all. I tend to take on more risk, and I’m okay with the crazy ups and downs. If all this stuff makes you queasy, stay far far away! Haha… there are plenty of other ways to test out theories than going “all in” like this.
We’ll see what happens going forward though. Make sure to place your bets now! We’re only into month 2 of this 12 month race, and I have a feeling it hasn’t even gotten interesting yet ;)
Jay loves talking about money, collecting coins, blasting hip-hop, and hanging out with his three beautiful boys. You can check out all of his online projects at jmoney.biz. Thanks for reading the blog!