Ask Dr. LJ: Stocks.

[prog]

I have some money lying around in several separate retirement accounts, from my variously salaried past. Because I work for myself now, and expect to continue doing so for the foreseeable future, I'd like to consolidate these various into one IRA basket.

Right now, my IRA has a couple of CDs in it. I think they've earned maybe $1,000 total over the last six years. Whoopie ding-dong. I don't see them doing much better than that, no matter the weather.

One of my accounts is made entirely of an index fund, and like everyone else's, it's been tanking lately. So I am thinking: let's see if I can't roll that into an IRA, and then reassign all the other retirement money I have into it too. Because, hey, cheap stocks, woo! The market will recover eventually, right?

Is this dumb?

Comments

[530nm330hz.livejournal.com]

That's mostly what I've been doing -- rolling over old 401(k)s into new IRAs and dollar-cost-averaging Spiders and Diamonds. I'm not going to predict where the bottom is, but by the time we're ready to retire the market as a whole will be way up from where they are this year, or else we'll have bigger problems.

The only detail is that for paperwork reasons it's a heck of a lot simpler to keep your 401(k) rollovers separate from your existing traditional and/or Roth IRAs. If you're just buying ETF index funds, the fact that this hampers your ability to pool your money to buy round lots of individual stocks shouldn't be a drawback.