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Columns: Dr. Don
Don Taylor, Ph.D., CFA, CFP   Expert: Don Taylor, Ph.D., CFA, CFP
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Custodian determines investment menu
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Moving account can improve IRA options

Dear Dr. Don,
I am a young investor with a Roth IRA. I intend to invest soon for 2007, but would like to wait for just the right market moment to "pull the trigger." What is the best place to park my cash until then? I'd like to put it in a money market account at the same institution as my Roth IRA in order to make the transaction as quickly as possible. Can a money market be a part of my IRA portfolio?
-- Ethan Equities

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Dear Ethan,
If you already have a Roth IRA, your investment options are limited to those offered by the current custodian, unless you move the account.

However, you can always invest your 2007 contributions in a different account than prior year contributions. Establish this account with a custodian that offers the array of investments you want, including a money market mutual fund or money market account.

In general, your choices for a custodian are banks, brokerages or mutual fund companies. If you make your own investment decisions, it makes sense to either open a brokerage account with a discount broker or deal directly with a no-load mutual fund family with funds that have low annual-expense ratios. Exchange traded funds, or ETFs, are an alternative to investing in mutual funds.

You're on your own in deciding when to "pull the trigger." Trying to time the market is a hard thing to get right. Good luck.'s corrections policy -- Posted: Dec. 7, 2007
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