If you like Scottrade, opening your Roth IRA there is a fine idea.

A Roth IRA is a retirement account, but you can take money out of it with certain limitations. If it were me, and I didn’t have much investment experience, I’d buy what’s called a Target-date mutual fund inside my Roth IRA.

So, open the Roth, and ask a customer service rep at Scottrade which target date funds they offer (or look them up yourself online) and then go to morningstar.com to read about which fund is the most highly rated. Then, buy shares of the fund, and keep buying them! Set up an automatic investment program if possible so that every month you have a chunk of money going into your Roth and buying more shares in your chosen mutual fund.

Buying individual stocks is fun and for me it was a good way for me to keep my interest in saving when I was a new investor, but individual stocks are a really risky proposition. I’d recommend putting more of your eggs into good mutual funds and maybe keeping 10% of your assets as “play money” to invest in individual stocks with.

If you have an IRA, how’d you open it?

I also have an Employee stock purchase plan where the company matches 50%. I can buy up to $2000 worth of stock every year which I max out. Basically I spend 2k and have 3k plus dividends.

The rest of the money I can “scrape” up I put into my sharebuilder account. I’m not sure if your familiar with sharebuilder and I’m not familiar with Scottrade other than their advertisements, but in sharebuilder when you transfer your money it goes into a money market acct. until it is invested. Right now the MMKT is earning about 4.5% which I use as my emergency fund when I need money. When I see an investment that I think is cheap at the moment I’ll set up the trade to execute. Having the MMKT account is great because I can get interest until I see an investment I want to get into.

Do do you get interest from having money in your Scottrade accont similar to sharebuilder’s MMKT? I was just wondering if all brokers are like that because sharebuilder is the only one I have delt with.

My favorite way to invest is just finding a cheap stock that I know will rebound in price and snatch it up. 4 mths down the road I’ll have a 20-30% gain. I’m also experimenting with an income trust, (risky investment since I don’t know alot about them.) The one I’m in now is a canadian oil firm. I get paid a dividend EVERY month, which is over 1% per month, but they automatically take our a foreign tax for Canada. So now I’m going to try getting the dividends reinvested to see if that affects the tax in anyay.

I’m not an expert, but I’m reading all I can and trying different things that I think has a balance of between high return and low risk.

I don’t know if you have a Roth IRA, but that’s the first thing I’d do if I were in your position. After I max it out ($4k for 2007, $5k for 2008), I’d look into either 1. taxable investing or 2. retirement accounts for individual business owners if you have freelance income.

If you have freelance income, you can check out SIMPLE IRA, SEP-IRA, or the individual 401K. They each have different limits & rules, so be sure to research before you put your money in.

Generally, you’d want to put your tax-inefficient holdings (bonds, REITs, etc.) into tax-advantaged accounts (Roth IRA, for example). With your taxable accounts, something like the Total Market Index or a Tax-managed fund would be good because they tend to generate fewer transactions and thus capital gains (which equals less taxes for you).

I am fortunate to have a 401k through work, so that’s what I’m going to concentrate on for the second half of 2007. Good luck!