- (1:30) – Ted Weschler And His Homerun IRA
- (7:30) – What Kind Of Investments Was He Making?
- (13:25) – Lessons To Learn From Ted Weschler
- (17:45) – Top Stock & ETF Picks For Your Roth IRA
-
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In this episode of ETF Spotlight, I speak with Tracey Ryniec, Zacks Senior Equity Strategist,
about investing lessons from Ted Weschler’s $264 Million Roth IRA.
Roth IRAs owned by ultra-wealthy Americans have been in spotlight after ProPublica obtained more than 15 years of tax return data on them. The largest one belonging to PayPal
PYPL
founder Peter Thiel had over $5 billion in assets as of 2019. Thiel used the account to buy founder’s shares in PayPal, and also shares in Palantir
PLTR
and Facebook
FB
when they were still private companies.
Unlike Thiel, Warren Buffett’s deputy Ted Weschler built his retirement wealth through publicly traded investments and strategies available to all investors. His investing journey provides some good lessons for other investors. These lessons include: start young, buy stocks, stay invested, maintain a diversified portfolio, and capture the power of compounding.
IRAs allow investors to buy individual stocks, bonds, ETFs or mutual funds. ETFs are excellent tools for retirement investors since they provide an easy way to build a diversified portfolio at a low cost.
Tracey recommends owning high quality stocks like Apple
AAPL
, Amazon
AMZN
and Nvidia
NVDA
, and ETFs in retirement accounts. The Invesco QQQ ETF
QQQ
and its cheaper version Invesco NASDAQ 100 ETF
QQQM
hold many highly innovative companies. Apple, Microsoft
MSFT
, Amazon and Alphabet
GOOG
are the top holdings in these funds.
Investors should also consider low-cost ETFs like the Vanguard S&P 500 ETF
VOO
and iShares Core S&P Total U.S. Stock Market ETF
ITOT
for broad market exposure.
Further, dividend paying ETFs are better placed in an IRA as income is sheltered from taxes. The Vanguard Dividend Appreciation ETF
VIG
and the iShares Core High Dividend Growth
DGRO
, which hold companies that have a record of increasing dividends over time, are worth a look.
Tune in to the podcast to learn more.
Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email
[email protected]
.
(In full disclosure, Neena owns shares of VIG in the ETF Investor Portfolio.)
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