I want to start investing in mutual funds need a little advice

I am 28 years old single, own my home. I make just under 60K a year. I do have some debt which will be paid off by the end of the year. I also have some retirement savings and I plan to contribuite more once my debt is paid off.

However this question is about non reitrement account mutual funds. I want to invest for the long term between 5 years - 20 years. If i need money in between I will withdraw as long as it hasn't lost a lot and stay in the same fund or take the balanace and open a new fund.

Now the big compaines have great funds such as fidelity, vanguard, and others. However they require high minimums around 2,500 or more to invest. I don't have that. I would like to start with something between 50-500 if possible and invest about 50 per month and add more if possible. The one fund company I looked at with low miniums is trowe price, but I don't like the performance on most of their funds.

I know if I leave this money in over long term I will make a lot of money I just need to get pointed in the right direction and try to find a fund company that I can start with a low balance and work my way up.

Any advice would be much appreciated

Hi! Actually, I'm rather sceptic as for your opportunity to make a lot of money investing 500 dollars. Probably $2.500 is more than you can afford it but why not to stick to some happy medium? say, $ 1000. Not that small sum, again. But your profit will be more or less tangible.And why namely mutual fund? Its only advantage is a smaller risk (though, it's still present here). As for the per cent it's not big. Probably, you'd better consider some other possibility of investing.e.g., on-line investing. Although there is a lot of scam about it, there are companies worth your trust. You only should be careful about it.

Getyourmoney. Investment (http://www.Investmentofmine.com)

Look at T Rowe Price- if you commit $50/month they will waive fund minimums (which are around $1000).

Mutual funds are a long term investment. You as an individual can deposit up to $4000/ year tax free into your IRA. Vanguard is a good fund group. Hypothetically if you made $50,000/ year and you deposited $4000 into your IRA, you would be taxed on $46,000/yr. Hence, the $4000 tax free. You can withdraw this money out of your IRA but you pay severe tax penalties.

youb -

You have a tendency to make incomplete statements, and, while most of what you're saying is factually true, some of what you're leaving out can cause problems for readers. I don't want you to feel like I'm picking on you, that's not at all the case, so please don't take this personally.

Completing post above:

The annual limit for IRA (Roth or Traditional) contributions is the lesser of 1) $5,000 for 2008, plus a $1,000 "catchup" provision for individuals age 50 and older; or 2) your taxable compensation for the year.

For the Traditional IRA, a limit to deductibility is in place if you are covered by a retirement plan at work (even if you don't participate): For single filers, the deduction is phased out for Modified Adjusted Gross Income (MAGI) between $53,000 and $63,000; for Married taxpayers Filing Jointly, the deduction is phased out for a MAGI between $85,000 and $105,000; and for Married taxpayers Filing Separately, the deduction is eliminated if your MAGI is $10,000.

If you're under the MAGI limits listed above and covered by a retirement plan, or if you are not covered by a retirement plan (no MAGI limit), your contribution to your Traditional IRA is deductible "above the line", that is, to calculate AGI.

Contributions to your Traditional IRA can be withdrawn at any time, although you will be subject to ordinary income tax and penalties if the distribution is not qualified. A qualified distribution (after age 59.5, first time home purchase, and a few others) are only subject to ordinary income tax.

For a Roth IRA, contributions are not deductible, however, qualified distributions are not taxed - at all. For a single taxpayer, the contribution limit for a Roth IRA is phased out for Modified Adjusted Gross Income (MAGI) between $101,000 and $116,000; for Married taxpayers Filing Jointly, the deduction is phased out for a MAGI between $159,000 and $169,000; and for Married taxpayers Filing Separately, the deduction is eliminated if your MAGI is $10,000.

In the case of either type of IRA, a married couple (filing jointly) can make contributions for both spouses even if one doesn't earn an income or a large enough income to make the full contribution, provided you otherwise qualify (e.g., MAGI limitations).

See IRS Pub 590 for additional information.