Hi Melissa,
Great question! Most IRAs have a minimum investment you need to make to open the account. For example, if you open an IRA at Vanguard and invest it in a Target Date Fund, the minimum is $1,000. Other types of funds have different minimum investments. From there, you will want to schedule automatic withdrawals from your bank account on a regular basis. A monthly withdrawal is the best option because it a) allows you to set it up and forget about it and b) allows you to be buying into the underlying finds a little at a time. You could also do quarterly, though, if that works better for your situation.
Be careful to set up your contribution amounts with the maximum allowed investment in-mind. If you’re under 50, you can contribute up to $5,500 in an IRA each year. If you’re over 50, that amount is $6,500. As an example, if you’re under 50 and make a $1,000 initial investment, you’d want to spread the remaining $4,500 over 11 months, for example, at $375 per month.
I hope this helps! Please keep us posted as you work through your Next Steps.
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