AT age 26, you should not worry that much where stocks will be 5 years from now.
I am in my early 40’s. When I was 26 we were just recovering from recession.
If I had put $5000 into the S&P 500 when I was 26 it would be worth over $12000 today, add another ~$2000 in dividends and that’s not a horrible rate of return. Add to that the fact that we are on the back side of a 40-50% bear market and that stocks have returned nothing over the past decade.
If this Roth money is strictly for retirement :
If I were you I would drop about $3-4k into stocks at semi-intervals over the next 4 months. (assuming you can buy with either no-load or small fee of less than $10) Buy at the end of days where we see a huge decline. Keep the other $1-2K in Money Market until next year’s contribution. Rinse and repeat until you no longer qualify to contribute to a Roth.
In 20 years you will thank me.
If this Roth money is mainly for retirement, but you are considering it a place to grow money for the next 5 years for another reasons (some people do this because of provisions in the tax code e.g. to buy a house), then I wouldn’t put more than 20% into stocks.
