Q. Are there any specific advantages or disadvantages to splitting my annual IRA contribution of $2,000 among two or more mutual funds, as opposed to placing the entire amount in one fund? Can you suggest any particular schedule for making the contributions? I am in my mid-20s.

A. There are no real disadvantages to investing your IRA money in more than one fund: There are, however, a couple of advantages. For one, it permits you to spread the risk, so that if you make what turns out to be a poor choice, the result is not totally catastrophic.

In addition, it is then possible to select several different investment strategies. You might place some of the money in a conservative income-oriented fund to provide relatively stable income with a high level of safety.

Then you could use a high-risk growth stock fund for another chunk -- a pretty attractive option at your age. And -- depending on your view of the world situation -- you might want to invest as much as 10 percent of the total in a gold fund. (Gold itself, like other collectibles, is not authorized for an IRA.)

With regard to timing: If you have the cash, your IRA will grow faster if you deposit the entire annual investment at the beginning of each year. That's because you take early advantage of the tax deferral on earnings as they accumulate in the account.

If you can't handle that, then logic says to put the money in as fast as you can manage. If you budget your expenses, you might find it easier to invest a fixed amount at regular intervals -- each month, for example, or each pay period.

Your options may be limited by the rules regarding minimum deposits for the funds you select. If you have chosen two funds, you might want to send the full monthly payment to each fund on alternate months. Aside from the advantage of early deposit, whatever technique best serves your needs is the way to go.

Q. My daughter is self-employed and has two Keogh plans -- one with an insurance company and one with an S&L. Because she is short on time, she asked me to fill out Form 5500-C for reporting the Keoghs to the IRS. It would make life much simpler for her if she could exchange the Keogh plans for an IRA -- but she has been told that she can't roll over the Keoghs into an IRA. According to what I read in IRS publications, this is permitted. Who is correct?

A. The IRS publications are correct. Funds in a Keogh plan may be rolled over into an IRA under the rules governing lump-sum distributions from a retirement plan.

Your daughter either can request a direct transfer from Keogh trustee to IRA trustee (after she selects one) or she can withdraw all the funds from the Keogh plans and then deposit them into the IRA account of her choice. She will have 60 days after withdrawal to redeposit and avoid any tax consequences.

She may run into termination problems with the trustees of her present Keogh accounts. For example, if the money at the S&L is in a certificate, she may have to wait for the maturity date to avoid a penalty on early withdrawal. And her insurance contract also may have phased withdrawal charges.

There may be a tax disadvantage to making the switch. The tax deferral features of both Keoghs and IRAs are the same; but Keogh offers the opportunity for 10-year averaging on a lump-sum withdrawal, an option not available with an IRA. All money withdrawn from an IRA is taxable as ordinary income. Depending on her future plans, this tax advantage for Keoghs might compensate for the annual reporting chore.

Q. My Keogh account balance of prior years was rolled over into an IRA account earlier this year. Is it true that this rollover will not be counted against my regular IRA $2,000 limitation?

A. Yes, it's true. A rollover of funds from a Keogh or other qualified retirement plan into an IRA does not affect your eligibility for the normal $2,000 annual IRA investment. However, be sure that the custodian of your IRA knows that the transfer from your Keogh was in fact a rollover, or he may report it as an excess contribution.