How do you guys have your 401K's broken down. I looked at mine today and this is my breakdown 78% Stock 15.7 Money market/Stable Value 5.8% Bonds 0.5% other I am only 27 so I know I should be a little "riskier" with my savings but I was curious if having that large percentage in stock is the right move. They are not any individual stocks but various funds. I have always had a positive return on my investments int he double digits. I know people say to never look at your 401K now and just let it grow but I kind of just want to set it one time and not have to worry to much.
risker? dude, you've got almost 80% in stock. any riskier you'd have a heart attack every day. well, at least i would.
The way I did it is I went through and used the funds that Forbes and i think it is called morningstar rated as good quality funds to be a solid backbone to your retirement account. I just feel I have too much backbone now.
At your age, most people have it in 100% stocks. For money you will not need for 30 to 40 years you do not need to be saving cash at this point.
Also it is difficult to know how to really give advice because just saying you have X% of stocks in your portfolio doesn't give the entire picture. How you diversify the stocks/funds/whatever is the key. Growth? Value? Large cap? Small cap? International?
This is what I currently invest in Investment AMERICAN GROWTH FD OF AMERICA ARTISAN INTERNATIONAL FUND BLUE CHIP GROWTH FUND EQUITY INDEX 500 FUND FIDELITY LOW PRICED STOCK FUND FINANCIAL SERVICES FUND HEALTH SCIENCES FUND INTERNATIONAL DISCOVERY FUND JANUS FUND MID-CAP GROWTH FUND MID-CAP VALUE FUND NEW HORIZONS FUND PERSONAL STRATEGY GROWTH FUND PIMCO TOTAL RETURN ADMIN SCIENCE & TECHNOLOGY FUND SMALL-CAP STOCK FUND SMALL-CAP VALUE FUND TRP STABLE VALUE FUND SCH E U.S. TREASURY MONEY FUND
I'm not even about to look them all up but it sounds like you have a nice mix of funds. If it is working for you then great. Personally, I wouldn't keep 15% of my retirement in cash. I'm 29 so we are about in the same boat. I'd probably keep about 5% cash, 5% in bonds, the rest in what you have now. You have decades before you are going to use/need the money so let it grow. You will ride out the bumps in the market. What I'd recommend even more is how you save for retirement. Here's what I'd do: Contribute into my 401k as much as my employer will match. After that, max out a traditional IRA for immediate tax savings and the ability to invest in whatever you want. I do not like the idea of having only a handful of investment options. Then if you qualify, max out a Roth IRA for deferred tax savings. If you still have money to save, max out your 401k. If you still want to save even more money for retirement, open up a brokerage account and just stash money in quality funds and/or stocks/bonds. Just know, I'm not in any way, shape, or form a financial advisor. I just read anything I can get my hands on. I'd love to be more financially savvy.
I picked the 3 funds my company offered with the lowest cost ratio. 40% S&P 500 Index 30% Vanguard Primecap 20% Vanguard Windsor Fund 10% Money Market My company matches 6%, but I contribute 10%. I'm in my mid-thirties. Should I move some of my fixed money into one of the variable funds?
thats about right. as long as you have solid stocks/mutual funds it shouldnt be a big problem. short term flucutations dont really mean much in the long run. but like others have said, there seems to be a bit much in cash.
There is no right answer. 90% stocks in your mid 30s is aggressive though. Increasing the stock exposure will likely increase your risk but not your return.
I would compare the 401k total return against a balance fund like Vanguard Wellington Fund or Dodge & Cox Balanced Fund. A more sophisticated comparison could be made against Target Date retirement funds like Vanguard Target Retirement 20xx or Fidelity Freedom 20xx, especially if you are managing toward your retirement date.
Mine has been doing 15% growth annualized for the last 3 1/2 years I've been with the company. I'm 100% stocks right now: - 20% large cap - Hotchkis and Wiley Large Cap Value - 20% mid cap - Artisan Mid Cap Value - 20% small cap - Artisan Small Cap Value - 40% international - Dodge & Cox International Stock - Neuberger Berman International Inst But I just rebalanced last week, dumped a couple funds and picked up a couple others, so the numbers are a bit off in the pure sense.
1. How do you max out both a traditional IRA and a Roth IRA? 2. Roth IRA distributions, assuming you meet the guidelines, will be tax-free not tax deferred.
The contribution limit for a traditional and Roth IRA for 2007 is $4000. http://www.fool.com/money/allaboutiras/allaboutiras01.htm You put $4000 in each, they are maxed out. You are correct about the Roth IRA. Withdrawals are tax free. I've been reading a lot about annuities and those are tax deferred.
