Hi Mustachians,
I hope you can help with a case study about my 401k.
My 401k managers recently visited the office and I had the chance to consult them about my allocations. I'm new to all this and didn't know what to make of their recommendations so I'd love to hear what you all think, and whether I should change my current allocations at all in either my 401k or my Roth.
I'm 37, and getting a late start on retirement savings, now focused on increasing contributions and reducing spending with the goal of FI in 10 years. I opened a Roth with Vanguard last year before becoming eligible for the employer 401k, and before discovering MMM. Since the new year I've increased my 401k contributions to 27% of my salary, and paused contributions to the Roth until I can reduce spending further (which should happen in June when I move to a cheaper house). I get a 4% match. I eventually plan to max the 401k but it'll take me a little time to get to that point (which is a topic for a more general case study than this one). My employer also offers a Roth 401k but since I already had one via Vanguard, I opted for the regular. They don't offer an HSA.
My current allocations/assets/fees are:
Roth: VTIVX / $1,775 / 0.18 expense ratio. I chose this pre-MMM-discovery, not sure if I should change it.
401k: VFIAX / $2,915 / 0.05 expense ratio. This amount includes my contributions + the employer match to date, however I don't become 100% vested until August 2015. If I leave the job before then (unlikely) I get 0% of the match.
The 401k dudes were advising that I allocate 50% in a Vanguard target date, up to 5% in emerging markets, 1% to 5% in precious metals, and the rest of the percentage in other S&P trackers.
Here are the funds I have available (ticker name / fee%):
AYBPX / 0.71
DIPSX / 0.12 - among their recommendations
MWTIX / 0.45
PLTPX / 0.59
VSGBX / 0.20
CHCYX / 0.81
RLBGX / 0.29
RERGX / 0.49
RNPGX / 0.45
YACKX / 0.76
BUFTX / 1.01
FSDPX / 0.82
FSCRX / 1.01
GITUX / 1.27 - among their recommendations as a fund of funds
JSMGX / 0.76
JVAIX / 0.90
MFLDX / 2.66 - among their recommendations, due to large cash allocation, I think? (Or the bigger fee...?)
ODVIX / 0.87 - this was the emerging markets recommendation for 5% allocation
POGRX / 0.66
VFIAX / 0.05
VEIRX / 0.21
VEXAX / 0.10
VIGAX / 0.09
VGPMX / 0.25 - this was the precious metals one they'd recommended, for 1-5%
VSGAX / 0.09
VSMAX / 0.09
VTXVX / 0.16
VTWNX / 0.16
VTTVX / 0.17
VTHRX / 0.17
VTTHX / 0.18
VFORX / 0.18
VTIVX / 0.18
VFIFX / 0.18
VFFVX / 0.18
VTTSX / 0.18
VMMXX / 0.17
I typed that all in due to inability to copy/paste in ungarbled form from our online system, so let me know if info is missing here that would help.
Did they give me good advice? Should I change anything? Or ignore and leave everything as is? I'd prefer to figure out a strategy for allocations now and then leave it all alone and not think about it unless I absolutely need to.
Thanks in advance for your thoughts!
PS: If I should add any info for case study purposes, please ask and I'll edit this post.