Author Topic: 401k Fund Consolidation  (Read 1327 times)

Chrissy

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401k Fund Consolidation
« on: December 31, 2014, 11:46:28 PM »
My BF has $18,000 in his 401k.  He's asked me to take a look and make suggestions.  Currently, he's holding:

Hartford Capital Appreciation Y
AllianzGI NFJ Dividend Value Admin
Columbia Small/Mid Cap Value Fund K
Fidelity Leveraged Company Stock

My inclination is to have him trade the Hartford and Allianz (which have underperformed) and Fidelity Leveraged (high fee) for Fidelity Spartan Total Market.  What do the Mustachians think?  Should he also trade the Columbia?  It usually outperforms the Spartan, but underperformed in 2014, and has a high fee.


MDM

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Re: 401k Fund Consolidation
« Reply #1 on: January 01, 2015, 12:01:52 AM »
Predictions are difficult, especially about the future.  Or words to that effect.

Anyway, your suggestion to "trade the Hartford and Allianz (which have underperformed) and Fidelity Leveraged (high fee) for Fidelity Spartan Total Market" seems reasonable.  See the first line of this post regarding the Columbia.

Would need to see all options, including fees and historical performance, before venturing more.

TomTX

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Re: 401k Fund Consolidation
« Reply #2 on: January 01, 2015, 07:03:11 AM »
Liquidate the high-fee crap, put it all in the low-cost Spartan index fund.

Don't worry about ANY further diversification until you have at least $50,000. Waiting for $250,000 is fine too. At that point, maybe (if you want) - consider a low-cost bond index for a percentage.

wtjbatman

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Re: 401k Fund Consolidation
« Reply #3 on: January 01, 2015, 08:51:17 AM »
If he has the Spartan Total Market index fund available to him, he likely should invest 100% into that. He doesn't need to keep the Columbia and tilt small-cap yet, especially if he has to use an expensive actively managed fund to do so.

Chrissy

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Re: 401k Fund Consolidation
« Reply #4 on: January 01, 2015, 10:13:10 AM »
Thanks gang!  I showed him the responses, and he rebalanced right away.