Author Topic: 401k funds  (Read 305 times)

Kubrick

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401k funds
« on: June 23, 2020, 09:04:57 PM »
My first post here. I have been investing my 401k in 2050 target date fund from past 4-5 years-FNSBX (company default). I want to move to total market funds like FSKAX moving forward. Is it a good idea ? Are target date funds any better in terms of fee etc., ?

ixtap

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Re: 401k funds
« Reply #1 on: June 23, 2020, 09:12:21 PM »
My first post here. I have been investing my 401k in 2050 target date fund from past 4-5 years-FNSBX (company default). I want to move to total market funds like FSKAX moving forward. Is it a good idea ? Are target date funds any better in terms of fee etc., ?

You will have to look at the funds available in your 401k plan and the fees associated with those funds.

MDM

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Re: 401k funds
« Reply #2 on: June 23, 2020, 09:21:33 PM »
That particular target date fund has much worse fees than the weighted average of FSKAX and other Fidelity funds similar to FNSBX's holdings.

See ixtap's recommendation.

MustacheAndaHalf

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Re: 401k funds
« Reply #3 on: June 24, 2020, 01:33:41 AM »
If I had to give you blind advice without looking at your 401(k), put everything in the lowest expense ratio fund.

(1) The lowest expense ratio fund is almost always an S&P 500 index fund.  Most of your retirement should be in equities, until you get close to retirement.  So that's a decent allocation.
(2) Fees can do a lot of harm, and some plans have choices with 1% or higher expense ratios (aka "annual fee").  Avoiding those is important, and picking the lowest expense ratio is a step in that dierction
(3) Act now.  Saving on expenses and being invested beats cash.  If you pull out of one fund, and remain indecisive, you can lose out on stock market returns.  A bad equity fund still beats holding cash.