Author Topic: Help with 401k Choices  (Read 3376 times)

fattest_foot

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Help with 401k Choices
« on: November 14, 2015, 03:29:03 PM »
My wife started a new job recently and we're looking at getting into the best fund possible. It's through Wells Fargo, and unfortunately, a lot of the options don't have any information associated with them (e.g. I can't click a link that tells me anything about the fund).

The best of the ones that I AM allowed to get additional information seems to be RFNEX, which is an American Funds large cap, with a .66 expense ratio.

That said, one that didn't have extra info and intrigued me was BlackRock S&P MidCap Index. Unfortunately, Google didn't find me a stock symbol for this one, but I assume it's an index of the S&P 400 midcap. The large cap version (WFSPX) is .07 expense, so I'd imagine this is similar. But would a MidCap be something we'd actually want to invest ~$20k of 401k money a year into, with a FIRE goal of 8-10 years? It seems like MidCap would be significantly more volatile.

The other funds are:

Wells Fargo Advantage Asset Alloc Adm
ASTON/Fairpointe Mid Cap N
Federated Kaufmann R
Aston/Tamro Small Cap/N
Dodge & Cox International Stock
Eaton Vance Large-Cap Value A
American Funds Fundamental Invs R4
Goldman Sachs Mid Cap Value Inst
Oakmark Equity & Income I
American Funds Growth Fund of Amer R3
Wells Fargo Enhanced Stock Market CIT N
Wells Fargo Stable Return Fund N
TCW Total Return Bond I
WF/Causeway International Value CIT N
JPMorgan Large Cap Growth R5
Goldman Sachs Small Cap Value Inst
Goldman Sachs High Yield A
WF/BlackRock Russell 2000 Index CIT N
WF/BlackRock S&P MidCap Index CIT N
WF/BlackRock Intl Eq Index CIT N
Baron Growth Institutional

And then the default which is just a mashup of about 20 other mutual funds.

Zaga

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Re: Help with 401k Choices
« Reply #1 on: November 14, 2015, 04:05:42 PM »
The problem here is we can't know what the actual ER's are for each of those funds; even if they are the same exact fund with a stated ER on the open market, the ER in your 401-K may be completely different.

So, you need to get on HR's back to find out the information you're entitled to, you can't make a good decision without knowing that info.

However, you should look into the Russell 2000 index, that's probably as close to a total market index as her 401-K offers.  (I think, double check me on that one.)

Did you want bonds in that account too?  If so, then you need to look more into those as well.

Seppia

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Re: Help with 401k Choices
« Reply #2 on: November 15, 2015, 08:51:56 AM »
Also, ask HR if they can add vanguard funds.
The 401k at my company used to have only horrible choices, all above 1.2% expense ratio, and after I insisted for about two months they added VTSAX and VBTLX.
So I think it's worth asking, most of times those picking the funds have absolutely no idea what they're doing and get the "recommendations" from the 401k provider, who usually makes sure only the worst funds are included.