Author Topic: Husband's 401K options  (Read 2670 times)

luminajd

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Husband's 401K options
« on: January 28, 2017, 08:25:04 PM »
Please be patient, I'm a 401K newbie. Husband signed up and this is what they put him in. Is this a good plan? He is 36 years old.
American Funds EuroPacific Gr R
Dodge & Cox International Stock
Invesco International Growth R5
Baron Small Cap Retail
Columbia Small Cap Value II Z
Fidelity Advisor Small Cap I
Columbia Mid Cap Value Z
American Funds Growth Fund of Amer R5
Vanguard 500 Index Admiral
Vanguard Equity Income Fund
Vanguard Windsor II Fund - Admiral

It looks like he does have the option of a TRowe Target fund, of which Target funds I'm a bit more aware of, but I cant tell from the long list above whether they put him in something good or not.
Thanks !

MDM

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Re: Husband's 401K options
« Reply #1 on: January 28, 2017, 11:34:18 PM »
Please be patient, I'm a 401K newbie. Husband signed up and this is what they put him in. Is this a good plan? He is 36 years old.
American Funds EuroPacific Gr R
Dodge & Cox International Stock
Invesco International Growth R5
Baron Small Cap Retail
Columbia Small Cap Value II Z
Fidelity Advisor Small Cap I
Columbia Mid Cap Value Z
American Funds Growth Fund of Amer R5
Vanguard 500 Index Admiral
Vanguard Equity Income Fund
Vanguard Windsor II Fund - Admiral

It looks like he does have the option of a TRowe Target fund, of which Target funds I'm a bit more aware of, but I cant tell from the long list above whether they put him in something good or not.
Thanks !
Are these the funds he is invested in, or funds in which he could invest?

If the former, it appears to be too many.

In either case, if you list the expense ratio the 401k charges for each fund you can get better replies.

WallStreetPhysician

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Re: Husband's 401K options
« Reply #2 on: January 29, 2017, 12:07:38 PM »
Please be patient, I'm a 401K newbie. Husband signed up and this is what they put him in. Is this a good plan? He is 36 years old.
American Funds EuroPacific Gr R
Dodge & Cox International Stock
Invesco International Growth R5
Baron Small Cap Retail
Columbia Small Cap Value II Z
Fidelity Advisor Small Cap I
Columbia Mid Cap Value Z
American Funds Growth Fund of Amer R5
Vanguard 500 Index Admiral
Vanguard Equity Income Fund
Vanguard Windsor II Fund - Admiral

It looks like he does have the option of a TRowe Target fund, of which Target funds I'm a bit more aware of, but I cant tell from the long list above whether they put him in something good or not.
Thanks !

In general, focus on the funds with the lowest expense ratios that provide broad market exposure; a Target-date fund is very good if you are just starting out and don't want to focus much on investments.  Vanguard 500 Index Admiral also will give you a diversified portfolio (not as much as total stock market, but a good start for a new investor). In a 401k, you can make changes without tax consequences, so I wouldn't sweat too much, just keep on learning.  Good luck!

luminajd

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Re: Husband's 401K options
« Reply #3 on: January 31, 2017, 01:10:48 PM »
Please be patient, I'm a 401K newbie. Husband signed up and this is what they put him in. Is this a good plan? He is 36 years old.
American Funds EuroPacific Gr R
Dodge & Cox International Stock
Invesco International Growth R5
Baron Small Cap Retail
Columbia Small Cap Value II Z
Fidelity Advisor Small Cap I
Columbia Mid Cap Value Z
American Funds Growth Fund of Amer R5
Vanguard 500 Index Admiral
Vanguard Equity Income Fund
Vanguard Windsor II Fund - Admiral

It looks like he does have the option of a TRowe Target fund, of which Target funds I'm a bit more aware of, but I cant tell from the long list above whether they put him in something good or not.
Thanks !
Are these the funds he is invested in, or funds in which he could invest?

If the former, it appears to be too many.

In either case, if you list the expense ratio the 401k charges for each fund you can get better replies.


Looks like this is what he IS invested in.
Im having a hard time finding the expense ratios.

MDM

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Re: Husband's 401K options
« Reply #4 on: January 31, 2017, 01:28:10 PM »
Im having a hard time finding the expense ratios.
The employer is legally required to make those available.  A phone call to HR (or the 401k administrator) seems in order.

See the pdf you can download from A Look at 401(k) Plan Fees | United States Department of Labor for more.

Car Jack

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Re: Husband's 401K options
« Reply #5 on: January 31, 2017, 01:42:25 PM »
Without more info, I'd say to move it ALL to the Vanguard 500 index.  We know it'll have a low expense ratio and no additional fees.  Can't say the same for the others.

rxmurphy

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Re: Husband's 401K options
« Reply #6 on: January 31, 2017, 01:51:27 PM »
Please be patient, I'm a 401K newbie. Husband signed up and this is what they put him in. Is this a good plan? He is 36 years old.
American Funds EuroPacific Gr R
Dodge & Cox International Stock
Invesco International Growth R5
Baron Small Cap Retail
Columbia Small Cap Value II Z
Fidelity Advisor Small Cap I
Columbia Mid Cap Value Z
American Funds Growth Fund of Amer R5
Vanguard 500 Index Admiral
Vanguard Equity Income Fund
Vanguard Windsor II Fund - Admiral

It looks like he does have the option of a TRowe Target fund, of which Target funds I'm a bit more aware of, but I cant tell from the long list above whether they put him in something good or not.
Thanks !
Are these the funds he is invested in, or funds in which he could invest?

If the former, it appears to be too many.

In either case, if you list the expense ratio the 401k charges for each fund you can get better replies.


Looks like this is what he IS invested in.
Im having a hard time finding the expense ratios.
I think there is such a thing a being TOO diversified. It looks like this. Way too many funds to be able to effectively manage and monitor. IMHO

luminajd

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Re: Husband's 401K options
« Reply #7 on: February 19, 2017, 10:08:03 AM »
I finally heard back on fees:
American Funds EuroPacific Gr R
Dodge & Cox International Stock .54
Invesco International Growth R5 .99
Baron Small Cap Retail 1.3
Columbia Small Cap Value II Z .92
Fidelity Advisor Small Cap I .99
Columbia Mid Cap Value Z .92
American Funds Growth Fund of Amer R5 .39
Vanguard 500 Index Admiral .05
Vanguard Equity Income Fund .26
Vanguard Windsor II Fund - Admiral .26

T Rowe price is also an option,
2030, 2040, 2050, etc. Husband is 37 years old, hope to retire by 60, fee is .76 for 2040


Now that you can see the fees, what is advisable for us to do?
Thanks again for your help!
« Last Edit: February 19, 2017, 10:14:51 AM by luminajd »

hankscorpio84

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Re: Husband's 401K options
« Reply #8 on: February 19, 2017, 10:26:18 AM »
I would follow this guy's advice and put it all in the Vanguard 500 fund.

http://www.marketwatch.com/story/warren-buffett-to-heirs-put-my-estate-in-index-funds-2014-03-13

EDIT: You might also want to check out this expense ratio calculator.  Its a simple, clear way to see the effect of low cost vs. benchmark funds over time.

http://www.begintoinvest.com/expense-ratio-calculator/
« Last Edit: February 19, 2017, 10:30:02 AM by hankscorpio84 »

With This Herring

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Re: Husband's 401K options
« Reply #9 on: February 19, 2017, 11:04:12 AM »
I finally heard back on fees:
American Funds EuroPacific Gr R
Dodge & Cox International Stock .54
Invesco International Growth R5 .99
Baron Small Cap Retail 1.3
Columbia Small Cap Value II Z .92
Fidelity Advisor Small Cap I .99
Columbia Mid Cap Value Z .92
American Funds Growth Fund of Amer R5 .39
Vanguard 500 Index Admiral .05  !!!!!
Vanguard Equity Income Fund .26
Vanguard Windsor II Fund - Admiral .26

T Rowe price is also an option,
2030, 2040, 2050, etc. Husband is 37 years old, hope to retire by 60, fee is .76 for 2040


Now that you can see the fees, what is advisable for us to do?
Thanks again for your help!

Put it all in the Vanguard 500 Index Admiral fund.  That covers most of the cap-weighted US stock market (which is good!).  The next cheapest fund is 5 times as expensive (the other two Vanguard funds at 0.26%), and the most expensive fund (Baron Small Cap Retail 1.30%) is 26 times as expensive.  If you have extra money to save, you can start an IRA for each of you with Vanguard and buy the Vanguard Extended Market fund, which will give you the rest of the US stock market, and look at also picking up Vanguard's bond index fund and maybe its international stock index fund.

Welcome to retirement investing!

luminajd

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Re: Husband's 401K options
« Reply #10 on: February 19, 2017, 02:39:23 PM »
Thank you for the advice, DONE!
Husband is maxing his 401K, I'm maxing 403B, and we plan on maxing our Roths (we have the target fund 204 through Vanguard), should we be doing a plain IRA instead of one of the options we are already doing?
Thanks

MDM

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Re: Husband's 401K options
« Reply #11 on: February 19, 2017, 03:03:27 PM »
...should we be doing a plain IRA instead of one of the options we are already doing?
Depends on your current savings vs. projected withdrawal marginal tax rates.  See Traditional versus Roth.

With This Herring

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Re: Husband's 401K options
« Reply #12 on: February 20, 2017, 08:40:04 AM »
In addition to MDM's advice, now will be a good time to read up on asset allocation in your multiple accounts.  Maxing all your retirement savings accounts is certainly an excellent start!