Author Topic: need help picking 401k allocations  (Read 3306 times)

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need help picking 401k allocations
« on: October 29, 2013, 01:53:14 AM »
Here are the choices I have, doesn't seem like a good pick :(. I included the fees on them and the stock symbol. I have it all going into the Schwab S&P 500 right now. Should I change this?

Schwab Retirement Advantage Money - SWIXX - 0.27%
PIMCO Total Return D - PTTDX - 0.75%
PIMCO All Asset Instl - PAAIX - 0.88%
Dodge & Cox Stock - DODGX - 0.52%
Schwab S&P 500 Index - SWPPX - 0.09%
Harbor Capital Appreciation Instl - HACAX - 0.66%
William Blair Small-Mid Cap Gr I - WSMDX - 1.10%
American Beacon Small Cp Val Inst - AVFIX - 0.82%
Tweedy, Browne Global Value - TBGVX - 1.38%
William Blair International Growth N - WBIGX - 1.44%

Khan

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Re: need help picking 401k allocations
« Reply #1 on: October 29, 2013, 02:27:20 AM »
First, a couple questions: How old are you? Do you have any ideas as to your risk tolerance?

Now, as for the funds you have access to:
Dodge and Cox is a pretty decent fund, with a decent expense ratio and focusing on dividends and growth - something which I personally agree with.
S&P 500 with .08 is a very good choice
I'd also use Pimco total return for your bond allocation, however much you care to put in it. It's important to understand that bonds are completely different from stocks, and you should diversify at least some small amount(adjusted compared to your risk tolerance).
I'd also consider a small amount in AVFIX, the expense ratio is on the high side of what I tolerate(.82), but it's a different asset class(small-micro cap, value) then the S&P 500, and is decent... ish...

Someone else could talk to you more about moving funds from a 401k to an IRA or something along those lines, I'd consider it as your plan isn't the best. Talk to HR, it's not criminally bad, but it's not great.

Your other fund choices are terrible, both in expense ratios(.27% just to keep it in -cash- - SWIXX), almost criminally in some cases(WIlliam Blair, Tweedy). I wouldn't put anything in HACAX as the ER for S&P compared to it is too much of a selling point.

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Re: need help picking 401k allocations
« Reply #2 on: October 29, 2013, 02:34:38 AM »
I'm 27, I don't mind the risk, I have another 40 years before I draw from 401k. I might change it to a IRA but ugh, I want the company matching and tax deferment. Does IRA get this pre-taxed?

And I've maxed the 401k for about 3 years now so there's a good amount in it.

Khan

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Re: need help picking 401k allocations
« Reply #3 on: October 29, 2013, 02:41:41 AM »
I'm 27, I don't mind the risk, I have another 40 years before I draw from 401k. I might change it to a IRA but ugh, I want the company matching and tax deferment. Does IRA get this pre-taxed?

And I've maxed the 401k for about 3 years now so there's a good amount in it.

I don't mean contributing to an IRA instead of the 401k, I mean moving money out of the 401k into an IRA. I have no knowledge on this process, or whether it can be done whilst contributing.

And it's not about minding the risk... It's about knowing yourself. Can you sleep easily if the market falls, and I don't mean 20%. I mean 50%. Can you look at the last 3 years of sunny weather, and see it and your principal dissapear, and hold on tight and ignore the whispers in your ear? What do you have right now.... 3 years of maxing plus good gains.... 80k? Imagine it dropped to 40k.

I'm 25 myself, and I also enjoy the market. If that happened I'd feel bad, but I'd also feel that everything's on a fire sale, and would dump every last penny I could into buying everything that catches my fancy.

Like I said before though, if it's a good company, talk to HR about the plan choices and expenses.

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Re: need help picking 401k allocations
« Reply #4 on: October 29, 2013, 03:08:33 AM »
Oh, I don't care if it drops, I don't even know how much I have in it really :S I don't look.

Khan

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Re: need help picking 401k allocations
« Reply #5 on: October 29, 2013, 03:14:09 AM »
Oh, I don't care if it drops, I don't even know how much I have in it really :S I don't look.

Great, keep up the good work!

dorkus619

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Re: need help picking 401k allocations
« Reply #6 on: October 29, 2013, 09:42:37 AM »
At least you have a good low fee option. My LOWEST expense ratio options are .51 and it gets really bad from there. *sigh*

Also I wish I had your strength to not look at the balance constantly and to not be concerned about a down market. Maybe I will get better. I currently look at my 401k at least every paycheck. But I really should get into a better habit of only looking at it periodically OR not at all!

matchewed

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Re: need help picking 401k allocations
« Reply #7 on: October 29, 2013, 10:20:43 AM »
My 2c on this one is to keep it in the S&P 500 index from Schwab. Typical disclaimer of depends on your risk tolerance, asset allocation...etc.

It has the lowest fees and will perform in step with S&P 500... sign me up any day.