This will be quick, but I have a lot to say (and ask!):
First, yesterday in front of the "free table" where residents of our condo leave unwanted possessions for anyone else to take and do with what they please, a neighbor had left a disassembled (but in perfect condition) double Chariot stroller, the kind that cost us (with accessories) $1100 new!
NT grabbed it, assembled it to see what was there, and listed it on Craigslist. A lady is coming by tonight to likely buy it for $535!
We had a few other Craigslist items that might sell tonight too. NT suggested giving part of the proceeds to charity, since it was so random. So whatever we make over $500 from this batch of items, we'll donate somewhere. $500 will go to student loans. Yay!
***
I watched a Frontline documentary on PBS about 401(k)s. The two main takeaways were that 1) actively managed funds are useless compared with index funds and 2) 401(k) fees can erode up to 60% of your potential compound growth over the course of your career!
I immediately went to my 401(k) and got out of the target-date fund I was in, and reallocated everything to three of the lowest-fee funds: two Vanguard indexes and an international stocks fund (higher cost than the Vanguards, but lower cost than the international fund my target-date had me in).
I suggest you look at the costs of your retirement funds, if you haven't already. The spread was staggering. In some cases I was paying $12 per $1000 annually; one of the Vanguards I picked will cost me 50 cents per $1000!
***
This leads me to a question: I checked NT's 401(k) options, and they aren't great. We do want to stay in up to the employer match, but I'm not sure what to do. Should I just pick some of the lower-cost ones, even if it means he's not greatly diversified in terms of risk? Keep in mind we also have my 401(k), AS's 401(k), three Roth IRAs, three pensions in the UK, and a small traditional IRA that's in cash. So I do feel we're diversified overall.
What do you think we should do? Here are NT's options along with their costs (I'll paste plain-text and create a screen grab too; not sure which will be more readable):
What I'm considering is dividing his money pretty much evenly between MFS Massacuhusetts Investors Trust (gross operating expense .78), Franklin Growth Series Fund (GOE .96), Victory Established Value Fund (GOE 1.06), JPMorgan Government Bond Fund (GOE 1.04), PIMCO Total Return Fund (GOE .85), and BlackRock Equity Dividend (GOE .99). Those are the least expensive of all his choices (besides the first listing, which I found out was a cash holding earning 0% while they charged us $6.90 per $1000 per year!) He doesn't have a lot of great options. My company at least had a couple Vanguards, one whose expense was only .05.
Investment /
Fund Investment Class / Historical as of Date / Ticker / NAV / Gross Operating Expense / One Month / Three Month / One Year / Three Year / Five Year / Ten Year / YTD / Month End
Ready Assets(7dayYield:0.00%) Capital Preservation 03/31/2013 MRAXX $1.00 0.69 N/A N/A N/A N/A 0.39% 1.58% N/A
MFS Massachusetts Investors Trust Fund A Large Cap U.S. Stock 03/31/2013 MITTX $23.72 0.78 2.95% 10.43% 15.12% 11.24% 5.78% 8.98% 10.43%
Franklin Growth Series Fund A Large Cap U.S. Stock 03/31/2013 FKGRX $54.64 0.96 3.04% 7.96% 8.66% 10.01% 6.91% 9.81% 7.96%
Victory Established Value Fund A Mid Cap U.S. Stock 03/31/2013 VETAX $31.11 1.06 3.74% 13.25% 15.86% 13.19% 9.44% 12.71% 13.25%
Goldman Sachs Growth Opp A Mid Cap U.S. Stock 03/31/2013 GGOAX $25.00 1.41 2.42% 9.12% 11.17% 12.18% 8.83% 11.41% 9.12%
Goldman Sachs Small Cap Value A Small Cap U.S. Stock 03/31/2013 GSSMX $47.61 1.44 4.68% 12.53% 17.28% 14.76% 9.73% 11.94% 12.53%
Prudential Jennison Small Company Fund A Small Cap U.S. Stock 03/31/2013 PGOAX $24.95 1.17 3.83% 11.28% 13.59% 12.88% 7.78% 13.07% 11.28%
Thornburg International Value Fund R4 International Stock 03/31/2013 THVRX $27.97 1.45 0.35% 2.41% 6.37% 4.63% -0.01% 11.86% 2.41%
Templeton Foreign Fund A International Stock 03/31/2013 TEMFX $6.95 1.21 -0.57% 1.16% 6.77% 4.39% 0.89% 9.26% 1.16%
Invesco Real Estate Fund A Specialty U.S. Stock 03/31/2013 IARAX $25.94 1.30 3.20% 6.54% 12.94% 15.13% 5.77% 12.71% 6.54%
Oppenheimer Developing Markets Fund A International Stock 03/31/2013 ODMAX $35.33 1.36 -0.79% 0.11% 5.35% 6.94% 5.72% 21.03% 0.11%
JPMorgan Government Bond Fund A Government Bond 03/31/2013 OGGAX $11.57 1.04 0.29% 0.05% 3.78% 6.27% 5.55% 5.01% 0.05%
PIMCO Total Return Fund A Diversified Bond 03/31/2013 PTTAX $11.24 0.85 0.30% 0.51% 7.50% 6.49% 7.31% 6.19% 0.51%
BlackRock Global Allocation Fund A Balanced 03/31/2013 MDLOX $20.58 1.16 1.63% 4.26% 6.11% 6.08% 3.60% 10.74% 4.26%
BlackRock Eqty Dividend A Large Cap U.S. Stock 03/31/2013 MDDVX $21.55 0.99 2.81% 8.35% 12.29% 11.84% 5.00% 10.47% 8.35%
Putnam Capital Opportunities Fund A Small Cap U.S. Stock 03/31/2013 PCOAX $14.07 1.27 3.76% 11.84% 10.40% 12.45% 9.89% 11.30% 11.84%
Found $500 (sort of), enraging (but good) documentary, 401k question
April 29th, 2013 at 06:06 pm
April 29th, 2013 at 07:28 pm 1367263733
As far as 401K...I chose some of the lowest cost options I had, but they are still $14.90 per $1000.00. I am still participating since that was my lowest option and now my employer is matching.
April 29th, 2013 at 08:04 pm 1367265892
I believe this is the TV show
How does the employer's financial team choose their funds? The program implied there was a dyed in the wool kick-back scheme. Can DH ask that they consider Vanguard or Fidelity MFs? Are there any ETFs allowed? Since you have EFs, wonder about the need for a cash holding unless it's a non DRIP dividend transfer to Money Market awaiting a purchase.
April 29th, 2013 at 08:08 pm 1367266094
Over and above the fees charged, you need to look at the ranking of the various funds in the allowed selections. It takes time but can pay off to look at the top 10 holdings and their percentage. Too many funds are really just an Index Fund copied by the management team. [can't comment on specific funds; different country
April 29th, 2013 at 09:03 pm 1367269419
April 30th, 2013 at 02:24 am 1367288658
April 30th, 2013 at 12:17 pm 1367324271
I'm with you on the index funds, and low-cost investments in general. For the past few years, I've been transitioning over much of my retirement accounts from T. Rowe Price to Vanguard, to same some money on fees. T. Rowe is low cost to begin with, but no one, IMO, beats Vanguard. And when you hit $10,000 in any one index fund with them, they automatically give that fund the Admiral Share designation, which is an even LOWER expense ratio.
https://personal.vanguard.com/us/content/Funds/FundsAdmiralSharesOverviewJSP.jsp
April 30th, 2013 at 12:25 pm 1367324704
April 30th, 2013 at 05:13 pm 1367342034
May 1st, 2013 at 04:35 am 1367382908
May 1st, 2013 at 05:03 am 1367384635
Anyhow, GREAT for you guys!
I was going to say the same as above. Check Morningstar (or similar) and chose a solid, then low cost fund.