Which bond fund in 401k?

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corn18
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Which bond fund in 401k?

Post by corn18 » Thu Jun 14, 2018 10:20 am

I am using most of my 401k for bond holdings. Most of my equities are in Roth and taxable. AA is 60/40 (25% international). 3 years from retirement (hopefully).

These are my choices in my 401k:

FID Managed Income Portfolio II Class 3 0.34%
BLKRK HIGH YLD BD K (BRHYX) 0.55%
DODGE & COX INCOME (DODIX) 0.44%
FID GNMA (FGMNX) 0.45%
VANG INFL PROT INST (VIPIX) 0.07%

I would like to put it all in VIPIX for the low fee. Right now it is split between DODIX and VIPIX about 30/70.

What would you recommend?
Last edited by corn18 on Thu Jun 14, 2018 10:59 am, edited 1 time in total.

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ruralavalon
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Re: Which bond fund in 401k?

Post by ruralavalon » Thu Jun 14, 2018 10:44 am

corn18 wrote:
Thu Jun 14, 2018 10:20 am
I am using most of my 401k for bond holdings. Most of my equities are in Roth and taxable. AA is 60/40 (25% international)

These are my choices in my 401k:

FID Managed Income Portfolio II Class 3 0.34%
BLKRK HIGH YLD BD K (BRHYX) 0.55%
DODGE & COX INCOME (DODIX) 0.44%
FID GNMA (FGMNX) 0.45%
VANG INFL PROT INST (VIPIX) 0.07%

I would like to put it all in VIPIX for the low fee. Right now it is split between DODIX and VIPIX about 30/70.

What would you recommend?
My suggestion is Dodge & Cox Income Fund (DODIX) ER 0.44%. It is a good actively managed, intermediate-term bond fund (average effective duration = 4.2 years), with good credit quality (average credit quality = A), with a moderate expense ratio and good diversification.

I don't suggest a TIPS fund unless retired or close to retirement, if at all.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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corn18
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Re: Which bond fund in 401k?

Post by corn18 » Thu Jun 14, 2018 11:01 am

ruralavalon wrote:
Thu Jun 14, 2018 10:44 am

My suggestion is Dodge & Cox Income Fund (DODIX) ER 0.44%. It is a good actively managed, intermediate-term bond fund (average effective duration = 4.2 years), with good credit quality (average credit quality = A), with a moderate expense ratio and good diversification.

I don't suggest a TIPS fund unless retired or close to retirement, if at all.
I am 3 years from retirement @ age 55, and these bond funds will be my bridge to SS @ 70 (my plan allows for the rule of 55). Does that make a difference?

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welderwannabe
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Re: Which bond fund in 401k?

Post by welderwannabe » Thu Jun 14, 2018 11:15 am

Of the choices you have the Dodge and Cox is the best.
I am not an investment professional, but I did stay at a Holiday Inn Express last night.

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ruralavalon
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Location: Illinois

Re: Which bond fund in 401k?

Post by ruralavalon » Thu Jun 14, 2018 12:16 pm

corn18 wrote:
Thu Jun 14, 2018 11:01 am
ruralavalon wrote:
Thu Jun 14, 2018 10:44 am

My suggestion is Dodge & Cox Income Fund (DODIX) ER 0.44%. It is a good actively managed, intermediate-term bond fund (average effective duration = 4.2 years), with good credit quality (average credit quality = A), with a moderate expense ratio and good diversification.

I don't suggest a TIPS fund unless retired or close to retirement, if at all.
I am 3 years from retirement @ age 55, and these bond funds will be my bridge to SS @ 70 (my plan allows for the rule of 55). Does that make a difference?
My personal choice would still be Dodge & Cox Income Fund (DODIX).
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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corn18
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Re: Which bond fund in 401k?

Post by corn18 » Thu Jun 14, 2018 1:12 pm

Thanks everyone! Just made the exchange from VIPIX to DODIX and sent all future contributions to DODIX. Easy peasy.

Mors
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Re: Which bond fund in 401k?

Post by Mors » Thu Jun 14, 2018 6:51 pm

Dodix is also my choice. Leave vipix for later. You could add a small portion of your fixed income to the managed income portfolio for diversification purposes, it is a stable value fund. It does not have interest rate risk, although it has probably smaller expected return too.

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abuss368
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Re: Which bond fund in 401k?

Post by abuss368 » Thu Jun 14, 2018 7:16 pm

corn18 wrote:
Thu Jun 14, 2018 10:20 am
I am using most of my 401k for bond holdings. Most of my equities are in Roth and taxable. AA is 60/40 (25% international). 3 years from retirement (hopefully).

These are my choices in my 401k:

FID Managed Income Portfolio II Class 3 0.34%
BLKRK HIGH YLD BD K (BRHYX) 0.55%
DODGE & COX INCOME (DODIX) 0.44%
FID GNMA (FGMNX) 0.45%
VANG INFL PROT INST (VIPIX) 0.07%

I would like to put it all in VIPIX for the low fee. Right now it is split between DODIX and VIPIX about 30/70.

What would you recommend?
Hi corn18 -

I would consider the Dodge & Cox Income Fund. I have read on Dodge & Cox over the years and my understanding is they only provide 6 mutual funds in total. They have been established a long time and based in San Francisco. Their managers "eating their own cooking" by investing substantial amounts along side the fund's shareholders. I do recall an interview where Jack Bogle provided positive comments about them.

Best.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

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