Help with 401K Allocation

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Topic Author
Woodberg
Posts: 9
Joined: Tue Oct 02, 2018 8:57 am

Help with 401K Allocation

Post by Woodberg »

Below is a list of the available funds in my company 401K and also how I'm currently allocated. All of my funds are in a traditional pretax 401K. I was hoping someone could help me with how to best simulate a three fund approach based on these choices. I'm 55 and about 8-10 years away from retirement. Thinking of a 60-40 stock to bond ratio. My company pays all of the management fees for the 401K so other than these expense ratio's, I have no additional cost. This 401K represents about 60% of my retirement savings, the other 40% is held in a taxable brokerage account at Schwab. Sorry that the data is not lined up into columns. I tried posting a few times, but could never get it to format correctly.

Expense ----------Return-------------
Fund Name Symbol Owned Asset Class Category Ratio 1 Year 3 Year5 Year10 Year/LOF
FID 500 INDEX IPR FXAIX 11.82% Stock Investments Large Cap 0.02% 17.90%17.30%13.94% 11.96%
INVS COMSTOCK Y ACSDX Stock Investments Large Cap 0.57% 18.95%13.77%11.33% 10.17%
JPM US EQUITY I JUESX 11.58% Stock Investments Large Cap 0.75% 19.55%14.97%14.19% 11.26%
FA LEV CO STOCK I FLVIX Stock Investments Mid-Cap 0.81% 9.42%10.93% 7.65% 10.30%
FID EXT MKT IDX IPR FSMAX 10.79% Stock Investments Mid-Cap 0.05% 16.17%16.17%11.45% 12.41%
WASATCH SM CAP GRTH WAAEX 0.03% Stock Investments Small Cap 1.27% 44.01%18.54%13.77% 13.18%
FID INTL INDEX IPR FSPSX 8.66% Stock Investments Internation 0.05% 2.63% 9.22% 4.51% 5.34%
FKLN MTL GLB DISC Z MDISX 13.51% Stock Investments Internation 0.96% 5.02% 7.51% 7.11% 7.09%
JPM EMRG MKTS EQ I JEMSX 4.37% Stock Investments Internation 1.27% -1.63%12.56% 6.09% 3.68%
OPPHMR INTL GRTH Y OIGYX Stock Investments Internation 0.85% 3.08% 7.44% 5.56% 6.18%
THORNBURG INTL GR R5 TINFX Stock Investments Internation 1.31% 9.63%11.43% 7.70% 9.60%
TWEEDY BROWNE GLBVAL TBGVX Stock Investments Internation 1.36% 6.03% 7.29% 6.08% 6.95%
3RD AV RE VALUE IS TAREX Stock Investments Specialty 1.11% 3.09% 7.05% 7.77% 7.11%
AMG M CS REAL EST N MRESX Stock Investments Specialty 1.09% 8.15% 9.45%10.87% 8.58%
FA MATERIALS I FMFEX Stock Investments Specialty 0.79% -2.19%11.43% 5.07% 9.77%
OPPHMR GOLD SPLMIN Y OGMYX Stock Investments Specialty 0.92% -20.94%12.12%-5.01% -4.07%
CALMOS MKT NEU/INC I CMNIX Stock Investments Other 1.02% 4.96% 4.77% 4.11% 3.90%
INVS CONVERT SECS Y CNSDX Stock Investments Other 0.69% 12.91% 7.95% 7.11% 8.28%
MS MK UNCNSTRD BD I MSDIX Stock Investments Income 0.88% 1.33% 3.54% 2.89% 5.34%
LS GLOBAL ALLOC Y LSWWX Stock Investments N/A 0.93% 12.30%10.27% 9.48% 8.84%
TRP CAP APPREC ADV PACLX 10.44% Blended Investments Other 1.01% 11.42%11.04%11.19% 9.59%
FA FREEDOM 2005 I FFIVX Blended Investments N/A 0.49% 2.96% 6.19% 4.67% 5.53%
FA FREEDOM 2010 I FCIFX Blended Investments N/A 0.53% 3.89% 7.31% 5.48% 6.40%
FA FREEDOM 2015 I FFVIX Blended Investments N/A 0.57% 4.96% 8.47% 6.18% 6.76%
FA FREEDOM 2020 I FDIFX Blended Investments N/A 0.61% 5.66% 9.21% 6.68% 7.07%
FA FREEDOM 2025 I FITWX Blended Investments N/A 0.66% 6.42% 9.95% 7.25% 7.64%
FA FREEDOM 2030 I FEFIX 24.24% Blended Investments N/A 0.70% 7.82%11.59% 8.19% 7.98%
FA FREEDOM 2035 I FITHX 0.17% Blended Investments N/A 0.74% 9.32%12.89% 8.93% 8.51%
FA FREEDOM 2040 I FIFFX Blended Investments N/A 0.75% 9.71%13.03% 9.02% 8.55%
FA FREEDOM 2045 I FFFIX Blended Investments N/A 0.75% 9.73%13.06% 9.06% 8.59%
FA FREEDOM 2050 I FFFPX Blended Investments N/A 0.75% 9.72%13.03% 9.07% 8.56%
FA FREEDOM 2055 I FHFIX Blended Investments N/A 0.75% 9.75%13.05% 9.09% 8.67%
FA FREEDOM 2060 I FDKQX Blended Investments N/A 0.75% 9.67%13.03%N/A 8.55%
FA FREEDOM INC I FIAFX Blended Investments N/A 0.47% 1.89% 4.77% 3.68% 4.59%
FRANKLIN INCOME ADV FRIAX Blended Investments N/A 0.48% 4.55% 7.87% 5.80% 6.64%
M&N PROBLND MAXTRM S EXHAX Blended Investments N/A 1.10% 13.73%11.96% 9.22% 7.51%
AB HIGH INCOME ADV AGDYX Bond Investments Income 0.58% -0.70% 5.88% 5.04% 8.59%
AMG M A SH DUR GVT N MGSDX Bond Investments Income 0.83% 1.03% 0.69% 0.66% 1.12%
BLKRK HI YLD BD INST BHYIX 4.39% Bond Investments Income 0.63% 4.10% 6.16% 5.60% 8.21%
FA EMERG MKT INC I FMKIX Bond Investments Income 0.82% -4.62% 6.62% 4.64% 7.86%
FID US BOND IDX IPR FXNAX Bond Investments Income 0.03% -1.31% 1.23% 2.10% 3.66%
JPM GOVT BOND I HLGAX Bond Investments Income 0.70% -1.30% 1.02% 1.92% 3.51%
PGIM ST CORP BOND Z PIFZX Bond Investments Income 0.52% -0.11% 1.71% 1.84% 3.38%
TMPL GLOBAL BOND ADV TGBAX Bond Investments Income 0.78% -1.99% 2.53% 2.05% 5.43%
VI FD FOR INCOME I VFFIX Bond Investments Income 0.61% -0.81% 0.46% 1.20% 2.64%
DREY INFL-ADJ SEC I DIASX Bond Investments N/A 0.51% 0.10% 1.35% 1.07% 2.52%
OPPHMR SR FLTG RT Y OOSYX Bond Investments N/A 0.88% 4.71% 5.39% 4.17% 5.57%
FID GOVT MMKT SPAXX Short-Term Investments N/A 0.42% 1.19% 0.52% 0.31% 0.23%
chevca
Posts: 3473
Joined: Wed Jul 26, 2017 11:22 am

Re: Help with 401K Allocation

Post by chevca »

Woodberg wrote: Fri Oct 12, 2018 1:21 pm This 401K represents about 60% of my retirement savings, the other 40% is held in a taxable brokerage account at Schwab.

Expense ----------Return-------------
Fund Name Symbol Owned Asset Class Category Ratio 1 Year 3 Year5 Year10 Year/LOF
FID 500 INDEX IPR FXAIX 11.82% Stock Investments Large Cap 0.02% 17.90%17.30%13.94% 11.96%
FID EXT MKT IDX IPR FSMAX 10.79% Stock Investments Mid-Cap 0.05% 16.17%16.17%11.45% 12.41%
FID INTL INDEX IPR FSPSX 8.66% Stock Investments Internation 0.05% 2.63% 9.22% 4.51% 5.34%
FID US BOND IDX IPR FXNAX Bond Investments Income 0.03% -1.31% 1.23% 2.10% 3.66%
You should look at all your accounts as one portfolio. So, depending on what you have in your taxable account you may or may not need to hold all asset classes for the 3 fund in the 401k account. I'd say all you need would be covered by by these funds though. No need to use any others in your 401k, IMO.
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AllMostThere
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Joined: Sat Dec 31, 2016 1:04 pm

Re: Help with 401K Allocation

Post by AllMostThere »

I echo chevca's advice. These 4 funds all have excellent ER's and fit the bill for three fund portfolio. 60/40 split is very reasonable.
It is not about how much you make; it is about how much you keep and how well you invest it. - Author Unknown | Dream as if you’ll live forever. Live as if you’ll die today. - Author James Dean
chevca
Posts: 3473
Joined: Wed Jul 26, 2017 11:22 am

Re: Help with 401K Allocation

Post by chevca »

I just looked at the percent owned of what you hold now, OP. You have a lot of overlap and hold some high ER funds. There's no need to hold the target date funds, if you're going to hold all the asset classes separately anyway. Or, the other way also... just hold a target date fund. There's no need to hold 0.03% of any fund. No need to hold any fund with an ER over 1, when there's the same or similar fund available in the 0.05 ER range.

You can definitely tidy up the 401k account and have low ERs.
Topic Author
Woodberg
Posts: 9
Joined: Tue Oct 02, 2018 8:57 am

Re: Help with 401K Allocation

Post by Woodberg »

chevca wrote: Fri Oct 12, 2018 1:58 pm I just looked at the percent owned of what you hold now, OP. You have a lot of overlap and hold some high ER funds. There's no need to hold the target date funds, if you're going to hold all the asset classes separately anyway. Or, the other way also... just hold a target date fund. There's no need to hold 0.03% of any fund. No need to hold any fund with an ER over 1, when there's the same or similar fund available in the 0.05 ER range.

You can definitely tidy up the 401k account and have low ERs.
I'm definitely planning to reallocate all of these funds into the 4 funds you suggested. My understanding is that since there is no Total market fund, I could use the FID 500 Index (FXAIX) and FID Ext MKT IDX (FSMAX) to approximate it. I seem to recall putting 80% in the FXAIX and 20% in FSMAX would be the right balance. I'm thinking about the following allocation for this account:

FXAIX - 40%
FSMAX - 10%
FSPSX - 10%
FXNAX - 40%


I understand you're point about considering all of my accounts as one big portfolio. I'm potentially planning to move my taxable brokerage account to Vanguard. My understanding is that it would be better to keep the bond fund in this tax deferred account and have more of the stock funds in the taxable account. I would allocate to the above percentages between both of my accounts.
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BL
Posts: 9874
Joined: Sun Mar 01, 2009 1:28 pm

Re: Help with 401K Allocation

Post by BL »

chevca wrote: Fri Oct 12, 2018 1:27 pm
Woodberg wrote: Fri Oct 12, 2018 1:21 pm This 401K represents about 60% of my retirement savings, the other 40% is held in a taxable brokerage account at Schwab.

Expense ----------Return-------------
Fund Name Symbol Owned Asset Class Category Ratio 1 Year 3 Year5 Year10 Year/LOF
FID 500 INDEX IPR FXAIX 11.82% Stock Investments Large Cap 0.02% 17.90%17.30%13.94% 11.96%
FID EXT MKT IDX IPR FSMAX 10.79% Stock Investments Mid-Cap 0.05% 16.17%16.17%11.45% 12.41%
FID INTL INDEX IPR FSPSX 8.66% Stock Investments Internation 0.05% 2.63% 9.22% 4.51% 5.34%
FID US BOND IDX IPR FXNAX Bond Investments Income 0.03% -1.31% 1.23% 2.10% 3.66%
You should look at all your accounts as one portfolio. So, depending on what you have in your taxable account you may or may not need to hold all asset classes for the 3 fund in the 401k account. I'd say all you need would be covered by by these funds though. No need to use any others in your 401k, IMO.
+1
Check your decimal points carefully to find the low numbers on ER. A zero or no number to the left of the decimal point is essential. Then, to the right of the decimal, a zero right after the decimal is outstanding or even a 1 or 2 is great!
Keeping it below 0.50% is not bad, but going much higher than 1/2% (0.5%) is getting more expensive. You are fortunate to have very low-cost funds, but some don't. Sorry if the decimal detail is simplistic, but a number of folks reading these threads don't have a feel for decimals; if it helps even one person this is a good thing.

I see you have a good understanding of all this. Vanguard is an excellent place to get good low-ER funds.
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ruralavalon
Posts: 26297
Joined: Sat Feb 02, 2008 9:29 am
Location: Illinois

Re: Help with 401K Allocation

Post by ruralavalon »

Woodberg wrote: Fri Oct 12, 2018 2:37 pm
chevca wrote: Fri Oct 12, 2018 1:58 pm I just looked at the percent owned of what you hold now, OP. You have a lot of overlap and hold some high ER funds. There's no need to hold the target date funds, if you're going to hold all the asset classes separately anyway. Or, the other way also... just hold a target date fund. There's no need to hold 0.03% of any fund. No need to hold any fund with an ER over 1, when there's the same or similar fund available in the 0.05 ER range.

You can definitely tidy up the 401k account and have low ERs.
I'm definitely planning to reallocate all of these funds into the 4 funds you suggested. My understanding is that since there is no Total market fund, I could use the FID 500 Index (FXAIX) and FID Ext MKT IDX (FSMAX) to approximate it. I seem to recall putting 80% in the FXAIX and 20% in FSMAX would be the right balance. I'm thinking about the following allocation for this account:

FXAIX - 40%
FSMAX - 10%
FSPSX - 10%
FXNAX - 40%


I understand you're point about considering all of my accounts as one big portfolio. I'm potentially planning to move my taxable brokerage account to Vanguard. My understanding is that it would be better to keep the bond fund in this tax deferred account and have more of the stock funds in the taxable account. I would allocate to the above percentages between both of my accounts.
In my opinion that is a reasonable plan.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
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