Where should I invest my 401k funds into?

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norm52
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Where should I invest my 401k funds into?

Post by norm52 »

Available funds:
https://drive.google.com/file/d/1dbgcoq ... sp=sharing

I am an 24 year old who makes 65,000 a year.
pkcrafter
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Re: Where should I invest my 401k funds into?

Post by pkcrafter »

See lakpr's post in your other thread--

viewtopic.php?f=1&t=340505&p=5826353#p5826353--

Do you know what asset allocation you want?


Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
Trader Joe
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Re: Where should I invest my 401k funds into?

Post by Trader Joe »

norm52 wrote: Mon Mar 01, 2021 7:20 pm Available funds:
https://drive.google.com/file/d/1dbgcoq ... sp=sharing

I am an 24 year old who makes 65,000 a year.
If I were you at your age I would invest 100% in Vanguard 500 Institutional Index Trust.

Your investment option here is fantastic.
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retired@50
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Re: Where should I invest my 401k funds into?

Post by retired@50 »

pkcrafter wrote: Mon Mar 01, 2021 7:32 pm See lakpr's post in your other thread--
viewtopic.php?f=1&t=340505&p=5826353#p5826353--

Do you know what asset allocation you want?

Paul
+1. lakpr basically nailed it.

It appears from the image of available funds, and the "current" column, you're sort of sampling a variety of funds available. This is a common issue young investors face, due primarily to uncertainty. I'd go with the low expense ratio index funds and ignore the others.

Paul asks a great question above. Knowing your own asset allocation is kind of like step 1. Maybe try taking this Vanguard investor questionnaire (linked below). The basic idea behind quizzes like this is to get you thinking about your own personal feelings toward risk and return.

Link: https://retirementplans.vanguard.com/VG ... Step=start

Regards,
This is one person's opinion. Nothing more.
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Duckie
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Re: Where should I invest my 401k funds into?

Post by Duckie »

norm52 wrote:Where should I invest my 401k funds into?
The best options are:
  • Vanguard Institutional 500 Index 0.01% -- Large caps, 80% of US stocks
  • BlackRock Extended Market Index 0.05% -- Mid/small caps, 20% of US stocks
  • BlackRock MSCI ACWI ex-US Index 0.10% -- Almost complete international stocks
  • Vanguard Institutional Total Bond Index 0.03% -- US bonds
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StevieG72
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Re: Where should I invest my 401k funds into?

Post by StevieG72 »

Trader Joe wrote: Mon Mar 01, 2021 8:12 pm
norm52 wrote: Mon Mar 01, 2021 7:20 pm Available funds:
https://drive.google.com/file/d/1dbgcoq ... sp=sharing

I am an 24 year old who makes 65,000 a year.
If I were you at your age I would invest 100% in Vanguard 500 Institutional Index Trust.

Your investment option here is fantastic.
+1

Less is more when it comes to investing!
Fools think their own way is right, but the wise listen to others.
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Brianmcg321
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Re: Where should I invest my 401k funds into?

Post by Brianmcg321 »

Put 100% into the Vanguard 500 index fund. Max it out for 31 years and then retire at 55. :moneybag :moneybag :moneybag
Rules to investing: | 1. Don't lose money. | 2. Don't forget rule number 1.
Topic Author
norm52
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Re: Where should I invest my 401k funds into?

Post by norm52 »

pkcrafter wrote: Mon Mar 01, 2021 7:32 pm See lakpr's post in your other thread--

viewtopic.php?f=1&t=340505&p=5826353#p5826353--

Do you know what asset allocation you want?


Paul
I was thinking 65% in US stocks, 30% in international and 5% bonds but bonds may not be necessary at my age since I have so much time.
dukeblue219
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Re: Where should I invest my 401k funds into?

Post by dukeblue219 »

norm52 wrote: Tue Mar 02, 2021 12:40 pm
pkcrafter wrote: Mon Mar 01, 2021 7:32 pm See lakpr's post in your other thread--

viewtopic.php?f=1&t=340505&p=5826353#p5826353--

Do you know what asset allocation you want?


Paul
I was thinking 65% in US stocks, 30% in international and 5% bonds but bonds may not be necessary at my age since I have so much time.
If you do that using low-cost index funds and stick with it you'll be fine. It may or may not be perfect but it's reasonable.
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ruralavalon
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Re: Where should I invest my 401k funds into?

Post by ruralavalon »

When young and just starting the most important investing decision you can make is to establish a high rate of contributions.

Your employer's 401k plan offers excellent very diversified index funds with very low expense ratios. You are fortunate.

I suggest that you contribute to the 401k as much as is practical for you. The annual employee maximum is $19.5k.

norm52 wrote: Mon Mar 01, 2021 7:20 pm Available funds:
https://drive.google.com/file/d/1dbgcoq ... sp=sharing

I am an 24 year old who makes 65,000 a year.
I noticed that you didn't include the target date funds offered. A target date fund is a good way to start.

If you don't want a target date fund, then my suggestion is:
1) 60%, VANGUARD INSTL 500 IDX: TRUST VLCSP (S&P 500 Index fund);
2) 20%, BLACKROCK MSCI ACWI EX CL M: BMSIT; and
3) 20%, VANGUARD INSTL TOTAL BND ID TR: VTBMK.
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