Help selecting funds.

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lepa71
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Help selecting funds.

Post by lepa71 »

Hi
I'm a married 51-year-old guy. Just started a new job. Need some help selecting funds from the list. There are quite a few really good funds and this is why I need help. I was thinking of Paul Merriman's target-date funds and small-cap funds but not sure. Or maybe just pick a BlackRock index 2055 as I'm tolerant for very aggressive. Not sure what that "NY LIFE INS CO ANCHOR IV" fund is and couldn't find much info on it. Also seems like DFA Commodity Strategy Institutional is doing very well last and this year. Any thoughts?

Code: Select all

Name                               Full Name                              Symbol           Total Expense      Net Expense Ratio
FIDELITY 500 INDEX                 Fidelity 500 Index                     FXAIX            0.02%              0.02%
FIDELITY MID CAP INDEX             Fidelity Mid Cap Index                 FSMDX            0.03%              0.03%
FIDELITY U.S. BOND INDEX           Fidelity US Bond Index                 FXNAX            0.03%              0.03%
FIDELITY INTERNATIONAL INDEX       Fidelity International Index           FSPSX            0.04%              0.04%
VANGUARD GROWTH INDEX INST         Vanguard Growth Index Institutional    VIGIX            0.04%              0.04%
VANGUARD SMALL CAP VALUE           Vanguard Small Cap Index I             VSCIX            0.04%              0.04%
VANGUARD VALUE INDEX I             Vanguard Value Index I                 VIVIX            0.04%              0.04%
VANGUARD BALANCED INDEX            Vanguard Balanced Index I              VBAIX            0.06%              0.06%
FIDELITY EMERGING MARKETS IDX      Fidelity Emerging Markets Idx          FPADX            0.08%              0.08%
BLACKROCK LIFEPATH INDEX 2025      BLACKROCK LIFEPATH INDEX 2025          LIBKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2030      BLACKROCK LIFEPATH INDEX 2030          LINKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2035      BLACKROCK LIFEPATH INDEX 2035          LIJKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2040      BLACKROCK LIFEPATH INDEX 2040          LIKKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2045      BLACKROCK LIFEPATH INDEX 2045          LIHKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2050      BLACKROCK LIFEPATH INDEX 2050          LIPKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2055      BLACKROCK LIFEPATH INDEX 2055          LIVKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2060      BLACKROCK LIFEPATH INDEX 2060          LIZKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX 2065      BLACKROCK LIFEPATH INDEX 2065          LIWKX            0.15%              0.09%
BLACKROCK LIFEPATH INDEX RETIR     BLACKROCK LIFEPATH INDEX RETIR         LIRKX            0.14%              0.09%
VANGUARD INFLATION PROTECT SEC     Vanguard Inflation-Protected Secs Adm  VAIPX            0.10%              0.10%
VANGUARD TOTAL INTL BOND INDEX     Vanguard Total Intl Bd Idx Admiral     VTABX            0.11%              0.11%
VANGUARD REIT INDEX                Vanguard Real Estate Index Admiral     VGSLX            0.12%              0.12%
DFA COMMODITY STRATEGY PORT IN     DFA Commodity Strategy Institutional   DCMSX            0.31%              0.31%
LOOMIS SAYLES CORE PLUS BOND       Loomis Sayles Core Plus Bond N         NERNX            0.38%              0.38%
PGIM HIGH YIELD Q                  PGIM High Yield R6                     PHYQX            0.38%              0.38%
CARILLON EAGLE MID CAP GROWHT      Carillon Eagle Mid Cap Growth R6       HRAUX            0.63%              0.63%
NY LIFE INS CO ANCHOR IV           ???????
I'm also going to be transferring about $300K from my previous employer's 401K and wondering if I really should just dump the whole amount into the set of funds or gradually buy-in based on the current market volatility. I know that timing is not a bogleheads way but...

Thanks in advance.

ps. if somebody is interested in how I made a table then let me know.
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retired@50
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Re: Help selecting funds.

Post by retired@50 »

lepa71 wrote: Mon Jun 20, 2022 5:14 pm ... Any thoughts?

Code: Select all

Name                               Full Name                              Symbol           Total Expense      Net Expense Ratio
FIDELITY 500 INDEX                 Fidelity 500 Index                     FXAIX            0.02%              0.02%
FIDELITY U.S. BOND INDEX           Fidelity US Bond Index                 FXNAX            0.03%              0.03%
FIDELITY INTERNATIONAL INDEX       Fidelity International Index           FSPSX            0.04%              0.04%
I'd probably just use the 3 listed above ^^^.

Combine in a way that suits your desired asset allocation.

Regards,
This is one person's opinion. Nothing more.
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retiredjg
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Re: Help selecting funds.

Post by retiredjg »

I would use the 500 index and total bond index. If you want to hold international in the 401k (instead of somewhere else), the international index will do fine.

If you prefer, the target date funds are fine as well.

Invest the rollover in a lump sum. It is unwise to take money out of the market and reinvest it over a period of time. You might get lucky or you might end up just paying more.
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lepa71
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Re: Help selecting funds.

Post by lepa71 »

Just forgot to ask. I assume my ER is the Net Expense Ratio.
Topic Author
lepa71
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Re: Help selecting funds.

Post by lepa71 »

retired@50 wrote: Mon Jun 20, 2022 5:21 pm
lepa71 wrote: Mon Jun 20, 2022 5:14 pm ... Any thoughts?

Code: Select all

Name                               Full Name                              Symbol           Total Expense      Net Expense Ratio
FIDELITY 500 INDEX                 Fidelity 500 Index                     FXAIX            0.02%              0.02%
FIDELITY U.S. BOND INDEX           Fidelity US Bond Index                 FXNAX            0.03%              0.03%
FIDELITY INTERNATIONAL INDEX       Fidelity International Index           FSPSX            0.04%              0.04%
I'd probably just use the 3 listed above ^^^.

Combine in a way that suits your desired asset allocation.

Regards,
Can you share your thoughts on ratio? I'm currently 90/10 stock/bond. Not sure about us vs international.
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Re: Help selecting funds.

Post by retired@50 »

lepa71 wrote: Mon Jun 20, 2022 5:44 pm
retired@50 wrote: Mon Jun 20, 2022 5:21 pm
lepa71 wrote: Mon Jun 20, 2022 5:14 pm ... Any thoughts?

Code: Select all

Name                               Full Name                              Symbol           Total Expense      Net Expense Ratio
FIDELITY 500 INDEX                 Fidelity 500 Index                     FXAIX            0.02%              0.02%
FIDELITY U.S. BOND INDEX           Fidelity US Bond Index                 FXNAX            0.03%              0.03%
FIDELITY INTERNATIONAL INDEX       Fidelity International Index           FSPSX            0.04%              0.04%
I'd probably just use the 3 listed above ^^^.

Combine in a way that suits your desired asset allocation.

Regards,
Can you share your thoughts on ratio? I'm currently 90/10 stock/bond. Not sure about us vs international.
I usually suggest about 30% of your stock should be international. This is enough to get the extra diversification benefit from owning international equities.
At your age, (51) I would consider a higher bond allocation than 10%, but what your spouse's portfolio looks like could also be relevant here.
As one possible sample portfolio... using a slightly more conservative 80/20 mix.
20% bond index
24% international stock
56% S&P 500 index

Regards,
This is one person's opinion. Nothing more.
Topic Author
lepa71
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Re: Help selecting funds.

Post by lepa71 »

retired@50 wrote: Mon Jun 20, 2022 6:20 pm
lepa71 wrote: Mon Jun 20, 2022 5:44 pm
retired@50 wrote: Mon Jun 20, 2022 5:21 pm
lepa71 wrote: Mon Jun 20, 2022 5:14 pm ... Any thoughts?

Code: Select all

Name                               Full Name                              Symbol           Total Expense      Net Expense Ratio
FIDELITY 500 INDEX                 Fidelity 500 Index                     FXAIX            0.02%              0.02%
FIDELITY U.S. BOND INDEX           Fidelity US Bond Index                 FXNAX            0.03%              0.03%
FIDELITY INTERNATIONAL INDEX       Fidelity International Index           FSPSX            0.04%              0.04%
I'd probably just use the 3 listed above ^^^.

Combine in a way that suits your desired asset allocation.

Regards,
Can you share your thoughts on ratio? I'm currently 90/10 stock/bond. Not sure about us vs international.
I usually suggest about 30% of your stock should be international. This is enough to get the extra diversification benefit from owning international equities.
At your age, (51) I would consider a higher bond allocation than 10%, but what your spouse's portfolio looks like could also be relevant here.
As one possible sample portfolio... using a slightly more conservative 80/20 mix.
20% bond index
24% international stock
56% S&P 500 index

Regards,
The reason we have only 10% bonds is that I have the regular salary to cover living expenses after maxing out all contributions( tIRA, Roth, and 401Ks). I used to have HSA and used it as an investment only. The new job does not have HSA, it only offers FSA( no high deductible plans)

I kind of always wanted to try Paul Merriman’s target fund and small-cap value portfolio in 80/20 between the 2. I saw the demo from his foundation and saw some gains there. What do you think?
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retired@50
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Re: Help selecting funds.

Post by retired@50 »

lepa71 wrote: Mon Jun 20, 2022 6:38 pm I kind of always wanted to try Paul Merriman’s target fund and small-cap value portfolio in 80/20 between the 2. I saw the demo from his foundation and saw some gains there. What do you think?
I've heard of the notion of using a small cap value fund combined with a target date fund on a podcast where Paul was either a guest or the podcast host, but that's the extent of my exposure to this idea.

However, given the choices you've listed, it seems one of the funds might be mislabeled. Vanguard does not consider the ticker VSCIX to be small cap value, they consider it small cap blend. So, I'm not really seeing which fund you could use in your plan to provide the small cap value exposure.

Code: Select all

Name                               Full Name                              Symbol           Total Expense      Net Expense Ratio
VANGUARD SMALL CAP VALUE           Vanguard Small Cap Index I             VSCIX            0.04%              0.04%
BLACKROCK LIFEPATH INDEX 2040      BLACKROCK LIFEPATH INDEX 2040          LIKKX            0.15%              0.09%
Source: https://investor.vanguard.com/mutual-fu ... folio/0857

Regards,
This is one person's opinion. Nothing more.
Topic Author
lepa71
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Re: Help selecting funds.

Post by lepa71 »

retired@50 wrote: Mon Jun 20, 2022 6:56 pm
lepa71 wrote: Mon Jun 20, 2022 6:38 pm I kind of always wanted to try Paul Merriman’s target fund and small-cap value portfolio in 80/20 between the 2. I saw the demo from his foundation and saw some gains there. What do you think?
I've heard of the notion of using a small cap value fund combined with a target date fund on a podcast where Paul was either a guest or the podcast host, but that's the extent of my exposure to this idea.

However, given the choices you've listed, it seems one of the funds might be mislabeled. Vanguard does not consider the ticker VSCIX to be small cap value, they consider it small cap blend. So, I'm not really seeing which fund you could use in your plan to provide the small cap value exposure.

Code: Select all

Name                               Full Name                              Symbol           Total Expense      Net Expense Ratio
VANGUARD SMALL CAP VALUE           Vanguard Small Cap Index I             VSCIX            0.04%              0.04%
BLACKROCK LIFEPATH INDEX 2040      BLACKROCK LIFEPATH INDEX 2040          LIKKX            0.15%              0.09%
Source: https://investor.vanguard.com/mutual-fu ... folio/0857

Regards,
You are right. I did not look deep enough and was judging by the label on their retirement focus site. Looking in the https://doc.morningstar.com/docdetail.a ... cker=VSCIX it is a blend of the 4 funds including the value one. lol
Comparing it to VSIIX, it is still not bad of a return as what Paul was using it for.

Just one more question. I asked this earlier. I believe Net ER is the actual ER I would pay for BlackRock TF. Right?
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Re: Help selecting funds.

Post by retired@50 »

lepa71 wrote: Mon Jun 20, 2022 7:11 pm Just one more question. I asked this earlier. I believe Net ER is the actual ER I would pay for BlackRock TF. Right?
I would expect the net ER is what you'd pay, but you might want to read the 401k plan documents to make certain.

Regards,
This is one person's opinion. Nothing more.
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Re: Help selecting funds.

Post by retired@50 »

lepa71 wrote: Mon Jun 20, 2022 7:11 pm You are right. I did not look deep enough and was judging by the label on their retirement focus site. Looking in the https://doc.morningstar.com/docdetail.a ... cker=VSCIX it is a blend of the 4 funds including the value one. lol
I suspect that the fund isn't a blend of 4 funds, I think that prospectus document covers all 4 of those funds, but each fund is a stand-alone fund in its own right. I've seen this sort of prospectus document before, where multiple (similar) funds are all covered in a single document.

Regards,
This is one person's opinion. Nothing more.
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Re: Help selecting funds.

Post by ruralavalon »

BlackRock LifePath Index funds are excellent target date funds, and using one in your employer's plan would be a good choice.

If you want to create your own asset allocation then use a combination of:
1) FIDELITY 500 INDEX (FXAIX) ER 0.02%;
2) FIDELITY INTERNATIONAL INDEX (FSPSX) ER 0.04%; and
3) FIDELITY U.S. BOND INDEX (FXNAX) ER 0.03%.

NY LIFE INS CO ANCHOR IV fund is probably a Stable Value Fund or Guaranteed Income Fund. If it pays a good interest rate it could be a suitable alternative to the bond fund.

I suggest reinvestment of the old 401k account immediately after the rollover. I see no benefit to stringing out the process.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
Topic Author
lepa71
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Re: Help selecting funds.

Post by lepa71 »

ruralavalon wrote: Tue Jun 21, 2022 11:17 am BlackRock LifePath Index funds are excellent target date funds, and using one in your employer's plan would be a good choice.

If you want to create your own asset allocation then use a combination of:
1) FIDELITY 500 INDEX (FXAIX) ER 0.02%;
2) FIDELITY INTERNATIONAL INDEX (FSPSX) ER 0.04%; and
3) FIDELITY U.S. BOND INDEX (FXNAX) ER 0.03%.

NY LIFE INS CO ANCHOR IV fund is probably a Stable Value Fund or Guaranteed Income Fund. If it pays a good interest rate it could be a suitable alternative to the bond fund.

I suggest reinvestment of the old 401k account immediately after the rollover. I see no benefit to stringing out the process.
I'm wondering, why not include FIDELITY EMERGING MARKETS IDX. Is it because of the current market?
Also. Are BlackRock lifepath index funds better than Vanguard retirement funds for the same year?
I had good success with Vanguard Growth Index Institutional VIGIX but I think it is too much into technology now. So not sure about it anymore.

As for, NY LIFE INS CO ANCHOR IV fund, I can find much info on it. My plan does not show any brochure info.

What ratio would you suggest for those 3 funds portfolio?
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Re: Help selecting funds.

Post by retiredjg »

lepa71 wrote: Wed Jun 22, 2022 5:17 pm
ruralavalon wrote: Tue Jun 21, 2022 11:17 am BlackRock LifePath Index funds are excellent target date funds, and using one in your employer's plan would be a good choice.

If you want to create your own asset allocation then use a combination of:
1) FIDELITY 500 INDEX (FXAIX) ER 0.02%;
2) FIDELITY INTERNATIONAL INDEX (FSPSX) ER 0.04%; and
3) FIDELITY U.S. BOND INDEX (FXNAX) ER 0.03%.

NY LIFE INS CO ANCHOR IV fund is probably a Stable Value Fund or Guaranteed Income Fund. If it pays a good interest rate it could be a suitable alternative to the bond fund.

I suggest reinvestment of the old 401k account immediately after the rollover. I see no benefit to stringing out the process.
I'm wondering, why not include FIDELITY EMERGING MARKETS IDX. Is it because of the current market?
You could certainly add that one. This particular "total international" is not total - it is a developed markets fund and does not contain the emerging markets. Add it if you want to really be "total". About 75/25 will do.

Also. Are BlackRock lifepath index funds better than Vanguard retirement funds for the same year?
The Blackrock target funds are certainly good funds and low cost to boot. Whether they are "better" or not is probably a matter of opinion, and probably irrelevant.

As for, NY LIFE INS CO ANCHOR IV fund, I can find much info on it. My plan does not show any brochure info.
It is a stable value fund. The US bond index is likely your best choice. Stable value is fine but you have to keep an eye on what it is paying each year. Sometimes it is better than a bond fund. Sometimes not.

https://markets.businessinsider.com/fun ... 64953abn90
What ratio would you suggest for those 3 funds portfolio?
That depends on two things. Your desired stock to bond ratio. And what is in all the other accounts you and your spouse (if any) have.
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lepa71
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Re: Help selecting funds.

Post by lepa71 »

retiredjg wrote: Wed Jun 22, 2022 5:35 pm
lepa71 wrote: Wed Jun 22, 2022 5:17 pm
ruralavalon wrote: Tue Jun 21, 2022 11:17 am BlackRock LifePath Index funds are excellent target date funds, and using one in your employer's plan would be a good choice.

If you want to create your own asset allocation then use a combination of:
1) FIDELITY 500 INDEX (FXAIX) ER 0.02%;
2) FIDELITY INTERNATIONAL INDEX (FSPSX) ER 0.04%; and
3) FIDELITY U.S. BOND INDEX (FXNAX) ER 0.03%.

NY LIFE INS CO ANCHOR IV fund is probably a Stable Value Fund or Guaranteed Income Fund. If it pays a good interest rate it could be a suitable alternative to the bond fund.

I suggest reinvestment of the old 401k account immediately after the rollover. I see no benefit to stringing out the process.
I'm wondering, why not include FIDELITY EMERGING MARKETS IDX. Is it because of the current market?
You could certainly add that one. This particular "total international" is not total - it is a developed markets fund and does not contain the emerging markets. Add it if you want to really be "total". About 75/25 will do.

Also. Are BlackRock lifepath index funds better than Vanguard retirement funds for the same year?
The Blackrock target funds are certainly good funds and low cost to boot. Whether they are "better" or not is probably a matter of opinion, and probably irrelevant.

As for, NY LIFE INS CO ANCHOR IV fund, I can find much info on it. My plan does not show any brochure info.
It is a stable value fund. The US bond index is likely your best choice. Stable value is fine but you have to keep an eye on what it is paying each year. Sometimes it is better than a bond fund. Sometimes not.

https://markets.businessinsider.com/fun ... 64953abn90
What ratio would you suggest for those 3 funds portfolio?
That depends on two things. Your desired stock to bond ratio. And what is in all the other accounts you and your spouse (if any) have.
I was looking for the ratio between international vs us stocks. My and my wife's investments are 90/10 Stock/Bonds. Some people posted I should consider 80/20 but I feel like if I stay 90/10 I would gain more on this downturn. I roughly contribute right now a $1250 per 2 weeks into 401K( it includes mine and company match).
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Re: Help selecting funds.

Post by retiredjg »

There is no consensus on this. People suggest anywhere between 0% international to about 50% of the stocks in international. That's for the whole portfolio, not just the one account at work.

I personally like about 1/3rd of my stocks in international.
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ruralavalon
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Re: Help selecting funds.

Post by ruralavalon »

lepa71 wrote: Wed Jun 22, 2022 5:17 pm
ruralavalon wrote: Tue Jun 21, 2022 11:17 am BlackRock LifePath Index funds are excellent target date funds, and using one in your employer's plan would be a good choice.

If you want to create your own asset allocation then use a combination of:
1) FIDELITY 500 INDEX (FXAIX) ER 0.02%;
2) FIDELITY INTERNATIONAL INDEX (FSPSX) ER 0.04%; and
3) FIDELITY U.S. BOND INDEX (FXNAX) ER 0.03%.

NY LIFE INS CO ANCHOR IV fund is probably a Stable Value Fund or Guaranteed Income Fund. If it pays a good interest rate it could be a suitable alternative to the bond fund.

I suggest reinvestment of the old 401k account immediately after the rollover. I see no benefit to stringing out the process.
I'm wondering, why not include FIDELITY EMERGING MARKETS IDX. Is it because of the current market?
That is would be a reasonable addition in my opinion.


lepa71 wrote: Wed Jun 22, 2022 5:17 pmAlso. Are BlackRock lifepath index funds better than Vanguard retirement funds for the same year?
Morningstar The Best Target-Date Funds for 2021 and Beyond. It seems that BlackRock LifePath target-date index funds are probably as good as Vanguard target-date funds. Morningstar rates the BlackRock funds higher than the Vanguard funds


lepa71 wrote: Wed Jun 22, 2022 5:17 pm What ratio would you suggest for those 3 funds portfolio?
Asset allocation is a very personal decision which must be based on your own individual ability, willingness and need to take risk.

It depends on facts that you haven't mentioned. About how long until expected retirement? Will you be eligible for a significant pension? What other accounts and investments do you and your spouse have? Do you have debt? Do you have dependents? How would you describe your tolerance for risk?

At age 51 an asset allocation around 30-40% bonds, with 20-30% of stocks in international stocks, would be within the range of what is reasonable in my opinion. So that could be something like:
1) 50% U.S. stocks;
2) 15% international stocks; and
3) 35% bonds.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
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lepa71
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Re: Help selecting funds.

Post by lepa71 »

Is there a website where I can find a curve for target funds to show how often the rebalancing is going to happen?
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Re: Help selecting funds.

Post by retired@50 »

lepa71 wrote: Wed Jun 22, 2022 9:22 pm Is there a website where I can find a curve for target funds to show how often the rebalancing is going to happen?
Check out some of the graphics and charts at this Vanguard site to get a general idea about how the investments change over the 40+ years that the funds exist.
https://institutional.vanguard.com/inve ... date-funds

Here's one that's helpful.
Image

Regards,
This is one person's opinion. Nothing more.
exodusNH
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Re: Help selecting funds.

Post by exodusNH »

lepa71 wrote: Wed Jun 22, 2022 9:22 pm Is there a website where I can find a curve for target funds to show how often the rebalancing is going to happen?
What do you mean by rebalancing? (It can mean a couple of things.)

If you mean "keeping the 3 asset classes at the proportions" I want, some of them do that daily. Quarterly, yearly, or when they get out of whack by 25% or an absolute 5%. E.g. 50% US - rebalance at 45% or below or 55% or higher. Or, bonds at 11.25% or lower or 18.75% or higher. The exact frequency doesn't matter too much as long as it's not too often or rarely.

If you mean "how the bond allocation increases over time", that's called the glidepath. About 25 years from the target date, it shifts 1-2% per year into bonds.

Successful investing is mostly about not making big mistakes, not precision.
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Re: Help selecting funds.

Post by retiredjg »

lepa71 wrote: Wed Jun 22, 2022 9:22 pm Is there a website where I can find a curve for target funds to show how often the rebalancing is going to happen?
I don't think you mean "rebalancing" which is probably near daily.

I think you are asking about "re-allocation" meaning changing the stock to bond ratio over time. Each fund family has their own formula which you would have to find on the website for their target funds.
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