New Career with benefits.

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tj.carpenter
Posts: 1
Joined: Sun Aug 27, 2017 8:10 pm

New Career with benefits.

Post by tj.carpenter » Mon Feb 12, 2018 7:09 pm

Hey guys! Im new to the whole investing thing other than just throwing money at an old 401 through an old employer. Ive been in school the past couple years and have started my new career as a CRNA. My wife (30) and myself (28) will be making a combined approx. 180k per year. She currently has 41k in a traditional IRA. I have approx. 11k in old 401k. Zero debt between the two of us.

I am currently in process of enrolling in new benefits with new employer. I plan on maxing out my 401k, maxing out my wife's IRA, and contributing to our HSA. I was contemplating putting about 60% of my 401k into a roth portion, and the other 40% traditional. Below are my options for funds to choose from within the plan. Ive talked to people who say that the target date fund is the best to do, but I also know that index funds tend to do really well with lower fees. I would love some input from everyone! Thanks in advance.

FID 500 INDEX INST (FXSIX)
Stock Investments Large Cap 0.03% No additional fees apply.

VANG GRTH INDEX INST (VIGIX)
Stock Investments Large Cap 0.05% No additional fees apply.

VANG VAL INDEX INST (VIVIX)
Stock Investments Large Cap 0.05% No additional fees apply.

FID EXT MKT IDX PR (FSEVX)
Stock Investments Mid-Cap 0.07% No additional fees apply.

VANG MDCPVAL IDX ADM (VMVAX)
Stock Investments Mid-Cap 0.07% No additional fees apply.

VANG SM GR IDX INST (VSGIX)
Stock Investments Small Cap 0.06% No additional fees apply.

VANG SM VAL IDX INST (VSIIX)
Stock Investments Small Cap 0.06% No additional fees apply.

FID INTL INDEX INS (FSPNX)
Stock Investments International 0.05% No additional fees apply.

VAN REAL EST IDX IS (VGSNX)
Stock Investments Specialty 0.1% No additional fees apply.

JPMCB SR PB 2020 CF
Blended Investment* N/A 0.26% No additional fees apply.

JPMCB SR PB 2025 CF
Blended Investment* N/A 0.26% No additional fees apply.

JPMCB SR PB 2030 CF
Blended Investment* N/A 0.26% No additional fees apply.

JPMCB SR PB 2035 CF
Blended Investment* N/A 0.26% No additional fees apply.

JPMCB SR PB 2040 CF
Blended Investment* N/A 0.26% No additional fees apply.

JPMCB SR PB 2045 CF
Blended Investment* N/A 0.26% No additional fees apply.

JPMCB SR PB 2050 CF
Blended Investment* N/A 0.27% No additional fees apply.

JPMCB SR PB 2055 CF
Blended Investment* N/A 0.28% No additional fees apply.

JPMCB SR PB INC CF
Blended Investment* N/A 0.27% No additional fees apply.

VANG BAL INDEX INST (VBAIX)
Blended Investment* N/A 0.06% No additional fees apply.

FID INT TR IDX PR (FIBAX)
Bond Investments Income 0.06% No additional fees apply.

VANG INTM BOND INST (VBIMX)
Bond Investments Income 0.05% No additional fees apply.

DFA INF PRT SEC PORT (DIPSX)
Bond Investments N/A 0.12% No additional fees apply.
FIMM TREASURY INST (FRBXX)

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alec
Posts: 2888
Joined: Fri Mar 02, 2007 2:15 pm

Re: New Career with benefits.

Post by alec » Mon Feb 12, 2018 8:36 pm

tj.carpenter wrote:
Mon Feb 12, 2018 7:09 pm
Ive talked to people who say that the target date fund is the best to do, but I also know that index funds tend to do really well with lower fees. I would love some input from everyone! Thanks in advance.
Well, the target date funds you have access to are pretty low fee, but not as low as the other funds in your 401(k). For, example, you could build a portfolio with the 3-5 funds below that would be just as diversified as the TR funds in the 401(k) at lower cost.**

although, if you really wants hands off, you could just do target date funds in every tax protected account (401(k), IRA, HSA, etc), and be done with it.

FID 500 INDEX INST (FXSIX)
Stock Investments Large Cap 0.03% No additional fees apply.

FID EXT MKT IDX PR (FSEVX)
Stock Investments Mid-Cap 0.07% No additional fees apply.

FID INTL INDEX INS (FSPNX)
Stock Investments International 0.05% No additional fees apply.

VANG INTM BOND INST (VBIMX)
Bond Investments Income 0.05% No additional fees apply.

DFA INF PRT SEC PORT (DIPSX)
Bond Investments N/A 0.12% No additional fees apply.
** doesn't look like the FSPNX has emerging markets in it (it's a MSCI EAFE index fund), so you'd have to get Emerging Market stocks in the IRAs.
"It is difficult to get a man to understand something, when his salary depends upon his not understanding it!" - Upton Sinclair

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Nearing_Destination
Posts: 778
Joined: Wed Aug 05, 2009 1:26 pm

Re: New Career with benefits.

Post by Nearing_Destination » Mon Feb 12, 2018 9:10 pm

alec wrote:
Mon Feb 12, 2018 8:36 pm
tj.carpenter wrote:
Mon Feb 12, 2018 7:09 pm
Ive talked to people who say that the target date fund is the best to do, but I also know that index funds tend to do really well with lower fees. I would love some input from everyone! Thanks in advance.
Well, the target date funds you have access to are pretty low fee, but not as low as the other funds in your 401(k). For, example, you could build a portfolio with the 3-5 funds below that would be just as diversified as the TR funds in the 401(k) at lower cost.**

although, if you really wants hands off, you could just do target date funds in every tax protected account (401(k), IRA, HSA, etc), and be done with it.

FID 500 INDEX INST (FXSIX)
Stock Investments Large Cap 0.03% No additional fees apply.

FID EXT MKT IDX PR (FSEVX)
Stock Investments Mid-Cap 0.07% No additional fees apply.

FID INTL INDEX INS (FSPNX)
Stock Investments International 0.05% No additional fees apply.

VANG INTM BOND INST (VBIMX)
Bond Investments Income 0.05% No additional fees apply.

DFA INF PRT SEC PORT (DIPSX)
Bond Investments N/A 0.12% No additional fees apply.
** doesn't look like the FSPNX has emerging markets in it (it's a MSCI EAFE index fund), so you'd have to get Emerging Market stocks in the IRAs.
I don’t know if I’d worry about EM, as I would have included small cap instead, in addition to some mid-cap ( you’d have to look to see how low the mid-cap fund goes to determine how much small cap you want to add)

agree that you could “roll your own “ at lower cost and really wouldn’t need to alter except slight modifications every few years (if working a glide path). you’d be doing any rebalancing yourself but could do that with new contributions

delamer
Posts: 3625
Joined: Tue Feb 08, 2011 6:13 pm

Re: New Career with benefits.

Post by delamer » Tue Feb 13, 2018 7:13 pm

A quick online search shows that the Target Date funds are composed of non-index funds, so I suspect that the fees posted are in addition to fairly high fees for the underlying funds. You can confirm that with a bit of research. If so, 0.26% is just the tip of the iceberg.

If you check the wiki on this site on “lazy portfolios,” you’ll find suggestions for portfolios that can be put together using the index funds available to you.

Your best bet is to pick a lazy portfolio and rebalance once a year to your preferred allocation.
Last edited by delamer on Tue Feb 13, 2018 7:15 pm, edited 1 time in total.

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Duckie
Posts: 5382
Joined: Thu Mar 08, 2007 2:55 pm

Re: New Career with benefits.

Post by Duckie » Tue Feb 13, 2018 7:14 pm

Nearing_Destination wrote:I don’t know if I’d worry about EM, as I would have included small cap instead, in addition to some mid-cap
Extended Market is not really a mid-cap fund. It's the "Completion Index" and holds the mid/small caps that aren't in the 500 Index. Roughly 80% 500 Index plus 20% Extended Market makes up the total US stock market.

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Nearing_Destination
Posts: 778
Joined: Wed Aug 05, 2009 1:26 pm

Re: New Career with benefits.

Post by Nearing_Destination » Tue Feb 13, 2018 9:11 pm

EM ===> emerging markets

(but I can see how you mistook me)

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Duckie
Posts: 5382
Joined: Thu Mar 08, 2007 2:55 pm

Re: New Career with benefits.

Post by Duckie » Tue Feb 13, 2018 9:31 pm

Nearing_Destination wrote:EM ===> emerging markets

(but I can see how you mistook me)
I understood you meant emerging markets for the first part of the sentence, but then you were writing about adding small caps in addition to the proposed mid caps and I was pointing out that although FID EXT MKT IDX PR (FSEVX) states it's a mid-cap fund, it really isn't.

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Nearing_Destination
Posts: 778
Joined: Wed Aug 05, 2009 1:26 pm

Re: New Career with benefits.

Post by Nearing_Destination » Tue Feb 13, 2018 9:43 pm

Sorry Duckie

wasn’t really looking at the fund, especially how far down it goes. I use a mid-cap fund that doesn’t have that much small cap in it. (I also haven’t added to emerging markets, instead culled some earlier, and don’t tilt to small cap ( I prefer Mel’s unloved mid-caps) as I don’t need the volatility in retirement)

I was merely thinking that if the fund did in fact have significant small cap in it that one might not need (much) additional small cap for their desired allocation

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