Daben,

Are you eligible to contribute to a Roth IRA? Conventional wisdom tends to
point to a prioritization as follows:
1. Contribute to 401(k) up to company match
2. Max out Roth IRA
3. Resume contributions to 401(k)
Ask if you need more information on why this prioritization is often
recommended.

For ideas on diversifying according to your age and risk tolerance, try some
of the many free online allocation tools listed at
http://home.earthlink.net/~elle_navorski/id4.html

Re bonds v. stocks: Historically stocks have done better than (investment
grade) bonds. Still, there are time periods where bonds certainly have
outperformed stocks. Many sources and authorities thus urge a mix of stocks
and bonds. This minimizes risk and maximizes return. If you have no faith in
stocks, then, sure put all your money in bonds. I personally urge further
study of the subject in areas such as what ownership of a stock means;
valuation of a company and so its stock; realities like a company's earnings
tend to rise because of (1) inflation and (2) greater demand (via either
population growth or better marketing). Bonds do not respond in the same
way. For the bottom to truly fall out of the stock market, IMO a surreal
amount of global chaos will be essential.

Lastly, you can arguably minimize risk in stock investing by sticking with
older, larger companies. Growth of principal may not be as great, but many
say it will exceed inflation.

Elle
Individual investor in stocks, bonds, and mutual funds for 20+ years

"daben" <dabenpb[at]yahoo.com> wrote:


- quote -

It's hard to say whether there are too many funds without knowing how much money
is involved, but it looks like you might. I think four or five funds would do
until you get into the mid six figures. (Broad equity index, bond index,
international, and perhaps an actively managed fund or two for spice).

- quote -

Market timing is a fool's game. Pick a equities/bond split that lets you sleep
at night and stick with it.

At some point in the next 30 years, you are going to get a brokerage statement
showing you have lost a bunch of money. Say a nasty word, rebalance to your
planned split, and get on with life.

At some point in the next 30 years, you are going to get a brokerage statement
showing you have made a bunch of money. Say a nice word, rebalance to your
planned split, and get on with life.

-- Doug

give 5 letter ticker symbols and/or go to morningstar.com.

I agree there is probably overlap. A follow up questions is "why did
you choose these funds"?

Of course you have overlapping funds. There are more stock funds in the
world than there are stocks. What are the fees of these funds, and how
has this aggregate (the stock portion) performed compared to the S&P500
for the 1-year, 5-year, and 10-year period?
If you want complete diversity and completely get rid of management
fees (which makes a big difference over the long haul) You could
simplify
and sit back:

Stock portion (most of it at your age):
90% VTI (VIPER) whole-market ETF
10% EFA international market ETF

Bonds: a mix of low-cost funds like VFIIX, VFSTX, VIPSX, VWEHX

If/when you think you want to call the market, sell your
stocks. Good luck...

Hi All

I am in my early 30's, married and rent in LA. I would like some
comments on my 401k strategy based on my current portfolio. I am with
Fidelity: my employer matches 4% and I contribute 20%. I max out my
401k each year. Here is my current layout:

Current
Balance (%) Investment
15.23% SCUD FIXED INC INST
14.50% VANG PRIMECAP ADM
11.44% COL/ACORN SELECT Z
11.22% VANG WINDSOR ADM
10.54% VANG MORGAN GRTH ADM
9.99% OAKMARK EQ & INC I
7.97% SPECIALTY VALUE FUND
7.01% 1ST EAGLE OVERSEAS I
6.22% HARTFORD CAP APP IA
5.89% FIXED INCOME FUND

Specifically, I am wondering if I have overlapping funds, too many
funds, enough diversification. Also, I am really starting to wonder
about the state of the economy and am toying (not ready to implement)
with the idea of moving all of my portfolio into safe invesments (read
bonds) and wanted some comments on this also.

Thanks
daben