Hi,
I'm 35 and currently have my entire 401k going into Fidelity index fund FXAIX. I originally had my 401k going into a target date 2040 fund. Below is a brief summary of both funds.
- 2040 Target fund: Fees ($4.00 per $1000), 1 year growth (16.49%), 5 year growth (11.02%), 10 year growth (10.13%)
- FXAIX: Fees ( ($0.15 per $1000), 1 year growth (17.44%), 5 year growth (13.98%), 10 year growth (14.18%)
Ideally I would like to retire at 55. I'm investing 15% of my income into my 401k and at the moment have a balance of $300k. I switched from the target date fund years ago due to the high fee's and lower returns compared to some index funds. However, is it really smart to have an entire 401k going into a single fund? Fee's alone on the target date fund would run me $1,200 a year, or $45 a year with the FXAIX index fund.
One argument I heard at the time is that an index fund will basically track the market which isn't necessarily a bad thing. My plan was to keep putting money into the index fund and then once I'm within 3-5 years of retirement start moving the money to a more stable fund.
Another fund that I've been eyeing lately is Harbor Capital Appreciation Fund Retirement Class. The fee's are high but the returns have been excellent over the past 10 years.
- HNACX: Fee's ($5.90 per $1000), 1 year growth (51.28%), 5 year growth (21.01%), 10 year growth (18.26).
Thank you
Submitted December 23, 2020 at 09:44PM by PinballBomb https://ift.tt/37LwYhW
