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Author: beachgirl2011 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75540  
Subject: Am I in the right mix for my 401K Date: 4/12/2011 10:59 AM
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I am 38 and have been investing in this for 4 years. Here is what I invested in:

Blended Fund Investments The Blackrock LifePath Portfolios LIFEPATH 2050 50% (not a mutual fund)

Stock Investments Specialty FID REAL ESTATE 50% (mostly common stock)

I do have more options but I am unsure if I should change my holdings right now. I know I do not want bonds (too conservative) and I think sticking with the LifePath 2050 based on my age is a good idea. Does anyone have any input for me? I was thinking of maybe changing from Fid Real Estate to Legg Mason Batterymarch U.S. Small Capitalization Equity Portfolio because the YTD return was 9.19%.


However these are all my options:

Blended Fund Investments LifePath Portfolios LIFEPATH RETIREMNT
Blended Fund Investments LifePath Portfolios LIFEPATH 2015
Blended Fund Investments LifePath Portfolios LIFEPATH 2020
Blended Fund Investments LifePath Portfolios LIFEPATH 2025
Blended Fund Investments LifePath Portfolios LIFEPATH 2030
Blended Fund Investments LifePath Portfolios LIFEPATH 2035
Blended Fund Investments LifePath Portfolios LIFEPATH 2040
Blended Fund Investments LifePath Portfolios LIFEPATH 2045
Blended Fund Investments LifePath Portfolios LIFEPATH 2050
Blended Fund Investments LifePath Portfolios LIFEPATH 2055
Stock Investments Large Cap Growth COL. MARSICO FOCEQ
Stock Investments Large Cap Growth GROWTH FD AMERICA R6
Stock Investments Large Cap Blend COLUMBIA LGCAP IDX
Stock Investments Large Cap Value DODGE & COX STK FD
Stock Investments Large Cap Value COLUMBIA LGCAP VALUE
Stock Investments Mid-Cap Blend COLUMBIA MIDCAP IDX
Stock Investments Small Cap Blend COLUMBIA SMCAP IDX
Stock Investments Small Cap Blend LM BATTERYMARCH SMCP
Stock Investments Foreign COLUMBIA INTL EQUITY
Stock Investments Foreign FID DIVERSIFD INTL
Stock Investments Specialty FID REAL ESTATE
Stock Investments -- VANGUARD TOT STK MKT
Bond Investments Intermed Government VANG INFL-PROT SEC
Bond Investments Intermediate-Term COLUMBIA BOND FUND
Bond Investments Intermediate-Term WA CORE BOND I
Bond Investments Stable Value STABLE VALUE FUND
Stock BAC (Bank of America) COM STK FUND
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Author: drippinfool Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 68882 of 75540
Subject: Re: Am I in the right mix for my 401K Date: 4/12/2011 1:07 PM
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"I was thinking of maybe changing from Fid Real Estate to Legg Mason Batterymarch U.S. Small Capitalization Equity Portfolio because the YTD return was 9.19%."

Chasing good returns (or running from bad returns) is a sure way to reduce the value of your retirement savings. Past performance (even YTD performance, which is still in the past) is a poor indicator of future performance. I would look for low-cost, broad-based index funds such as the Vanguard Total Stock Market Index Fund to fill your equities allocation. You do have a desired asset allocation, don't you?

(Disclosure: I own Vanguard Total Stock Market Index Fund)

-drip

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Author: CABob Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 68883 of 75540
Subject: Re: Am I in the right mix for my 401K Date: 4/12/2011 1:24 PM
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I am 38 and have been investing in this for 4 years. Here is what I invested in:

Blended Fund Investments The Blackrock LifePath Portfolios LIFEPATH 2050 50% (not a mutual fund)

Stock Investments Specialty FID REAL ESTATE 50% (mostly common stock)

I don't have any specific recommendation, but, that seems like a very high allocation to real estate. You indicate that the LifePath is not a mutual fund, but, it sure sounds like one.
http://www2.blackrock.com/US/institutions/investment-strateg...
I assume it contains investments in both stock and bonds, domestic and international, large cap and small cap and it otherwise well diversified. That seems like a reasonable choice in a tax advantaged account.

Bob

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Author: MajorMajor78 One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 68884 of 75540
Subject: Re: Am I in the right mix for my 401K Date: 4/12/2011 4:49 PM
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50% is by far the single largest holding of REIT's I've ever hear of. Most people if they like REIT's go for 5-15% of a portfolio.

The Lifepath 2050 is pretty solid for a fire and forget type of retirement investment. Market cap weighting looks to more or less follow the overall market and has about 33% exposure to international and a modest exposure to emerging markets.

I guess the choice is if you want to do it yourself or if you want to keep it fire and forget. Not all that long ago I got rid of our target date funds and went with VANGUARD TOT STK MKT along with both mid-cap and small-cap funds to overweight the little guys.

Don't chase returns. Keep the expenses low (very important). Do a little reading on asset allocation and figure out a good mix that meets your goals and risk tolerance.

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Author: biddy11 One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 68904 of 75540
Subject: Re: Am I in the right mix for my 401K Date: 4/15/2011 6:06 AM
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Look you should have a pie like this for your age(If you like aggressive,like I do I'm 33)

40% a large US cap
25% A small US cap
20% international
15% bond

Lets make are money early!
then when your five years from drawing on your 401k...switch to this

60% bond
15% cash
25% stocks
Much success
Biddy

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Author: madbrain Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 68906 of 75540
Subject: Re: Am I in the right mix for my 401K Date: 4/16/2011 12:02 PM
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beachgirl2011,

The expense ratios and whether the funds are managed or passive are important. I think in your list, you should put a significant portion in the Vanguard total stock market fund. This is low expense and passive. I would elect at least 40%.

You should have some international exposure also. You have only one choice in your 401k, the Fidelity diversified international. It is a managed fund unfortunately. Fortunately, it is a very good fund. I held it for many years. I would still be in it but rolled over my funds to a new employer and am now in Harbor international instead, which is also managed. Everything points to the US no longer being the #1 world economy fairly soon. I have had 40 to 50% international exposure for many years in my 401k for that reason. Most people have less, 20 to 30%.

You didn't put the ticker for fidelity real estate. Is it FRESX ? 50% exposure is definitely way too high. I do think real estate will pick up though. If you have been holding for a while and still have a profit in the fund, you may want to take some profits now and reduce the exposure to about 20%. If not, reduce a it gradually and exchange it for other funds as it picks up.

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