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Author: FoolStreet Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 465319  
Subject: Re: "Batten down the hatches?" Date: 11/14/2012 12:28 AM
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PolymerMom,

I've been on a huge 3-fund kick lately. Keeping it simple and just focusing on Asset Allocation, and then just low-cost indexes.

Have you thought of using a morningstar x-ray and also comparing expense ratios of your various funds?

Without googling each ticker, it looks like you have:

Bonds:
18.2 Bonds & CDs
18 Tax exempt bonds
7.1 Money Market
= 42% (not counting balanced)

US Stocks
3.9 HSGFX (1.07% ER)
3.9 VGENX (.34% ER)
4.4 FPACX (1.25% Expense Ratio!)
5.2 Large Cap Funds
= 17%

International Stocks
2.8 VINEX (.42% Expense Ratio)
3.9 First Eagle Global (1.13% Expense Ratio)
4.2 DODFX (0.64% Expense Ratio)
11.1 MACSX (1.12% Expense Ratio)
= 22%


Looking at the ERs, and for argument's sake, why not just do something like...

Bonds 42% (as-is, or try Vanguard Total Bond Mkt, VBMFX, ER .22%)
US Equity 17% (Vanguard Total Stock Market, VTSMX at .18% ER)
Int'l 22% (Vanguard International Index, VGTSX at .22% ER)

3 Funds and super simple, but boy look at those low expense ratios :-)


Again, for comparison's sake, paying 1.22% ER versus .22% ER is like losing 1% of your return to the fund. Considering that inflation is 1.6% and that money market only earns .2%, then giving away a free 1% to any fund seems pretty expensive to me.
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