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I'm 51 years old and hope to retire at 62. Besides my 401K, I have two roll-over IRAs - a traditional IRA ($265K) and a Roth IRA ($52K). These IRAs are currently professionally managed at Fidelity (Fidelity Portfolio Advisory Service) for a fee of a little over 1%. The reason I chose to put this money in a managed fund was that I don't have a lot of expertise at investing and I don't care to spend a great deal of time managing the money myself. However, I feel that if the managed fund is not able to beat the market (which it's not), then it's not worth the high fees I'm paying. Though I tend to think that some managed funds may be worth the fees if they can consistently beat the market over an extended period.

I've been considering moving my money into a family of low-cost index funds (with some allocation between domestic stocks, international stocks and bonds). Specifically, I was thinking of Fidelity Spartan funds (to keep the money at the same place as the 401K money) or possibly moving to some of the low-cost Vanguard index funds. However, I was also considering ETFs, but I don't really know the pros/cons of that approach.

I was also toying with the idea of just moving the $265K into index funds (or ETFs?), and moving the $52K into another actively managed fund, if I can find one with reasonable fees and a good track record. Then I could leave them alone for a while to see how things are going.

I would appreciate any advice on managed funds vs. index funds vs. ETFs for roll-over IRAs.
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