2007-04-25 08:39:48 · 6 answers · asked by kickapoocreek 1 in Business & Finance ➔ Investing
As you have already been advised, your age somewhat effects your mutual fund selection but it should not dominate it.
In my opinion, if you are 10 years away from retirement, equities should account for 75% to 100% of your portfolio. Less than 10 years 50% to 75%, short term investments 25%, long term foreign currency denominated debt 25% more or less.
Of the equity portion, 1 part large cap, 1 part foreign developed market, 1 part foreign devloping markets especially China and India, 1 part mid cap, 1 part value dividend paying investments.
That is a somewhat rough approximation, but something along those lines.
2007-04-25 09:40:14 · answer #1 · answered by Anonymous · 1⤊ 0⤋
The easiest method is to base it on age. If you are 20-40 years old, go with aggressive funds that have mostly stocks. You are young enough to withstand the risk and you will be rewarded for it. If you are 40-55, choose funds that have a combination of stocks and bonds so their is mild risk. If you are approaching retirement at age 55 or higher, go with low-risk funds that are more based on bonds so you don't lose a lot of your nest egg if the market tumbles.
If you want to do some homework, go to the website of the 401K company and look at the history of each fund. Choose funds that have had good results and are relatively young and can still grow.
2007-04-25 08:59:07 · answer #2 · answered by Mr. Luva Luva 4 · 1⤊ 0⤋
Ask your plan administrator for as much information as possible on each fund. Find out what level of risk each one carries, what its performance has been over the last five years, and what the fund invests your money in. Check them out on the internet--find out what their fund managers' reputations are. Once you have that information, you can make an educated decision, rather than a guess, as to where to commit your money.
2007-04-25 08:43:43 · answer #3 · answered by MOM KNOWS EVERYTHING 7 · 0⤊ 0⤋
Find a financial counselor. You don't pay them, other companies do.
2007-04-25 08:43:20 · answer #4 · answered by Rhi 3 · 0⤊ 0⤋
In general, the older you are the more conservative you should be. If you're young, get risky. go to vegas..
2007-04-25 08:50:56 · answer #5 · answered by penny stomper 1 · 0⤊ 0⤋
Put it up on the wall and throw darts.
2007-04-25 08:42:44 · answer #6 · answered by mrmanseven 3 · 0⤊ 2⤋