time to call him
Nobody told me that I was going to have to choose the investments in my 401K and decide how to balance it. Silly me for thinking that it was something simple, like shares in one mutual fund. After doing some research and playing with risk tolerance estimators, I realize that I’ll have to actually do some research, get down with some prospectuses(… prospecti?… prospectus’s? LOL!), investigate fees, and take my decision seriously. And I already know that even then, I’ll want some reassurance that I’m doing the smart thing and my choices appropriately address my goals.
So I think it’s time to call that financial planner whose contact information I’ve been holding on to for such a time as this. I’ve been putting this off because I didn’t want to spend time or money on service that I can provide for myself. I have always been a do-it-yourself-er, when the task is something I can do to my own satisfaction. It wasn’t hard to figure out that I need to reduce my high interest debt as quickly as possible, start saving regularly, and reduce my expenses. I didn’t need a financial planner for that. But properly balancing my 401K is another level of finance. I’m ready to learn how to do it on my own - I’ve already started learning. But I’m not so cocky about my ability to learn that I’m going to make my choice based on my unprofessional, inexperienced judgment alone.
Now I just have to find his number…
You can do it yourself. Try 80% stocks and 20% bonds
or you can be more aggressive and do 90% stocks and 10% bonds
Thanks for the vote of confidence! Even once I’ve decided these larger percentages, I have to choose which funds I want - I have read up again on the differences between small, mid, and large cap funds and decide how I want to split my stock and bond percentages. I was surprised to find that I had so much choice (and responsibility)!
Comment by Moneymonk — September 21, 2007 @ 11:51 am
Wow. That sounds tough. My 401(k) doesn’t offer a ton of options so it’s easy for novices like me to jump into it. Best of luck, and I hope you can share your decisions! I’m learning with you
Comment by ms. m&p — September 21, 2007 @ 12:39 pm
My 401k offer retirement target funds depending on the date you plan to retire.
ex. Vanguard 2030, 2040 whatever year you plan to turn 65
If you have that option it’s more easier. Because they spread the money out for you.
I have VASGX in my 401k
I love how when I typed VASGX into Google, its information - full name, year to date performance, aMorningstar rating, and a graph for the past four years popped up in the search results. Thanks Moneymonk - I learn something new every day! I’ll probably spend a significant part of the weekend setting up my 401K and other financial stuff. Should be fun… *smirk*
Comment by Moneymonk — September 21, 2007 @ 4:08 pm
When I started to put money in my 401K I just allocated it all to aggressive and growth funds. I did that to get the company match. Did not have that many options. Good that you are looking into researching…now that I am moving my funds because am no longer at the job. I will switch to vanguard targeted funds. Makes it easy for a novice like me who does not know much.
Comment by tiredofbeingbroke — September 21, 2007 @ 7:50 pm
I remember five years ago when I had to choose for my banks I just picked blindly. I had no idea what those numbers meant. Five years later I had $2,000. I can just imagine would it would be if I had known what I was doing. LOL!
I’m glad you educated yourself before hand
Comment by Constance — September 27, 2007 @ 5:28 pm