This girl likes funds.
I found a CNN Money article that listed the 7 types of funds for a diversified portfolio:
U.S. Blue Chip
International Blue Chip
Small Cap
Value
Bond Fund
TIPs Fund
Money Market Fund
My current funds are:
U.S. blend fund
International fund
Bond fund
Money Market fund
Eventually, I’d like to add a small value fund and a REIT fund to my equity holdings and a TIPs Fund to fixed holdings. All of these funds have a minimum dollar amount, so I’ll have to wait until my portfolio double in size before I take that step. For now, I feel that my portfolio is appropriate for my risk tolerance and goals.
As always, please do your own research before you invest.
And, I don’t know how realistic this is (need to crunch the numbers first), but I’d like to have $100,000 saved for retirement by the time I’m 30. This figure is daunting (because I expect to be in school for 2 years before 30), but it’s made less so by the fact that 1. I can hope to have gains carry me some of the way (although in this market…), 2. I already have almost 1/4 saved towards that $100,000 goal.
“I’d like to have $100,000 saved for retirement by the time I’m 30.”
Me too!! It is one of my goals, obviously not well thought out since it involves such nice round numbers. A lot depends on the market, but I think I should be able to do it just fine if things go how I hope with my career (no plans to quit work for school).
I have pretty similar funds, but mostly through the target date funds. I did add in a REIT, which is a little larger slice of my portfolio than I’d like, but had a minimum investment, and it’s slice is shrinking
I picked up the latest “Money” magazine at the airport yesterday – and this was the article in it! I thought it was great, and of course it highlights mutual funds (especially low-cost ones) so that is fantastic. I think it is a great idea, and I hope to follow the style when I start investing in my company’s 401(k) in October!
It looks like you have a nice, simple set of funds. As you mentioned, getting some small-cap exposure can help your returns over the long-term, as can some emerging markets exposure. The CNN/Money article seemed to pick a pretty random set of funds. It doesn’t make much sense to recommend, for instance, an S&P 500 index fund in addition to a “Value” fund since many of the stocks in the S&P are value stocks with relatively high dividend yields. I’m also not sure how important a TIPS fund is for the average investor, in addition to a regular bond fund.
My goal is to have paid off my college loans (~$30K) and also have $15K saved by the time I’m 24, because that’s when I’ll need to go back to grad school. So that’s about $15K/year. My company will pay for my MBA, so assuming I have 4 years left after grad school and continue socking away $15K per year, I’ll be at $75K by the time I’m 30. Not bad!