Retirement fund help?

Question

I don't mind risk and already have growth funds. Im looking for a balanced fund such as SABPX but would like some feed back on the liftime funds from principal funds such as the 2050. What do you think? Good idea? What are the fees like? Tell me what you know..Thanks

Answer 1

The lifetime funds change their allocations as you get older.  So what they have today, they will not hold in 5 or 10 years.  They start out more aggressive, and then become more conservative over time.

Many fund companies have these, and they seem like not a bad idea if you don't want to do your own allocation models.  I'd go to a no-load fund like Vanguard, however. They have the same type of funds with a decent track record.  Why pay to buy Principal?

Answer 2

Why not invest in a 401k composed of index funds? Index funds are passively managed so the fees are much lower relative to mutual funds.

Benjamin Graham said that the average person is better off investing in index funds than individual stocks. If you diversify your 401k with a mix of international, domestic, various cap sizes, and mix in some bonds and make REGULAR contributions you will likely outperform more ambitious investors.

Answer 3

Check them out at Morningstar.com.  Good source of info on mutual funds.