401K and TSP

[Rolo]

imported post

Ah, good point.

Now if you would spend as much time on market comments as you did on humourous comments, you might hit single-digit gains this year, mlk! Imagine! A WHOLE NUMBER!

 

[mlk_man]

imported post

Rolo wrote:

I see no speaking of 'blood pressure' here. I've often wondered what planet you're on, mlk.

Three women die together in an accident and go to heaven. When they get
there, St. Peter says, "We only have one rule here in heaven. Don't step
on the ducks."

So they enter heaven, and sure enough, there are ducks all over the place.
It is almost impossible not to step on a duck, and although they try their
best to avoid them, the first woman accidentally steps on one.

Along comes St. Peter with the ugliest man she ever saw. St. Peter chains
them together and says, "Your punishment for stepping on a duck is to
spend eternity with this ugly man!"

The next day, the second woman accidentally steps on a duck, and along
comes St. Peter, who doesn't miss a thing, and with him is another
extremely ugly man. He chains them together with the same punishment as
the first woman.

The third woman has observed all this and, not wanting to be chained for
all eternity to an ugly man, is very, VERY careful where she steps. She
manages to go months without stepping on any ducks, but one day St. Peter
comes up to her with the most handsome man she has ever laid eyes on...
very tall, tan, muscular, and with good hair. St. Peter chains them
together without saying a word.

The woman remarks, "I wonder what I did to deserve being with you for all
of eternity?"

And the guy says, "Well, I don't know what you did, but I stepped on a
duck."


Moral of the story: Before you comment on others, take a good look at
yourself first!

 

[mlk_man]

imported post

Rolo
Member

Joined:
Mon Mar 22nd, 2004

Location:
Colorado USA

Posts:
1462
Posted: Wed Oct 5th, 2005 08:47 pm





Quote


Reply


C Fund: Next SP500 stop:1178. At 200-day MA now and I really don't expect an increase untilit hits 1178first and maybe even 1140, but, of course, it could bounce tomorrow. If it doesn't bounce off MA200 starting tomorrow, then I would be totally bearish. Look at a 1-year chart to see what I mean.

S Fund: 510 or 488 or 200-day MA bounce.

F Fund: crapcrapcrapwhocares

I Fund: haha...so much for seeking refuge outside the country! Actually, I'm optimistic enough to not punch. I don't expect EFA to drop below 56, or a 50-day MA bounce. This is still the place to be...it doesn't look like it's stalling like SP500 is and there's that beautiful cup-and-handle we just broke out of...

EEM: Looks strong, no worries, just a speedbump.

XAU: Ow. Quit it. I didn't expect that...but everything is friggin' falling...well, 'cept mlk_man's blood pressure. It's over-extended. :shock:








You may have bashed too many walls in your youth.........

DIDn't copy too well: http://www.tsptalk.com/mb/view_topic.php?id=1038&forum_id=1&jump_to=31737#p31737

 

[Rolo]

imported post

mlk_man wrote:

Rolo wrote:

mlk_man wrote:

Costs: The expense ratio you pay to invest in a fund reduces your net return: the higher your expense, the less money you make.

This popular belief is crap! You don't make less money....less than what?

NET RETURN is after the management expenses anyway, so this particular statement is real crap!

All of my "high expense" funds net far more than this index crap...so I say again: less than what?

[line]

100 funds is a decent selection and is not overwhelming...a nice selection of companies and a nice selection of sectors and strategies. My wife's 401k has ~100 funds and I do very well with it...some of the funds are in Morningstar's top fund Quickrank for 1 and 3 month returns as of Monday.

"31" seems like a lot of friggin' ice cream flavours, but it seems to work...you know they'll have what you want.

Speaking of blood pressure.............whew, we have a real pressure cooker here ladies and gentlemen!

I see no speaking of 'blood pressure' here. I've often wondered what planet you're on, mlk.


[line]


Yes, g-ma, that was from the article. I have no problem bashing articles. Or mlk. Or anything else worth bashing. heh.

I just started some head meds today, so who knows...I might lighten up! :u

 

[Birchtree]

imported post

I'm just trying to figure out who is Laurel and who isHardy. But I must say ya'll give me a giggle now and then. Peaches, did this Yankee get that ya'll right.

 

[mlk_man]

imported post

Rolo wrote:

mlk_man wrote:

Costs: The expense ratio you pay to invest in a fund reduces your net return: the higher your expense, the less money you make.

This popular belief is crap! You don't make less money....less than what?

NET RETURN is after the management expenses anyway, so this particular statement is real crap!

All of my "high expense" funds net far more than this index crap...so I say again: less than what?

[line]

100 funds is a decent selection and is not overwhelming...a nice selection of companies and a nice selection of sectors and strategies. My wife's 401k has ~100 funds and I do very well with it...some of the funds are in Morningstar's top fund Quickrank for 1 and 3 month returns as of Monday.

"31" seems like a lot of friggin' ice cream flavours, but it seems to work...you know they'll have what you want.

Speaking of blood pressure.............whew, we have a real pressure cooker here ladies and gentlemen!

 

[grandma]

imported post

Rolo wrote:

mlk_man wrote:

Costs: The expense ratio you pay to invest in a fund reduces your net return: the higher your expense, the less money you make.

...isn't this a part ofthis article M_M presented, not what M_M himself wrote?

 

[Rolo]

imported post

mlk_man wrote:

Costs: The expense ratio you pay to invest in a fund reduces your net return: the higher your expense, the less money you make.

This popular belief is crap! You don't make less money....less than what?

NET RETURN is after the management expenses anyway, so this particular statement is real crap!

All of my "high expense" funds net far more than this index crap...so I say again: less than what?

[line]

100 funds is a decent selection and is not overwhelming...a nice selection of companies and a nice selection of sectors and strategies. My wife's 401k has ~100 funds and I do very well with it...some of the funds are in Morningstar's top fund Quickrank for 1 and 3 month returns as of Monday.

"31" seems like a lot of friggin' ice cream flavours, but it seems to work...you know they'll have what you want.

 

[mlk_man]

imported post

I would be happy with 17 funds as long as they were diversified among different sectors. Over 100 is most likely too much, especially if costs more in maintenance fees. Having only 5 is a differenct matter. Can you imagine if we had an energy fund to invest in this year........









Improved 401(k)? Who can tell?
Fund line-ups are changing. If Time Warner's plan is any indication, the changes may be baffling.
October 5, 2005: 11:40 AM EDT
By Jeanne Sahadi, CNN/Money senior writer





NEW YORK (CNN/Money) – Which would you prefer: a restaurant that offers a select number of well-prepared entrees or a menu with listings that rival the number of words in the dictionary?

Personally, I prefer the first option. Too much choice exhausts me.





So you'd think the move made by Time Warner, my employer, to simplify and reduce my 401(k) investment choices would delight me.

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It might, except I've had the hardest time figuring out just what exactly the changes mean.

I bore you with this for one reason: Time Warner's plan may be the wave of the future, 401(k) experts tell me, at least at large companies.

I suspect my mystification is due mostly to the ample but confusing and not-always-informative marketing materials sent to employees. I imagine corporate communications at other firms making similar changes won't be much better.

So I tried to get some basic questions answered that would benefit anyone facing a similar changeover.

What your 401(k) may soon look like
Time Warner changed its investment line-up in two ways:

First, it reduced the number of investment options from over 100 to just 17. In the past decade, the thinking in the 401(k) industry has been "the more choice, the better," said David Wray, president of the 401(k)/Profit Sharing Council of America. But now the thinking is too much choice causes deer-in-the-headlights syndrome.

The 17 funds in our plan cover the basic asset classes and investment styles to create a diversified portfolio. So if you know your desired asset allocation, it's easy to pick the funds you need.

The second change was more significant in my view. Rather than continue to offer publicly traded mutual funds, Time Warner is offering mostly separately managed accounts and commingled funds, which are not publicly traded.

That means they are open only to Time Warner employees in the case of separate accounts, or to the employees of a handful of companies, including Time Warner, in a commingled pool.

"There's clearly a trend away from retail mutual funds to more institutionally managed funds," said Harold Small, a principal of the 401(k) advisory firm FiduciaryVest.

Here's what that means to you and me in terms of:

Costs: The expense ratio you pay to invest in a fund reduces your net return: the higher your expense, the less money you make.

Institutionally managed funds tend to be much less expensive than publicly traded ones, since your employer has more leverage to negotiate fees.

Lower costs can mean we get to keep an extra few hundred dollars a year in our accounts, which, compounded over time, is not insignificant.

Performance and track record: What most concerned me about our new fund lineup was that there was no past performance data or lists of holdings for most of the new funds.

Past performance may be no guarantee of future results but it gives you an idea of how a fund performs in good times and bad.

In terms of holdings, I'd like some assurance that my money won't be too heavily invested in any one company when I look at my portfolio as a whole.

According to Small, a company would likely hire an investment firm to run a particular type of fund (e.g., small cap blend) in which they have a good track record. The holdings in that fund are likely to replicate about 90 percent of the holdings in a comparable retail fund run by the same investment firm.

So you might use information on that publicly traded version as a proxy, until your fund starts reporting performance and holdings.

Transparency: You can't look up information about non-public funds at fund trackers like Morningstar or in the press. So you are reliant on your employer and its investment service providers to give you the information you seek. Typically, performance is reported quarterly, Small said, even though fund shares are priced daily.

What should you do?
Before hiring outside investment managers, your employer has the responsibility to ensure they'd act in the best interest of plan participants, said Rick Applegate, a 401(k) adviser and certified financial planner. And your employer needs to continue monitoring the investment managers' performance once they are hired.

Despite my grousing, I'm somewhat confident Time Warner has done a reasonable job picking decent investment managers who can provide reasonable returns.

"You should spend no time whatsoever wondering if those funds are good for you, once you're confident your employer has done the proper due diligence," said Wayne Bogosian, president of the Personal Financial Education Group.

I'm influenced, too, by studies suggesting that over the long term it's less important what individual funds you invest in (save the true dogs) than that you maintain a diversified, low-cost portfolio and invest money steadily over the years.

But some of my colleagues are having none of it. They like the old plan and they don't want to give up the funds they were invested in. So they've decided to open self-directed brokerage accounts through the plan. Those accounts let them invest in a wide array of publicly traded mutual funds.

There's an account maintenance fee and the expense ratios of the funds they invest in are likely to be higher than those in the plan.

There are two reasons to opt for a brokerage account, Small said.

• If you want exposure to investment strategies not available within your plan; or
  
  
  
  
• If you think you can get better returns and/or less risk from funds with similar strategies to those in the plan. But the rewards have to be high enough to more than offset your additional costs to use the account.

Whether you choose to invest inside your plan or out, you first should figure out how much you can contribute and what target rate of return you'll need to achieve your long-term goals based on your contributions, Bogosian and Applegate said.

Then create a portfolio that gives you a good chance of achieving that, but which also suits your risk tolerance and time horizon.

In my case, I'm first going to dig through the marketing materials again to see if I can intuit what the heck it is I'm really getting myself into.