My retirement fund that I just started was worth $15k in December of 2021. Then, May of 2022, our area was hit really hard. My retirement plan went down to $7k. Today, it’s worth $11k. I lost $4k on my retirement plan. It’s invested in total market funds, some tech, some big cap companies, and healthcare. But every sector has been ravaged by the stock market changes.
I’m in a Vanguard target fund and I’m up 7.8% over the same period. There was a lot of red until December 2023, when it broke even. All gains are pretty much from this year looking at my returns chart.
That’s messed up.
Which funds did you invest into? I’ve studied like 25 hours of investing. Haven’t found a good fund yet except FSKAX and VTI
Mainly VFFVX, which is up 4.46% over a 3 year period, but I have about 20% in various other funds.
If you have an account with Fidelity, FZROX should be a better choice than VTI. Unless you enjoy investing or want to really get into it, either do a target date fund for the easiest and lowest risk, or a total market fund like VTI, or an S&P500 fund like VOO. You really don’t need to overcomplicate beyond that, except to potentially start buying bonds when you are nearing retirement if you didn’t choose a target date fund.
I recommend FSKAX over FZROX. There are few minor differences. Yes FZROX has a lower expense ratio, but it BARELY lower when compared to FSKAX. My understanding is the biggest downside to FZROX is that you can’t hold that in any other brokerage. So if one day you decide you don’t like Fidelity you have to sell all your FZROX and then buy something else offered at the other brokerage. In a retirement fund this isn’t so much a big deal, but could mean you miss out on gains between the sale and the purchase of whatever else you replace it with.
If you’re investing in a non-retirement account this is a BIG deal, as any gains would be taxed at the time of sale. This can mean you pay 15%-20% on the gains just to switch brokerages. FSKAX doesn’t have that limitation, and you’d be able to simply do an “in kind” transfer of the securities to your new brokerage without any tax events/consequences. To me, that portability is worth the tiny different in expense ratio.
I let my bank’s financial advisor handle that. They have apps that calculate everything.
They do. And you can generally trust banks to try and sell you what’s most profitable to them.
They are fiduciaries.
Fiduciary is a legally defined term. Fiduciaries are expected to exercise a duty of care and a duty of loyalty to clients, and as a result, are “held to the highest standard of conduct.” Fiduciaries have a bond of trust with another person (called the beneficiary or principal) and have a legal obligation to act for the beneficiary’s benefit – not their own.
That’s all fine, but just be sure you know how much you’re paying them for that service. Before we switched to self-managed a number of years ago our guys were taking 1.4% off the top of the whole account just to pick a bunch of index ETFs. Market goes up 5% and I only see 3.6% of it. Not good. Plus the ETFs they picked had higher expenses than just going with a whole market choice.
They offered to get us on a plan at 1%. Ha, no thanks.
Yeah that’s bad. We’re with JP Morgan through our local Chase branch and their fee when all is said and done is averaged down to less than 1% of the total account balance.
That’s better for sure. Still too much for me. Our all-in investment cost is 0.05% now. That’s a lot of free compounded yield compared against guided investments which are themselves no better than the average market (on average).
Who are you with?
We are on Fidelity. But self-directed on all the big ones are no fee and free trades these days - Vanguard, Fidelity, Merrill and probably others. Just need to watch the fund/ETF fees to have a total cost.
You found the good ones. No need to go looking further.
I’m in BTC S&P 500 Index, BTC Russell 2500, BTC ACWI EX US IMI, and BTC US Debt and am at 11.93%, 3.6%, 3.87%, and -1.34% over the last 3 years. Over the last year though, it’s 36.36%, 26.36%, 25.22%, and 11.6%. My funds are Large Cap Blend, Small Cap Blend, Foreign Blend, and US Bonds at roughly 67/7/20/6 percent division of my portfolio.
I think you just got into the market at the height of the markets during COVID and are still digging your way back out. You could try diversifying a little bit in a similar fashion to spread the gains and losses out a bit over both large and small US companies and foreign markets.
I’ve put my ira into FNILX. Zero fees and consistently beats 10%
Yeah there is something else going here. No domestic markets are actually down in this interval. OP must have bought some individual stocks.
Yeah, this is FSKAX over 3 years. I have a lot of my portfolio in it and it does well. It’s up 24% over that period.
Or be invested in managed funds with high fees that are performing poorly vs index funds. My 403b is definitely up over this same period, but I’m only in index funds