Saturday, April 01, 2006

Retirement plans: Evaluation

While recently reviewing our retirement plans, I noticed they weren’t doing so well. Or at least not as well as I would like them too. I’m going to evaluate our retirement plans on a few different posts to help me see what we have and how we can improve. Perhaps getting some input along the way. Today I’ll check out my company sponsored 401(k). It’s held @ Prudential Financial, and my current account allocation looks like this… Alliance Bernstein Growth & Income Fund ClA (CABDX) 35% MFS Massachusetts Investors Growth Stock Fund ClA (MIGFX) 30% Lord Abbett Mid Cap Value Fund ClA (LAVLX) 15% EuroPacific Growth Fund ClA (AEPGX) 10% John Hancock Small Cap Equity Fund ClA (SPVAX) 10% When I initially chose the current allocation, it was a suggested portfolio that was considered aggressive, 100% stocks. It looks to be a fairly balanced portfolio, but more than half seem to be under performing. Now that I know a bit more about funds in general, I would like to take more control and hopefully improve performance. As of December 31st 2005 the performance percentage was 6.53%. Compared to common indices that’s not so good, more specifically the S&P 500. Jon over @ MyMoneyBlog introduced me to Morningstar’s Instant X-Ray, which will help me evaluate what I have and even research potential holdings. 401(k) Asset allocation… I like the proportion of stock which is 96%, that’s about right for someone of my age. But I would’ve like to have seen more of it allocated in the international market, which has done very well the past several years. I need to find out what other funds are available through Prudential, I’m not quite sure at the moment. I will at least need to re-allocate what I have now, that would be first and easiest thing to do since it’s available to be done online....

2 comments:

LAMoneyGuy said...

Do you highly value the advice of the Prudential representative? The cost of those load funds is rather significant. I wrote a post about mutual fund loads.

I would seriously consider moving the account to a no load family or discount broker which will give you access to a wide range of no load funds.

John said...

That's something else I have to consider as well. I'll have to check to see what my options are...