Right now we have target date funds from Vanguard. There are just so many options to choose from, and even the experts seem to get it wrong half the time. So I'm wondering how you choose what to invest in.
Diversify :) Target funds are great and they are supposed to diversify for you but the one aspect that is not diverse is the fund manager. You really have to read the prospectus for each fund. Notice the names of the fund managers. See what you are actually holding in the target date fund and perhaps make some other choices that will still keep your portfolio balanced. I do believe that if you don't have the time and desire to spend a fair amount of time keeping up with the market, you shouldn't be trying to manage your own individual stocks (at least not for a significant portion of your savings). DH and I have selected a few funds that keep us balanced and hopefully we will be able to take advantage of the good and minimize the bad.
XM,: mama to ds (5/08), dd (9/10) and ds (6/12) ! :C.H.S & M.
I just had a choice of a few and went with the most aggressive one... it'll be decades before we retire. When we're closer to retirement I'll shift into something safer. IDK, if I had to spend a ton of time researching this stuff I just wouldn't do it... I know me. Doing something is better than doing nothing.
The line about the experts getting it wrong half the time is key. No one knows what will happen! Its good to follow what the experts are doing merely to validate your choices. Read opinions of several experts and see how they do or don't line up. If you are well versed on the stock market, read and keep up with whats going on and make educated choices for yourself.
I read that women tend to be more careful with their choices, picking mutual funds over stocks. And men tend to be more aggressive with their choices, by investing in stock. SO I just bought a stock (Im neither well versed in the stock market nor experienced but I was ready to invest..I asked a confident and they told me a stock that all the experts were tooting). Actually, the mutual fund I was investing in for the past 5 years, was at a loss and had high maintenance fees so I sold it and bought stock. The stock I bought was one that was recommended by experts. Why not.
The key, diversify. If you have a mutual fund, find out what it is invested...if you buy an individual stock you may or may not want it to be invested in the stock that is covered by the mutual fund.
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