Should I modify my IRA holdings?

[zanemoseley]

We have a simple IRA at work for retirement and I made some changes a couple years ago to try and boost my returns. I'm 31 and have about $40k saved, currently putting about $7500 in each year.

Right now I'm at about 50% in the Pacific Life Funds Moderate Aggressive Fund http://www.mutualfunds.pacificlife....io_optimizationfunds/moderate_aggressive.html and about 50% in First Eagle Global Fund https://www.feim.com/article/global-fund

Last year the PL fund had a 17.39% return last year w/o sales charge and the Global Fund was 15.49% w/o sales charge. That looked really good until I realized that the S&P 500 went up 26% over the year.

If I'm trying to continue on the moderate to moderately aggressive path is there anything you would change with the above?

 

[glenn1]

We have a simple IRA at work for retirement and I made some changes a couple years ago to try and boost my returns. I'm 31 and have about $40k saved, currently putting about $7500 in each year.

Right now I'm at about 50% in the Pacific Life Funds Moderate Aggressive Fund http://www.mutualfunds.pacificlife....io_optimizationfunds/moderate_aggressive.html and about 50% in First Eagle Global Fund https://www.feim.com/article/global-fund

Last year the PL fund had a 17.39% return last year w/o sales charge and the Global Fund was 15.49% w/o sales charge. That looked really good until I realized that the S&P 500 went up 26% over the year.

If I'm trying to continue on the moderate to moderately aggressive path is there anything you would change with the above?

What firm is your account held at, and do you have a full range of investment options to choose from or only a menu of investment options provided by the plan administrator?

Honestly, unless I had absolutely no other choice and was only contributing to get an employer match, I would never ever purchase a loaded mutual fund in any account I own.

 

[ultimatebob]

That return is pretty lame. Most of the Mutual Funds in my IRA had a 30% gain last year, with my technology fund (FSCSX) doing over 50%.

 

[Ken g6]

currently putting about $7500 in each year.

I thought the limit was $5500, unless you're in the catch-up age bracket. Or did you mean 401K?

 

[Scarpozzi]

If that's through work, it's likely a 401K or 401A, or 403B...though could be 457 or other similar funds...

If you made over 15%, I wouldn't argue. Check the funds you're invested in and see how many pay out dividends. A lot of dividend funds don't match the returns on the market because they have lower perceived risk and the payouts can be reinvested to actually give you more future growth.

At this point in your investments, anything you can do to get the number of shares you own to go up is in your best overall interest. We all like to see a large dollar value, but for you and I (I'm 33), we should want to see the market tank while we're saving so our dollars can buy more shares at a lower price....

 

[BurnItDwn]

Meh, I would not be looking at "moderate" in my 30s. I would put everything in higher risk holdings. Most of my holdings are in an S&P Midcap 400 fund and a Russel 2000 holding (small/mid company funds available to my 401k)

I figure that even though these funds do get hit harder during economic hard times (like losing over 50% in one year), they tend to do better than bigger companies during the boom times. (I believe up around 40% last year.)

 

[zanemoseley]

I'm pretty sure what we invest in at work is a simple IRA due to our company size, I'm definitely under the max contribution through the IRS. The company we use is Merrill Lynch. I checked an email from my contact at ML and here's a quote "This is an open architecture plan, which means almost any mutual fund can be held in the account." So my options are pretty open as far as what to use.

 

[zanemoseley]

Meh, I would not be looking at "moderate" in my 30s. I would put everything in higher risk holdings. Most of my holdings are in an S&P Midcap 400 fund and a Russel 2000 holding (small/mid company funds available to my 401k)

I figure that even though these funds do get hit harder during economic hard times (like losing over 50% in one year), they tend to do better than bigger companies during the boom times. (I believe up around 40% last year.)

Losing 50% in one year would hurt my feelings pretty damn bad. Not sure if I could handle that lol.

 

[SociallyChallenged]

We have a simple IRA at work for retirement and I made some changes a couple years ago to try and boost my returns. I'm 31 and have about $40k saved, currently putting about $7500 in each year.

Right now I'm at about 50% in the Pacific Life Funds Moderate Aggressive Fund http://www.mutualfunds.pacificlife....io_optimizationfunds/moderate_aggressive.html and about 50% in First Eagle Global Fund https://www.feim.com/article/global-fund

Last year the PL fund had a 17.39% return last year w/o sales charge and the Global Fund was 15.49% w/o sales charge. That looked really good until I realized that the S&P 500 went up 26% over the year.

If I'm trying to continue on the moderate to moderately aggressive path is there anything you would change with the above?

At age 31, you should pretty much be in a well diversified, stock mutual fund only portfolio. Hell, I made 6% in the last 1.5 months last year so getting 17% all year is pretty abysmal. It might be worth the money to go chat with a financial adviser and get things sorted out. I've done a lot of personal research, read several books, and not only have a stock mutual fund portfolio for retirement, but it's largely small and mid cap stocks. These are more aggressive and more volatile, but have better average return over the long run. Think about it - you have 30 years for the market to recover, bounce back, and push forward. If you look at data, you essentially cannot lose over 10 years (especially in an index market fund or ETF).

And you must not have a true IRA or Roth IRA - the maximum contribution for those under 50 is $5,500. If you are contributing $7,500 in an IRA, you are subject to penalties.