Retirement Planning – 401k Allocations with T. Rowe Price
Personal Finance
My employer runs their 401k plan through T. Rowe Price this is where the majority of my retirement funds are held. Like most retirement plans ours offers a limited selection of funds, and I decided to write a breakdown of the investment choices and my personal allocations.
Here is a list of the funds available my plan:
| Fund Name | Ticker | Type | Expense | 5yr return |
| Amer Funds Europacific Growth | AEPGX | Foreign Large Blend | 0.76% | 13.47% |
| Equity Income Fund | PRFDX | Large Value | 0.71% | 7.48% |
| Equity Index Trust (Equity Index 500)** | PREIX | Large Blend | 0.35% | 4.81% |
| Mid-Cap Growth Fund | RPMGX | Mid-Cap Growth | 0.80% | 9.97% |
| Personal Strategy Balanced | TRPBX | Moderate Allocation | 0.90% | 8.00% |
| Personal Strategy Growth Fund | TRSGX | Large Blend | 0.92% | 8.58% |
| Personal Strategy Income Fund | PRSIX | Conservative Allocation | 0.80% | 7.07% |
| PIMCO Total Return Admin | PTRAX | Intermediate-Term Bond | 0.68% | 4.24% |
| Small-Cap Stock Fund | OTCFX | Small Blend | 0.92% | 10.67% |
| TRP Stable Value Fund Sch E*** | Money Marketesque | |||
| Wells Fargo Lg Co Growth | NVLAX | Large Growth | 1.20% | 0.39% |
** Not the actual fund in my plan, but closely resembles it. Fund in plan doesn’t have a ticker.
*** Don’t have much info on this and don’t really care to look it up since I’m not interested in a money market fund.
So, right away I’m throwing out Wells Fargo Lg Co Growth because the expense ratio, returns, and morning star rating all suck. Also TRP Stable Value Fund Sch E because I am 30 years from retirement and have no desire to have a money market fund in my portfolio. Also Personal Strategy Income Fund because again I’m too far from retirement for that, and PIMCO Total Return Admin because I have enough bond exposure in my ROTH and taxable accounts.
My plan is to keep is simple, with the majority of my funds going in the plan that tracks the S&P 500 – Equity Index Trust (Equity Index 500). The fund hasn’t performed well in the 5 year timeframe, but the 3 year looks much better and from all I’ve read on asset allocation this is the right choice. I also want international exposure so I have a fair chunk of the Amer Funds Europacific Growth fund (its the only international fund so not much of a decision there). These 2 funds make up about 85% of my portfolio.
To fill in the rest I am a big fan of value funds, so I picked the Equity Income Fund which is a large cap value fund. My sentimental choice was the Mid-Cap Growth Fund because back when I first started at the company I had no idea what I was picking and this made up about 60% of my portfolio – and luckily it did very well in that timeframe.
So here is my final asset allocation in my plan:
Equity Index Trust (Equity Index 500) – 60%
Amer Funds Europacific Growth – 25%
Equity Income Fund – 10%
Mid-Cap Growth Fund – 5%
Hopefully it will serve me well.
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Don’t trash the Stable Value fund, mine is up almost 10% since your post, and considering the rest of the market…
Thanks for the tip Frank, I may have to peruse over to the library website to see if they stock it.
While I think that’s a pretty good allocation so far, I think a little more work on your part can improve it. Jonathon over at mymoneyblog.com reviewed a book called all about asset allocation here. I would recommend looking into it at a bookstore. I recently did that, and at the very least it gets you thinking about asset allocation, correlation, and etc. Just my two cents.