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Home > Where should I roll over my 401K?

Where should I roll over my 401K?

October 17th, 2008 at 07:09 pm



I've got a question for all you readers out there, I could really use your advice...

I've just received my rollover forms from Principal Investors, the company that handled 401k for my previous employer. What I've done in the past with all my errand, abandoned 401k accounts was rollover and consolidate them all into one Vanguard IRA. The amounts were pretty small and having them all under one roof with a lot more funds to choose from were huge benefits.

At Vanguard everything is invested in the TargetRetirementFund2045 (VTIVX). That fund is 90% stocks and 10% bonds and has fallen -33.00 this year, and -4.10 the past three years. My rational mind tells me to buy low and sell high, and that it has time to rebound since I won't need that money for a long time, but I'm still scared. Should I be buying bonds, treasuries or commodities instead of this fund? Should I leave it at Principal in case one of these guys folds, even though their choices are meager and the performance just as bad?

I'd like to know what you would do if faced with the same situation... (as long as it doesn't involve cashing it out and stashing it in my mattress)

5 Responses to “Where should I roll over my 401K?”

  1. merch Says:
    1224272456

    I would just throw it in TargetRetirementFund2045.

    I use Vanguard for my IRA. I have about six of their funds there. And I manually rebalance my funds every year in the first quarter. I keep my percentages the same and rebalnce to that each year.

    Since you use the TargetRetirementFund2045, they do the rebalancing for you.

    By the way I use index funds at Vanguard.

  2. Broken Arrow Says:
    1224272494

    If you're already in the Target retirement fund, I would just keep plugging that.

    That's the exceptional beauty of even cookie-cutter asset allocations like this, because, so long as you keep contributing, it'll keep you at a reasonable allocation that will reward you in the long run.

    Please pardon me, but when people get scared and start doing things with their money that they shouldn't, that's when trouble starts.

    There's nothing wrong with being afraid. We just can't let fear make us do things that will ultimately make things worse for us.

  3. Ima saver Says:
    1224273447

    I agree, leave it at Vanguard. My Vanguard Index funds are down a lot too, but they will come back someday.

  4. MileHighGirl Says:
    1224284901

    Thanks for your unanimous input. I was leaning towards that as well. I figure I should just follow my original strategy, since I had a reason for choosing it in the first place. I do believe the market will rebound, and that the economy will get better and should make my decisions based on that.

  5. baselle Says:
    1224288961

    Keep it in the 2045 Fund. You have a good 40 yrs to let it incubate, plus Vanguard has one of the lowest fee structures around.

    To keep yourself from getting too scared, you might want to find out the top 25 entities that the fund invests in, and perhaps research those. You'll probably be pleasantly surprised.

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