AboutWarren Boroson Expertise Author of "Keys to Investing in Mutual Funds" (Barrons), "Ultimate Mutual Fund Guide" (Probus), "How to Pick Stocks Like Warren Buffett" (JKLasser), and "The Reverse Mortgage Advantage" (McGraw-Hill). Former financial columnist for Gannett News Service.
Experience Author of 20 books; winner of 1996 Personal Finance award from Investment Company Institute and Washington University. Formerly on staffs of Money and Sylvia Porter's Magazine. Had a radio program (on WEVD) about mutual funds and a newsletter, FundDigest.
Expert: Warren Boroson Date: 1/30/2005 Subject: Roll Over
Question I retired 2 years ago and have left part of my retirement investments in a 401K plan that my former employer has handled. The funds include ICAP Equity Fund, Northern Trust S&P Equity Index and EuroPacific Growth Fund. The gains have been modest over the years and I have been looking to roll over these funds to something else. I have been reading "The Lazy Person"s Guide To Investing" in which they talk about "The Couch Potato Portfolio' and "The Coffeehouse Portfolio" basically featuring investments with Vanguard. I claim ignorance when it comes to the stock market and mutual funds. Should I be rolling over my existing plan to something that would provide a better return? I am not looking for a "get rich quick" scheme but something I would have more confidence in
Answer Dear Jay Rajchel:
You might as well dump ICAP Equity. Over 5 years it has returned only 2.98% a year, and Morningstar gives it only 3 stars (for average). If you want another "value" fund, you might consider T. Rowe Price Equity Income.
Northern Trust S&P Equity Index is probably a good choice, but its expenses are certainly higher than the Vanguard index fund's.
American EuroPacific Growth is a winner. I wouldn't sell it. Four stars from M*, although its five-year record isn't glorious.
I've read the "Lazy Person's etc." -- it's unnecessarily complicated. I would suggest that you consider Vanguard Balanced Index for a good chunk of your portfolio. That, plus a good value fund, plus a good foreign fund, should do very well.
I presume that you have fixed-income funds to offset your stock funds.
