Clark Howard: Sample Low Cost Investment Funds

Sample Low Cost Investment Funds

TIAA Equity Index

  • tiaacref.org
    Invests in approximately 3,000 companies
    Expense: 0.26%
    Mininum investment:   $2,000 to open IRA; $ 2,500 for general account (or $50 if you start an Automatic Inv. Plan). If your balance is below $1,500, you will be charged $25, unless you invest at least $100/month in an automatic investment plan.

Vanguard Total Stock Market Index

  • vanguard.com
    Invests in approximately 3,400 companies
    Expense: 0.20% (other fees may apply)
    Minimum investment: $3,000 minimum to open an IRA; $3,000 minimum to open an investment account

Vanguard Star

  • vanguard.com
    Invests 35% in bonds and 65% in stocks using a basket of Vanguard funds
    Expense: 0.37%
    Minimum investment: $1,000 minimum to open an IRA; $1,000 minimum to open an investment account

Schwab Total Stock Market Index Fund

  • schwab.com
    Invests in 4,000 companies
    Expense: 0.09%
    Minimum investment: $100

Schwab International Index Fund

  • schwab.com
    Invests in 350 publicly traded companies from selected countries outside the U.S.
    Expense: 0.19%
    Minimum investment: $100

Schwab Small-Cap Index Fund

  • schwab.com
    Invests in the second-largest 1,000 publicly traded U.S. companies
    Expense: 0.19%
    Minimum investment: $100

Fidelity Four-in-One Index Fund

  • fidelity.com
    Invests 48% in 500 largest stocks, 12% in rest of U.S. stock market, 25% in international stock index, 15% in bond index
    Expense: 0.36%
    Minimum investment: $2500 minimum to open an IRA; $10,000 minimum to open an investment account

Targeted Retirement or ‘Lifecycle’ Funds New!

With these funds, you pick the year you expect to retire — let’s say 2035. You buy that portfolio and over the next 30 years the company you choose picks a mix of stocks and bonds to get you the best return with the lowest overall risk. As you get closer to 2035, your investments get less risky.

Fidelity Freedom Funds

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  • fidelity.com
    Invests in a combination of stocks, bonds and cash equivalents
    Years available: 2010, 2015, 2020, 2025, 2030, 2035, 2040, 2045, 2050, plus the Fidelity Freedom Income Fund for those already in retirement
    Expense: between 0.71% and 0.91%
    Minimum investment: $2,500 minimum to open an IRA; $2,500 minimum to open an investment account

T. Rowe Price

  • troweprice.com
    Invests in a combination of stocks, bonds and cash equivalents
    Years available: 2010, 2015, 2020, 2025, 2030, 2035, 2040, 2045, 2050, 2055
    Expense: between 0.67% and 0.84%
    Minimum investment: $1,000 minimum to open an IRA; $2,500 minimum to open an investment account

Vanguard Target Retirement Funds

  • vanguard.com
    Invests in a combination of stocks, bonds and cash equivalents
    Years available: 2010, 2015, 2020, 2025, 2030, 2035, 2040, 2045, 2050, plus the Target Retirement Income Fund for those already in retirement
    Expense: 0.21% or 0.22%
    Minimum investment: $3,000 minimum to open an IRA or general account

*Sources: Fidelity.com, Schwab.com, Tiaa-cref.com, Troweprice.com, vanguard.com