Which 401k index fund(s) to choose from?

I just switched jobs and enrolling into their 401k. They match half up to 3%. Ive been following you and want to invest in an index fund. They have 32 options for me, and there are only 3 index funds to choose from. Fid 500 index, Fid extended market index, and Fid international index. Is one or two of them good choices? I don’t think I’m going to do international. FSKAX wasn’t available to choose from.

Thanks in advance for your advise!!

The good news is those are great choices and all you need! IF IT WERE ME, I’d probably do something like:

  • 50%: Fidelity 500 index
  • 20%: Fidelity extended market index
  • 30%: Fidelity international index

The top two together approximate the “total us market” (with a slight tilt toward small cap stocks). And the last is the international market. Notably missing is a bond fund. If you want to include a bond fund, you could assign a portion of your asset allocation to that, and split the rest proportionally as above.

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I have a similar question… Looking to rebalance 401k because the target fund is .9% expense ratio.

Proposed Allocations

• 70% Vanguard 500 Index Admiral (.04%)

• 15% Vanguard Mid Cap Index Admiral (.05%)

• 4% Vanguard Small Cap Index Admiral (.05%)

• 10% Vanguard Developmental Market Index Admiral (.07%)

Things I’m concerned about:

• All the bonds available kind of have high-ish expense ratios. We’re okay with being aggressive now… but will it be an issue when we need to rebalance in the future?

• We tried our best to make something similar to VTSAX but aren’t 100% sure if our understanding is accurate.

• International funds - only developmental market funds were available, not emerging. Will this be an issue? Is our allocation for international too low?

For reference, here’s a full list of funds, ticker symbols, and net expense ratios:

Short Bonds/Stable/Money Market

TFLIC Guaranteed Pooled Fund TFLIC N/A

Transamerica Government Money Market R4 TFGXX 0.50%

PGIM Short-Term Corp Bond B6 PSTQX 0.38%

Intermediate/Long-Term Bonds

Pioneer Bond K PBFKX 0.34%

Aggressive Bonds

MassMutual Premier High Yield I MPHZX 0.54%

Templeton Global Bond R6 FBNRX 0.56%

Large-Cap Stocks

Columbia Dividend Income Inst3 CDDYX 0.58%

Vanguard 500 Index Admiral VFIAX 0.04%

Pioneer Fundamental Growth K PFGKX 0.66%

T. Row Price Blue Chip Growth I TBCIX 0.56%

Dodge & Cox Stock DODGX 0.52%

Small/Mid-Cap Stocks

Wells Fargo Special Mid Cap Value R6 WFPRX 0.72%

Vanguard Mid Cap Index Adm VIMAX 0.05%

MassMutual Select Mid Cap Growth I MEFZX 0.71%

Wells Fargo Special Small Cap Value R6 ESPRX 0.87%

Vanguard Small Cap Index Adm VSMAX 0.05%

Janus Henderson Triton N JGMNX 0.66%

Principal Real Estate Securities R6 PFRSX 0.81%

International Stocks

American Funds EuroPacific Gr R6 RERGX 0.46%

Vanguard Dvlp Markets Index Adm VTMGX 0.07%

American Funds EuroPacific Gr R6 RNWGX 0.60%


JP Morgan Smart Retirement Income A JSRAX 0.73%

JP Morgan SmartRetirement 2055A JFFAX 0.88%

I am also working on rebalancing my 401k funds and I have these exact same fidelity index fund choices as Kyle and was wondering how/if I should diversify between them, so thanks for this information!

I also have a few vanguard options including VANG GROWTH IDX ADM, VANG BAL INDEX ADM, and VANG TOT BD MKT ADM plus some AF Target-date funds and other bond options. Does it benefit me to mix the VANG and FID IDX funds together or would it be better just to choose one? I know in your course you said they all perform about the same, so I am not sure how much it really matters.

I am 32, if I was to put together a three fund portfolio with Int. stocks, US stocks and bonds like the example you gave in your course, would the best mix be the Fidelity 500 or Vanguard Growth Index for the US Stocks around 50% of portfolio, the Fidelity International Market around 35% and then the Vanguard total bond market for the remaining? Does it help me to also squeeze in the Fidelity extended market or would it be better to stick to three? Would love some input.

Enjoying the course and office hours, thanks for all of the great information @Jeremy!