money market question
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Subject Author Date
money market question Jane 05-07-2007
Posted by Jane on May 7, 2007, 8:53 am
I have about $275K in a 401k to roll over. I am semi-retired. I
don't need the money now but I don't know when I will. Could be next
month or could be not for five years.

I am a VERY conservative investor and I don't like things complicated.

The $275k represents about half of my portfolio. The rest is with
Vanguard with a 51%/49% split of bonds and stocks.

I was thinking of rolling it all into either the Wellesley fund or the
Wellington fund.

I realize this isn't diversified but again, I want things to be
simple. Any suggestions would be appreciated.

thanks


Posted by FranksPlace2 on May 7, 2007, 9:25 am


> I have about $275K in a 401k to roll over. I am semi-retired. I
> don't need the money now but I don't know when I will. Could be next
> month or could be not for five years.

Money you need in the short term should be in bonds not stocks.
>
> I am a VERY conservative investor and I don't like things complicated.

Why not money to Vanguard? They have plenty alternatives and one
brokerage is more simple.
>
> The $275k represents about half of my portfolio. The rest is with
> Vanguard with a 51%/49% split of bonds and stocks.

This is a reasonable allocation for a conservative investor but
remember by failing to invest in stocks, you may trade risk of loss in
the short term for risk of running out of money in the long term.
>
> I was thinking of rolling it all into either the Wellesley fund or the
> Wellington fund.

I don't know these funds but I would avoid any mutal funds that have
front end fees.
>
> I realize this isn't diversified but again, I want things to be
> simple. Any suggestions would be appreciated.

You can get resonable diversity with three stock index funds such as
large cap, mid cap and small cap. Don't confuse diversity of
brokerages with diversity of stock holdings.
>
> thanks


Posted by joeu2004 on May 7, 2007, 12:12 pm
> I have about $275K in a 401k to roll over. I am semi-retired. I
> don't need the money now but I don't know when I will. Could
> be next month or could be not for five years.
> I am a VERY conservative investor and I don't like things complicated.
> The $275k represents about half of my portfolio. The rest is
> with Vanguard with a 51%/49% split of bonds and stocks.
> I was thinking of rolling it all into either the Wellesley fund or
> the Wellington fund.

Odd. Your subject speaks of a "money market" question,
but those funds are balanced bond/stock funds. Why are
you considering them?

Wellesley (VWINX) currently is split 60%/39% bond/stock,
more conservative than the allocation of your other holdings.

But Wellington (VWELX) is split 33%/65% bond/stock. If
you are "VERY conservative", you definitely want to steer
clear of Wellington.

In any case, I see no point in considering any loaded fund
of such general character. There are plenty of good quality
no-load funds with the same styles.

But if you truly want to put the money into a money market
fund, you should be looking at the many MMFs available
from Vanguard and others. For Vanguard funds, go to
https://flagship.vanguard.com/VGApp/hnw/FundsByType .

Whether taxable or non-taxable MMFs are best for you
depends on your tax situation. Be sure to compare the
after-tax rates of return.


Posted by Andrew Koenig on May 7, 2007, 12:32 pm

> Wellesley (VWINX) currently is split 60%/39% bond/stock,
> more conservative than the allocation of your other holdings.

> But Wellington (VWELX) is split 33%/65% bond/stock. If
> you are "VERY conservative", you definitely want to steer
> clear of Wellington.

> In any case, I see no point in considering any loaded fund
> of such general character. There are plenty of good quality
> no-load funds with the same styles.

Why do you think these are load funds? They're not.


Posted by Justin on May 7, 2007, 12:33 pm
joeu2004 wrote on [Mon, 7 May 2007 11:12:48 -0500]:
>> I have about $275K in a 401k to roll over. I am semi-retired. I
>> don't need the money now but I don't know when I will. Could
>> be next month or could be not for five years.
>> I am a VERY conservative investor and I don't like things complicated.
>> The $275k represents about half of my portfolio. The rest is
>> with Vanguard with a 51%/49% split of bonds and stocks.
>> I was thinking of rolling it all into either the Wellesley fund or
>> the Wellington fund.
>
> Odd. Your subject speaks of a "money market" question,
> but those funds are balanced bond/stock funds. Why are
> you considering them?
>
> Wellesley (VWINX) currently is split 60%/39% bond/stock,
> more conservative than the allocation of your other holdings.
>
> But Wellington (VWELX) is split 33%/65% bond/stock. If
> you are "VERY conservative", you definitely want to steer
> clear of Wellington.
>
> In any case, I see no point in considering any loaded fund
> of such general character. There are plenty of good quality
> no-load funds with the same styles.

I didn't realise these funds were loaded? You know they aren't, right?

> But if you truly want to put the money into a money market
> fund, you should be looking at the many MMFs available
> from Vanguard and others. For Vanguard funds, go to
> https://flagship.vanguard.com/VGApp/hnw/FundsByType .

Which is where you'll also find the aforementioned Wellington and
similarly named Wellesly


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