The M&I Trust 401K review

Be sure to take advantage of your match

This is a very nice 401K plan.

As I have written in a few of my other hubs regarding 401K’s, a lot of people ask me for advice on investing in their 401K. I am not a professional so be advised my opinion is just that some guy’s opinion.

Some of the funds I like in this plan are as follows:

The Artio International Equity Fund symbol BJBIX: This fund has done very well over the years and is run by an experienced manager who has run the fund since 1995. The returns have been above average. I would have no problem putting up to 25 percent of my 401K assets into this fund. This fund is always near the top of its peer group.

Goldman Sachs Small Cap Value Fund symbol GSSMX. This fund is a well run fund by a manager who has headed up the fund for the last 10 years. While this fund will never make my list of the Best Small Cap Funds the nearly 9 percent returns achieved over the last ten years is commendable. Morningstar gives this fund a three star rating. I would give it four.

Marshall Mid-Cap Value symbol MRVEX. This is another sound fund. This fund has been run by the same manager since 1997. This fund has rung up gains in excess of 8.5 percent per year over the last 10 years. This fund is particularly attractive since it has only 250 million of assets under management. With fewer assets under management the fund manager has more latitude where they invest your hard earned money. This fund is rated 4 stars by Morningstar and I agree.

Vanguard 500 Index Signal index fund symbol VIFSX. This is a low cost index fund. Low cost index funds will outperform 80 percent of mutual funds. This fund is a good choice for large cap investing. This fund is very similar to the Vanguard index fund recommend in my hub entitled The best Large Cap Funds.

When it comes to bond and fixed income funds the offerings are a little weak. The Fidelity Advisor Intermediate Bond symbol FDIAX is rated two stars by Morningstar. About 30 percent of this fund is in bonds BBB rated or lower. I cannot recommend this fund.

The M&I stable principal fund is a pretty good money market type fund. It is yielding 2.7 percent per year. All of the assets are rates A or better with 80 percent plus being AAA rated.

I do not recommend the target portfolios in this plan. For the 2020 plan to have lost over 32 percent of its value in 2008 is simply not acceptable. The 2050 portfolio seems to be a slightly better fund. These funds appear a little more aggressive than their target dates would indicate.

The M&I balanced funds seem to be a better choice for those investors who are looking for single fund diversification. The M&I Moderate Balanced Fund only lost 20 percent of its value in 2008 which is a better deal for the cautious investor than the 32 percent lost by the 2020 fund.

So how do I recommend investing money in this plan? As follows:

Fund

Percent of Portfolio

Artio International Equity Fund symbol BJBIX

25%

Goldman Sachs Small Cap Value Fund symbol GSSMX

15%

Marshall Mid-Cap Value symbol MRVEX

15%

Vanguard 500 Index Signal index fund symbol VIFSX

25%

The M&I stable principal fund

20%

If one is more aggressive simply cut the percentage of your assets in the stable value fund and spread the assets around the remaining funds. Conversely if one is more risk averse or near retirement a greater percentage of assets should go to the stable value fund.

For investment ideas for your IRA consider the 2011 IRA portfolio.

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