Inside Morningstar's 401(k)
Which mutual funds make our list?
I like knowing where fund managers put their money: It's a true test of what they have faith in. In the same vein, I'm aware that our readers like to know what's in Morningstar's 401(k) plan.
We recently added more funds to our lineup, so this is a fine time to update you about our choices. In our 401(k), we seek low-cost funds that make great long-term investments. I sit on the committee that selects the funds, and we have free rein to select virtually any fund. We look for the absolute lowest-cost share class available on a fund. Period. In contrast, many 401(k) plans seek funds with 12b-1 fees, or fees from the plan provider, in order to put the administration costs onto employees.
Some of the share classes mentioned are institutional and might be difficult for you to access, but nearly all have reasonably priced retail share classes that are on our Analyst Picks list. For the three PIMCO funds, Harbor offers the cheapest retail share classes. Allianz NFJ Small Cap Value PSVIX is closed to new investors, and Morgan Stanley U.S. Real Estate MSUSX is only for institutional investors.
Russel Kinnel has a position in the following securities mentioned above: SLADX, OAKLX, PTTRX, PCRIX, HACAX, VASVX, POAGX, PRRIX, RWMFX, PRHYX, AWSHX. Find out about Morningstar’s editorial policies.