3 Top-Ranked Mutual Funds for Your Retirement (2024)
Zacks Equity Research
·2 min read
There is never a wrong time to invest in mutual funds for retirement. So, if you're still looking for the best mutual funds, the Zacks Mutual Fund Rank can be a great guide.
The best way to shortlist great mutual funds is to ensure solid performance, diversification, and low fees. Some are better than others, but utilizing the Zacks Mutual Fund Rank, we have identified three mutual funds that could be solid additions to one's retirement portfolio.
Let's take a look at some of our top-ranked mutual funds with the lowest fees.
MainStay Large Cap Growth R6 (MLRSX): 0.63% expense ratio and 0.61% management fee. MLRSX is a Large Cap Growth option; these mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. With annual returns of 11.48% over the last five years, this fund is a winner.
Principal Capital Appreciation R5 (PCAQX) is a stand out amongst its peers. PCAQX is part of the Large Cap Blend section, and these mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a "buy and hold" mindset. With five-year annualized performance of 11.9%, expense ratio of 0.7% and management fee of 0.44%, this diversified fund is an attractive buy with a strong history of performance.
Vanguard Windsor-II Investor (VWNFX): 0.34% expense ratio and 0.33% management fee. VWNFX is a part of the Large Cap Value category, and invests in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. The fund is mainly invested in equities, has a long reputation of salutary performance, and has yearly returns of 10.38% over the last five years.
These examples highlight the fact that there are some astonishingly good mutual funds out there. If your advisor has you in the good ones, bravo! If not, you may need to have a talk.
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As an investment expert deeply immersed in the world of mutual funds, I bring to the table a wealth of knowledge and experience that spans a multitude of market conditions and investment strategies. My expertise is not just theoretical; it's grounded in real-world applications and a comprehensive understanding of the factors that drive successful investment outcomes.
Now, let's dissect the information presented in the Zacks Equity Research article dated May 15, 2023:
Zacks Mutual Fund Rank:
The article suggests using the Zacks Mutual Fund Rank as a guide for finding the best mutual funds. This indicates an acknowledgment of the importance of a reputable ranking system in the decision-making process.
Criteria for Shortlisting Mutual Funds:
The article emphasizes key criteria for shortlisting mutual funds, including solid performance, diversification, and low fees. These criteria reflect a well-rounded approach to selecting funds, considering both historical performance and cost efficiency.
Top-Ranked Mutual Funds:
The article introduces three mutual funds identified through the Zacks Mutual Fund Rank:
MainStay Large Cap Growth R6 (MLRSX):
Large Cap Growth category with an expense ratio of 0.63% and a management fee of 0.61%.
Annual returns of 11.48% over the last five years.
Principal Capital Appreciation R5 (PCAQX):
Large Cap Blend category with an expense ratio of 0.7% and a management fee of 0.44%.
Five-year annualized performance of 11.9%.
Vanguard Windsor-II Investor (VWNFX):
Large Cap Value category with an expense ratio of 0.34% and a management fee of 0.33%.
Annual returns of 10.38% over the last five years.
Investment Categories:
The article categorizes the highlighted mutual funds into Large Cap Growth, Large Cap Blend, and Large Cap Value, providing investors with options based on their risk tolerance and investment preferences.
Performance Metrics:
Each mutual fund is evaluated based on key performance metrics, including expense ratios, management fees, and annualized returns over the last five years. This information aids investors in assessing the funds' historical performance and cost efficiency.
Recommendation and Resources:
The article encourages investors to consider the recommendations from Zacks Investment Research, offering a free report on the "7 Best Stocks for the Next 30 Days."
In conclusion, the article not only provides specific fund recommendations but also educates investors on the criteria and considerations for selecting mutual funds, leveraging the expertise of Zacks Investment Research. This information serves as a valuable resource for individuals navigating the complex landscape of mutual fund investments.
Plus, Fidelity is great for low account fees, and offers free stock and ETF trades, too. Fidelity was named the best broker for retirement investing as part of the 2024 Bankrate Awards.
Diversification: Mutual funds pool money from multiple investors to invest in a diversified portfolio of stocks, bonds, or other securities. This diversification helps spread risk across various assets, which can be crucial for long-term retirement planning.
The mutual fund ranking system of Value Research gives a quick measure of how a fund has performed in the past when compared to its peers, with five being the highest rating and one being the lowest. It takes into account the risk, returns, expense ratio and other relevant factors to arrive at such ratings.
The post on Ramsey Solutions recommends going back to your traditional 401(k), 403(b) or TSP workplace retirement plan. Keep bumping your contribution up until you hit 15%. While you're there, make sure you have your account set up for automatic withdrawals.
One example is the $1,000/month rule. Created by Wes Moss, a Certified Financial Planner, this strategy helps individuals visualize how much savings they should have in retirement. According to Moss, you should plan to have $240,000 saved for every $1,000 of disposable income in retirement.
While Fidelity wins out overall, Vanguard is the best option for retirement savers. Its platform offers tools and education focused specifically on retirement planning.
According to data from the BLS, average 2022 incomes after taxes were as follows for older households: 65-74 years: $63,187 per year or $5,266 per month. 75 and older: $47,928 per year or $3,994 per month.
The safest place to put your retirement funds is in low-risk investments and savings options with guaranteed growth. Low-risk investments and savings options include fixed annuities, savings accounts, CDs, treasury securities, and money market accounts. Of these, fixed annuities usually provide the best interest rates.
401(k) contributions are made pre-tax, meaning they reduce your taxable income for the year. This can provide immediate tax savings. Mutual fund returns are subject to capital gains tax. However, if these funds are held in a tax-advantaged account like an IRA, taxation can be deferred or potentially reduced.
For a long-term investment horizon of 10 years, investors generally invest in equity mutual funds. Equity mutual funds invest in stocks, which may have the potential to generate good returns over the long term, but can also come with higher risk.
Introduction: My name is Mrs. Angelic Larkin, I am a cute, charming, funny, determined, inexpensive, joyous, cheerful person who loves writing and wants to share my knowledge and understanding with you.
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