Balanced funds and asset allocation funds

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Why balanced funds and asset allocation funds make sense?

Most companies offer what is called a balanced fund. A balanced fund offers professional management and an asset allocation that is typically 60% stock and 40% bonds.

An asset allocation or balanced fund does all the work for you, offering the right mix of cash, bonds, and stocks in one fund. You don’t have to create an investment pyramid by yourself. As a result, these kinds of funds make the process of investing really easy. You don’t have to work for a company with a 401(k) plan to make use of them. You can invest in preselected and professionally managed asset allocation funds through a traditional IRA, Roth IRA, or SEP IRA.

If you are working with a financial advisor, ask them about these funds.

If you want to do this yourself, there are ways to invest without a broker or advisor. Here are some full-service options. These companies offer asset allocation and balanced funds. Whats more, most of these funds are no-load-funds - meaning, you can invest in them without having to pay a commission.

  1. Vanguard
  2. Fidelity Investments
  3. Charles Schwab
  4. T Rowe Price
  5. American Century
  6. Scudder

Banks that offer full-service options

  1. Wells Fargo
  2. Washington Mutual
  3. Bank of America
  4. Bank One
  5. Putnam Funds
  6. Van Kampen Investments

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