For most people, mutual funds are good investments, and the best mutual funds come from the best fund companies. Don’t be fooled by performance records or hype in search of the best funds; And don’t pay high selling costs for the privilege of investing money.
Mutual funds are packaged investments designed for average investors who need help investing money and offer professional money management and instant diversification, usually at a reasonable price. When you invest money in them, you own shares of a professionally managed portfolio. Some funds perform better than others, but the truth is that even the best funds fail to consistently outperform their peers.
It surprises me when I hear someone say something like, “mutual funds are not good investments.” It all depends on where you invest your money. In a bad stock market, for example, stock funds lose money. And if you’re investing money with the wrong fund company (also called a family), sales charges, annual expenses, and fees will greatly reduce your earnings. So what should you look for when looking for the best backgrounds?
Look for reputation, financial solidity, service and LOW COST before investing money. These things separate the best mutual funds and fund companies from the rest…and make them good or mediocre investments. Choosing the best funds within the fund family is a different matter. In my opinion, the best funds in the United States come from some of the largest companies: Fidelity and Vanguard are the two largest in the United States. Both are financially strong with good reputations. They offer good investments and good service, and have been around for many years.
So when are mutual funds not good investments? If you’re paying 5% or more in upfront sales charges, 2% or more a year in expenses, and 1 ½% in additional fees (and you’re getting poor service)…they’re not good investments.
On the other hand, some of the biggest and best fund companies cost you ZERO up front and only charge around ½% annual expenses with no ongoing annual fees going to a sales rep. These companies offer funds free of charge (no sales charge) and you can find them online by searching for “free funds.” There you will see names like Vanguard, Fidelity and T Rowe Price. They all offer good investments and free service with a toll-free number.
Investing money should not be an expensive proposition. America’s Best Mutual Funds are affordable and available through America’s biggest and best fund companies. And yes, they are good investments if you know where to buy them.
If the funds were not available to the public, it would be very difficult for the average investor to assemble and manage a balanced portfolio of stocks, bonds, and money market securities. With them, investing money is greatly simplified. Average investors can easily manage their portfolios. For example, in a typical 401k plan there may be 20 different options available. Probably 18 or 19 of these are mutual funds. It is up to the employees to choose the funds that fit their risk profile.
There is a lot of competition in the money business, and financial companies want you as a customer. That’s why they advertise so much. Investing money is big business, and most people know very little about it. You can learn a lot on the Internet simply by visiting fund company websites. But no one can accurately predict (in terms of investment performance) which specific funds will be the best for 2014, 2015 and beyond.
Go with the best fund companies, and you’ll have access to the best mutual funds and get the most bang for your buck. A dollar saved in charges, fees and expenses translates into a dollar earned. I hope you find many good investments.