Q: I have retired but, I have left my retirement plans with the companies I have worked with. I need to know what should be done at this point and, what the safest vehicles would be for these funds, which amount to $35,000.00.
A: The best thing to do with old employer plans is to roll them out of the respective plan and into an IRA that you set up. Once in an IRA, we like to diversify the assets across a couple of different index funds. Index funds provide exposure to a particular market sector while removing company specific risk. Our firm likes to use ETFs (Exchange Traded Funds) as they are generally low-cost and closely track the index that we’re looking for exposure to.
A few good ETFs to take a look at are IVV (tracks the S&P 500), SDY (tracks the dividend growers on the S&P 500) and BND (tracks the total bond market).