new strategy

[frank]

I have recently gotten quite a bit of money when a cd expired. I need the income for reitrement. I am looking at franklin income fund and vanguard wellesley fund. are there any other options for fairly secure funds with any kind of return? let me know what you think and if one of these funds is superior to the other. thanks

frank

 

[dmdunca44]

If you are looking at FKINX, the ER is .64. VWINX has an ER of .25 and their admiral shares (VWIAX) have an even lower ER of .18.

So on costs, Wellesley is way ahead. For performance comparison, you can use Morningstar's chart. It appears that the Franklin fund outperforms Wellesly, but the bonds are of the lower quality - so you are taking more risk in exchange for higher yield.

You'd have to decide whether the risk is worth it to you.

Disclosure: we used to have the Franklin funds. I was uncomfortable with the risk and moved to Wellesley.

 

[gerntz]

What does fairly secure mean? What does need the income mean? What's quite a bit?

Net, seems to me you first need a financial plan for the future including all your assets & needs before making any decision other than parking this money in a bank account temporarily.

 

[jebmke]

yield chasing often ends badly. Wellesley is a fine fund but it is over one-third stocks and the bond component has an average duration of about 6 so they will lose value if interest rates rise.

 

[REWahoo]

How sad that returns have dropped so low someone would view investing in Wellesley "yield chasing"...

 

[foxfirev5]

How sad that returns have dropped so low someone would view investing in Wellesley "yield chasing"...

It's pretty scary, my 83 yo mother told me she is buying Wellesley as her CD's mature. Completely risk adverse when she was 65 now she's taking the plunge. I'm 57 and looking to go the other way. I guess she could do worse.