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Oppenheimer 401K
Old 03-08-2006, 10:32 AM   #1
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Join Date: Mar 2006
Posts: 86
Oppenheimer 401K

Hello all,

Firstly, let me say that I just discovered this forum a few weeks ago, and it is exactly what I've been looking for! I've been lurking on the forums and there appears to be a lot of great information as I'm considering a partial retirement within the next couple of years. Once I have my thoughts and questions together, I'll post in the appropriate section on that.

However, my question now is about 401K equity funds. My company (10 employees) has Oppenheimer as our 401K funds manager. For many reasons (high fund costs, difficulty dealing with, etc.) we would like to move to a new company.

About two thirds of our funds are still in class B shares however. All new contributions are class A, and some of our oldest class B shares have just started converting, but it'll take another 4-5 years for all of the funds to convert fully to class A.

So currently, to switch, it would cost us about 1 to 2% of our total funds in sales charges. I think I'm at the point however where I'm willing to go ahead and do it and pay the sales charge.

So, here's my question:

I would like a fund manager that offers a fund that essentially mirrors some large index like the S&P500. Oppenheimer offers no such fund. I'd be more than happy to put all of my 401K equity funds into SPDR if I could.

Vanguard seems to be widely respected on these forums. Do they offer such a fund? Anyone know what their actual costs (not just published costs) are with such a fund?

Oh, and lastly, any ideas on the best way to go about setting up such an account. I don't want a "financial advisor" in the mix as I don't need one, or want one collecting a commission on my dime. Is it possible to go directly to Vanguard without an FA? And does that actually save any money, or does the fund manager simply collect the commissions that would normally go to an FA?


I want to spend my last dollar on the very last day of my life.
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Re: Oppenheimer 401K
Old 03-08-2006, 10:58 AM   #2
Thinks s/he gets paid by the post
Join Date: Jun 2005
Posts: 4,005
Re: Oppenheimer 401K

Vanguard - good choice. Go to their website and read up. Or call them up and tell them what you want to do. They'll explain the process and the costs (they're honest about that stuff).

Vanguard 500 index fund:

Expense ratio is 0.18%. Put in $100,000, and the expense ratio is 0.09%. Trading costs may be an extra 0.01-0.05% per year (not sure, but they don't trade much). You'll pay a $10 fee per year if you have less than $10000 in the fund. If it is in an IRA, you'll pay another $10 fee if less than $5000 is in the fund. That's the fee structure. Nothing is hidden.

Vanguard has tons of other mutual funds - some follow indexes, some are actively managed. Some are mixes of other vanguard funds. One thing they all have in common is the low expense ratio.

The general advice is read up on "portfolio allocation". Decide on an allocation plan then implement your plan by buying what you have in your plan.
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