2. Choose your investment vehicles if they are not already chosen (as in your 401k)

In my portfolio models shown in this blog, I use six Exchange-Traded Funds (ETF’s).  Essentially, these ETF’s are index funds that can be bought and sold during market hours on the stock exchange.

They are:

SPY – The S&P500 Index


EPP – The MSCI Pacific Ex-Japan Index

GLD – The price of Gold

BWX – The Non-US AAA-Rated Sovereign Bond Index

IEF – US Government Bonds, 7-10 Year maturity, Index

TIP – US Government Inflation-Protected Bonds Index

For your 401k, you may have investment selections that closely correspond to the asset classes represented by the ETF’s I have chosen. If so, then you can simply match your choices to the ETF’s I use, and follow the percentage allocations in the model portfolio most suitable to your situation. If your 401k choices lack one of these asset classes, please let me know what all of your choices are.  It may take me a week, but I may be able make a couple of suggestions.

Also, if there is a large group of readers who have the same plan, let me know who you are and what your plan offers.

On to Step 3