Opinons on "Fidelity Freedom Fund"?

[sweeps]

Originally Posted by CRFSaver

I would check your prospectus quite closely as I would bet you the .21% Vanguard is charging you is on top of the Weighted Average .207% in all the funds. As for someone retiring in 19 years finding a single good (Vanguard or Fidelity) fund to invest in is what I would advise people. That extra .21% can add up to real money over 17 years. I remember seeing an article about people spending more time researching car purchases then they do their own investments that are a lot larger dollars and mean a whole lot more in the long run. Of course everyone has their own preferences on what they should do and why and as long as you are comfortable with what you have then go for it. I am greedy and want the extra .21%...

The difference is 0.003%, not .21%. 0.003% is not significant in the grand scheme of things.

[CRFSaver]

My point was not the difference, but that the .21% is on top of the weighted average of .207% meaning you are actually paying .417%, not .21%. I would be quite shocked if Vanguard was only charging you .03%.

[sweeps]

Prepare to be shocked. Per the prospectus:

According to an agreement between the Target Retirement Funds and Vanguard, the
Funds’ expenses will be offset by a reimbursement from Vanguard for (1) the Funds’
contributions to the costs of operating the underlying Vanguard funds in which the Target
Retirement Funds invest, and (2) certain savings in administrative and marketing costs that
Vanguard expects to derive from the Funds’ operation.

The Funds’ trustees believe that the reimbursements should be sufficient to offset most,
if not all, of the expenses incurred by the Funds. As a result, each Fund is expected to
operate at a very low or zero expense ratio. Since their inception in 2003, the Funds, in fact,
have incurred no direct net expenses.

Although the Target Retirement Funds are not expected to incur any net expenses
directly, the Funds’ shareholders indirectly bear the expenses of the underlying Vanguard
funds. The expense ratios for the Investor Shares of each of the underlying funds during
the Target Retirement Funds’ 2005 fiscal year were...(table omitted)

In other words, you're only paying for the weighted expense ratio of the underlying funds -- roughly 0.2%. Granted, that could change, but I doubt Vanguard will let it happen because they'd lose a lot of investors in these funds.

[CRFSaver]

I stand corrected!

[Ima saver]

Vanguard is looking good.

[jerseyguy]

Ok, thanks all for your responses. So, if I go with Vanguard..does anyone have any thoughts on which of there multiple retirement plans are best? Very confusing to me. Again, I plan on retiring in about 20- 25 years. I am leaning on going with a SEP IRA. I am self employed with no employees, so figured this would allow me to put more away faster. Thanks again.

[sweeps]

The best choice would probably be Target Retirement 2035.

If you'd rather invest only in domestic funds, you could invest 75% in Total Stock Market and 25% in Total Bond Market.

[Kirby]

I love the freedom funds. I intend to use them as my main retirement vehicle.