With Retirement In Mind, the Funds You Can't Ignore

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Everyone should have an individual retirement account, designated as a ROTH IRA, as a tax free investment for their future. Unfortunately, most Americans have little education in investment economics and do not know how simple it is to begin the process and take control of their future. Anyone who believes Uncle Sam is going to provide for a vibrant and secure retirement is in for an old age rude awakening.

Last week, the basics of investing were discussed so that everyone could have the confidence to open up a retirement account. Today things get even easier. Here are arguably the 3 best mutual funds that can be purchased on your own for as little as $500.

That's right, opening an account is not expensive; and if you set up "auto investment" to purchase more shares monthly, and reinvest your dividends/capital gains for even more shares, you will see your account balance steadily grow and your retirement fears diminish.

These 3 funds have been researched and chosen out of thousands that are offered. They were picked because they most closely meet the parameters outlined last week, including management, fees, and performance. Most importantly, their low initial investment amount makes them assessable to all investors; especially millennials who need to start early yet have limited dollars to invest. Remember, time and compounding makes almost any investment a sure thing.

Each of these 3 funds belongs to a solid fund family that offer multiple fund choices so you can work with them in confidence. Of course not all funds in a family meet the specific parameters outlined so be careful if you buy into their other funds.

Obviously, when you invest risk and reward must be factored in; and this writer has no stake in any of these funds. Ultimately you must take that leap of faith, download the form to open an account, and send a check. With that said, each of these funds consistently invested for the next 30-50 years should offer you a retirement nest egg that you will not only be proud of, but will give you peace of mind.

Here are the 3 golden tickets in alpha order.

Elfin Trusts (ELFNX) is managed by GE Asset Management out of Stamford Connecticut. It is a 4 star large growth fund. It has a .18 expense ratio, no load or 12b-1 fees. The fund has a turnover of only 13% and a 10 year performance of 8.85%. Initial investment to open an account is $500 and subsequent investments must be at least $100, less if you open an automatic investment plan (AIP).

Homestead Value (HOVLX) out of Arlington Virginia is a 4 star large value fund. It has a .61 expense ratio, no load or 12b-1 fees. It has a 2% turnover and a 10 year performance of 7.76%. Initial investment to open an account is $200. Subsequent investment amount is $1.00. Homestead was actually founded so rural Virginian's with limited resources could begin investing.

Nicholas (NICSX) out of Milwaukee Wisconsin is a 5 star mid cap growth fund. It has a .73 expense ratio, no load or 12b-1 fees. It has a 22% turnover and a 10 year performance of 10.2%. Initial investment to open an account is $500 and the subsequent investment amount is only $50. Nicholas is a Midwest company that caters to Middle American's.

Opening an account in a specific mutual fund is no different than deciding what shirt to buy; the only difference is that you're exchanging dollars for shares in a company whose business is to make your dollars grow.

You do not need a laundry list of investments and thousands of dollars to be an investor. Start with one great fund, learn the ropes, and keep it simple.

There is no excuse for not having a ROTH IRA building wealth for your future. In fact, you're sitting in front of your computer right now so take the first step. Don't rely on Uncle Sam. Wake up, take charge, and provide your future with a secure and vibrant retirement.

Dean Kalahar recently retired from teaching economics and pyschology.  He has authored three books, including The Best of Thomas Sowell, a user-friendly guide to Sowell's insightful thinking on a wide range of social and political issues. 

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