With over 8,000 mutual funds to choose from, picking a few to put your money into can be a bit overwhelming.  If you have a 401k, the human resource department dwindled the list down a bit, if your lucky.  But which to choose?

Well lets say you’ve decided on the type of a fund, a growth fund for example, but you still see that you have a dozen to choose from.   There is no point in picking 2 or 3 different growth funds and putting your  money into each.  Reason being that all three funds will be invested in several of the same stocks.  If the funds do well, great.  But if they don’t you’re going to feel three times the pain.  There is no diversification with money in 3 growth funds so don’t do it, pick one growth fund and only one growth fund.  It’s better that way. Continue Reading…