High growth mutual funds that Dave Ramsey recommends (bonds, fee, 401k)
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High growth mutual funds are always recommended by Dave Ramsey. Unfortunately, Dave never seems to mention any of his specific favorite high growth mutual funds. Instead, he always asks people to call an ELP. I assume the call to the ELP will generate revenue for Dave Ramsey, which seems to be the motive to not mention any specific high growth mutual funds.
Does anyone have high growth mutual funds that have at least a 10 year track record that they can recommend?
High growth mutual funds are always recommended by Dave Ramsey. Unfortunately, Dave never seems to mention any of his specific favorite high growth mutual funds. Instead, he always asks people to call an ELP. I assume the call to the ELP will generate revenue for Dave Ramsey, which seems to be the motive to not mention any specific high growth mutual funds.
Does anyone have high growth mutual funds that have at least a 10 year track record that they can recommend?
I'm not sure he does, which is why he doesn't actually name any. He talks as if mutual funds regularly return 12% CAGR. Over the past ten years the S&P had a CAGR of 7.6%, so his funds beat the market by almost 60% over the past ten years and 1-2%/yr over the past 30 years.
I would just invest in an S&P index fund through Vanguard or an ETF like SPY and avoid the high expense ratios that come with actively managed mutual funds.
It has been suggested that he is referring to the Investment Company of America (AIVSX). It claims an annual return of 12.13% since its inception in 1934:
It has been suggested that he is referring to the Investment Company of America (AIVSX). It claims an annual return of 12.13% since its inception in 1934:
Is that before or after the expense ratio? Also, don't forget the load fee of 5.75% for American Funds. It would need to beat the market by over 1% each year to catch up and even then it would take about 25 years to break even with an index fund invested in the S&P with an ER of .05-.1% and no load fee.
Is that before or after the expense ratio? Also, don't forget the load fee of 5.75% for American Funds. It would need to beat the market by over 1% each year to catch up and even then it would take about 25 years to break even with an index fund invested in the S&P with an ER of .05-.1% and no load fee.
I have no idea...I'm not promoting or recommending it, just offering the information. I'm fully in agreement with your suggestion of an S&P 500 index fund...thats exactly where my equities money is.
High growth mutual funds are always recommended by Dave Ramsey. Unfortunately, Dave never seems to mention any of his specific favorite high growth mutual funds. Instead, he always asks people to call an ELP. I assume the call to the ELP will generate revenue for Dave Ramsey, which seems to be the motive to not mention any specific high growth mutual funds.
Does anyone have high growth mutual funds that have at least a 10 year track record that they can recommend?
This should help. The funds with the top 10 and 20 year track records are towards the bottom. There are different categories that you can choose in the drop-down menu. Keep in mind of course that past performance is no guarantee of future results.
It has been suggested that he is referring to the Investment Company of America (AIVSX). It claims an annual return of 12.13% since its inception in 1934:
That fund is ok, but only if you can avoid paying the sales load. Otherwise, it's not worth it. Its performance over the most recent 10, 15, and 20 year periods has been ok, but uninspiring. It certainly hasn't been 12%, although that is true for most funds. But even compared to other stock mutual funds, its returns have been so-so or only a little above average, depending on the time period measured.
Typically, you can avoid the sales load if you get this fund in your 401K. But if you can't, it's not worth it.
I have no idea...I'm not promoting or recommending it, just offering the information. I'm fully in agreement with your suggestion of an S&P 500 index fund...thats exactly where my equities money is.
The returns are shown net of the expense ratio but do not include the sales load.
This should help. The funds with the top 10 and 20 year track records are towards the bottom. There are different categories that you can choose in the drop-down menu. Keep in mind of course that past performance is no guarantee of future results.
Allow me to narrow this down to top performing no-load mutual funds that have been around at least 20 years and are open to new investors:
Dodge & Cox Stock
Fidelity Contrafund
Mairs & Power Growth
Parnassus Core Equity
Homestead Small Company Stock
T. Rowe Price Value
Amana Growth
FPA Crescent
Mairs & Power Balanced
Dodge & Cox Balanced
Only Mairs & Power Growth has exceeded 12% returns over the past 20 years, although all of them have exceeded 10% over that time frame. The stock market overall just hasn't done that well over the last 2 decades. This tells you how unrealistic it is to expect 12% returns.
Personally, I'd recommend one of the three balanced funds at the end of the list. Balanced funds typically have ~ 1/3 of their assets in bonds and cash. That takes away a little bit from long term returns, but balanced funds typically hold up much better in bad years than funds that are 100% in stocks, so they're much easier to stick with for the long term. The two top performing balanced funds on this list have outpaced a lot of more aggressive funds, as well as beat the S&P 500 Stock index with less volatility.
Last edited by mysticaltyger; 04-09-2015 at 08:00 PM..
It has been suggested that he is referring to the Investment Company of America (AIVSX). It claims an annual return of 12.13% since its inception in 1934:
The fund you listed has a 10 year annual return of just 6.89%. Nothing special at all.
I don't follow Dave Ramsey, but I have a hard time believing he would recommend any mutual funds with a load nor an expense ratio as high as this one. Terrible choice. No wonder its Morningstar rating is just 3 stars.
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