T. Rowe Price Index Fund Portfolio

T. Rowe Price is the third largest direct marketer of mutual funds in the country. They are gaining respect from individual investors and corporations for trusting their money. BUT, they do not offer a wide selection of index funds nor are those funds placed prominently on their website.

Since, not everyone has access to Vanguard for their 401(K) plan through work, here are my suggestions for building index funds portfolios using T. Rowe Price funds. Since index funds selection is limited at T. Rowe Price, I did not construct elaborate portfolios like I have done with Vanguard and Fidelity index funds.

The percentage numbers are not prescriptive, but merely suggestions. You can tweak these number depending on your goals, age, and risk tolerance profile. Please remember that, even if you divide your asset allocation equally among all your funds, you will still come out ahead simply for getting started. So, don't sweat too much into percentages. Eventually, as you buy and hold your investments for longer timeframes, you can tweak your asset allocation by diverting more or less money.

Portfolio #1: T. Rowe Price Simple Three Index Fund Portfolio

If you like a little bit of control over your asset allocation, here is a simple three index fund portfolio. These funds cover the entire gamut of financial markets.

Fund	Aggressive	Moderate	Conservative
T. Rowe Price Total Equity Market Index Fund	40%	40%	30%
T. Rowe Price International Equity Index Fund	40%	30%	30%
T. Rowe Price  US Enhanced Bond Index Fund	20%	30%	40%

 

Portfolio #2: T. Rowe Price Five Index Fund Portfolio

If you like to diversify and further control over your asset allocation, here is a five index fund portfolio.

Fund	Aggressive	Moderate	Conservative
T. Rowe Price Total Equity Market Index Fund	40%	35%	30%
T. Rowe Price 500 Index Fund	10%	10%	10%
T. Rowe Price Extended Equity Index Fund	10%	10%	10%
T. Rowe Price International Equity Index Fund	30%	25%	20%
T. Rowe Price  US Enhanced Bond Index Fund	10%	20%	30%