New to investing need help with mutual funds

I am 27 and want to do some investing in mutual funds for non retirement. This is bascially for probally 5 years down the road either to invest to buy a car or pay off some debt. I know it's going to be at least 5 years before I plan to use this money.

My problem is i dont know too much about investing. I know I can go to someone such as morgan stanley or fidelity, etc but they will probally charge me a fee for someone to assit me and handle the account.

I am unsure at this time how much 5 plan to start with, but I do like the ideas that I can do this online myself without having to pay someone. Fidelity and vanguard and both great compaines but would require a minimum for 2,500 inital investment. I don't like that idea, i'd rather open up a few different funds with another company for about 200 a fund.

If anyone has any advice on what my options are here I would really appreciate it.

Something in my coffee isn't working. You are going to invest money for 5 years to buy a car or pay down debt? That seems odd to me...is Dave Ramsey around? What rate is the debt right now? Why not pay it off now if it is higher that you can safely invest? You said you don't know much about investing, so it will be difficult.

You might be able to finance a car for under 5% easily, so why save up to pay it off?

Now, if you were talking about a house, I would probably say a 5-year CD at this point. With this relatively short timeframe and a shaky market, I would consider the debt now without know more about your situation.

if your goal is to save to pay off debt, then it might be wise to take the extra money and just pay off the debt now.

If the debt has an interest rate (like 0%, 5%, 10%, 20%...) and the investment return has an interest rate (like 3%, 5%, 10%), it only makes sense to save, IMO, if you can earn 1% more on the investment. Anything less and the risk of each suggests to me to pay down the debt.

I think I made a mistake when I posted this. I am not sure what I will need the money for, but what I am saying I am looking at a minimum of 5 years of when I plan to touch this money. However I may just take a portion out and leave a good amount of balance still in the fund. This could even be a 7-10 year time frame I am really unsure that will depend on what happens in my life. I am unsure for what this money will be used for, but this will be a non retirement account.

I am looking for a fund company that allows low miniums, which is why I like trowe price. They allow the account to be opened with as little as 50 dollars as long as you agree to contribute 50 per month to the account. Once your account reaches 2,000.00 dollars you are no longer forced to contribite to it.

Other compaines I have looked into such as fidelity, vanguard, morgan stanley, merrill lynch and TD ameritrade have much higher minimums, around the 2,500 range.

The one fund the the person who I spoke to for Trowe price recommened is TRPBX which is the Trowe Price Personal Strategy Balanced fund. Now looking at the history of this fund it is not an outstanding performer. I am willing to take a good amount of risk but I would not want the entire fund to focus on stocks, I would want some sort of diversication.

I hope this helps

I would suggest a fund which pays off some income- this could actually help tax situation the year of withdraws.

PRFDX for example (equity income). Disclaimer- 45% of my retirement savings is in this one fund.

If you want money in 5 years, just take the income distribution that year as cash. Then let the rest keep growing.

This fund will give off small distributions each quarter, a slightly larger one at end of year.

If you only chose one fund, PRFDX is 100% equity, but it's about as conservative as a 100% equity fund could be. Slow and steady for sure.

If you need to balance the risk, maybe a muni bond fund from T Rowe to compliment it, or choose TGRIX (International growth and income) which is similar to PRFDX, just a foreign fund instead of domestic.

disclaimer- I own TGRIX as well. About 15% of my retirement is in this fund.

The one fund the the person who I spoke to for Trowe price recommened is TRPBX which is the Trowe Price Personal Strategy Balanced fund. Now looking at the history of this fund it is not an outstanding performer. I am willing to take a good amount of risk but I would not want the entire fund to focus on stocks, I would want some sort of diversicationOn the contrary, this fund was an excellent recommendation for your 5-10 year time frame. The reason you may assume that it is not an outstanding performer is most likely erroneous. The reason the returns are not stellar is because there is an ample mixture of stocks, bonds and cash. TRPBX invests in a diversified portfolio typically consisting of about 60% stocks, 30% bonds, and 10% money market securities.

What the fund offers is what you seek most: Some respectable appreciation, coupled with stability and consistency and minimal downside tendencies. Although the fund's best one year return was only 28%, it's WORST return was only -7.7% (Trade Towers). Your time horizon returns (5-10 years), have historically exceeded 11% annualized. It has shown 10 up years and only 2 down years over the past 12.

And it's cheap with low minimums. A good fund for your purposes.