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do it for them, mutual funds are an investment worth considering.

As with any investment, mutual funds require the investor to do a substantial amount of homework before allocating their money. Here are a handful of mutual funds to consider for the upcoming year:

Vanguard 500 Index (VFINX)

› Minimum Initial Investment: $3,000

› Large-cap stocks include: Apple (AAPL), Microsoft (MSFT) and General Electric (GE)

T. Rowe Price Financial Services (PRISX)

› Minimum Initial Investment: $2,500

› Large-cap stocks include: Citigroup (C), JPMorgan Chase (JPM) and State Street (STT)

Vanguard Health Care (VGHCX)

› Minimum Initial Investment: $3,000

To start the education process, you’ll need to know just what a mutual fund is. A mutual fund is a company that pools money from many investors and invests the money in stocks, bonds, short-term moneymarket instruments, other securities or assets, or some combination of these investments. Moreover, each share represents an investor’s proportionate ownership of the fund’s holdings and the income those holdings generate.

Advantages And Drawbacks

Mutual funds are appealing for several reasons. For one, they are managed by professionals, whose career it is to constantly monitor the stocks and bonds in the fund’s portfolio. They take their time selecting investments.

With this being said, if you choose to invest in a fund, all control will be in the hands of the mutual fund money managers who run the portfolio. Typically, all mutual funds charge annual expenses that vary based on the account value. For example, the average for managed funds is around 1.5 percent or lower if not as actively managed.

Are Mutual Funds Right For You?

For those who don’t have the time necessary to manage an investment portfolio and don’t mind paying a yearly expense ratio to have an expert

› Large-cap stocks include: Bristol-Myers Squibb (BMY), Allergan (AGN) and UnitedHealth Group (UNH)

Fidelity Select Retailing Portfolio (FSRPX)

› Minimum Initial Investment: $2,500

› Large-cap stocks include: Amazon (AMZN), Home Depot (HD), Priceline (PCLN), Netflix (NFLX) and O’Reilly Automotive (ORLY)

Vanguard Intermediate-Term Investment Grade (VFICX)

› Minimum Initial Investment: $3,000

› Large-cap stocks include: HSBC (HSBC) and Medtronic (MDT) investorplace.com, frugalrules.com, money.usnews.com