We used to have American Funds (INV Co of America, New Prespective) as well some index funds. Options gradually changed to many Target Date funds, SP 500 index, Stable value and some replacement funds that didn't have a ticker symbol (US Equity, Global Equity, and an Emerging Mkts fund), as well as the LMC common and ESOP funds. I have moved 75% of my assets into the Self Managed option, invested in the 4 or 5 well perfroming funds as well as equities (Boeing and P&G for now). I am planning to move more. My plan contributions are going 100% into LMC common stock fund. Was I doing the correct thing in trying retain some control and flexibility?
Many fund administrators use proprietary funds for 401k plans. These funds are often a different share class of the same funds that do trade online and have tickers, but it can often be difficult to match them up. It is very difficult not having a ticker for those of us who like to keep track of our accounts in Quicken, etc.
As for whether you are "doing the right thing" it is hard to know. You have a self managed option, which is not all that common. Taking advantage of this, if you know what you are doing, opens up a universe of options - which is great. You can use low cost index funds, low cost ETF's - and yes, own some individual equities if you wish. Again, if you know what you are doing, and if you build a diversified portfolio with an asset allocation that is suitable for your age and retirement goals, then there is nothing wrong with what you are doing.
If you are unsure, you can review your selections with a fee only financial planner. Any planner who works for an hourly fee would be happy to look over your portfolio and make suggestions. I think it would be worth the minimal investment, just to make sure you are on the right track.
Sounds like you are doing the right thing. I would continue to do the research into your various investment options, track you investments closely and make changes as necessary. I am not a big fan of target date funds. If you know what you are doing with your investments, I think you will do better self-directing your investments. Also, if you want a second option, you can always pay a financial advisor for an hour or two of his time to review your investment options, holdings, etc. and provide suggestions.
James K is right. You should find someone to review your plan investment options to determine if they are adequate. If not then they can help you select the proper investments using the self-managed option.
There is a trend these days among plan sponsors to reduce the number of plan investment options. Studies show that when the typical participant is faced with many plan options they become overwhelmed and make poor investment decisions.
If you sponsor is doing their job they will have made very low cost investment options available to you in the fund line up. And give you the right type of investments so you have the ability to construct a diversified portfolio. Best guess on my part is that you can use the available plan investment options to fill in the core investment options in a well-diversified portfolio. If you want to diversify further, for example real estate or commodities or emerging markets, then you can use the self-directed option for that.
My best advice to you is to be sure you are diversified. Do not put too many eggs in the Lockheed Martin basket. Do not concentrate your retirement investments in one industry. When you say you have ‘well-performing funds’ it may be they are all well performing only because they all own the same stocks. If one fund goes down they’ll all go down.
Again, best to get some help. Ask your Human Resources department if they have made arrangements for employees to speak with an investment professional. Better run plans will offer this option. If not then reach out to a fee-only planner to help you design a portfolio that is right for your personal situation.
Hope this helps.
The advantage to the target date fund is that you can invest with confidence and not have to constantly keep up on the investments. They are managed by people who reallocate the investment in many sectors and toggle down the risk as you near retirement. The advantages to doing this are diversity, proper risk allocation, and it prevents you from trying your hand at market timing which can be a rocky road. (It's human nature to buy high and sell low)
I first would find a risk tolerance questionnaire and figure out where you are, then I would speak with an advisor on what that risk level diversification would look like. Many times, I advise people to put half in the target date and half in your own allocation and have fun with it... see if you can beat out the fund managers over time!