Do I need to keep all this financial stuff? Why?

My wife’s employer invests her retirement contribution in mutual funds. American Funds is the largest of these. Of course, the fund invests in various companies, products, etc. I know a lot about a lot of stuff, but I don’t know a lot about mutual funds. I do know that when the market is down, her fixed contribution purchases more shares (because the cost is low). When the market is up, the value of her account goes up, but the number of shares her contribution purchases goes down. So, for us (she is 44 years old), a down market is pretty good for us because she buys lots of shares. When it is time to retire, we want a strong market so that the value of those investments will be high.

But that isn’t my question. All of these funds that she invests in send us booklets, prospectuses (prospecti?), and other books. After a while, they really stack up. Do we need this stuff?

I do keep the quarterly and annual statements, but those are specific to her and show the value of the investments. The books I’m talking about are the ones sent to all shareholders. What am I supposed to do with this stuff?

(I’m a public employee and my retirement is held with the Teacher Retirement System of Texas. I do have an annuity and a life insurance policy that pays dividends each quarter. I get literature from those, but it is minuscule compared to the piles of literature my wife gets.)

No, you don’t need to keep them. You could take a quick look through them to see what the expense ratios are, but in an employer provided plan there may not be much choice in the matter (i.e., there may not be cheaper funds to select in the same asset class). Other than that, and perhaps making sure the funds you have represent the asset allocation you want, there is no reason to keep the prospectus or fund annual reports.

Do keep the statements.

You need to keep the statements from the broker in case of a later claim. Why the government accepts such statements as “proof” of assets when they can easily be photoshopped is beyond me, but they do ask I have been through several of these incidents myself with failed banks/brokerages.

As for the material you’re really referring to- No, you can toss them. In fact, if you dig a little deeper you will find you can agree to electronic delivery of such materials in most cases. Sometimes it takes a LOT of digging, and it won’t always be directly through the fund nor broker. For example I happened to see a URL on one mailing, and only one, of the 4 I got one day. I’d post it but I don’t have it on this machine. A quick visit to that URL ended 99% of the tree-waste that I received from that point forward.