If you're willing to do a little more work and bookkeeping than just putting money into the 401(k) I would recommend the following. I note that you said you chose some funds based on performance since the expense ratios are all high. I would recommend against chasing performance because active funds will almost always falter; honor the old saw:
"past performance is no guarantee of future returns".
Assuming the cash in your Ally account is an emergency fund, I would use it to pay off your credit card debt to avoid the interest payments. Use free cash flow in the coming months to bring the emergency fund balance back up to an acceptable level. If the Ally account is not an emergency fund, I would make it one!
With no debt and an emergency fund for 3-12 months of living expenses (pick your risk tolerance), then you can concentrate on investing. Your 401(k) options are unfortunately pretty poor. With those choices I would invest this way:
- Invest as much as required to maximize the company match to your 401(k), but no more. For most people I would recommend to invest 100% in RRTFX because it is already fairly well diversified and keeps it simple. Personally I prefer a higher international allocation than the ~30% of RRTFX as well as a little more real estate exposure, so I would probably put the majority into RRTFX (say 75%) with the remainder in RERCX (15%) and OREAX (10%). I don't like that RERCX is active, but there does not appear to be an index option. The other funds that concentrate on slices of the US market I wouldn't bother with since RRTFX already covers them; you're just creating additional leverage. Small caps historically have done well, for instance, but not in all situations, and who knows what the future may hold.
- After you hit the 401(k) match, begin putting the rest of your monthly funds available for investment towards either an IRA or Roth IRA (be sure to be aware of the yearly contribution limits). Personally I prefer the immediate tax benefits of an IRA, but I'm going for early financial independence, so I expect my tax rate to be much lower when it comes time to withdraw from retirement accounts, thus negating most of the Roth benefit. A good article is available at Mad Fientist on choosing between the two. Note that it is an early financial independence site, so some of the points he makes are assuming that is the reader's goal as well. Whichever way you go, put your money into low cost index funds or ETFs.
Once you fill up your choice of IRA, then you have the tougher decision of where to put any extra money you have to invest (if any). A brokerage account gives you the freedom of investment choices and the ability to easily pull out money in the case of a dire emergency. The 401(k) will give you tax benefits, but high fund expenses. The tax benefits are considerable, so if I were at a job where I plan on moving on in a few years, I'd fund the 401(k) up to the max with the knowledge that I'd roll the 401(k) into a rollover IRA in the (relatively) short term. If I saw myself staying at the employer for a long time (5+ years), I'd probably take the taxable account route since those high fund fees will add up over time.
One you start building up a solid base, then I might look into having a small allocation in one of my accounts for "play money" to pick individual stocks, or start making sector bets.
