The best investments for a retirement plan -- such as a 401(k), 403(b), or traditional IRA -- will generally be those that generate higher current income and simultaneously provide the owner with a high probability of long-term price appreciation. Most workplace plans will offer a menu of funds from which you'll be required to choose, and it's especially important to pay attention to the specific investments listed, as well as the corresponding expense ratios. Keeping your costs low is a core tenet of investment success in a retirement plan, and the four funds below most certainly satisfy that requirement. 

1. Vanguard High Dividend Yield Index Fund Admiral Shares

The Vanguard High Dividend Yield Index Fund (VHYAX) has proven itself to be not only a reliable income generator, but a long-term growth engine. One of the great benefits of holding high-dividend investments in tax-deferred accounts is that each dividend payment is shielded from tax when it is paid. If a high-dividend fund is held in a taxable account, any time the fund distributes cash, you'll need to add that amount to your taxable income for the year. In other words, this one checks all of the boxes for an ideal retirement fund -- high income distribution, low expenses, and a robust portfolio of large-cap companies. 

Many of Vanguard's Admiral Shares are reserved for wealthier investors who are able to meet lofty investment minimums -- typically $50,000. With this particular fund, the lower-cost shares are closed to new investors, while the Admiral Shares are now accessible with a minimum investment of only $3,000. 

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2. Vanguard Dividend Growth Fund

While the previous fund focuses on high-yield companies with strong balance sheets, this fund is concentrated with companies that have demonstrated the "ability and commitment" to grow their dividends over time. Vanguard Dividend Growth Fund (VDIGX) is sensible for 401(k) investors with a long-term investment plan. Any income derived from portfolio companies is received in a tax-deferred manner -- this treatment won't change even as dividend payouts increase over time. 

Generally speaking, the companies that have the ability and willingness to continuously pay out increasing amounts of cash to their shareholders are also those that tend to be financially healthy. The top three holdings of this fund -- McDonald's, UnitedHealthcare Group, and Coca-Cola--  are well suited not only to increasing their dividends, but also experiencing significant share price appreciation over time. As far as 401(k) funds go, Vanguard's Dividend Growth Fund stands out as an unusually efficient, convenient, and practical choice. 

3. Fidelity Series High Income Fund

For those investors looking to tax-optimize their overall asset allocation, it's generally preferable to hold income-producing funds in your tax-deferred accounts. In the course of placing the right funds in the right accounts, you'll most likely end up with your taxable bond funds in your 401(k) or traditional IRA. The Fidelity Series High Income Fund (FSHNX) provides a high level of current income at low expense, and can act as a more aggressive income play as part of a broader bond allocation. It's not recommended to invest in high-yield bond funds as a primary holding, but they can play a part for an investor with tax-advantaged space seeking higher income.

The fund yields roughly 5% to 6% and offers a zero expense ratio, but also employs debt instruments with higher risk than investment grade corporate bonds. This means that several underlying bonds are at risk of default, which is the price you'll pay for higher cash payouts. Managed carefully, this fund can have a place in any well-diversified retirement portfolio, but it's important to ensure you hold some share of safer bonds to reduce the risk to your total portfolio. 

4. Fidelity ZERO Total Market Index Fund

If you're in the early stages of your career, there would also be nothing wrong with simply investing your retirement savings in a single total stock market fund for free. The Fidelity ZERO Total Market Index Fund (FZROX) costs nothing to buy, and provides exposure to the broad U.S. stock market. There's a very high likelihood that your employer's 401(k) menu includes this fund or a similar one. If you're also new to investing, simplicity is your best friend: A low-cost, well-diversified index mutual fund that requires no active management will be difficult to beat.

Consider your entire portfolio

The best funds for a 401(k) plan are those that also make sense within the context of your comprehensive financial plan. Before selecting any fund for any account, it's best to devise an appropriate asset allocation -- if you need help, don't be afraid to hire a fee-only financial planner to act as your guide. Once you feel confident with your direction, review any of the above funds for retirement plan success.