Dear Mr. Berko: 

I read your five T. Rowe Price recommendations with great interest. I know that T. Rowe Price is a very good organization. However, we prefer to own Fidelity funds for our children’s college education. We have three children – ages 8, 10 and 14 -– and we’re finally at that point in our jobs where we can begin to save and invest about $500 every three months for each child. We want to give our children every opportunity we can so they can be successful. Our parents weren’t able to help us pay for our schooling, and we don’t want our kids to suffer through the worries that made it so difficult for us.

R.T., Detroit



Dear R.T.: 

I understand how you feel. However, I think a whole lot of young adults would be infinitely better off if they earned those opportunities rather than received them as gifts from their parents.

You and two other readers have asked that I recommend a portfolio of the best-performing mutual funds from Fidelity Investments for two primary goals: individual retirement accounts and other retirement programs and investments for children’s or grandchildren’s college education. It seems that Fidelity has more mutual funds than Mr. S.J. Carter has Little Liver Pills – more than 700, all with different objectives. These funds can be purchased by members of the armed forces, in trusts for young female orphans, by Republican state legislators, by baseball players, by gays and lesbians, by ex-convicts and members of Congress, by male law enforcement officers, by widowers, by investors older than 55, by non-U.S. citizens residing in California, by divorcees and by chiropractors and chiropodists. So whatever your objective, the Fidelity family has a fund for you, though I don’t think it has a fund specifically for lawyers ... yet.

I’ve culled the list of 700 funds, but before enumerating what I feel would be the best, you need to know that successful investing in mutual funds must be a long-term commitment. And by long-term commitment, I mean not two or five years but rather at least 15 years. When you are considering mutual funds for your kids’ education, you’d best begin when they’re very young (younger than 4) because you’re likely to be disappointed with the short-term results. Given your kids’ ages, you may not have enough time. And because you’re considering periodic, piecemeal investments (rather than a lump sum) over a five- to 10-year time frame, the likelihood is that you’ll also be disappointed in the results. Anyhow, here they are.

Fidelity Select Chemicals Portfolio (FSCHX-$145.45) is a $1.2 billion portfolio that owns companies such as FMC, LyondellBasell Industries, Sigma-Aldrich and Ecolab. Its one-year return is up 25 percent; the three-year return is up 22 percent; the five-year figure is up 17 percent; and its 10-year return is up 16 percent. Since its inception in 1985, it’s averaged 14 percent.

Fidelity Select Consumer Staples Fund (FDFAX-$93.98), a $2.3 billion portfolio, owns issues such as CVS, Bunge, Pernod Ricard and Altria. Its one-, three-, five- and 10-year returns are 14 percent, 15 percent, 11 percent and 12 percent, respectively, and since its inception in 1985, it’s averaged 13 percent.

Fidelity Select Health Care Portfolio (FSPHX-$199.24) is a $3.9 billion portfolio that owns issues such as Alexion Pharmaceuticals, Perrigo, Actavis and Cerner Corp. Its one-, three-, five- and 10-year returns are 36 percent, 26 percent, 18 percent and 11 percent, respectively, and since its inception in 1981, the fund has averaged 15 percent.

Fidelity Select Leisure Portfolio (FDLSX-$136.19) is small, $415 million, and owns issues such as Hyatt, Yum Brands, Brinker International and Penn National Gaming. And its one-, three-, five- and 10-year returns are 28 percent, 19 percent, 17 percent and 11 percent, respectively. Since its inception in 1984, it’s averaged 14 percent.

Fidelity Select Software and Computer Services Portfolio (FSCSX-$115.60) is a $2.7 billion portfolio containing WNS, Visa, Web.com Group and Oracle. Its one-, three-, five- and 10-year returns are 28 percent, 21 percent, 19 percent and 12 percent, respectively, and since its inception in 1985, it’s averaged 15 percent.

Fidelity Select Retailing Portfolio (FSRPX-$87.91) is small, $920 million, and owns L Brands, TJX Cos., O’Reilly Auto Parts and Dick’s Sporting Goods. Its one-, three-, five- and 10-year returns are 31 percent, 23 percent, 22 percent and 13 percent, respectively, and since its inception in 1985, it’s averaged 13 percent.