Some skeptics malign funds that track the market as a lowbrow way of investing. But over the past 40 years, the S&P is up 1,110% -- meaning a $100 buy-in four decades ago would be valued at $1,210 today. That's pretty powerful. Imagine if you continued to invest across your early years, too, with $100 here and $100 there to supplement the fund.

Fidelity Small Cap Discovery

If you want to get a little more pop in your retirement fund and don't mind taking on a bit more risk or paying a bit more in fees, the Fidelity Small Cap Discovery (FSCRX) fund can be a great choice.

This fund seeks out the top small companies that have big-time potential. Unlike a big fund that contains S&P 500 components, the companies in the fund are stocks you likely haven't heard of -- yet.

The profit potential of this fund is obvious. Think about the money you'd be sitting on if you could have invested in Apple (AAPL, news) or Microsoft (MSFT, news) way back when they were small-time companies. (Microsoft publishes MSN Money.) Of course, some of these small companies will struggle along, and eventually fail.

The expenses are larger on this Fidelity fund because the manager's research and active role should add value that a passive index fund can't match by just moving in lockstep with the market.

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But manager Chuck Myers has been running the fund for more than five years -- since March 2006 -- and has a track record to back up his leadership. With the fund's annualized return of more than 6% over the past five years -- while the Dow Jones Industrial Average ($INDU) was shedding nearly 4% -- you can see the power of his strategy.

The downside is that when the Small Cap Discovery Fund falls short, it likely will hurt. And a $2,500 buy-in also puts it out of reach for many investors just out of college. But if you can scrape together the cash and can handle the volatile ride, this fund could help provide a solid start on accumulating a $1 million nest egg.

Funds for young investors
FundCategoryMinimum initial purchaseExpense ratio5-year return (annualized)
Vanguard Target Retirement 2050 (VFIFX)Target date$1,0000.00%1.30%
Schwab S&P 500 Index (SWPPX)Large-cap blend$1000.09%0.35%
Fidelity Small Cap Discovery (FSCRX)Small-cap blend$2,5001.04%6.40%