Finally asking for portfolio advice..

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Finally asking for portfolio advice..

Postby loudog » Thu Mar 14, 2013 7:19 pm

Hello! I joined the forum some time ago and had some circumstances that kept me from doing this for longer than I ever planned. I would like to follow the Boglehead’s strategy and would really appreciate some help/advice getting started. I feel like I am in a decent financial position, while living a pretty low cost lifestyle. I want to ensure that I set myself up for my next 30 years or so. After reading the book I did open up some Vanguard funds, but now want to fully integrate myself! Unfortunately, no vanguard funds are offered in my 401k and since I recently almost paid off my entire mortgage I don’t have tons of cash. I am a saver, though, and want to start doing what I can the right way.

Emergency funds: Almost 12 months
Debt: Credit card is paid in full monthly. Only other debt is mortgage- owe about $9,750.00 at 3.19% interest and mortgage payments are $98.56/month (taxes & insurance are not escrowed and add up to about double or so my mortgage)
Tax Filing Status: Single, no dependents
Tax Rate: 25% Federal, 7.05% State
State of Residence: Minnesota
Age: 30
Desired Asset allocation: 90%+ stocks / 10% bonds/fixed
Desired International allocation: Do not know what is appropriate. Do want some

Current total portfolio:

$111,500 divided as shown below.
95% equity in my house brings total to about $250k. Not sure how/if that gets counted in my portfolio.

Cash:
3.59% $4,000 (for investing – not included in emergency funds)

Taxable:
3.05%, Vanguard Total Stock Market Index Fund Investor Shares (VTSMX)(0.18%)

401k:
4.86%, American Europacific GR FD R5 (RERFX) (0.55%)
8.69%, Blackrock S&P 500 Index I (MASRX) (0.31%)
39.51%, Fastenal Company Stock (FAST) (0.00%??)
7.11%, Pimco Total Return Port. Instl (PTTRX) (0.46%)
5.46%, Blackrock Global Alloc I (MALOX) (0.89%)
8.94%, American Capital World G & I (RWIFX) (0.5%)

I have tried to stick with the cheapest options available.

Company match? Yes- based on profit sharing formula- last year 86% of up to $5,000 of contributions. Half deposited into company stock and the other half deposited into current investment direction. Company stock can be sold immediately, however I have always kept it.

Annuity:
7.17%

Roth IRA at Vanguard:
7.13%, Vanguard Total International Stock Index Fund Investor Shares (VGTSX) (0.22%)

Traditional IRA at Vanguard:
4.49%%, Vanguard Prime Money Market Fund (VMMXX) (0.16%)

New annual Contributions:
This is part of what I am seeking advice on. See my questions below.

Funds available in 401(k):
Blackrock EQ Dividend I (MADVX) (0.76%)
John Hancock Disciplined (JVMIX) (1.03%)
JP Morgan U.S. Equity FD CL R5 (JUSRX) (0.59%)
Mainstay Large Cap Growth Fund (MLAIX) (0.92%)
Munder Midcap Core Growth FD Y (MGOYX) (1.08%)
Oppenheimer Main Street SML Y (OPMYX) (0.83%)
Delaware Invstmnt Div INC CL A (DPDFX) (0.92%)
Invesco Stable Value RET CL 3 (ISVET) (0.56%??)


Questions:
1. Should I invest in a ROTH for 2012 tax purposes? This is my most immediate question.
Note: To date I have not put anything into any sort of IRA for 2012 or 2013 tax purposes

2. I am comfortable putting 40% of my income towards retirement, I want to ensure that I have the right tax strategy and/or tax diversification. Specifically how much I should put in my 401k vs. ROTH IRA, Traditional IRA, taxable investments or otherwise? I plan on using all Vanguard funds outside of my 401k and fund recommendations are very much appreciated.

3. Would moving to an IRA (Roth or Traditional?) immediately after reaching the company’s match ($5000) be the way to go since I will be able to pick much cheaper funds than what is available in my 401k? Or if the company stock does not have any costs should I keep in there?
Note: I am not sure what Bogleheads opinion on investing in company stock is, but FAST is a very solid stock that has been amongst the top performing stocks since it went public in 1987. It has a solid history of growth and in a position to keep that pace. I realize past performance does not indicate future performance, but my 401k would not be what it is today without FAST. Let me know if I am crazy for being so heavily invested in the company I invest my livelihood on. It will be hard to give up... especially with what else is available in the 401k.

4. Do I not want to have too much in my 401k? After age 70 ½ I have to have minimum withdrawals, but there is no such requirement for Roths. I read that somewhere and it seemed to make sense. Please let me know your thoughts.

5. Advice on improving my current portfolio would be very much appreciated. I am nervous about putting much more into stocks right now since things are seeing all-time highs and don’t want to throw money into a bull market that may be near its’ peak.

Additional Info-

I am currently putting 22% of my income into my 401k. That is the lowest I have put in for a while due to bull market. Last year put in around 30%.
Income is around $50k

I hope I covered everything. It was a great exercise putting this together! If you need additional information please let me know and I am looking forward to this discussion!

Thank you so much,
LD
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Re: Finally asking for portfolio advice..

Postby letsgobobby » Thu Mar 14, 2013 11:03 pm

Congrats on nearly paying off your mortgage by age 30: nice job.

You must sell your company stock, now. Keep 5% if you must. That is your single biggest risk and it is an enormous one. It is the gravest error I see in your portfolio.

Yes if course you should invest in Roth IRA for both 2012-13. If you can afford it, why would you relinquish tax preferred space, only to never get it back?

In your tax bracket 401k better than a Roth IRA. Of course max both if you can, but that is more than 50% of your income.

Ignore the market. Invest per your plan. Perhaps it is your desired stock allocation, and not the market, which is too high? I think 90/10 is supremely risky.

Are any of your 401k funds index funds? Have you plotted any of their total returns vs an index fund?
Last edited by letsgobobby on Fri Mar 15, 2013 12:45 am, edited 1 time in total.
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Re: Finally asking for portfolio advice..

Postby Occupier » Thu Mar 14, 2013 11:13 pm

OK. Regarding investing in the tax free you should max those things out even if you don't get a tax deduction this year. Money in a tax free account compounds tax free for the rest of your life. In taxable they get a bit of it each year. I don't like the size of the FAST holding. It's too many eggs in one basket. A rule of thumb is no more than 5-10% in any one stock. People at ENRON thought their companies stock looked good too, but it went up in smoke in one year, and some lost their entire retirement. I would put a big chunk of that stock in 500 Index instead. Maybe then you would change the taxable to total international. Both are tax efficient but your international 401 choices are high cost for the Int. Funds. How about Total Bond or TIPS in the Traditional IRA your 10% bond allocation is a bit low for your age. That is all I see. Dave
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Re: Finally asking for portfolio advice..

Postby coolguy954 » Thu Mar 14, 2013 11:23 pm

agreed with previous poster about too much company stock in your 401k. My company has been in business for over 70 years and I still don't trust them to be here when I retire. 39% of your 401k is company stock is scary. Cash a majority of that out ASAP. max out your roth and ditch the traditional ira. max out your 401k. Try to user more index funds in your 401k. Try not to make your savings/investments go over 30%. Live a little and use your money :)
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Re: Finally asking for portfolio advice..

Postby loudog » Thu Mar 14, 2013 11:50 pm

Thank you for your responses.

Bobby- Do you mean I should max out the entire $17.5k possible in my 401 before putting anything into a ROTH IRA? Or do you mean just to the company match at $5k? I wasn't aware that the 401k in my situation was that much more advantageous.
Yes, there is an index fund and since I first read the Bogleheads book I started putting a large percentage of my contributions in that... but it is taking some time to catch up.
Thank you for the ROTH advice for 2012. Will do so. But for 2013 only if I have left over after maxing my 401k if I understood that correctly.
Regarding the stock allocation- Does it seem risky at my age? I still see myself as such a long way off from retirement. Good point though that if I am affraid of the current market then it might be my AA that isn't right. That is consistent with other advice I've seen given recently on the forum.

Occupier- If I get something in an IRA within the next two week's it should count for 2012, correct?
How about the rest of my funds in my 401k? should I just put it all into the index fund? I don't feel like I have that great of options in the 401k and zero Vanduard options, which is a bummer. For the TIPS are you refering to VIPSX?
Regarding FAST- I am tempted to go on about them being known for their fiscal responsibility etc, but I know it would be a losing argument and your point is well made. Perhaps I have been drinking the kool-aid.

Do either of you have advice as to which Vanguard funds would be good options for 2012's ROTH. And why ROTH in my case vs. Traditional IRA?

Thanks- lou
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Re: Finally asking for portfolio advice..

Postby BL » Fri Mar 15, 2013 12:13 am

I am currently putting 22% of my income into my 401k. That is the lowest I have put in for a while due to bull market. Last year put in around 30%.
Income is around $50k


I am wondering if you really are in the 25% tax bracket.

50k -standard deduction - 1 exemption - 401k contributions = ??

I believe the 25% bracket starts at $36,250 so around $5000 401k will bring you into the 15% bracket which is what you want to do. The comments on Roth IRA may change if you verify that you income is indeed in the 15% bracket.

Is your "income" gross income, adjusted gross income, taxable income, or ?? I was thinking your Box 2 income before 401k, but that may not be what you mean.
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Re: Finally asking for portfolio advice..

Postby Brian2d » Fri Mar 15, 2013 12:42 am

Just some clarification on the feedback regarding employer stock.

You're doing something quite common, which is thinking that a company being a "good company" is a reason to own lots of its stock. This is not necessarily the case. Apple when it was at $700 may well have been a good company, but it was overvalued, and anyone owning Apple has lost 38% of its value at a time the market went up. Any single company, no matter how well managed, has diversifiable risk, which is uncompensated risk.

Further, as an employee of the company, you are more likely to be adversely affected if the company has difficulty than if it does well. If the company has troubles, you don't want a large portion of your portfolio tanking at the same time your job is in jeopardy.

Vanguard's portfolio analysis warns people of risk in a single stock that is greater than 5% of the portfolio. Anything higher than that is usually unnecessarily risky, no matter how good the company is. Even if everything your management is correct, it's still too high an allocation in a single stock.
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Re: Finally asking for portfolio advice..

Postby letsgobobby » Fri Mar 15, 2013 12:48 am

Don't forget s/he also has state tax on to of marginal federal rate. Given the income level, unless there is a pension I would not rush to use a Roth IRA even at the 22% bracket, which is 15% federal + 7% state.
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Re: Finally asking for portfolio advice..

Postby loudog » Fri Mar 15, 2013 1:18 am

I'll try to clarify my income. Gross income was $48.5k. With my 401k contributions and medical pre-tax deductions I believe that made my taxable income $35,514 (my math exacly matched box 1 from my W2- wages, tips, other comp)
Box 3 on the W2 (SS wages) was $45,458.

Hope that helps and makes the ROTH question easier. Anything else let me know.

Thanks much!
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Re: Finally asking for portfolio advice..

Postby loudog » Fri Mar 15, 2013 1:21 am

Brian, thank you for the additional feedback on employer stock. It is a tough pill to swallow, espeically when it has treated me so well, but you guys are right.
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Re: Finally asking for portfolio advice..

Postby roymeo » Fri Mar 15, 2013 1:27 am

More on company stock:

If your company gave you bunch of stock in some random company that you don't/wouldn't buy on your own, would you hold on to it?

Do you think you would intentionally buy your company's stock if they gave you a cash bonus?


Sell it and buy what YOU want to own.
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Re: Finally asking for portfolio advice..

Postby rickmerrill » Fri Mar 15, 2013 2:18 am

Can we get his marginal rate to 15% so that he can unwind his company stock without paying capital gains tax? Maybe by increasing his pre-tax to lower his AGI and sell over a few years? Might save 5-6k in taxes.
If I am stupid I will pay.
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Re: Finally asking for portfolio advice..

Postby letsgobobby » Fri Mar 15, 2013 3:45 am

Looks like it is in his 401k.
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Re: Finally asking for portfolio advice..

Postby loudog » Fri Mar 15, 2013 10:47 am

Correct Bobby it is in my 401k. Should it just all go into the Blackrock Index fund (MASRX)? That seems to me to really be the only fund that actually is lower cost in my 401k.


So it seems that I was incorrect on my tax bracket. If I'm actually in the 15% does that change the IRA vs 401k avdice given earlier?
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Re: Finally asking for portfolio advice..

Postby Jay69 » Fri Mar 15, 2013 11:12 am

letsgobobby wrote:Don't forget s/he also has state tax on to of marginal federal rate. Given the income level, unless there is a pension I would not rush to use a Roth IRA even at the 22% bracket, which is 15% federal + 7% state.


letsgolobby

Is this one those cases where the OP may what to shoot for somthing like 25/75 or 50/50 rIRA/tIRA?

If you are unable to fill all your tax avantage space Im a fan of using Roth Space for the Emergency fund.

Welcome to the boards from the land of 10,000 lakes.
"Out of clutter, find simplicity” Albert Einstein
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Re: Finally asking for portfolio advice..

Postby loudog » Fri Mar 15, 2013 11:45 am

Thanks Jay!

letsgolobby- sorry I've been calling you Bobby... I misread your name...
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Re: Finally asking for portfolio advice..

Postby letsgobobby » Fri Mar 15, 2013 1:16 pm

I'm not a tax expert, but let's start with how much pretax you could afford to contribute to retirement each year. If 40% of $48k that implies $19,200. If you put $17,500 in your 401k, what would your taxable income be? subtract your exemptions, your deductions, etc. $28,800 - standard exemption - standard deduction, etc. I don't know MN's state tax structure; how low will your state taxes get at that income level?

If you lived in a state with no income tax, getting into the 15% federal tax bracket would persuade me to use a Roth IRA. I wouldn't do any Roth IRA contributions at 15% federal + 7% state.
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Re: Finally asking for portfolio advice..

Postby loudog » Fri Mar 15, 2013 2:43 pm

Minnesota tax rate for single is as follows (according to http://www.tax-rates.org/minnesota/income-tax#TaxTable)-
$0+ marginal tax rate of 5.35%
$23,100+ marginal tax rate of 7.05%
$75,891+ marginal tax rate of 7.85%

Hmm, so even if I max the 401k plus medical pre-tax deductions ($17.5k + edit 1,428) that is a total of $18,900 and gets my taxable down to about $29,100- not enough for the next level of state tax. It does get me to 15% federal, right? Do you still say not to do Roth at this point? Would need to invest about another $6k if I am figuring this all out correclty.
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Re: Finally asking for portfolio advice..

Postby Jay69 » Mon Mar 18, 2013 10:47 am

loudog

One thing to keep and eye open to is any windfall you may find your self with. I was playing around with this concept a while back here based on living in state with a state taxes. If you were to get a lets say $500,000+ (in taxable) it may make some sense to have some Roth space as well.

I think many overdue in the Roth, for me living in Mn and in the 15% federal bracked I'm shooting for 25/75 rIRA/tIRA. If I'm anywhere near close I hope to not touch the Roth and leave that to my kids. All depends on what Mr/ Market does in the next 60 years.
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Re: Finally asking for portfolio advice..

Postby loudog » Mon Mar 18, 2013 3:10 pm

Jay
That is a good perspective. At the moment I have no pending windfalls that I can see anytime soon. Considering that I still have the following questions that I would love to hear opinions on. From many of the responses it seems that most see my portfolio to basically be on the right track.

1.Should I put anything into a Traditional or Roth for 2012 taxes
2.For 2013 and beyond do I put everything I can into 401k or at what point should I move my contributions to an IRA (Roth, Traditional or both?)
3.Does the fact that I can have much lower costs in an IRA (because it would be with Vanguard) than the funds in my 401k change the strategy of whether I am contributing to 401k or IRA based on my tax bracket?
4. Other than having too much FAST stock in my 401k, are there many thoughts about the rest of my 401k options and which fund I should put all the FAST stock into?

Thank you,
lou
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Re: Finally asking for portfolio advice..

Postby Jay69 » Tue Mar 19, 2013 8:47 am

loudog wrote:Jay
That is a good perspective. At the moment I have no pending windfalls that I can see anytime soon. Considering that I still have the following questions that I would love to hear opinions on. From many of the responses it seems that most see my portfolio to basically be on the right track.

1.Should I put anything into a Traditional or Roth for 2012 taxes
2.For 2013 and beyond do I put everything I can into 401k or at what point should I move my contributions to an IRA (Roth, Traditional or both?)
3.Does the fact that I can have much lower costs in an IRA (because it would be with Vanguard) than the funds in my 401k change the strategy of whether I am contributing to 401k or IRA based on my tax bracket?
4. Other than having too much FAST stock in my 401k, are there many thoughts about the rest of my 401k options and which fund I should put all the FAST stock into?

Thank you,
lou


Lou

1. If you have the funds to fill for 2012 yes take the space. If you have to sell some of your taxable and you don't have to much in gains I would look at that option to fill the space.

2. Your 401k fund choices are not the best. I would fill the 401k up to the match, then the tIRA then back to the 401k then taxable or maybe even some I-bonds.

3. Always take the free money in the 401k first even if the fund choices are a crap shoot then fill the other buckets after, see #2.

4. I would use the S&P 500 fund and the Pimco bond fund as your core holdings in the 401k and fill the IRA with an international fund like VXUS.

Most 401k's will have some target date funds, do they offer some? They maynot be very sexy but if the ER is not to crazy it maybe worth a look.
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Re: Finally asking for portfolio advice..

Postby loudog » Tue Mar 19, 2013 6:53 pm

1. If you have the funds to fill for 2012 yes take the space. If you have to sell some of your taxable and you don't have to much in gains I would look at that option to fill the space.

2. Your 401k fund choices are not the best. I would fill the 401k up to the match, then the tIRA then back to the 401k then taxable or maybe even some I-bonds.

3. Always take the free money in the 401k first even if the fund choices are a crap shoot then fill the other buckets after, see #2.

4. I would use the S&P 500 fund and the Pimco bond fund as your core holdings in the 401k and fill the IRA with an international fund like VXUS.

Most 401k's will have some target date funds, do they offer some? They maynot be very sexy but if the ER is not to crazy it maybe worth a look.


Thanks for the feedback. I have a few follow-ups to the points-

1. I have about $4,000 to put in a Roth. I have both a traditional and ROTH with Vanguard. Which is best to favor for 2012 purposes?

2. Great information. I was looking for something like that and really appreciate. Why tIRA as opposed to ROTH? Also interesting you mention to do taxable or bonds. Not sure if I would have that much left over, but definitely something to think about as my income rises.

3. Got it.

4. Yeah I kind of figured that would be my best bet for my 401k. Right now my 401k is by far where most of my investments are so I get a little nervous about having everything in just the two funds... but I'm doing that right now with FAST stock which is more risky...

My 401k does not offer any target funds. Unfortunately just the ones I listed. Stuck with Pimco and Index. It is through Merrill Lynch. Perhaps I can petition HR to offer a Vanguard fund someday!

lou
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Re: Finally asking for portfolio advice..

Postby DiscoBunny1979 » Tue Mar 19, 2013 7:29 pm

Brian2d wrote:Just some clarification on the feedback regarding employer stock.

You're doing something quite common, which is thinking that a company being a "good company" is a reason to own lots of its stock. This is not necessarily the case. Apple when it was at $700 may well have been a good company, but it was overvalued, and anyone owning Apple has lost 38% of its value at a time the market went up. Any single company, no matter how well managed, has diversifiable risk, which is uncompensated risk.

Further, as an employee of the company, you are more likely to be adversely affected if the company has difficulty than if it does well. If the company has troubles, you don't want a large portion of your portfolio tanking at the same time your job is in jeopardy.

Vanguard's portfolio analysis warns people of risk in a single stock that is greater than 5% of the portfolio. Anything higher than that is usually unnecessarily risky, no matter how good the company is. Even if everything your management is correct, it's still too high an allocation in a single stock.


----------------------------------

I'm sorry, but I have to say that there is a purpose to owning company stock and why a company gives or makes company stock available to employees at a discounted rate. One of the reasons is to provide a way for employees to be "owners" in the company. Sometimes, owning company stock provides motivation and a sense of drive and purpose so that the employee is not just sitting behind a desk, but is encouraged to better themselves or improve their work habits so that there's a ripple effect throughout the company of optimistic employees performing at maximum. . . which could translate into more sales, better customer service, and a perception on wall street and main street that the company makes more than just good products. Owning company stock can encourage employees to better understand a Company's financial health and therefore they might be in a position to make better 401K decisions and choice of retirement plans if offered.

While I don't agree with owning a huge stake in the company one works for, owning shares, taking the discounted rate, and holding for some short period is not a sin. Actually, the example of Apple at 700 is misguided. The reason is that most people did not buy at 700. Employees sometimes are offered the lowest price the company's stock obtained during the investment period AND a 15 % discount on top of that. We do not know if Apple was overvalued at $700 or is now valued correctly at $450. Stock is bought and sold at a price by two people coming together to determine price. The price at the time is the right price. While someone can obtain apple stock at a lower price today does not mean that at $700, it didn't have the perceived value of $700. To me it's like buying a new HD TV for $700 one day. A month later that same $700 TV is selling for $500. But you bought at $700. You made the conscious decision that it was worth $700 then, even though it could be had for less a month later. It wasn't 'overpriced' when you bought it or you wouldn't have bought it in the first place.
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Re: Finally asking for portfolio advice..

Postby roymeo » Tue Mar 19, 2013 8:31 pm

That's the theory, which is fine. Though I'd disagree that the "purpose to owning company stock" for the employee's financial health is the same as it is for the company to be giving it away at a discount. They may even be at odds.

"Stock Options for Dummies" also pretty much recommends selling as soon as you can (options, rather than ESPP, same dif.).

I'm pretty comfortable with the plan I had before I started here: I didn't own any stock in my current employer directly then. I'm not sure what logic should make me want to hold onto it now that I am here. When they give me a T-Shirt, I could hold on to that because "Hey, they are worried about me having clothes and it's also good for them to offer me logo-wear from their advertising/recruiting/morale perspective." I mean c'mon, that T-Shirt is free, it doesn't matter if my T-Shirt drawer is full; emotional attachment. I'm glad they throw free money and t-shirts at me. But I treat the free money as free money, not as an emotional attachment. And I donate away (or refuse) the T-Shirt.

It makes sense to make wise decisions around taxes for your options and USPP's, but I don't see the benefit to me to tie my financial state to a randomly selected individual stock that isn't a part of my plan.

roymeo

-----

edit to add:

And besides the morale uplift during good times, there's another side of those stock perks: when the stock price plummets there's very often a company-wide drop in morale period. Throw in a bunch of people who also have stock/options that lose value and that morale drops even further. Even in relatively good times it's not too hard to someone who got hired/ESPP period started when the stock was higher than it is this month showing a decided lack of enthusiasm. That doesn't just have to be after a huge fall, but rather a teasing lower plateau due to some far off change that most employees probably feel very little chance to change.
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Re: Finally asking for portfolio advice..

Postby loudog » Wed Mar 20, 2013 3:57 pm

Couple of good takes on company stock. For me, I've kept mine simply because it has done so well. Before reading Bogleheads I'd actually thought about purchasing it in a taxable account outside my 401k as well. So the idea that I only have it because it was "given" to me as earlier posted isn't entirely true because I contribute monthly to it as well... and that isn't all where my mentality is. I do feel that I have a sense of ownership in the company, but as an investor not an employee and that being what my motivation is to do well. I simply own too little and don't have significant enough of a role to feel like that is a big part of it. I just like seeing my account balance rise.

Anyway, anyone have a thought if I should contribute to a ROTH or Traditional for 2012 based on the info I've shared so far? I have about $4,000 to use.

Thanks!
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Re: Finally asking for portfolio advice..

Postby sometimesinvestor » Thu Mar 21, 2013 11:00 am

I agree that 40% is way too much in your company stock though the good news is that your company Fastenal seems to have decent prospects.I certainly hope you resd Value line reports on the prospects for the company as you sell down the position and do online research. As another source for info though not very timelywould be the annual reposts and the investor day reports for the Sequoia Fund http://www.sequoiafund.com/fund-reports.htm . That fund reports on its large positions in some detail and Fastenal is one of their largest positions at between 5 and 6%.
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Re: Finally asking for portfolio advice..

Postby loudog » Fri Mar 22, 2013 7:52 pm

I appreciate the good outlook on my company stock, but as everyone has mentioned I have too large of a percentage of it and need to move most to the indext fund.

Right now the thing that I am still stuck on is whether or not whether or not to do a Traditional IRA or ROTH for 2012 with the roughly $4,000 I have to do so. And regardless which one I do I'm not sure which fund to buy. I currently have VGTSX in my ROTH, which I feel would be good to do again, but Jay69 mentioned VXUS. I don't really understand why I would want to do an ETF vs regular mutual fund in my case.

Input on that would be be great!
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Re: Finally asking for portfolio advice..

Postby BL » Sat Mar 23, 2013 9:21 am

Looks like you just have to make the best decision you can.

1. Get down to 5-10% of company stock

2. Figure out your AA, what percent total equity, international, and fixed income you want. (International at Vanguard, 500 index and Pimco at 401k, and whatever more bonds you need at Vanguard with any remaining in Total Stock Market (or some Extended Market to balance 500 fund) at Vanguard. Get an approximation going to start with as these can be changed at no cost.

3. Mixed advice for IRA/Roth:
---- a. Reduce current taxes by using tIRA (get 15% back to use on next year's contribution) .
---- b. Roth: Save on future taxes and/or use as a container for possible emergencies as you can remove contributions if you really need them (You could put some short-term bonds in to keep down risk.)

Total International is the ETF mentioned and it is also available in mutual funds. Once you get to $10,000 the ERs are the same, but they are not bad before you get to Admiral status, either.

What is happening to your IRA money market? I would at least choose some kind of bond fund or whatever you need for your AA.

I would put some of emergency money in Roth to fill it completely (use up 5000 for 2012 and 5500 for 2013, split between tIRA and Roth, if desired.)
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