Simple 3 fund portfolio btwn Roth/Taxable?

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Simple 3 fund portfolio btwn Roth/Taxable?

Postby bkkchris » Sun Mar 24, 2013 11:59 pm

I am helping my gf set up a retirement plan. 41yrs, high 5 figure portfolio, 25% tax bracket.

Currently she has 27,000 in a ROTH all in FFNOX (Fidelity Four-In-One Fund).

She will invest $5,500 additional to the ROTH for 2013 and the max for all future years.

In addition she has $50,000 available to invest in taxable space. She is comfortable to lump in 25k now and the remaining 25k over the next 10 months.

I am planning a 30% bond, 35/35% US/International allocation.

Thinking of putting all her ROTH into the bond fund and the US/International in the taxable.

Seems reasonable enough?
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Re: Simple 3 fund portfolio btwn Roth/Taxable?

Postby Bob's not my name » Mon Mar 25, 2013 5:03 am

No tax-deferred savings?
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Re: Simple 3 fund portfolio btwn Roth/Taxable?

Postby Taylor Larimore » Mon Mar 25, 2013 11:43 am

Chris:
Thinking of putting all her ROTH into the bond fund and the US/International in the taxable.

Good thinking. She is wasting tax-efficient space in her Roth by holding already tax-efficient stocks in her Fidelity four-in-one fund. Be sure to place only tax-efficient stock funds in the taxable account. Total Stock Market and Total International should be excellent choices for a taxable account.

You can read more here:

Principles of Tax-Efficient Fund Placement

Best wishes
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle
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