Passthedamnhamplease wrote:Finally, what's the best way to move everything from my current mutual
funds to the ones at Vanguard? Most of them I've only had 1-2 months.
A couple I've had for 5 yrs. (I put in a lot in 2008 and then the
recession made me nervous about adding more especially given the lack
of time to research appropriate investments.)
It's usually best to move things all at once if you aren't making a significant change in your allocation. If you have US stock funds that you don't want to keep, you can sell the stock funds and buy Vanguard Total Stock Market Index, or the C and S funds in your TSP; you'll keep your exposure to the stock market.
For investments you have held 1-2 months, any gains on the sale will be short-term (taxed at your full rate), but there won't be much in gains. For investments you made in 2008, there will be large gains, but the gains are long-term and taxed at 15% federal almost independent of how much they are.
Total US Stock Market, 30% - taxable acct, VSTMX
US REIT, 10% - Roth IRA, VGSIX
Small Cap Value, 10% - Roth IRA, VISVX
International Developed Mkts, 20% - Taxable, VDMAX
Emerging Mkts, 5% - Taxable, VEIEX
Total US Bonds, 25% - one third in Roth, two thirds in taxable, VBMFX
View all your investments, including the TSP, as one portfolio. The TSP is the best place to hold bonds, because of the G fund; if you want to hold 25% in bonds, put your entire TSP contribution into the G fund until you reach that 25%. Once you have the 25%, you can add the C and S funds.
There is no need to hold developed and emerging markets separately in a ratio close to the market allocation, unless you plan to hold the I fund in the TSP for your developed markets allocation. (I would recommend using the TSP for US stock in preference to foreign stock, as you lose the foreign tax credit on international stock held in the TSP, and this offsets the expense advantage of the I fund.). You might as well put everything in Total International, particularly if it is in your taxable account; this also gets you small-caps.