Asset Allocation, life changes - newbie needs advice

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
cyclist
Posts: 321
Joined: Fri Jun 21, 2013 9:04 am

Asset Allocation, life changes - newbie needs advice

Post by cyclist »

My wife and I are mid-50s. We've just laid away the last of the college money for our kids. (College funds are excluded below.) We had suspended retirement investing while we did that, but are ready to resume. We'd always planned to fund our own retirement, but are now aware that we are likely to get a low 7-figure inheritance sometime around our own retirement time. We're wrestling with (1) how much we'll choose to save for our own retirement given that expectation, and (2) asset allocation, of course.

We're both salaried, in the 28% tax bracket. Most assets are in tax-advantaged accounts, except for cash and an insurance settlement intended for travel and play pre-retirement. Barring a change of heart, we'll probably resume contributing 8-10% of salary towards retirement. There is a possibility that one or both of us might want a career change; if so, salaries would drop along with retirement contributions. Our 3% 15-year $225k mortgage is quite manageable.

We've got about 1.3 million in a portfolio that contains lots of pesky little accounts that should probably be closed. I worry a bit about the long-term bonds and think we probably are under-weighted internationally. We've been slowly reducing our equity percentage over time. It's now about 63%. I'd love to reduce it a bit more, but am not clear if this really is or isn't a particularly bad time to rebalance into bonds. (Unless I get better advice here, it would probably go to Vanguard Total Bond Market.)

What changes would you recommend -- over the long haul, and today?

CREF Stock 25.6
Index 500 VFIAX (or equivalent) 24.4
CREF Bond 13.3
Vanguard Int Term Tax-Exempt Adm VWIUX 8.0
Vanguard Total Bond Mkt Index 5.9
Cash/CDs/MM 4.7
T Rowe Price Equity Income PRFDX 4.3
Vanguard LT Investment Grade Adm VWETX 4.0
Vanguard total Stock Adm VTSAX 2.8
T Rowe Price Growth Stock PRGFX 2.2
CREF Social Choice 1.3
CREF Global Equities 1.3
Vanguard Morgan Growth VMRGX 0.9
Vanguard International Growth VWIGX 0.8
Vanguard PrimeCap VPMCX 0.4
Johm221122
Posts: 6393
Joined: Fri May 13, 2011 6:27 pm

Re: Asset Allocation, life changes - newbie needs advice

Post by Johm221122 »

It would be better to follow asking portfolio question format
Welcome to forum
John
User avatar
ofcmetz
Posts: 2465
Joined: Tue Feb 08, 2011 7:09 pm
Location: Louisiana

Re: Asset Allocation, life changes - newbie needs advice

Post by ofcmetz »

It would be a lot easier for posters to answer your question if you would edit your details and post in this recommended format:

http://www.bogleheads.org/forum/viewtop ... f=1&t=6212


I would caution against factoring any inheritance into your calculations or plans. This money is not yours until you actually get it and circumstances and situations can change. You also really have no idea when it would come in.
Never underestimate the power of the force of low cost index funds.
Post Reply