ruralavalon wrote:In taxable domestic if just starting out (don't know what taxable gains you may have already built up), I would for simplicity and expected efficiency go with this (adjusted for whatever you ultimately decide for the 401k):
70% Total Stock Market; and
30% Small Cap Value.
Rick Ferri blog post, Winning with Small Value Stocks . 70/30 TSM/SCV seems to be the historical efficient frontier.
ruralavalon wrote:In the 401k, is the $75 fee for some funds for any transation, even reinvestment of dividends etc., or just for the initial purchase, or just for initial purchase and any periodic or monthly purchase?
What are all fees associated with using the brokerage link? Usually there is an annual charge, a per transaction charge, or both. The usefullness of the brokerage link depends at lot on what the fees are.
Utkap wrote:The general opinion seems to be for the traditional 401k, so that is where I will start. A line from an article ruralavalon posted does bother me though. "A Roth 401(k) is also good for people who are already in the top tax bracket and expect to be there forever." This may be me, but I don't have a crystal ball.
Utkap wrote:My intent was to double the US market's holdings of small/mid for both value and blend. Using the allocation you suggest, mid caps are barely affected, but small cap value is at 460% of normal values. Please see the following pictures of morningstar style boxes to illustrate what I mean. Also note that I do not claim to have a superior allocation. It is just based on a gut feeling, and also that I have a soft spot for mid caps.
I have access to the Brokerage Link information now. I updated my original post.
There are no annual fees for the Brokerage Link account, and I can buy Fidelity funds with no transaction fee. ETFs are $7.95 per trade.
I would like to get a total bond fund or intermediate bond fund into the 401k account. I've been reading some of the threads on Fidelity vs Vanguard bond funds, and I'm still undecided. What are some opinions on paying the commission for the Vanguard fund over using Fidelity? Which funds should I consider?
I would also like to get my small cap funds into the 401k if possible. Same question...Vanguard + commission or which Fidelity funds?
Utkap wrote: . . . I tried to tilt to just about double the US market's mid cap and small cap percentages. I also wanted a value tilt. I realize I have no idea if this will pay off in the end, but this is my best guess at trying to increase returns a little. Having both blend and value funds for mid/small should also allow me to tax loss harvest if I choose to, unless I'm mistaken.
. . . . .
Desired Asset allocation: 85% stocks / 15% bonds
Desired International allocation: 40% of stocks
. . . . .
I think you are both right and the $75 fee does not apply since it is being bought through the 401k.
The Spartan funds look like good alternatives, rather than paying the commission for Vanguard ETF's. However, I'm still struggling to figure out how I want to set up my 401k funds.
1) There don't seem to be any Fidelity index funds tracking value stocks.
2) I don't have anything to sell in my taxable account (capital gains from the market surge, and my muni bond fund was recently taken to the minimum value for admiral class). I don't have any new money to add to it, but the 401k is getting large deposits every 2 weeks. Should I buy a Spartan international fund in the 401k and forget about the tax implications?
3) The large cap fund in my 401k with a 0.02% expense ratio tracks the S&P 500, not the total stock market. My allocation up to this point has been based on the total stock market VTSAX fund. Buying just large caps would throw off my intended 2x the market in mid & small caps. Should I switch to the S&P 500 fund, or get a Spartan total market?
I didn't take into account a 401k when I originally set up my taxable, so I am slightly regretting having a mid cap value fund in my allocation, but I think there is a way to make it all work. Do you have any suggestions for how I can structure my 401k to reach my target allocation, using my available 401k funds and/or the BrokerageLink account?
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