TVKNSC wrote:We currently max-out our Roth TSP 2040 and VG 2040s each year. I recently placed $60,000 into Wellington Admiral from ING. Although I like AA of the Wellington, it appears it isnt very tax-efficient, so should I exchange for VG total stock market index (admiral)? I am better understanding the AA, but with my age (35), would this be too risky to place all this money in an index fund that is 99.5% stocks? My research says that it may not be as risky as I think, but wanted some of your professional feedback.
TVKNSC wrote:Thanks for the response. Yes, I am drawn to the 3-fund approach, with total market, total international, and total bond. Like in my initial post, the lifestrategy growth appealed to me, but that seems very similar to our current 2040. I realize that the Lifestrategy growth's ER is 0.17%, which is great, but VTSAX has 0.06% and has a good track record..I am sure they will make some sort of difference over time, but VTSAX, alone, seems a little more riskier than I normally dabble in. It's an odd situation because I dont want to be conservative to the point I miss-out on some chances for growth with VTSAX.
I think you're right on the overlap. This probably makes little sense, but I look at it as paying another expense ratio for a fund that mirrors one I am already involved with?..My logic is probably off on this assessment.
TVKNSC wrote:I know this gets off-topic, but Is is too early to worry about the rise of interest rates impacting bond funds? Or shouldnt that be much of a concern given we dont know when they will spike and by how much?
TVKNSC wrote:any final thoughts? I am looking at pulling trigger on the following:
Exchange Wellington admiral for VTSAX and VTIAX
Reset TSP allocation by removing TSP 2040 and moving to all bonds (F and G funds)
This will give me the 3-fund portfolio I have been looking for, and my stocks will now be in tax-efficient fund, while all bonds will be in tax-deferred.
AA for 35 y/o: | VG VTSAX = 35% | VG VTIAX = 30% | Roth TSP F Fund = 10% | Roth TSP G Fund = 20% | VG 2040 Roth IRA = 5%.
TVKNSC wrote:Z3 & LM,
Yes, I fully agree with both of your assessments. I have roughly 33% international and tax-efficiency seems to be pretty subjective. I am willing to be tax-efficient, even if the return isn't eye-opening.
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