Bogleheads.org

Shooting4Sixty wrote: ↑Mon Mar 20, 2023 8:37 pm .08% expense ratio at my work vanguard 401k and .12% at fidelity, which if I'm understanding properly is a negligible difference? FXAIX and FSKAX are .015% , Should that be a consideration?

Use this calculator to determine the effects of expense ratio on your investments: https://www.nerdwallet.com/article/inve ... calculator

Is the "simplicity" of a target date worth this additional cost to you, or are you OK with taking 30 minutes each year to rebalance amoung two funds instead?

Are you OK with the target date funds change in asset allocation over time, or do you want more control over your asset allocation?

CKMAN wrote: ↑Mon Mar 20, 2023 4:04 pm I am ready to do it but unsure what to pick. The more I read/study the bigger chicken I become

Appropriate fund choices at Fidelity, Schwab or Vanguard are contained in this wiki article. https://www.bogleheads.org/wiki/Three-fund_portfolio

Welcome to the forum, CKMAN. I am new here and have been reading some good stuff. I decided to move my managed investments and save myself over 1% on fees I have been paying to my financial fiduciary. I feel like I have been paying them for telling me “ all is great and you are all set to live until 99 and you have enough money to afford your life style”. We have been with them for 5 years and I maybe they made some money but I maybe could do better (hope not worse). They did, and are, making themselves a lot of money at your expense... $20,000/year. If you can, please comment on my portfolio distribution below. I am open to any ideas on my current portfolio that was set up by them. Do you think it’s a good balance or should I rebalance som...

Your portfolio selection looks fine to me. I'd not invest in anything that made up 5% of my asset allocation. Just another thing to keep track of and won't move the risk or return needle compared to other assets one of the two broad asset classes (stocks and fixed income). I suppose one could also theorize that Ex-us is on sale and now'd be a good time to get on board....hmmm In my opinion, it's hard to know what is "on sale" at any point in time. I think in terms of diversification and asset allocation and invest in broad, total market index funds because of this. If I were to think that something is "on sale", I might try to market time and move my investments around based upon this feeling. I know that's a losing stra...

Holding "dry powder" is market timing and a poor long-term investment practice.

For highly liquid cash, I'd invest this is in a money market fund.

What would you do with this? You're correct that your portfolio is a mess relative to what most Bogleheads would choose. Should I leave it alone and let PAS keep doing their part? You could, but that wouldn't be my recommendation. Since you've started to post on Bogleheads, I would recommend DIY investing. Save yourself the 0.3% fee. Start here https://www.bogleheads.org/wiki/Getting_started Ask questions of the forum. Select a simple, diversified, low cost portfolio. Should I leave it alone and close PAS and invest based on what I think I can do with what they set up? I suggest you close PAS. The main reason to keep using PAS would be if you're prone to panic selling when your portfolio value drops. Hopefully, they could persuad you to no...

About 3% of our retirement portfolio is in "cash" I-bonds. The rest of the portfolio is 80:20 (equities:mainly duration-matched TIPS). Still working. Might retire next year or in three years.

We keep a month or two of current expenses in FZDXX (non-FDIC insured money market fund... oh, the risk! ), but that's not a part of our retirement portfolio.

does it make sense to use FZFXX - 4.23 SPAXX - 4.22 to park a few months of emergency cash over SPRXX - 4.35 Mainly cause its a prime mm and the risk wording includes the possibility they can put a temp freeze on withdrawals if they so choose? Any idea what the timeframe for a freeze would be? For the extra 12 dollars I would get on a 10k principle a year I don't feel its going to kill me. I have now had some success in buying some short tbills on the new and secondary market at Fidelity mainly as an academic exercise. I feel so grown up lol. Is there any caution to attempting to buy some CD's out there as well? If they are FDIC insured and I know I don't need the cash by the maturity date. From what I read on the wiki's I can keep cash in...

mikephfl wrote: ↑Thu Mar 16, 2023 3:00 pm my financial advisor (fiduciary, 1%)

After reading your thread title and this intro, I've already come to my conclusion. No need to read anymore. I think paying an advisor (any advisor) 1% of AUM doesn't make any sense.

I've been thinking about going with VG's PAS service, for which I'd pay .03% vs his 1%.

Good idea. (VPAS will charge 0.3% of assets, not 0.03%) Better idea is to find a fee-only advisor.

Sounds like the company is holding all of the cards. Not a good position to be in.

Kal1981 wrote: ↑Wed Mar 15, 2023 5:44 pm

Ed 2 wrote: ↑Wed Mar 15, 2023 5:07 pm

Kal1981 wrote: ↑Wed Mar 15, 2023 4:58 pm Makes you wonder if the fundamentals of investing has changed. Businesses mindset is no longer what it used to be, pre-2008 recession.

Ask those who lived during 70s. I think it’s nonsense that something changing in investing fundamentals, it’s just coming back to reality.

And what would reality look like? I suspect enduring more down turn and probably the US market dragging down other markets with it.

So the TL:DR version of the documentary is more media fear-mongering? I generally appreciate Frontline episodes so I hope it's not.

One investment opportunity you didn't mention was a Health Savings Account. Do you have access to such an account and does a high deductible medical plan fit with your health care spending? If so, maximizing HSA contributions should be a priority. https://www.bogleheads.org/wiki/Health_savings_account

Hello, My wife and I have 60/40 portfolio in a brokerage account. We both work. We have some cash which we would like to invest safely (meaning capital preservation and inflation protection). Note that we buy I-bonds every year but because we can buy only $20k between the two of us, it is not adequate. We have the money in big banks and they pay close to nothing. I want to change that picture so I created few CDs at Barclays but I don't want to go overboard (i.e. exceeding FDIC limit in one bank). I think my choices are CDs or money market funds or else? What are my options and pros and cons of them? To keep up with inflation in "safe" investments, your choices are I-bonds and TIPS. With 100K to invest, you could make I-bond &quo...

I own stock in a large private company that I used to work for. The company is offering to purchase my stock in a private transaction for ~$375k. If you don't take the offer, can you sell the stock at any time. In other words, does this stock have no issues with liquidity? If you can't sell the stock at the time of your choosing, this would be a huge red flag for me. The other red flag that would give me the heebie-jeebies is having so much of my wealth tied up in a single company. The chance of permanently losing money (compared to investing in a broad-based total stock market fund) is too much of a risk for me. Lastly, if the value of this stock is a complete black box to people holding the stock, this is a red flag for me. Should you ta...

Hello Bogleheads , My long time financial adviser is retiring and his succession plan is to merge his current clients with another firm that uses the same investor broker /dealer . My wife and I have been doing due diligence interviewing two other advisory firms . Question is it prudent to stay with his succession plan or move funds to a new advisory firm ? Thanks In your forum post in 2019, you stated that you and your wife had a 1.7 million dollar portfolio. I don't know how much your advisor is charging, but if this is a typical assets under management advisor charging a high fee, consider your current situation a golden opportunity to increase your wealth. For advice, I would suggest two options. First, pay Vanguard about 5,000/year (0...

Welcome to the forum! Hello. I am new to this forum and investing. I have $15K to invest in a ROTH, I will take this money out in 10-15yrs from now. From what I have learned from this forum, I have come to the following portfolio: FSPGX 20% VQNPX 20% VTSAX 20% VTRIX 10% VTIAX 10% VQNPX 10% FTBFX 10% This is based on the "Core Fore" and I've expanded a little bit. I don't need this money, I'm hoping it can generate some amount for my future down payment on a home in the future. So I welcome any input and thank you for taking the time to read and hopefully expand my knowledge further. I think this portfolio violates the Boglehead principal of simplicity. https://www.bogleheads.org/wiki/Bogleheads%C2%AE_investment_philosophy

https://www.dinkytown.net/java/compare-investment-fees.html Give this tool a whirl. The 30-40 year numbers will be an eye opener. That is quite the eye-opener! Even when I compare my one-fund portfolio with its expense ratio of 0.15% to its component funds, at 0.03, 0.06, and 0.07, it's not just eye-opening, but more like eye-popping. I still wonder how to quantify the benefit of having that one fund, i.e. avoiding behavioral mistakes, and automatic rebalancing. Avoiding behavioral mistakes is worth a lot, especially if you're prone to make them. According to the Vanguard site for advisors, the advisor's alpha can be anywhere from 0 - 200 basis points for behavioral coaching. Source: https://advisors.vanguard.com/iwe/pdf/IARCQAA.pdf That's...

So you are favoring plan A since it does include a COlA? I haven't crunched the numbers like you should. However, you should give SERIOUS consideration to Plan A over Plan B because of the COLA benefit. I’m not really sure how to crunch the numbers. Someone much wiser than me did above and looks like A wins. But to clarify, both plans have same COLA benefit. Here's my attempt at crunching the numbers. Cutting to the chase, I'd take Plan A over Plan B. As I see it (could be wrong), the money you are not receiving from Virginia in Plan A is the employer contribution to the 401a and 457 that amounts to 3.5% of your wife's salary/year. Currently, this amount is 1400/year at her 40K salary. Plan A: COLA'ed Pension at Retirement: 40,000 (current...

Turnerb wrote: ↑Tue Mar 14, 2023 5:12 pm So you are favoring plan A since it does include a COlA?

I haven't crunched the numbers like you should. However, you should give SERIOUS consideration to Plan A over Plan B because of the COLA benefit.

You write that you aren't trying to time the market, but what you propose (not investing immediately) is market timing.

Since this money is intended for retirement 25 years in the future, you should prioritize retirement accounts with this money over taxable.

My suggestion would be to maximize your retirement accounts for this year immediately.

With the remainder of the money, perhaps invest this in a taxable account at your retirement asset allocation. Next year, sell money from this taxable account and invest it in your retirement accounts. Pay the tax on any growth in the taxable account over that time.

Some quick ideas: Begin folding your emergency fund into ibonds. Ibonds will keep pace with inflation better than HYSA. Live off of the money you're currently planning to put into taxable for living expenses so you can put a larger % of your paycheck into 401k. Push back if my math is off on this, but I think it is preferable to have $ in 401k than $ in taxable. Going 90/10 equities to bonds would get you a more efficient trade-off between risk and reward. Keep maxing that Roth IRA! I haven't read the previous posts so this might be redundant with other people's advice. Doesn't it make you nervous having your emergency funds tied up in I-Bonds, since they can't be cashed in for a year? If you add I bond positions over a years time, this ca...

Some thoughts and suggestions. My first reaction is that your various investment accounts contain too many individual funds. This complexity isn't likely to generate additional return compared to a simplified portfolio. Emergency funds: $30,000 in CDs for 12 months expenses. Plus checking account: $20-25K. Do the CDs have a penalty for early withdrawal? If so, you should consider a more liquid investment vehicle for your EF like money market funds. Desired Asset allocation: 60% stocks / 40% bonds. Desired International allocation: 15% A reasonable choice. On my comment about your portfolio complexity, you should consider your retirement portfolio accounts as a single entity. Maintain your asset allocation over the entire portfolio. Each acc...

Well done, OP!

I grew up in small town of 9000 people in rural America. The town has 3 (!) EJ offices. I'm disheartened now when I visit, drive past the offices, and realize townspeople with any savings are probably using EJ to guide them. Even the rural church my extended family attends uses EJ to manage their meager portfolio.

At least EJ investors don't realize they are being fleeced. Ignorance in bliss.

On the other hand, your post and those of fellow EJ escapees makes me smile.

I have invested some of our IRA funds in individual TIPS via purchasing at auction and on the secondary market. My preferred brokerage is Fidelity, and the secondary market purchasing process has been simple with acceptable selection, including the purchase of smallish lots.

I also have a 401k Merrill and an IRA at Merrill Edge (for the BoA Preferred Rewards status) and find that brokerage annoying to use compared to Fidelity. However, I've not tried to purchase individual TIPS at ME.

FZROX has beaten VTI by 0.14% annually since inception and FZILX has beaten VXUS by 0.12% Are you sure you don’t want to switch back? The OP's funds are in a taxable account. The general advice is to use funds portable to any brokerage in a taxable account so that selling (and incurring taxable capital gains) isn't necessary should one choose to move brokerages in the future. The Zero funds are not portable from Fidelity without selling. As to your thought about the Zero funds having higher future returns than similar index funds, there is no way to know if this will be true. I think the Zero funds are great and use these for our Fidelity IRA accounts. I expect that any return increase by using the Zero funds will be insignificant, but I l...

FriedOkra wrote: ↑Thu Mar 09, 2023 9:15 pm I went ahead earlier today and put in the rest of my HSA for the year. I'm moving money to be able to do the rest of the Roths either tomorrow (if it makes it by then) or Monday.

A very good decision in my opinion.

While I can imagine scenarios where DCA-ing is necessary for some folks in some situations (only being able to afford to contribute X percentage of monthly pay, for example)...

This scenario is lump-summing in practice (although it may be the original definition of DCAing that has since been mutated by most people to mean a form of market timing).

Welcome to the forum. Thanks to reading this forum and following good habits, I've been able to max out my Roth IRA, am on track to max out 401k, have 12 months emergency fund saved in a HYSA (3.75 APY), and have paid off debts. My taxable brokerage just contains my vested RSU shares. Congratulations on having good habits! The Bogleheads advice on RSUs is to immediately sell these at vesting and invest the money elsewhere. If invested appropriately, eliminates exposure to a single stock and the potential extreme volatility associated with that single stock. What do I do with the money I save every paycheck? I've thought about investing in taxable, opening a CD, investing in treasury bonds, or just continuing to save in the HYSA. What has wo...

Welcome to the forum. Hi all. First post here and trying to learn more about investing. This site has an excellent wiki for self-learning. https://www.bogleheads.org/wiki/Getting_started Until last year, I was super heavy on equities (97% equities / 3% bond funds of non-401k assets). Vast majority of the equities were from a single stock that did very well in the last several years. Although it's a great stock and was very good to me, I wanted to diversify a bit away from equities (and 1 single stock) so I sold 10%. What are some bonds (or other investments) I should be looking into? In the meantime I have the cash in a high-yeld savings account. I was also considering starting 529s for my kids and putting it all there. Without knowing the ...

techinvestor23 wrote: ↑Thu Mar 09, 2023 10:44 am Since my income is ~$350K per year, I am not expecting to be eligible for college aids anyway.

529s were made for Bogleheads like you.

amsr wrote: ↑Wed Mar 08, 2023 2:51 pm I use Fidelity.

At Fidelity, use FZDXX if you have an initial investment of at least 100K. If less than this, use SPRXX.

Easy. Accessible. Safe.

RobLyons wrote: ↑Wed Mar 08, 2023 4:53 am Not that anyone is really following my thread, but I took one final step to fix my EF situation. I sold the Foxbody Mustang in my default picture for a nice profit. I had previously scheduled some work to be done on it but realized this isn't financially wise and also I was "over" owning the vehicle.

So in less than 3 months my EF has quadrupled, while actually increasing retirement contributions and not reducing HELOC over payments.

Just sharing my experience/accomplishment

Market timing is very likely to result in lower returns. It would be appropriate to follow the Boglehead Investment Philosophy in the wiki.

retired@50 wrote: ↑Tue Mar 07, 2023 12:10 pm

dogagility wrote: ↑Tue Mar 07, 2023 11:57 am

ClassII wrote: ↑Sat Mar 04, 2023 12:36 pm I'd stay clear of Fidelity's zero-fee funds. They generally don't have the liquidity of the equivalent funds (FSKAX) since they're much smaller.

Where is the data to back up this claim?

I don't even think "liquidity" is a concern with a mutual fund. When you sell shares, you're not actually selling to another market participant, you're redeeming the shares with the fund itself. There's no bid/ask spread to worry about.

Regards,

Agree. That's why I was curious about the supporting info.

ClassII wrote: ↑Sat Mar 04, 2023 12:36 pm I'd stay clear of Fidelity's zero-fee funds. They generally don't have the liquidity of the equivalent funds (FSKAX) since they're much smaller.

Where is the data to back up this claim?

All of our banking for the past 7 years has been done via Fidelity's CMA. No issues whatsoever. Easy. Helpful employees.

OP, it appears that you and your wife don't need the windfall money to meet your retirement goals. I wouldn't let this windfall be the downfall of your marriage by pushing your wife to do something against her will. Let it go... poor financial decision that is may be.

(My BH advice would be to invest this money all in the stock market since you don't need it. Then give the money to charity as it appreciates in value.)

My 3 kids are super smart. All National Merit Scholars (top 1%), etc. We highly value education and always clearly expected all the kids to go to college and most likely beyond, and we were committed to paying for at least the undergrad. ZWorkLess, Not directly related to OPs question but can you shed some light on how your kids managed to get scholarships ? How much weight does academics have on scholarship decision versus essays etc ? I have 2 kids .. still some years away and i have also been saving diligently for their undergrad. My kids each took the National Merit Scholar route, choosing a good out of state university that met their needs and offered generous merit aid. I spent many hours digging through lists like this one random on...

xtallographer wrote: ↑Sun Mar 05, 2023 4:41 pm For me, I will not use the HSA money any time soon. I consider it as a long term retirement fund. So I will have some mix.

Then add the HSA money to your retirement pile of money, and invest it accordingly.

My Roth 457(b) Account I’m looking for high reward 30 years+ time frame. Can anyone else optimize for a more aggressive high risk 100% stock portfolio in a Roth 457(b) account? Thoughts / opinions? Optimize? I don't know about that. If you really want to go for a high risk, high reward stock portfolio, tilting to small cap value is child's play compared to using leveraged funds. https://www.fidelity.com/learning-center/investment-products/etf/types-of-etfs-leveraged-etfs Whether or not a small cap value tilt will result in greater wealth is unknown. It has during some periods in the past; will it in the future? Noboby knows. As for leveraged funds, there's no way I would invest in those either, but these are high risk, high reward.

mm2023 wrote: ↑Sun Mar 05, 2023 12:30 am Our current rent is about $4500 and its not big enough for us anymore.

Looking at BankRate, a 30 year fixed mortgage rate is 6.4%. Monthly payment on 1MM mortgage is $6200.

Property taxes? Another $1000/month?

Insurance? Another $200/month?

Repairs? Another $1000/month?

Using these ballpark numbers, you monthly cost of home ownership is $8400 or about double the cost of rent.

I would think you could afford this on two incomes totaling 400K, but we don't have all of your budget numbers. If one of those incomes is lost, I think it would be tight.

rocketsrule wrote: ↑Fri Mar 03, 2023 10:47 am Student Loans - $1700/ mo (4.28%) 225k left

Pay off this student loan entirely.

Put the remaining amount in a money market fund like FZDXX. If you live in a high tax state, consider a tax exempt money market fund.

NiceUnparticularMan wrote: ↑Thu Mar 02, 2023 10:08 am But I personally wouldn't want to tell my kids something that was obviously not true.

Not to de-rail the thread, but this was why I told my 3 year old that Santa Claus didn't exist when she asked. I just couldn't lie to her.

Our two spawn recently graduated from college. Here is our experience, OP. Tippy-top private schools: Need based grant aid predominates. (OP unlikely to qualify) Middling private schools: Give out merit aid like candy. It's really a marketing tool to make a person feel special and like the school. WIth merit aid, many middling privates are approximately the cost of a state flagship university. State schools. Unlikely to recieve any grant aid. In our case, we saved enough in a 529 to pay the full cost of attendance at our state flagship universities. Both of our girls graduated from those universities. We would do it again in a heartbeat. My suggestion, OP, is to run your financial numbers through Net Price Calculators at several colleges yo...

Publix stock went up a bit today, it was $13.19 now it's $14.55. I'm not sure if I should sell now or hold for a few more years. My dollar cost average is $10.60. I have purchased 712.2583 shares and my dollar cost average is $10.60 so the value went from $7,549 to $10,363. Employees online are saying that in March the stock price usually goes up so Publix can give us less shares when they give us stock in the Profit plan each year. Ralphboy, awhile back, you realized that your holding in your employer stock was too large and too risky. You made a plan to trim that holding back, knowing that you will continue to receive some company stock each year. There is nothing that has happened in the market that should change your plan. You made a p...

Nathan Drake wrote: ↑Tue Feb 28, 2023 8:39 pm

dogagility wrote: ↑Tue Feb 28, 2023 1:43 pm Vineviz's 5 fund example is fine from a Boglehead perspective.

I don't think there are any data to say it is consistently "better" than a typical three-fund index portfolio. Returns are nearly identical over the last decade. Similar volatility. Just adds complexity, in my opinion.

A decade isn’t a very long time

“Better” depends on your perspective, tolerance for risk and diversification

Look at the previous decade to see it’s “value” in an era where total stock market did poorly

Any differene in values can be attributed to random noise. That's why I say it's fine but with unneeded complexity.

Vineviz's 5 fund example is fine from a Boglehead perspective.

I don't think there are any data to say it is consistently "better" than a typical three-fund index portfolio. Returns are nearly identical over the last decade. Similar volatility. Just adds complexity, in my opinion.

gurusw wrote: ↑Sat Feb 25, 2023 3:09 pm 1. If I get fired, do I get severance and COBRA? Will I get social security benefits? I think if I get laid off, I get all these benefits.

All of this information should be available on your company HR site.

The best time to find a job is when you have a job.

Northern Flicker wrote: ↑Sat Feb 25, 2023 2:06 pm Take a look at all-in-one funds. Some examples of low cost funds with a 60/40 mix of stocks and bonds:
VSMGX LifeStrategy Moderate Allocation
VBIAX Balanced Index Fund.

+1 A simpler strategy that ticks the Boglehead's boxes does not exist. All a person needs to do is set it up and then not touch anything.

albireo13 wrote: ↑Fri Feb 24, 2023 4:16 pm Yeah, I am going to look at transaction activity.
Are they churning?
Fees for each transaction?

Even if RJ isn't churning, the 1% AUM fee is enough to not use RJ.

Think deeply about articpineapplecorp's chart. You stand to lose a significant amount of your spending money by using RJ.

If your wife really doesn't trust the two of you to manage your portfolio, then use Vanguard's PAS. They charge 0.3% AUM for the service and will put you in low cost index funds for life.

CletusCaddy wrote: ↑Fri Feb 24, 2023 9:50 am

dogagility wrote: ↑Fri Feb 24, 2023 5:20 am

dougspitz wrote: ↑Thu Feb 23, 2023 3:22 pm For Fidelity roth, IRA, HSA: AVGE (Avantis all equities market etf)

The AVGE expense ratio is 0.23.

At Fidelity for tax advantaged accounts, you can recapitulate a total world index by using FZROX (total US) and FZILX (total international) funds at a 50:50 ratio. These funds have an expense ratio of 0.

Using these lower expense index funds will save you significant money over time.

You save on fees but then lose the expected outperformance.

That "loss" is an unknown. I know the expenses will be higher.