Time to get a handle on my investments: help wanted

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fickle
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Time to get a handle on my investments: help wanted

Post by fickle »

Greetings. I am sorry to say that while I'm rather meticulous in my profession, I have been remiss in straightening out my money matters. Horribly remiss.
What follows is a hodge-podge of pin-the-tail-on-the-donkey investments and inertia. I am ashamed, but vow to do better. After reading some Swedroe and this website, I have learned just how very little I know (e.g one month ago, I didn't know what equity was). At least I knew enough to be investing in something, and I paid very little commission by not falling for any sales pitches.

I am limited by a large portion of my retirement investments in either plans with few options or in individual stock. Because I expect to have a lower tax bracket in 5 years (when I hope to retire), I was trying to hang on to the one stock I will have massive capital gains on, and was planning on selling some with more reasonable c.g next year, making sure I don't bump my tax bracket up, and rolling that in to mutual funds at Vanguard. With some encouragement, I might sell some this year, but I have to get moving on that, and I'd hate to leap now and regret later.

FYI: I'm "her" and hubby makes no money decisions (zero interest in it) and has no income.

Emergency funds: 60K
Debt: none
Tax Filing Status: Married Filing Jointly with one young tax-deduction
Tax Rate: 25% Federal, 0% State
Age:55
Desired Asset allocation (I can be convinced I am wrong): 60-65% stocks / 35-40% bonds --with 5% REIT stuck in there.
Desired International allocation: 25% of stocks with 5% emerging markets
Current total portfolio: 750K (I've also tucked 68K into a 529 and have a flexible, prepaid tuition plan for 5 full college years.)

Current retirement assets:
Taxable
2.6% VG Muni
1.5% VG Total Stock Index

30% in a variety of stock
ETA: I bit the bullet and sold a good portion of the above. I'm left with with:
17.3% in mostly midcap, and a bit in small cap. (I am more accurate after checking the caps of all the holdings!)
12.7% awaiting placement in a VG fund (taxable account.)

My 457b
28%--25% Bond fund, 45% Sm Cap Value Index fund, 35% Lg Cap Eq Index-- limited options


Company match? NO

Pension plan (pretax)
8.3% 1/3 bonds, 2/3 Sm Cap Value Index
No company match, but I'll get a small defined benefit pension at 65
ETA:
Same options as above, but not the "target date funds"

His Roth IRA at Vanguard
1.6%European Stock Index Admiral Shares e/r 0.14
3.2% Extended Market Index Admiral VEXAX 0.14
1.7% domestic REIT 0.1

Her Roth IRA at Vanguard
1.8% VEMAX Emerging Markets Index Admiral 0.2
1.7% domestic REIT 0.1
2.7% 500 Index Fun Admiral VFIAX .05
2.2% Sm Cap Index Admiral VSMAX .16


His Traditional IRA at Vanguard
1.7%--- I will need to pick as it rolls in (in progress)

Her Traditional IRA at Vanguard
13% ---I will need to pick as it rolls in from other accounts (in process)

Annual Contributions
$33K Her 457b and self-directed pension
$6.5K his IRA/Roth IRA
$6.5K her IRA/Roth IRA
$20-30K taxable (for retirement, not short term goals)
(I'm saving >50% of my income, but this could change in disaster or ill-health strikes).

Available funds in retirement accounts:
ETA: see website linked above.

Questions:
1. I should simplify this mess, right? How? Remember I have to decide to do with about 15% I'm rolling into our Vanguard accounts. I know I'm short on international stocks because that is what I let go in rolling over into the traditional IRAs I just opened at VG. I'm willing to have a more complex portfolio if it helps it be tax-smart.

2. Now that I'm sold on indexed mutual funds, what the heck should I do with all that stock? Sit and watch or crunch numbers and sell judiciously but relentlessly?

I'm all ears,
Katie
Last edited by fickle on Sat Dec 22, 2012 3:47 pm, edited 5 times in total.
RadAudit
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Re: Time to get a handle on my investments: help wanted

Post by RadAudit »

I'm replying to bump this up so you can get better replies than I am capable of.

But, right off, I don't see anything in your situation to be ashamed of. You have > $750k and you're investing > 50 % of your annual income. Those are fantastic numberes.

Now sometime, getting a portfolio in shape takes a little time. But you have an excellent opportunity to start because you are in a roll over to VG. You seem to have an asset allocation picked out and you have an idea of where you want to go with your portfolio. And your questions have the appropriate answers contained in them.
fickle wrote:1. I should simplify this mess, right?
Yes. If you haven't already, I'd run the portfolio through VG's Portfolio Watch or Morningstar's Instant X-Ray to see where the porfolio is now compared to your plans. Might give you an idea of where the machine thinks you are compared to where you want to be.
fickle wrote: Now that I'm sold on indexed mutual funds, what the heck should I do with all that stock? Sit and watch or crunch numbers and sell judiciously but relentlessly?
Crunch numbers and sell judiciously.

Other than that, general rules of thumb seem to work fairly well. Three or fund portfolio is complex enough for most folks, age in bonds, bonds in tax advantaged accounts, etc., etc. And keep plugging. And yes, I'd whittle away on a 90% capital gain in one small cap stock before I didn't have any gain to worry about.
FI is the best revenge. LBYM. Invest the rest. Stay the course. Die anyway. - PS: The cavalry isn't coming, kids. You are on your own.
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ruralavalon
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Re: Time to get a handle on my investments: help wanted

Post by ruralavalon »

Welcome to the forum :) .

Its good to see that you are debt free. Saving 50% of income is extraordinary. With $750k saved and invested at age 55, you are well ahead of your contemporaries -- http://www.ebri.org/pdf/surveys/rcs/201 ... s4-age.pdf .
fickle wrote:Age:55
Desired Asset allocation (I can be convinced I am wrong): 60-65% stocks / 35-40% bonds --with 5% REIT stuck in there.
Desired International allocation: 25% of stocks with 5% emerging markets
In my opinion your desired asset allocation is within the range of what is reasonable.

fickle wrote:I am limited by a large portion of my retirement investments in either plans with few options or in individual stock. Because I expect to have a lower tax bracket in 5 years (when I hope to retire), I was trying to hang on to the one stock I will have massive capital gains on, and was planning on selling some with more reasonable c.g next year, making sure I don't bump my tax bracket up, and rolling that in to mutual funds at Vanguard. With some encouragement, I might sell some this year, but I have to get moving on that, and I'd hate to leap now and regret later.
First, can you identify (fund names, tickers, expense ratios) for us the investment options offered in each of your retirement plans (the 457b and the self-directed pension). EDIT If those funds have no tickers, are they index funds and can you identify the indexes they follow. Please add this to your original post using the "edit" button, it helps a lot to have all of your information in one place.

With the above information we could make some investment suggestions for you to consider.

Second, I suggest you determine the gain/loss status (amount?, short or long term?) of each investment in your taxable account. Your plan of selling "judiciously but relentlessly" could then include selling soon anything with a loss, so you could promptly sell some of the gainers without incurring any tax liability. Temporarily holding on to the one small cap stock with "more than 90% gain on it" seems like a reasonable idea for now, even though that amounts to 10% of the total portfolio. In the long run, that percentage in one stock would make me nervous.
Last edited by ruralavalon on Tue Dec 18, 2012 1:46 pm, edited 2 times in total.
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tractorguy
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Re: Time to get a handle on my investments: help wanted

Post by tractorguy »

Do you work for the company that is the small cap you hold with more than 90% gain in it? If so, your risk is much more than the 10% investment indicates. If the company stumbles, then both your job and your investment in it will be at risk at the same time. The stumble could come out of no-where. (look at what BP's stock did after the oil rig disaster in the Gulf). There is absolutely nothing worse than being forced to take early retirement and finding out that your nest egg has disappeared. I've got friends and neighbors in this boat.

My company made it very attractive to own their stock. I made a practice of selling whenever it grew to more than 10% of my investment portfolio and the biting my teeth and paying taxes. Paying taxes on a profit is better than grieving about the profit that disappeared when the disaster struck. I've never regretted any of the sales (even though I would have more money if I had held on).
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fickle
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Re: Time to get a handle on my investments: help wanted

Post by fickle »

Okay, I have edited (in parentheses with the ETA lead) my original post.
None of my stock is showing a loss at this time, so there is nothing to harvest.

My options in my company pre-tax plans seem to be all Blackrock, which means nothing to me, other than that the name seems modern.

My single large holding in stocks in NOT in my company stock. But it is in a company I know nothing about, and when I try to research it, I am get lost in the language.
ETA: I'm reading and trying, and at least know a hair more than what investopedia has to say about it. It is a financial institution.

Any good ideas about what international funds at Vanguard I might move into that would balance what I already have? Or should I go with my current urges and pick an V.G. global index fund and stop worrying so much?
Last edited by fickle on Thu Dec 20, 2012 5:34 am, edited 1 time in total.
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ruralavalon
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Re: Time to get a handle on my investments: help wanted

Post by ruralavalon »

Am trying to figure out what your plan choices are more exactly, to know what to suggest for you.
fickle wrote:Available funds
The 457b has a bond fund, a sm cap and large cap index, an emerging market and a global
What is the bond fund named? What index used? expenses?
fickle wrote:The global fund is a Blackrock fund with benchmark of "ACWI IWI" . . .
More exactly, in your plan materials is ths called "Blackrock Msci Acwi Ex-Us Imi Index Fund "?
fickle wrote:The small cap value index is a Blackrock fund with a Russell 2000 benchmark
More exactly, in your plan materials is this called "BlackRock Russell 2000 Index Fund"?
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
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fickle
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Re: Time to get a handle on my investments: help wanted

Post by fickle »

I can find no tickers. I went back and put the titles in the fund info pdfs in quotes in my most recent editions. The pdfs note BlackRock in the upper right hand corner, and rather generic names such as "Global Equity Index Fund", and under that Benchmark-- MSCI ACWI Investable Market Inex (ACWI IMI) with a Morningstar Category of World Stock.

None of the funds have tickers or anything but these generic titles. In the above example, it is a blend with 45% Giant, 30% Large, 18% meid, 5.4% small and 1.5% micro with 49.7% non-USian.

I don't know if BlackRock is uncreative, or if they market these to be readable to the average employee where I work, many of whom are not that literate, and those that are often have English as their 3rd or 4th language. (And many baled into Savings Pool at the worst possible moment 4-5 years ago, and no amount of reasoning will get them out of it, sadly, very sadly.)

I'll poke about the internet and see if I can find something on these generically-named funds on a non-pdf.

Okay, I poked around BlackRock's website for institutions, individuals, collective trusts, defined contributions, etc. etc. and I'm not finding the *same* generic-titled funds. When I google the names, it shows up my plan only. So, I think these are specialized offerings not available to all. I work for a huge organization. Aside from going through fund by fund and listing what they invest in I don't know that I can get any closer except that they are index funds for what they are titled: sm cap value or large cap or global, etc. and that their expenses a little more than Vanguard.
Last edited by fickle on Tue Dec 18, 2012 10:00 pm, edited 1 time in total.
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grabiner
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Re: Time to get a handle on my investments: help wanted

Post by grabiner »

fickle wrote:30% in a variety of stock, about 1/3 Lg Cap US (IBM, Exxon), 1/3 in mid cap, and 1/3 small cap. The small cap is one stock and capital gain is over 90% on it (at this point in time).
No single stock should be more than 5% of your portfolio, as you are taking an unnecessary risk, and even more so with a stock which is small-cap and highly volatile. I would sell at least half the small-cap stock, possibly all of it if it doesn't fit your portfolio. In addition, if you sell it now, you avoid the risk that capital gains tax rates will go up in 2013.

Another alternative would be to donate some of the stock to charity; the charity can sell it tax-free, and you can deduct the full value (up to 30% of your income, with the excess carried over to the next year). You shouldn't donate just for the tax deduction, but if you are going to give $10,000 to your alma mater or house of worship, you might as well take the tax advantage of donating a stock you don't want to hold.

If your large-cap and mid-cap holdings are well diversified, and the cost of selling them is very large, you can hold onto them and just treat them as if they were part of a large-and-mid-cap stock index fund such as
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fickle
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Re: Time to get a handle on my investments: help wanted

Post by fickle »

grabiner wrote:
No single stock should be more than 5% of your portfolio, as you are taking an unnecessary risk, and even more so with a stock which is small-cap and highly volatile. I would sell at least half the small-cap stock, possibly all of it if it doesn't fit your portfolio. In addition, if you sell it now, you avoid the risk that capital gains tax rates will go up in 2013.
Oh, how I agree! But selling even half would be dumping 50K into my 2012 income, bumping me up into the next tax bracket, and costing me 7.5K in capital gains. Everyone has their own personal weak spots, and doing this would hurt. I picked the name "fickle" as a joke. Losing because of inaction is far less disturbing to me than losing because of an active action I have taken. But I do know the human mind if full of idiosyncratic habits, and that smart people fight ones that are counterproductive. :?
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Re: Time to get a handle on my investments: help wanted

Post by grabiner »

fickle wrote:Oh, how I agree! But selling even half would be dumping 50K into my 2012 income, bumping me up into the next tax bracket, and costing me 7.5K in capital gains.
The tax bracket won't be affected. You pay tax on your regular income at varying rates which determine your bracket, and then qualified dividends and long-term gains are taxed at a 15% rate independent of the rest of your income.

(You do need to check that you won't hit some other important phase-out such as losing the $500 child tax credit.)
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fickle
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Re: Time to get a handle on my investments: help wanted

Post by fickle »

grabiner wrote:
fickle wrote:Oh, how I agree! But selling even half would be dumping 50K into my 2012 income, bumping me up into the next tax bracket, and costing me 7.5K in capital gains.
The tax bracket won't be affected. You pay tax on your regular income at varying rates which determine your bracket, and then qualified dividends and long-term gains are taxed at a 15% rate independent of the rest of your income.

(You do need to check that you won't hit some other important phase-out such as losing the $500 child tax credit.)
You're right. I realized that after I posted. (As jejune as it seems, I blushingly admit to only having *bought* stock.)
Well, that bucked me up.

Does everyone really think c.g. tax rates will go up? In addition to being incredibly naive about all matters financial, I haven't watched the news since 1974. (And you do realize I don't admit all these things to real people in the flesh. Viva la internet!). Is a raise in the capital gains rate in the offing, or just a possibility with lots of doom and gloom on the tube to get people to tune in?

I thank you all for your patience. I loved my old dad, but he was born before WWI and believed I did not need the financial and political education my brothers got. After all, "some man" would take care of me. To paraphrase the old feminist saw, I am becoming the man my parents wanted to me marry, even if I am a late bloomer.

Okay, another really basic question. My brokerage account is with Vanguard. How late in the year can I wait if I am going to sell something? What is cutting it too close?
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Re: Time to get a handle on my investments: help wanted

Post by ruralavalon »

What benchmark do your plan materials identify for the bond fund?

Can you provide a links to the pdfs of your plan materials for each of the 4 funds?
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Re: Time to get a handle on my investments: help wanted

Post by fickle »

ETA: I have posted the link to the website that has the pdfs in my original post.

I cannot find them matching up with funds at BlackRock's own website. I do notice that the bond fund is heavier on the Baa funds than its benchmark. That stands out right off.
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Re: Time to get a handle on my investments: help wanted

Post by grabiner »

fickle wrote:Okay, another really basic question. My brokerage account is with Vanguard. How late in the year can I wait if I am going to sell something? What is cutting it too close?
If you sell a mutual fund, you may want to sell on December 28; sales don't always post on the same business day.

If you sell a stock or ETF, you can sell on December 31 and still get the gain or loss for this year. However, if you are selling a large amount of a small-cap stock or low-volume ETF, you may need to be patient, selling smaller amounts over several hours. If you try to sell a large amount with a market order, you will sell it, but possibly not at a good price. (For example, if the bid is an order to buy 500 shares at $20, and you place a market order to sell 5000 shares, you might wind up selling 500 shares at $20, and 1000 shares at $19.50, and 3500 shares at $19, getting $96,000 rather than the $100,000 you were expecting.)

Therefore, I wouldn't cut it too close if you are trying to sell this year to avoid a possible increase in tax rates for next year. I don't know whether the capital-gains tax rate will be 15%, 20%, or somewhere in between, and I won't know until Congress actually passes a bill.
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Re: Time to get a handle on my investments: help wanted

Post by fickle »

grabiner wrote: In addition, if you sell it now, you avoid the risk that capital gains tax rates will go up in 2013.
Okay, I poked around the news some and decided that while no one can say for certain what the rates will be in 2013, it is likely they won't go DOWN, so I sold a good chunk of those that were really too sector-specific for my new, hopefully wiser goals. I meant to sell all these loose individual stocks at some point anyway, why not shed 2/5ths of them before a possible rise in rates?

My next question is more specific. Since the proceeds of the sales will go into a taxable account, and I need to add to my international stock percentage, I was reviewing VG's offerings. On this board, the Total International Stock Index is mentioned for such an account, but not the Tax-Managed International stock (VTIAX vs. VTMGX). I am wondering why this is so? Is it because the former in an index fund and the latter isn't, or that tax-managed funds are eschewed? Thanks!
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Re: Time to get a handle on my investments: help wanted

Post by JW-Retired »

If it was me I would sell at least a good chunk of that small cap stock you have a big holding in before year-end. Probably I would sell it all. Hanging on to that is clearly a risk. If you don't sell it now then when will you? Highly doubtful you will ever see the cap gains tax any lower than the 15%.

And no state tax. I would love such a low cap gains rate.
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ruralavalon
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Re: Time to get a handle on my investments: help wanted

Post by ruralavalon »

fickle wrote: My next question is more specific. Since the proceeds of the sales will go into a taxable account, and I need to add to my international stock percentage, I was reviewing VG's offerings. On this board, the Total International Stock Index is mentioned for such an account, but not the Tax-Managed International stock (VTIAX vs. VTMGX). I am wondering why this is so? Is it because the former in an index fund and the latter isn't, or that tax-managed funds are eschewed?
Here is a general comparison of the two funds. https://personal.vanguard.com/us/funds/ ... tingFrom=2 .
Wiki article link: Principles of Tax-Efficient Fund Placement .

1. Both are very tax efficient, but Tax Managed Int'l has the edge (see: "Average annual total return—after taxes on distributions" and "Average annual total return—after taxes on distributions and sale of fund shares". See also: table 1 of wiki article.).
2. Total International is an index fund, and is much more diversified (6331 holdings vs 883). Per Morningstar, Tax Managed Int'l holds no int'l small caps, and less int'l mid cap. Both include emerging markets, at about 08% of the fund.
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ruralavalon
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Re: Time to get a handle on my investments: help wanted

Post by ruralavalon »

fickle wrote:Age:55
Desired Asset allocation (I can be convinced I am wrong): 60-65% stocks / 35-40% bonds --with 5% REIT stuck in there.
Desired International allocation: 25% of stocks with 5% emerging markets
Here is a portfolio idea to consider, using your desired asset allocation, along with some explanation.

In my example I will use a 60/40 stock bond allocation with 25% of stocks (15% overall) in international, and 5% in REIT. This works out to 45% domestic stocks which includes 05% REIT, 15% international, and 40% bonds. I suggest using Vanguard Total Intl Stock Index Admiral VTIAX, which includes both developed and emerging markets (08% of fund), rather than holding emerging markets separately. This keeps the overall portfolio simpler and sticks to cap weighting.

Since you have a large taxable account, you need to be concerned about tax efficiency. Large cap index funds tend to be very tax efficient, and so are suitable for any type of account including taxable accounts. Bond funds and REIT funds are very tax INefficient, so should be located in tax protected accounts. Wiki article link: Principles of Tax-Efficient Fund Placement

The idea in fund selection is to seek a combination of broad diversification (to reduce risk) and low expenses (to increase your net gain), as simply as is practical given the funds you have to choose from. You start making the best choice in the 457b and pension, where the choices are very limited, and then fill out the asset allocation from the nearly unlimited selection of funds offered elsewhere. There are many acceptable fund choices in your 457b and pension (most are widely diversified, and all seem to be moderate cost), so there are probably several good ways to do this.

The Washington State Bond Fund offered in your work plans consists predominately of corporate bonds, so I suggest diversifying that by adding some Intermediate-Term Treasury Fund (VFIUX) in the IRAs. I used a 50/50 split between the two bond funds.


In my example all percentages are rounded off.

Taxable account (34%; adds $20-30k/yr)
04%, Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX), er = 0.06%
30%, various stocks to be sold
(as stocks are sold, transition to --
15%, Vanguard Total Intl Stock Index Admiral VTIAX, er = 0.18%,
19%, Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX), er = 0.06%,
both very tax efficient)


Her 457b (28%; adds $33k/yr between 457b and pension)
12%, Washington State Bond Fund (managed fund, ~ Barclays Capital Intermediate Credit Index, corp. bonds)
13%, Blackrock U.S. Large Cap Equity Index Fund (S&P 500 index)
03%, Blackrock U.S. Small Cap Value Equity Index Fund (Russell 2000 Value Index)
(If you wish to approximate domestic total market, keep the S&P 500 and Sm.Cap.Value in about a 4:1 or 5:1 ratio)
Wiki article link: Approximating Total Stock Market .

Her pre-tax pension (8%)
08%, Washington State Bond Fund (managed fund, ~ Barclays Capital Intermediate Credit Index, corp. bonds)

His Roth IRA at Vanguard (7%; adds $6.5k/yr)
07%, Vanguard Intermediate-Term Treasury Fund Admiral Shares (VFIUX), er = 0.10%

Her Roth IRA at Vanguard (8%; adds $6.5/yr)
08%, Vanguard Intermediate-Term Treasury Fund Admiral Shares (VFIUX), er= 0.10%

His rollover tIRA at Vanguard (2%)
02%, Vanguard Intermediate-Term Treasury Fund Admiral Shares (VFIUX), er= 0.10%

Her rollover tIRA at Vanguard (13%)
05%, Vanguard REIT Index Fund Admiral Shares (VGSLX), er = 0.10%,
05%, Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX), er = 0.06%
03%, Vanguard Intermediate-Term Treasury Fund Admiral Shares (VFIUX), er= 0.10%

This gives you a simple, broadly diversified, low cost portfolio in your desired asset allocation, using just seven funds, with tax efficient fund placement. You should be able to manage the portfolio and do most rebalancing to keep to your desired asset allocation by the way you direct your future contributions to the various accounts where you will be making contributions.

I hope that this helps.
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Re: Time to get a handle on my investments: help wanted

Post by grabiner »

fickle wrote:My next question is more specific. Since the proceeds of the sales will go into a taxable account, and I need to add to my international stock percentage, I was reviewing VG's offerings. On this board, the Total International Stock Index is mentioned for such an account, but not the Tax-Managed International stock (VTIAX vs. VTMGX). I am wondering why this is so? Is it because the former in an index fund and the latter isn't, or that tax-managed funds are eschewed? Thanks!
Total International is more complete; Tax-Managed International holds only large-cap developed-markets stock. To get the same allocation as Total International, you need 65% Tax-Managed International, 20% Emerging Markets Index, and 15% FTSE All-World Ex-US Small-Cap (preferably as an ETF). The three-fund portfolio is harder to manage, although it may still give a small tax savings because Tax-Managed International has 100% qualified dividends.

I generally recommend Total International if you are holding international at the market weight, and Tax-Managed International as the core holding if you are overweighting emerging markets and small-cap and thus will need three funds anyway. (I hold Tax-Managed International myself, because I do overweight emerging markets and small-cap.)
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fickle
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Re: Time to get a handle on my investments: help wanted

Post by fickle »

ruralavalon wrote:
This gives you a simple, broadly diversified, low cost portfolio in your desired asset allocation, using just seven funds, with tax efficient fund placement. You should be able to manage the portfolio and do most rebalancing to keep to your desired asset allocation by the way you direct your future contributions to the various accounts where you will be making contributions.

I hope that this helps.
Oh, it does. How human that just scratching multiple heads over a single problem makes it seem so less huge. I thank you very much. I can feel my heart rate slowing down already. I wish I could do you a favor in return. If you ever want advice on how to train a deaf dog, use an egg-white "raft" to make perfectly clear soup stock, or wonder about the safety of anti-lipid meds, I'm your gal, but I doubt I will ever be able to give you any financial help. Also human: our talents and our gifts are not uniform. Thanks again for everyone's thoughts.
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Re: Time to get a handle on my investments: help wanted

Post by letsgobobby »

For remiss you've done quite well! I bet you are just *loving* your decision to fund the GET 529. The rate of return has been spectacular for a safe instrument.

You seem to have good instincts despite your proclaimed lack of knowledge. You've avoided scams, saved a lot of money, invested in GET, etc. The simple portfolio that ruralavalon has suggested will do quite well. I do think 60/40 is as aggressive as you should be. Why take any risk you dont need to take? I might suggest 50/50, though I'm a conservative type in general.

I'd think also about protecting yourself from loss in other ways. Do you have long term care insurance? Do you have adequate umbrella/personal liability insurance? Do you have flood insurance on your home? Do you have an earthquake rider on your home and possessions? The last two are typically a good idea in Washington, especially in western Washington and especially if you own your home free and clear and would be on the hook for a half million dollar or so rebuild. That would put a dent in your financial situation real fast.

At this point you *have* got it made. You save more than you spend, have no debt, and have lots saved. Now you need to protect what you've grown.
Topic Author
fickle
Posts: 51
Joined: Sun Dec 16, 2012 6:09 pm

Re: Time to get a handle on my investments: help wanted

Post by fickle »

letsgobobby wrote: I bet you are just *loving* your decision to fund the GET 529. The rate of return has been spectacular for a safe instrument.
As long as the state doesn't default on it, this will be the best thing I ever tripped over and fell into. I don't think it is a great deal buying it now, but I was fortunate to pop out a baby just at the right time to benefit from this. I knew the 7% yearly increase cap would never hold ....
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