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Posted: Sun Feb 24, 2013 8:19 pm
by letsgobobby
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Re: optimal 529 allocation given these fund choices, please

Posted: Sun Feb 24, 2013 8:32 pm
by Grt2bOutdoors
I think 529 plans were developed to provide broad widely diversified exposure to securities markets so participants could obtain market returns without it turning into a speculative arena. There is the West Virginia 529plan which offers DFA funds, but that is not the options you are dealing with.

Not sure there is a true optimal investment, the optimal one is the one that gets you to your goal. Is your plan going to remain static other than rebalancing, or will you try to fine-tune it over time. I guess my question is, will you second guess yourself if you experience significant tracking error vs. the broad market?

Re: optimal 529 allocation given these fund choices, please

Posted: Mon Feb 25, 2013 1:38 pm
by northstar22
I don't know that I'm qualified to be giving you advice, bobby, but since I've benefited from your advice (both directly and indirectly) and I like the thread I'll chime in.

40% international is obviously reasonable, and TISM is the best choice you have there. You end up with a 20% small and value tilt, which is a nice tilt but nothing extreme. I suppose you'd rather have a SCV fund, but you have to play the hand you're dealt. Given the choices you have and your desired allocation I think this is the simplest way to do it. The absolute simplest thing would be to put it all the Vanguard aggressive growth which would require no further thinking, but then obviously you lose the tilt.

100% stocks is a personal choice, and since you're contributing a lot to 529s and presumably aren't going to cost your kids a college education if it loses half its value, I don't see a problem.

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Posted: Tue Feb 26, 2013 1:09 am
by letsgobobby
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