Portfolio Review

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Ashley1748
Posts: 15
Joined: Thu May 21, 2015 5:41 pm

Portfolio Review

Post by Ashley1748 » Thu May 21, 2015 7:44 pm

Hi everyone,

I am seeking review of our retirement portfolio. Thank you!

Emergency funds: Three months (not part of asset allocation)
Debt: None
Tax Filing Status: Married Filing Jointly
Tax Rate: 39.6% Federal, 0% State
State of Residence: WA
Age: 60, 55
Desired Asset allocation: 50% stocks / 50% bonds
Desired International allocation: 30% of stocks
Portfolio size is in low eight figures, ~50x of desired annual income

Current asset allocation, funds (expense ratios) are as follows:

Tax-deferred accounts
8.5% - Total aggregate bonds, VBTLX (0.07), AGG (0.08)
1.75% - International bonds, VTABX (0.19)

Taxable accounts
9.5% - Limited term Municipals, VMLUX (0.12)
20.25% - Intermediate term Municipals, VWIUX (0.12)
10% - Long term, Municipals, VWLUX (0.12)
34% - Total Stock Market, SCHB (0.04), VTSAX (0.05)
1% - Small Cap Index. VB (0.09)
14% - Total International, VTIAX (0.14)
1% - Emerging Markets Index, VWO (0.15)
Last edited by Ashley1748 on Fri May 22, 2015 10:54 am, edited 2 times in total.

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Bogle_Feet
Posts: 826
Joined: Tue Jan 14, 2014 6:56 pm

Re: Portfolio Review

Post by Bogle_Feet » Fri May 22, 2015 4:30 am

Jim Cramer's allocation ratio recommendations:

60 to retirement - 40% - 50% bonds
After retirement: Own some stocks, approximately one-third of your portfolio. Focus on high yielding stocks that can generate more income with less risk.

Bob Brinker recommends more exposure to stocks with a 50/50 allocation for a 70 year old.

livesoft
Posts: 62361
Joined: Thu Mar 01, 2007 8:00 pm

Re: Portfolio Review

Post by livesoft » Fri May 22, 2015 6:37 am

Looks great to me!

But I'm just curious, what's with the 1% allocations to VB and VWO? They seem out of place unless you are either slowly getting rid of them or slowly increasing them. Can you please explain how they came to be in your portfolio since they kind of stick out from the rest of your portfolio?
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ruralavalon
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Location: Illinois

Re: Portfolio Review

Post by ruralavalon » Fri May 22, 2015 8:04 am

Welcome to the forum :) .
Ashley1748 wrote:I am seeking review of our retirement portfolio. Thank you!
Both the asset allocation and the funds selected look fine in my opinion.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

Grt2bOutdoors
Posts: 19086
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: Portfolio Review

Post by Grt2bOutdoors » Fri May 22, 2015 8:18 am

Looks good to me. 50x annual draws? - that is some margin of safety you've got there!

BTW, this is the Bogleheads - we don't subscribe to Jim Cramer or CNBC except to turn the volume off and watch them bicker amongst themselves. :twisted:
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Ashley1748
Posts: 15
Joined: Thu May 21, 2015 5:41 pm

Re: Portfolio Review

Post by Ashley1748 » Fri May 22, 2015 10:50 am

livesoft wrote:Looks great to me!

But I'm just curious, what's with the 1% allocations to VB and VWO? They seem out of place unless you are either slowly getting rid of them or slowly increasing them. Can you please explain how they came to be in your portfolio since they kind of stick out from the rest of your portfolio?
Good question. The idea was to use some money to overweight growth. So, I decided to put 1% for small cap and another 1% to emerging markets. In the end, I am not sure if the amounts are big enough to help either way.

When I have some tax advantaged situations in the future, I might roll them to market weight.
Last edited by Ashley1748 on Fri May 22, 2015 4:12 pm, edited 1 time in total.

Ashley1748
Posts: 15
Joined: Thu May 21, 2015 5:41 pm

Re: Portfolio Review

Post by Ashley1748 » Fri May 22, 2015 11:29 am

Bogle_Feet wrote: Bob Brinker recommends more exposure to stocks with a 50/50 allocation for a 70 year old.
Thanks. The plan is to stay at 50/50 for rest of my life.

Ashley1748
Posts: 15
Joined: Thu May 21, 2015 5:41 pm

Re: Portfolio Review

Post by Ashley1748 » Fri May 22, 2015 11:33 am

Grt2bOutdoors wrote:Looks good to me. 50x annual draws? - that is some margin of safety you've got there!
Thanks. The only reason i put it there was in case this should be a factor in the portfolio allocation. Some added context. Both of us are conservative investors. Our original idea was to have 40/60 Stock/Bond allocation. In his book on asset allocation, Rick Ferri made a good point on taking a longer-term view with the portion money that is likely to survive retirement or will pass on as inheritance. I think about 25% to 30% of the portfolio qualifies in this category. So, we decided to adjust the overall portfolio to 50/50 and the plan is to stay with this allocation.

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