Good Afternoon,
I recently opened a traditional IRA at Vanguard and need some help with investment allocation. I am very inclined to go with a 3 fund portfolio and I would like to stay at 60% stocks & 40% bonds. Would like both domestic & International stocks
Should I stick to this investment allocation
VTSMX
VGTSX
VBMFX
or should I just opt for VSMGX (Lifestyle Portfolio) It does re balance on its own.
I do have more than 25 years to retire and the main reason to get into Vanguard was to take advantage of low ER's.
Appreciate your thoughts & comments.
Investment Allocation help in Vanguard IRA
Re: Investment Allocation help in Vanguard IRA
Well they're basically the same, so it's only a matter of which details matter to you.
VSMGX holds international bonds as well as domestic. The case for international bonds has been much debated, here & elsewhere. It likely makes very little difference either way.
VSMGX has 40% of equities in international. Maybe you want a different number. The "best" ratio has been endlessly discussed. No one knows what it is. Everything from 0 to 50% has been recommended by somebody.
The 3-fund will have a slightly lower overall expense ratio, especially once you get enough invested to hold admiral-class shares of each fund.
You have to rebalance the 3-fund yourself, adding a little more time/complexity.
VSMGX holds international bonds as well as domestic. The case for international bonds has been much debated, here & elsewhere. It likely makes very little difference either way.
VSMGX has 40% of equities in international. Maybe you want a different number. The "best" ratio has been endlessly discussed. No one knows what it is. Everything from 0 to 50% has been recommended by somebody.
The 3-fund will have a slightly lower overall expense ratio, especially once you get enough invested to hold admiral-class shares of each fund.
You have to rebalance the 3-fund yourself, adding a little more time/complexity.