Help with bond fund choices please

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Help with bond fund choices please

Post by Windylotus » Wed Jun 13, 2018 6:36 pm

Hello Bogleheads,
Recently my wife and I decided to cut back her 403b contributions. Just enough to get the match. We want to max out her HSA first, then back to 403b contributions. There seems to be five bond fund choices but I'm not sure what is right for us. We have 21 years until retirement and currently hold an 80/20 portfolio AA with 75/25 U.S./International equities. I was thinking splitting our bond contributions to half VBMPX and half VTAPX? Please let me know what you think? Listed below are our fund choices. Thanks in advance!

Short-Term Bond Index VBIRX (.07)
Inflation-Protected Securities VIPIX (.07)
Total International Bond VTABX (.11)
Total Bond Market VBMPX (.03)
Short-Term Inflation-Protected Securities VTAPX (.06)

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Re: Help with bond fund choices please

Post by retiredjg » Wed Jun 13, 2018 6:39 pm

Your suggested split would be fine I'm sure. I would just use the Total Bond Market VBMPX (.03) and call it good.

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Re: Help with bond fund choices please

Post by dbr » Wed Jun 13, 2018 6:40 pm

I think the default choice for long term bond holdings is intermediate duration. For twenty years and more there is no incentive hold shorter term. How much difference it makes to hold some TIPS or not is probably dancing on the head of a pin at this point.

For any concern about portfolio risk and return the handle to turn is stock-bond allocation but not what bond fund exactly to own.

Doctor Rhythm
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Re: Help with bond fund choices please

Post by Doctor Rhythm » Thu Jun 14, 2018 1:19 am

Total Bond Market VBMPX as your sole bond fund would be fine. For what it's worth, Vanguard is recommending some exposure to international bonds, and their target date fund for your time horizon puts around a third of the total bond allocation in VTABX. That's not typical, though.

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