Help with 401K allocation

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Kendrick33
Posts: 12
Joined: Fri Dec 15, 2017 12:58 pm

Help with 401K allocation

Post by Kendrick33 » Sat Oct 13, 2018 5:16 pm

Hello my name is Kendrick. I'm 42 years old. I set up my 401K last December when my company moved over Fidelity. I had originally implemented the three fund portfolio. I was doing 90% stock (61% S& P, 2% small cap, 27% international)) and 10% bond. After looking back I think it was rather aggressive. I sat with my State Farm Financial advisor who changed my fund allocation to the following below with the YTD returns showing.

ac Asset Class Category %Invested Balance Cost Basis YTD Returns As Of
FLEXPATH+AGR 2055 I1  02/08/2018 Blended Investment* N/A 51.63 $85,548.16 $83,779.27 2.11% 10/12/2018

BLKRK EQUITY INDEX  01/05/2018 Stock Investments Large Cap 23.24 $38,511.31 $35,901.30 2.37% 10/12/2018

MM SEL MID CAP GR I  (MEFZX) 02/08/2018Stock InvestmentsMid-Cap 8.89 $14,734.93 $13,837.44 6.49% 10/12/2018

VANG SMCPVL IDX ADM  (VSIAX) 02/08/2018 Stock InvestmentsSmall Cap 8.76 $14,509.53 $14,069.97 4.66% 10/12/2018

BR US DEBT INDEX  01/05/2018 Bond Investments Income 3.75 $6,217.72 $6,250.30 -1.70% 10/12/2018

BR EAFE EQUITY INDEX  01/05/2018 Stock Investments International 2.48 $4,115.58 $4,375.41 -10.16% 10/12/2018

FID MID CAP IDX IPR  (FSMDX) 10/03/2018 Stock Investments Mid-Cap 0.62 $1,029.43 $1,096.41 -6.20% 10/12/2018

FID SM CAP IDX IPR  (FSSNX) 10/03/2018 Stock Investments Small Cap 0.62 $1,025.45 $1,106.61 -7.47% 10/12/2018

I was looking back at the Bogleheads Guide to Investing today on asset allocation, where it said a middle-aged investor's allocation should be the following: large cap domestic stock 30%, small/mid cap 15%, international funds 10%, REITs 5%, Intermediate-term bond fund 20%, and Inflation-Protected Securites 20%. Based on the list of funds provided below, what would you recommend implementing the three fund portfolio, the suggestion in the Boglehead's Guide to Investing, and/or would you add in a target fund?

Name/Inception Date Asset Class Category 1 Year 3 Year 5 Year 10 Year/LOF* Returns As Of Bench- mark
BLKRK EQUITY INDEX 07/24/2017
Stock Investments Large Cap 17.90% 16.86% 13.43% 11.23% 09/30/2018 Show

FID BLUE CHIP GR K6 (FBCGX) 05/25/2017
Stock Investments Large Cap 27.63% N/A N/A 25.34% 09/30/2018 Show

VANG EQUITY INC ADM (VEIRX) 03/21/1988
Stock Investments Large Cap 10.70% 14.89% 11.64% 11.16% 09/30/2018 Show

FID MID CAP IDX IPR (FSMDX) 09/08/2011
Stock Investments Mid-Cap 13.93% 14.49% 11.63% 14.71% 09/30/2018 Show

MM SEL MID CAP GR I (MEFZX) 05/31/2000
Stock Investments Mid-Cap 17.21% 15.86% 13.95% 14.10% 09/30/2018 Show

VANG SELECTED VALUE (VASVX) 02/15/1996
Stock Investments Mid-Cap 0.83% 11.23% 8.41% 11.40% 09/30/2018 Show

FID SM CAP IDX IPR (FSSNX) 09/08/2011
Stock Investments Small Cap 15.42% 17.35% 11.31% 15.22% 09/30/2018 Show

FID SMALL CAP GR K6 (FOCSX) 05/25/2017
Stock Investments Small Cap 29.30% N/A N/A 30.23% 09/30/2018 Show

VANG SMCPVL IDX ADM (VSIAX) 05/21/1998
Stock Investments Small Cap 11.23% 15.10% 11.45% 11.41% 09/30/2018 Show

AF EUROPAC GROWTH R6 (RERGX) 04/16/1984
Stock Investments International 1.47% 9.93% 6.20% 6.83% 09/30/2018 Show

AF NEW WORLD R6 (RNWGX) 06/17/1999
Stock Investments International 1.15% 11.53% 4.79% 6.23% 09/30/2018 Show

BR EAFE EQUITY INDEX 08/14/2017
Stock Investments International 3.10% 9.55% 4.67% 5.14% 09/30/2018 Show

DFA INTL CORE EQ I (DFIEX) 09/15/2005
Stock Investments International 1.87% 10.92% 5.50% 6.57% 09/30/2018 Show

DFA REAL EST SEC I (DFREX) 01/05/1993
Stock Investments Specialty 4.38% 7.88% 9.44% 7.66% 09/30/2018 Show

VANG INFO TEC IDX AD (VITAX) 01/26/2004
Stock Investments Specialty 34.60% 28.02% 21.88% 17.13% 09/30/2018 Show

FLEXPATH+AGR 2025 I1 04/01/2015
Blended Investment* N/A 7.06% 9.92% N/A 6.17% 09/30/2018 Show

FLEXPATH+AGR 2035 I1 04/01/2015
Blended Investment* N/A 8.84% 11.74% N/A 7.22% 09/30/2018 Show

FLEXPATH+AGR 2045 I1 04/01/2015
Blended Investment* N/A 9.45% 12.37% N/A 7.60% 09/30/2018 Show

FLEXPATH+AGR 2055 I1 04/01/2015
Blended Investment* N/A 9.46% 12.38% N/A 7.62% 09/30/2018 Show

FLEXPATH+AGR RET I1 04/01/2015
Blended Investment* N/A 4.77% 7.27% N/A 4.75% 09/30/2018 Show

FLEXPATH+CON 2025 I1 04/01/2015
Blended Investment* N/A 4.08% 6.62% N/A 4.37% 09/30/2018 Show

FLEXPATH+CON 2035 I1 04/01/2015
Blended Investment* N/A 5.86% 8.59% N/A 5.48% 09/30/2018 Show

FLEXPATH+CON 2045 I1 04/01/2015
Blended Investment* N/A 8.22% 11.15% N/A 6.93% 09/30/2018 Show

FLEXPATH+CON 2055 I1 04/01/2015
Blended Investment* N/A 9.48% 12.39% N/A 7.66% 09/30/2018 Show

FLEXPATH+CON RET I1 04/01/2015
Blended Investment* N/A 2.76% 4.92% N/A 3.38% 09/30/2018 Show

FLEXPATH+MOD 2025 I1 04/01/2015
Blended Investment* N/A 5.70% 8.40% N/A 5.32% 09/30/2018 Show

FLEXPATH+MOD 2035 I1 04/01/2015
Blended Investment* N/A 7.79% 10.65% N/A 6.58% 09/30/2018 Show

FLEXPATH+MOD 2045 I1 04/01/2015
Blended Investment* N/A 9.27% 12.20% N/A 7.47% 09/30/2018 Show

FLEXPATH+MOD 2055 I1 04/01/2015
Blended Investment* N/A 9.51% 12.40% N/A 7.61% 09/30/2018 Show

FLEXPATH+MOD RET I1 04/01/2015
Blended Investment* N/A 3.79% 6.16% N/A 4.10% 09/30/2018 Show

MIP CL 1 09/07/1989 7 day yield as of 09/30/2018 1.64% Bond Investments Stable Value 1.48% 1.32% 1.21% 1.31% 09/30/2018 Show

AB GLOBAL BOND Z (ANAZX) 03/27/1992
Bond Investments Income -0.18% 2.78% 3.34% 5.14% 09/30/2018 Show

BR US DEBT INDEX 08/14/2017
Bond Investments Income -1.19% 1.33% 2.20% 3.45% 09/30/2018 Show

PGIM TOTAL RTN BD R6 (PTRQX) 01/10/1995
Bond Investments I ncome -0.88% 2.86% 3.46% 5.98% 09/30/2018 Show

DFA INF PRT SEC PORT (DIPSX) 09/18/2006
Bond Investments N/A -0.05% 1.81% 1.23% 3.43% 09/30/2018 Show

LD ABT HIGH YIELD R6 (LHYVX) 12/31/1998
Bond Investments N/A 2.62% 8.08% 6.24% 9.55% 09/30/2018 Show

User avatar
Duckie
Posts: 5954
Joined: Thu Mar 08, 2007 2:55 pm

Re: Help with 401K allocation

Post by Duckie » Sat Oct 13, 2018 5:59 pm

Kendrick33 wrote:I was doing 90% stock (61% S& P, 2% small cap, 27% international) and 10% bond.
10% bonds is low for age 42 and 2% anything is a waste of effort.
Based on the list of funds provided below, what would you recommend implementing the three fund portfolio, the suggestion in the Boglehead's Guide to Investing, and/or would you add in a target fund?
First, don't have individual funds plus a target-date fund. It's one or the other. Second, you have a lot of numbers but none of them are the expense ratios. We need to know how much stuff costs. Without that information the following (which all have "index" in the title) appear to be the best/cheapest options:
  • BLKRK EQUITY INDEX -- Large caps
  • FID MID CAP IDX IPR (FSMDX) -- Mid caps
  • FID SM CAP IDX IPR (FSSNX) -- Small caps
  • VANG SMCPVL IDX ADM (VSIAX) -- Small cap value
  • BR EAFE EQUITY INDEX -- International developed markets
  • BR US DEBT INDEX -- US bonds
If you want your 63/27/10 AA you could have:
  • 53% BLKRK EQUITY INDEX
    10% VANG SMCPVL IDX ADM (VSIAX)
    27% BR EAFE EQUITY INDEX
    10% BR US DEBT INDEX

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Peter Foley
Posts: 4539
Joined: Fri Nov 23, 2007 10:34 am
Location: Lake Wobegon

Re: Help with 401K allocation

Post by Peter Foley » Sat Oct 13, 2018 6:55 pm

Your adviser needlessly over complicated your portfolio. A complicated portfolio may necessitate professional help (and the fees that go with that help) whereas a simple portfolio does not.

Kendrick33
Posts: 12
Joined: Fri Dec 15, 2017 12:58 pm

Re: Help with 401K allocation

Post by Kendrick33 » Sat Oct 13, 2018 8:42 pm

What are your recommendations for simplifying the portfolio?

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Peter Foley
Posts: 4539
Joined: Fri Nov 23, 2007 10:34 am
Location: Lake Wobegon

Re: Help with 401K allocation

Post by Peter Foley » Sat Oct 13, 2018 10:33 pm

Go back to where you started. You should have a large cap US fund, an extended market fund (if available), an international fund, and a bond fund.

The list you provided does not have an extended market fund so you can add a mid cap to your small cap to replicate total stock market. There is a ratio posted on the Wiki that you can follow.

Along the lines Duckie suggested, I would recommend at least 20% in bonds and would put at least 5% in small cap and 5% in mid cap.

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