Please critique portfolio for a young investor

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phaeocise
Posts: 4
Joined: Sun Feb 03, 2019 10:28 pm

Please critique portfolio for a young investor

Post by phaeocise »

Hi All,

After learning so much in the past week on this forum I think I'm going to go with the following mix (120K):

Cash (20k)
Roth IRA (30K): 65% Total US (VTSAX), 35% Total international (VTIAX)
Regular taxable account (70K): 65% Total US (VTSAX), 35% Total international (VTIAX)

Super simple portfolio, but after looking at a few advice threads:
- Bonds don't interest me at my age and risk tolerance
- REITs interest me and was thinking about putting them in my Roth for tax reasons
- VTSAX and VTIAX seem very tax efficient for the taxable account with low expense ratios
- There some tax efficient ETF and small cap funds others suggested but not really seeing the big advantage over these 2 funds

Please let me know what your thoughts are and provide suggestions and inputs!

Thanks
michaeljmroger
Posts: 524
Joined: Fri Sep 21, 2018 10:54 am

Re: Please critique portfolio for a young investor

Post by michaeljmroger »

All of this makes sense to me! I’d personally add at least some bonds to my portfolio even if I was still very young but, if you’re confident you can stomach a severe drop, then you’re good to go!

Good luck.
Thecallofduty
Posts: 90
Joined: Sat Jan 19, 2019 10:59 am

Re: Please critique portfolio for a young investor

Post by Thecallofduty »

Just my thoughts:

If you expect to have that same ratio of taxable to roth moving forward you could just put:

30k Roth: 100% total stock market
70k Taxable: 50% total stock, 50% international

Is your 20k cash for bills/checking or part of total portfolio for investments? Consider putting in high yield savings if u want it fdic insured or money market account.

If your young and dont want bonds thats fine, especially if you are not taking out for 20-30 years. If you add bonds in future put in tax deffered acount and not taxable.

Good luck :dollar
-thecallofduty
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ruralavalon
Posts: 20183
Joined: Sat Feb 02, 2008 10:29 am
Location: Illinois

Re: Please critique portfolio for a young investor

Post by ruralavalon »

phaeocise wrote: Tue Feb 05, 2019 12:18 am Hi All,

After learning so much in the past week on this forum I think I'm going to go with the following mix (120K):

Cash (20k)
Roth IRA (30K): 65% Total US (VTSAX), 35% Total international (VTIAX)
Regular taxable account (70K): 65% Total US (VTSAX), 35% Total international (VTIAX)

Super simple portfolio, but after looking at a few advice threads:
- Bonds don't interest me at my age and risk tolerance
- REITs interest me and was thinking about putting them in my Roth for tax reasons
- VTSAX and VTIAX seem very tax efficient for the taxable account with low expense ratios
- There some tax efficient ETF and small cap funds others suggested but not really seeing the big advantage over these 2 funds

Please let me know what your thoughts are and provide suggestions and inputs!

Thanks
In a taxable account use:
1) Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) ER 0.04%; and
2) Vanguard Total International Stock Index Fund Admiral Shares (VTIAX) ER 0.11%.
There is generally no particular need to use any additional funds in a taxable account.

In another post you mentioned that you have recently started your own business.

Instead of, or in addition to, a taxable account you should look into the tax-advantaged accounts available for the self-employed such as an:
1) individual (solo) 401k;
2) SEP IRA; or
3) SIMPLE IRA.

There are Boglehead's wiki articles on each type of plan. On the Vanguard website look for "small business plans" and look under the "compare plans" tab for a nice table comparing the types of plans available for the self-employed.

Do you have any employees in your business other than yourself?
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started
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