Portfolio Review

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Topic Author
KPG
Posts: 55
Joined: Mon Nov 25, 2013 10:38 am

Portfolio Review

Post by KPG » Thu Nov 14, 2019 3:13 am

I have been trying to simplify my portfolio. How's this looking. Any comments or suggestions would be appreciated.

Emergency funds: yes
Debt: none
Tax filing status: MFJ
Tax rate: 22% federal
PA
Age: him:72 her:66 Both retired
Asset allocation 50/50 This is the most conservative I have ever been?
15% international
seven-figures
V. is for vanguard

Taxable Accounts
13% - VWILX - V. international growth
2% - VWO - V. emerging mkts. etf
3% - VPCCX - V. prime cap core
5% - cash
5% - VFSUX - V. short term investment grade
6% - VWEAX - V. High yield corporate

401k rollover
10% - VFSUX - V. short- term investment grade
3% - VWEAX - V. high- yield corporate
21% - VFIDX - V. intermediate -term investment grade
8% 1 stock

Roth IRA
9% - VWENX - V. wellington - his
15% - POAGX - primecap odyssey aggressive

User avatar
1789
Posts: 314
Joined: Fri Aug 16, 2019 3:31 pm
Location: OR

Re: Portfolio Review

Post by 1789 » Sat Nov 16, 2019 1:38 am

Hello,

As Mr Bogle used to say “ Simplicity is the master key to financial success” . I think you took a very important decision to simplify your holdings.If 50-50 is the number that let you sleep well, then you can stick to that.

Generally bonds are bad in taxable accounts and you need an estimate of how much tax you would pay if you were to unload shares in taxable and re arrange them. I think simplifying your Roth IRA and 401K rollover is easier as 401k is tax sheltered and Roth IRA is tax free. I recommend you to start simplifying your holdings and reduce it to “Three Fund Portfolio” with VTSAX (in Roth IRA/taxable/401k rollover), VTIAX (in Roth IRA, taxable, 401k rollover) and VBTLX (401k rollover).

An example distribution would be 40% VTSAX, 10% VTIAX and 50% VBTLX. I wish you the best!
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)

Topic Author
KPG
Posts: 55
Joined: Mon Nov 25, 2013 10:38 am

Re: Portfolio Review

Post by KPG » Sat Nov 16, 2019 8:16 pm

1789,
I have sold 1 stock and 3 mutual funds so far this year. I was going to sell VWO - Emerging mkts. but I was just going over the portfolio that Vanguard did for my sister and it has VWO in it, so I'm going to keep it for now and use that space for more of a Roth conversion from my 401k. Once I get the Dec. 10 distributions I can hopefully calculate close to the 22% tax bracket. My 50/50 does not account for the bond portion in Wellington so I have a little more in bonds. I have been reading posts on High Yield Corp, I think it's gone. The taxable account in High Yield is at a $1200 loss and the rollover High Yield is about even. How can a fund showing a +13.99% return for the year have a loss? I don't understand bonds, I'll NEVER understand bonds but I know I have to have some fixed in my portfolio. Go with either Total bond indx or intermediate term indx. Thanks for responding to my post, I have more simplifying to do. KPG

User avatar
1789
Posts: 314
Joined: Fri Aug 16, 2019 3:31 pm
Location: OR

Re: Portfolio Review

Post by 1789 » Tue Nov 19, 2019 9:44 pm

Sorry for the late response. It seems i missed this. I think understanding and utilizing bonds are key at your age. Please refer to this reading below and feel free to ask your questions.i am sure more knowledgable folks will chip in to explain if you have further questions about bonds.

https://www.thebalance.com/the-differen ... urn-417081
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)

krow36
Posts: 2251
Joined: Fri Jan 30, 2015 6:05 pm
Location: WA

Re: Portfolio Review

Post by krow36 » Tue Nov 19, 2019 10:03 pm

KPG wrote:
Sat Nov 16, 2019 8:16 pm
1789,
I have been reading posts on High Yield Corp, I think it's gone. The taxable account in High Yield is at a $1200 loss and the rollover High Yield is about even. How can a fund showing a +13.99% return for the year have a loss?
A fund in your taxable account can have capital loss on its sale if you have bought it a higher prices than its current value. It all depends on your cost basis, which is what you paid for the shares, including any dividend shares that you reinvested. The YTD return only reflects the rate of return since Jan 1 of the year. There was a significant stock market drop in Dec 2017, and the fund's value was much lower on Jan 1, 2019 than currently. A High Yield Corp Bond fund invests in junk bonds and responds to market downturns similarly to equity funds. It's not a good choice to balance out the volatility of your equity funds.

Topic Author
KPG
Posts: 55
Joined: Mon Nov 25, 2013 10:38 am

Re: Portfolio Review

Post by KPG » Wed Nov 20, 2019 10:16 pm

1789, Thanks for the very good link on bonds. My bonds are mainly for safety in a market downturn not income.
krow36, It's taking me this long to see you can lose principle on a bond. High yield is going to go, I'll have to take a loss. I can put it in Total stock or total international and not raise my allocation that much or find somewhere in tax advantage, maybe his Roth. Thanks to both of you for answering my post. KPG

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