Portfolio Advice

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Topic Author
Abk911
Posts: 200
Joined: Thu Aug 09, 2018 1:22 pm

Portfolio Advice

Post by Abk911 »

Dear Friends:

I decided the best way was to actually show the portfolio here and decide the right path basis guidance from the kind team here:

AGE:

Age 42 / Spouse 40
State CA

Approx numbers rounded off:

Total: Emergency Fund: 75k ..... Cash: 50k Ally + CD: 25K Ally

Retirement / Deeferred: 100+75+5.5+5.5= 186K

401K Mine: 100k (TF: 2045)
Spouse: 75k (TF: 2040)
IRA. Mine 5.5k (TF: 2045)
IRA Spouse: 5.5k (TF: 2040)

Taxable: total: 45+4+4+4+4+4=65k

Stocks Mostly all Tech company Stocks: 45k worth ETRADE

Then I have: APROX numbers below
VTSAX: 4K (now on DCA per week deposits for VTSAX only)
VGT: 4K
VTI: 4K
VOO: 4k
MGK: 4K

Any idea how should i proceed? and if i am missing on anything. Just to clarify the 4k Vanguard funds u see were cold feet experimentation. Not sold them cause of high CA taxation.

Loans:
Mortgage 28 years left :( : 8k per month including property tax
2 CARS... 1100 per month total. (700 per month for purchased car (plan to keep for good) and 400 per month for a leased car)

May get a 20k cash upside... thinking if i shld buy back my leased car (for 27k) or buy a tesla model 3 for 47k. Tesla will save per month on gas. whatever I decide would like to hold the car for 7 years.
Last edited by Abk911 on Wed Dec 04, 2019 11:25 pm, edited 2 times in total.
Flyer24
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Re: Portfolio Advice

Post by Flyer24 »

It is best to edit your post and follow the format in this link.

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Topic Author
Abk911
Posts: 200
Joined: Thu Aug 09, 2018 1:22 pm

Re: Portfolio Advice

Post by Abk911 »

updated
Last edited by Abk911 on Wed Dec 04, 2019 11:26 pm, edited 1 time in total.
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big bang
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Re: Portfolio Advice

Post by big bang »

My first observation is that the level of expenses that you have listed is presenting a picture of a high earner. However, relative to the expenses the level of the savings for your age is very low.
This is only a guess and without knowing your numbers, but you need to find a way to increase your contributions to save more (much more..).
(1) save a lot, (2) select an asset allocation containing both stock and bond asset classes, (3) buy low cost, widely diversified funds, (4) allocate funds tax-efficiently, and (5) stay the course.
Topic Author
Abk911
Posts: 200
Joined: Thu Aug 09, 2018 1:22 pm

Re: Portfolio Advice

Post by Abk911 »

u are correct. the issue is that a NC residence moved to CA... about 5 years ago. So while salary increased, the NC savings for the NC salary... did not help at all.
  • So the first 10 years of career due to the move are a wash out.
  • much of savings went in downpayment on CA home... that knocked off lot of the cash... almost 200-250k
  • Wife was not always working. Only last 4 years.
  • Also, child care takes away 2k a month ... so affects savings further
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big bang
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Re: Portfolio Advice

Post by big bang »

Abk911 wrote: Wed Dec 04, 2019 11:16 pm Loans:
Mortgage 28 years left :( : 8k per month including property tax
2 CARS... 1100 per month total. (700 per month for purchased car (plan to keep for good) and 400 per month for a leased car)
Housing and car expenses are holding you back. You will need to see how you can reduce those.
(1) save a lot, (2) select an asset allocation containing both stock and bond asset classes, (3) buy low cost, widely diversified funds, (4) allocate funds tax-efficiently, and (5) stay the course.
Topic Author
Abk911
Posts: 200
Joined: Thu Aug 09, 2018 1:22 pm

Re: Portfolio Advice

Post by Abk911 »

thanks. any suggestions on the investment portfolio changes itself?
retired@50
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Location: Living in the U.S.A.

Re: Portfolio Advice

Post by retired@50 »

Abk911 wrote: Wed Dec 04, 2019 11:16 pm Dear Friends:
...

401K Mine: 100k (TF: 2045)
Spouse: 75k (TF: 2040)
IRA. Mine 5.5k (TF: 2045)
IRA Spouse: 5.5k (TF: 2040)

Taxable: total: 45+4+4+4+4+4=65k

Stocks Mostly all Tech company Stocks: 45k worth ETRADE

Then I have: APROX numbers below
VTSAX: 4K (now on DCA per week deposits for VTSAX only)
VGT: 4K
VTI: 4K
VOO: 4k
MGK: 4K

Any idea how should i proceed? and if i am missing on anything. Just to clarify the 4k Vanguard funds u see were cold feet experimentation. Not sold them cause of high CA taxation.
Your ETFs MGK & VGT are tech focused which puts you overweight in tech, in addition to the 45K worth of undisclosed tech stocks. This is likely a mistake since being this much overweight in a single sector puts you at much higher risk. VTSAX and VTI are two different share classes of the same total stock market index fund. This seems peculiar, but isn't really a problem. You're likely to be better off if you try to sell the tech focused investments over the next several years. At a minimum, stop re-investing any dividends so you don't buy any more tech stocks or ETFs. Stick with VTSAX or VTI for the total stock market index fund, then use VTIAX or VXUS for a total international stock fund. These two "total market" funds will cover the entire world nicely, at appropriate weight.

As far as the target date funds go for the 401k, I'd say that's fine. It appears to be keeping you balanced across stocks and bonds, and international stocks as well.

Best of luck.
This is one person's opinion. Nothing more.
02nz
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Re: Portfolio Advice

Post by 02nz »

Why have you been putting money into taxable when you clearly aren't (or haven't been) maxing out tax-advantaged? Bad idea for a number of reasons.

And ... "thinking if i shld buy back my leased car (for 27k) or buy a tesla model 3 for 47k. Tesla will save per month on gas." I'm a big fan of Teslas but buying a 47K car to save maybe $100/mo on gas ... this is the kind of math that has gotten you where you are, no offense.
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Wiggums
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Re: Portfolio Advice

Post by Wiggums »

I would not overweight in tech. I think you need to max out tax advantaged accounts before taxable.

Between house and cars, your annual expenses are 109k. I understand that your in an expensive area, but I would focus on your reducing spending so you can build a nice retirement balance. I’d buy a $20,000 car and run it until it died.

I don’t recall if you are saving for college.

Good luck to you.
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dogagility
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Re: Portfolio Advice

Post by dogagility »

Wiggums wrote: Thu Dec 05, 2019 5:35 am I would not overweight in tech. I think you need to max out tax advantaged accounts before taxable.

Between house and cars, your annual expenses are 109k. I understand that your in an expensive area, but I would focus on your reducing spending so you can build a nice retirement balance. I’d buy a $20,000 car and run it until it died.
I agree with Wiggums' advice.
Turn off dividend reinvestment in your taxable holdings and put this toward tax-deferred retirement accounts.
With the 20k "upside" cash you will have, purchase a car for 20K or less. Tesla's are sweet but won't do your household budget any favors. As for the lease, run the numbers to determine if it's better to get out now or wait until the lease ends. Then, the suggestion would be to not lease any more cars.
All children spill milk. Learn to smile and wipe it up. -- A Farmer's Wife
Topic Author
Abk911
Posts: 200
Joined: Thu Aug 09, 2018 1:22 pm

Re: Portfolio Advice

Post by Abk911 »

Thanks everyone. Good advice here.

This year onwards I have been maxing the 401k for me and wife and also Roth IRAs... any other tax deffered angle that i am missing.

also ... i take your feedback seriously. Condiering my earnings are high only after i moved to the bay which was in 2011... where should i have been ball compared to where i am ... if i had done this the right way.
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dogagility
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Re: Portfolio Advice

Post by dogagility »

Abk911 wrote: Thu Dec 05, 2019 1:24 pm This year onwards I have been maxing the 401k for me and wife and also Roth IRAs... any other tax deffered angle that i am missing.
Yes. A Health Savings Account. The name wouldn't suggest this, but for many people, it's one of the best retirement savings vehicles available. https://www.bogleheads.org/wiki/Health_savings_account
All children spill milk. Learn to smile and wipe it up. -- A Farmer's Wife
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