Portfolio Review: 2020 plans

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Joined: Thu Mar 28, 2019 8:00 am

Portfolio Review: 2020 plans

Post by planetmike » Wed Jan 08, 2020 12:09 pm

I'm working full-time, wife is on permanent disability, receiving social security and a monthly disability check.

Emergency funds: Yes, funded for six months, in a HYSA
Debt: None, no mortgage anymore.
Tax Filing Status: Married Filing Jointly
Tax Rate: 15% Federal, 5.75% State
State of Residence: Virginia
Age: Me: 51, Wife: 48

Desired Asset allocation: 75% stocks / 25% bonds
Desired International allocation: 0% of stocks

Total Portfolio: $175,000

Current retirement assets

HYSA for emergency fund, fully funded

His 403b at Wells Fargo
  • 0.7% Vanguard Institutional Target Retirement 2035 Fund (VITFX) (0.09%)
His Roth IRA at Vanguard
  • 17.2% Vanguard Total Stock Market Index Admiral (VTSAX) (0.04%)
His Traditional IRA at Vanguard
  • 38.4% Vanguard Total Stock Market Index Admiral (VTSAX) (0.04%)
  • 12.9% Vanguard Total Bond Market Index Admiral (VBTLX) (0.05%)
Her 403b at Invesco
  • 13.0% Invesco Diversified Dividend A (LCEAX) (0.81%)
From an old job now on disability, can't roll it over until retirement or no longer disabled and can resign.

Her Roth IRA at Vanguard
  • 15.9% Vanguard Total Stock Market Index Admiral (VTSAX) (0.04%)
Her Traditional IRA at Vanguard
  • 1.9% Vanguard Total Bond Market Index Admiral (VBTLX) (0.05%)
Total: 100%. Equities: 85%, Bonds: 15%.

New annual Contributions
$350 his 403b (no employer matching contributions)
$7,000 his IRA/Roth IRA
$6,000 her IRA/Roth IRA

Funds available in her 403(b) at Invesco
There is a huge list of funds available at: https://www.invesco.com/us/financial-pr ... erformance

Looking through it, there isn't much to get excited about. Looking at these:
  • Invesco Peak Retirement 2035 Fund;A (PKKMX) (0.41%)
  • Invesco S&P 500 Index Fund;A (SPIAX) (0.55%)
1. Still working to get to our desired asset allocation. In 2019 we invested into VBTLX in our traditional IRAs. Should I sell off some VTSAX and buy VBTLX in my traditional IRA?

2. Then our 2020 contributions will go into VTSAX in our Roth IRAs?

3. I'm not thrilled with being stuck at Invesco for her 403b. Should we move out of LCEAX into something else? Choices are exhaustive, but I'm not seeing anything like a VBTLX or even VTSAX as an option.

4. I'm still learning, but our next big decision will be the international aspect of the equities.

Thank you very much for your guidance. Mike

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Re: Portfolio Review: 2020 plans

Post by brad.clarkston » Wed Jan 08, 2020 12:43 pm

I don't see any glaring "why did you do that?" type of questions in your port.

Question #1) What does your IPS tell you? That's a trite little answer I know but it comes down to do you need to balance the overall port to get more bonds ? If you do then yes, if you don't then let it ride. It looks like your at about 15%/16% overall in bonds for the full retirement plan is that where you want to be?

Question #2) Also depends on your IPS do you need to build more stock positions or bond postilions to reach your desired goals? If nether then split it between them to keep your desired percentages.

Question #3) I would dump all of it into one of the Peak Retirement dated funds and be done with it unless you have the time to become a Invesco expert and break down all there funds and min/max the investment but since it's only 13% I wouldn't bother.

Question #4) Do you want International stock funds (stay away from bonds) ? It's not really a given that you need them.

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Re: Portfolio Review: 2020 plans

Post by ExitStageLeft » Wed Jan 08, 2020 1:51 pm

I would add the Invesco OSDAX fund to consideration in her 403b.

OSDAX Invesco Oppenheimer Ultra-Short Duration Fund 0.38%

You could use all 13% as part of your bond allocation. That would give you an overall lower ER.

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Re: Portfolio Review: 2020 plans

Post by planetmike » Wed Jan 29, 2020 11:22 pm

Thank you for your help. We ended up deciding to go into the Peak 2035 fund.

It was an ordeal to do this. We spent a long time on the phone with a customer service rep. In order to make any changes to the account, we had to physically mail a letter signed by my wife with the order/request to change. We got that mailed last Wednesday, it was executed today.

I never would recommend anyone use Invesco for any kind of investing. Their processes are byzantine. We ended up there when Dean Witter merged with Morgan Stanley, then they sold off their university retirement system to Invesco, and now we are stuck there.

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