Need serious help

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
financenewbie111
Posts: 6
Joined: Sun Aug 23, 2020 7:47 am

Need serious help

Post by financenewbie111 »

I am in a complete financial mess right now and need recommendations. We are a three person household with annual income around 600k. Been working since last 5 years and was collecting money for a down payment on a house initially and for some reason didn’t end up buying a house. Paid off student loans. While I did that the market kept rising up and I made the worst decision to timing and not getting in and I have missed this entire bull run. I am now sitting with 750k in cash and I have no idea how to deploy this money. My fear still remains that I might end up losing a chunk especially now that the market is all time high but I know I have to invest this. Our 401k is seriously risk averse as well with more with just 20 - 25 percent In stocks.Any advice will be helpful. The more specific the advice the better I will be able to enact it. Yes I already am aware that I have committed a financial blunder. Thank you for your help.
onourway
Posts: 2665
Joined: Thu Dec 08, 2016 3:39 pm

Re: Need serious help

Post by onourway »

Welcome to the forum.

Know that you are not alone - many others have made the same decisions - and that you are in the fantastic position of having both good savings and a huge shovel (income) to help straighten things out.

I would suggest you format your post as per the Asking Portfolio Questions sticky post at the top of this forum. You will get much more specific, useful advice by doing this.

:sharebeer
User avatar
arcticpineapplecorp.
Posts: 6185
Joined: Tue Mar 06, 2012 9:22 pm

Re: Need serious help

Post by arcticpineapplecorp. »

financenewbie111 wrote: Sun Aug 23, 2020 8:00 am I am in a complete financial mess right now and need recommendations. We are a three person household with annual income around 600k. Been working since last 5 years and was collecting money for a down payment on a house initially and for some reason didn’t end up buying a house. Paid off student loans. While I did that the market kept rising up and I made the worst decision to timing and not getting in and I have missed this entire bull run. I am now sitting with 750k in cash and I have no idea how to deploy this money. My fear still remains that I might end up losing a chunk especially now that the market is all time high but I know I have to invest this. Our 401k is seriously risk averse as well with more with just 20 - 25 percent In stocks.Any advice will be helpful. The more specific the advice the better I will be able to enact it. Yes I already am aware that I have committed a financial blunder. Thank you for your help.
if you want specific advice, then we need you to provide more specifics first.

please repost according to the following format:
viewtopic.php?t=6212

also read this:
https://www.bogleheads.org/wiki/Investm ... _statement

this:
https://www.bogleheads.org/wiki/Getting_started

and this:
https://www.bogleheads.org/wiki/Managing_a_windfall

we'll be here when you're ready.
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
Nowizard
Posts: 3017
Joined: Tue Oct 23, 2007 5:33 pm

Re: Need serious help

Post by Nowizard »

If your income is stable, then you have not even necessarily made an error but can reframe your decisions as being conservative based on high level of income with predicted stability. In the long run you have a marvelous opportunity to accumulate wealth, and many here will aid you in establishing a plan to invest wisely. The earlier post about presenting your data applies in order for those responses to occur. Without doing that work, you are getting opinions based on assumptions rather than your specific circumstances, and the process of preparing that post will begin your journey toward financial literacy.

Tim
dbr
Posts: 33842
Joined: Sun Mar 04, 2007 9:50 am

Re: Need serious help

Post by dbr »

One comment is that it helps to become more familiar with the nature of investing and risk in investing. One way to capture that is to notice that it is not that you might lose a chunk of what is invested but that over some periods of time you will certainly lose a chunk of what is invested. To invest you have to accept that account values will go up and down, sometimes by a lot.

My specific advice, which can sound like a broken record on this forum, is that there is a framework for thinking about how much risk to take and it is the following:

1. How much risk do you need to take investing in stocks to meet your goals. This requires doing some level of modeling of the range of results of putting money in uncertain outcomes to have a good chance to meet what you want. This also forces the even more important thought process of deciding what your goals are.

2. What is your ability to take risk. This means looking at how well you can cope with bad outcomes. It includes your potential for recovering from downturns through future years of earning and saving, what your resources are in terms of owning a home, sharing risks as a couple, how wealthy you already are, and so on.

3. What is your willingness to take risks, meaning how well prepared are you to see asset values plummet and not do something stupid, such as selling out at a market low. This exercise is partly introspection, but I think is also an exercise in psychological preparation that can be affected by training your cognitive state.

PS The posts just above are right on target.
Topic Author
financenewbie111
Posts: 6
Joined: Sun Aug 23, 2020 7:47 am

Re: Need serious help

Post by financenewbie111 »

Thank you so much for responding. I will get working on getting these details to you guys right now. Thank you again.
User avatar
Sandtrap
Posts: 11744
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii No Ka Oi , N. Arizona

Re: Need serious help

Post by Sandtrap »

Here you go:

Read About Bob, The Worst Market Timer
What happens if you only invested at market highs?
http://awealthofcommonsense.com/2014/0 ... ket-timer/

Investing Behavior Pitfalls
https://www.bogleheads.org/wiki/Behavioral_pitfalls

Oustanding suggestions prior you have gotten. :D
j :happy
Wiki Bogleheads Wiki: Everything You Need to Know
retiredjg
Posts: 41890
Joined: Thu Jan 10, 2008 12:56 pm

Re: Need serious help

Post by retiredjg »

Some people just need someone to manage their investments. You may be one of them.

I encourage you to do all the things suggested above. If you find you still cannot get started, consider using Vanguard's Personal Advisor Service to get your portfolio set up and manage it for a few years. At that point, you might be ready to take it over for yourself. The cost is very low (much less than what you have already lost in not being invested).

Vanguard is the only service I recommend because they have no financial incentive to put you in anything other than a good low cost portfolio. They also make it very easy to transition to a do it yourself approach if/when you decide that is the right thing for you.
dbr
Posts: 33842
Joined: Sun Mar 04, 2007 9:50 am

Re: Need serious help

Post by dbr »

retiredjg wrote: Sun Aug 23, 2020 8:52 am Some people just need someone to manage their investments. You may be one of them.

I encourage you to do all the things suggested above. If you find you still cannot get started, consider using Vanguard's Personal Advisor Service to get your portfolio set up and manage it for a few years. At that point, you might be ready to take it over for yourself. The cost is very low (much less than what you have already lost in not being invested).

Vanguard is the only service I recommend because they have no financial incentive to put you in anything other than a good low cost portfolio. They also make it very easy to transition to a do it yourself approach if/when you decide that is the right thing for you.
I agree this may be a good suggestion. I would reinforce the point that they will not sell you things that are rip-offs or unsuitable. The chance of both of those things happening elsewhere is very high.
Topic Author
financenewbie111
Posts: 6
Joined: Sun Aug 23, 2020 7:47 am

Re: Need serious help

Post by financenewbie111 »

Emergency funds: Available

Debt: None

Tax Filing Status:  Married Filing Jointly with one child age 2. No plans for anymore kids

Tax Rate: 25% effective Federal, 6% State

State of Residence: MA

Age: 33/ spouse 36

Desired Asset allocation:Not sure - need advice
Desired International allocation: Not sure - need advice

Cash at hand 770K

Dont own house or any other asset

Current retirement assets

His 401k/brokeragelink
135 K
Company match 50% of the first 6%
Domestic Stock 28% VXUS
Foreign Stock 7% VWOB
Bonds 12% BND
Short Term 52% CASH
Unknown 0% $0
Other 2% GLD

His Roth IRA
70K
Percent Value
Domestic Stock 20% VXUS
Foreign Stock 8% VWOB
Bonds 10% BND
Short Term 60% CASH
Unknown 0% $0
Other 2% GLD

HSA
5k
Percent Value
Domestic Stock 24% $1,196
Foreign Stock 11% $523
Bonds 17% $832
Short Term 48% $2,347
Unknown 0% $0
Other 0% $8

Her 401K
160K
Net
Domestic Stock 36%
Foreign Stock 7%
Bonds 22%
Short Term 35% Cash
Unknown 0%
Other 0%
Her ROth
41K
Current
Domestic Stock 7%
Foreign Stock 3%
Bonds 1%
Short Term CASH 89%
Unknown 0%
Other 0%

Deferred compensation
1200. Just started putting money here as receiving match

529 - started last year 12000 50:50 mix


Contributions

New annual Contributions
Maximize both our 401ks with match
Doing mega back door roths for two years and plan to keep doing that

Available funds

Have all funds available through brokerage link


I really appreciate the help you guys are giving me. Thank you.
User avatar
Taylor Larimore
Advisory Board
Posts: 29951
Joined: Tue Feb 27, 2007 8:09 pm
Location: Miami FL

Re: Need serious help

Post by Taylor Larimore »

financenewbie111 wrote: Sun Aug 23, 2020 8:00 am I am in a complete financial mess right now and need recommendations. We are a three person household with annual income around 600k. Been working since last 5 years and was collecting money for a down payment on a house initially and for some reason didn’t end up buying a house. Paid off student loans. While I did that the market kept rising up and I made the worst decision to timing and not getting in and I have missed this entire bull run. I am now sitting with 750k in cash and I have no idea how to deploy this money. My fear still remains that I might end up losing a chunk especially now that the market is all time high but I know I have to invest this. Our 401k is seriously risk averse as well with more with just 20 - 25 percent In stocks.Any advice will be helpful. The more specific the advice the better I will be able to enact it. Yes I already am aware that I have committed a financial blunder. Thank you for your help.
financenewbie111:

Welcome to the Bogleheads Forum!

"sitting on 750k in cash" is not exactly a financial blunder. It was many years before I saved that amount.

Take a look at The Three-Fund Portfolio and its many benefits. It may be what you are looking for.

Best Wishes
Taylor
Jack Bogle's Words of Wisdom: "There may be better investment strategies than owning just three broad-based index funds but the number of strategies that are worse is infinite."

"Simplicity is the master key to financial success." -- Jack Bogle
User avatar
geerhardusvos
Posts: 1128
Joined: Wed Oct 23, 2019 10:20 pm
Location: heavenlies

Re: Need serious help

Post by geerhardusvos »

financenewbie111 wrote: Sun Aug 23, 2020 9:08 am Emergency funds: Available

Debt: None

Tax Filing Status:  Married Filing Jointly with one child age 2. No plans for anymore kids

Tax Rate: 25% effective Federal, 6% State

State of Residence: MA

Age: 33/ spouse 36

Desired Asset allocation:Not sure - need advice
Desired International allocation: Not sure - need advice

Cash at hand 770K

Dont own house or any other asset

Current retirement assets

His 401k/brokeragelink
135 K
Company match 50% of the first 6%
Domestic Stock 28% VXUS
Foreign Stock 7% VWOB
Bonds 12% BND
Short Term 52% CASH
Unknown 0% $0
Other 2% GLD

His Roth IRA
70K
Percent Value
Domestic Stock 20% VXUS
Foreign Stock 8% VWOB
Bonds 10% BND
Short Term 60% CASH
Unknown 0% $0
Other 2% GLD

HSA
5k
Percent Value
Domestic Stock 24% $1,196
Foreign Stock 11% $523
Bonds 17% $832
Short Term 48% $2,347
Unknown 0% $0
Other 0% $8

Her 401K
160K
Net
Domestic Stock 36%
Foreign Stock 7%
Bonds 22%
Short Term 35% Cash
Unknown 0%
Other 0%
Her ROth
41K
Current
Domestic Stock 7%
Foreign Stock 3%
Bonds 1%
Short Term CASH 89%
Unknown 0%
Other 0%

Deferred compensation
1200. Just started putting money here as receiving match

529 - started last year 12000 50:50 mix


Contributions

New annual Contributions
Maximize both our 401ks with match
Doing mega back door roths for two years and plan to keep doing that

Available funds

Have all funds available through brokerage link


I really appreciate the help you guys are giving me. Thank you.
What do you spend per year?
What is your desired asset allocation?
Check out those links shared above.

You make enough money that if you can keep your expenses low, you can do some serious investing over the next few years. If you are investing for the long-term, do not be afraid to lump sum your cash into your desired asset allocation.
VTSAX and chill
Ostentatious
Posts: 266
Joined: Fri Aug 15, 2014 6:34 pm

Re: Need serious help

Post by Ostentatious »

I don’t see the serious problem here. You have a sizable amount of money to invest. Create a personal investment policy and invest accordingly. As for losing part of your money, you can’t change that, if you follow sound investment policy including investing in index funds, you will come up on top at the end of the day.
Topic Author
financenewbie111
Posts: 6
Joined: Sun Aug 23, 2020 7:47 am

Re: Need serious help

Post by financenewbie111 »

I believe we spent around 175K a year.
That personal investment policy is what I need help with. How to infuse the money into investments - in parts and how often over how long is what I need help with.
Again I appreciate everyone’s time and help here. This has been bothering me a lot and hence seems serious to me.
dbr
Posts: 33842
Joined: Sun Mar 04, 2007 9:50 am

Re: Need serious help

Post by dbr »

financenewbie111 wrote: Sun Aug 23, 2020 9:39 am I believe we spent around 175K a year.
That personal investment policy is what I need help with. How to infuse the money into investments - in parts and how often over how long is what I need help with.
Again I appreciate everyone’s time and help here. This has been bothering me a lot and hence seems serious to me.
If your dilemma is how fast to change your asset allocation then the theoretically "correct" answer is as fast as practical. The practically correct answer is as fast as practical, but one should use some caution at not throwing everything around at once. If you have to transfer something make sure the transfer is complete and then transfer the next thing, account by account. After the transfers are secure, then make sales one at a time. Or make the sales complete and then do transfers. Don't give a broker a chance to get confused about what goes where. If you are rolling over tax deferred do that when it is not confused with transferring into a taxable account, etc.

If you think there is some special safety or higher return in some clever plan to change asset allocation over time, then that is just not so. I say asset allocation because assets in cash are still invested and are allocated to cash with all the rights and responsibilities assigned thereto.

If you remain nervous about the whole thing it is very likely the problem is not about how fast to go but whether or not you are confident in your plan. If you don't understand the plan or are still worried about it, going slower is not going to fix any of that. So the thing to do is to work harder on the plan or get some professional (or amateur Boglehead) help with the plan.
nydoc
Posts: 146
Joined: Mon Jul 22, 2019 5:57 pm

Re: Need serious help

Post by nydoc »

How much of 750K is for down payment? This money needs to be in cash equivalents form anyway. If there is not much left after that you can invest that at 60:40 allocation and get used to it slowly.
Topic Author
financenewbie111
Posts: 6
Joined: Sun Aug 23, 2020 7:47 am

Re: Need serious help

Post by financenewbie111 »

Planing to move states and buy house in one -two years. Aiming for a down payment of 25-30 percent with price range 650-700.
delamer
Posts: 10519
Joined: Tue Feb 08, 2011 6:13 pm

Re: Need serious help

Post by delamer »

One principle that sometimes gets lost in the recommendations and theorizing on this forum is the stocks are an investment to be held for the long term. At an absolute minimum, no money that you expect to spend within the next 5 years should be held in stocks.

And the longer your time horizon, the greater percentage of your investments can be put in the stock market.

So a downpayment for a house that you plan to buy within a year or two should not be invested in any stocks. In contrast, money that you are putting into a 401(k) for your retirement in 30 years should be heavily in the stock market.

Two basic pieces of advice:

1. Invest only in low-cost, index-based mutual funds or ETFs for your stock and bond holdings.
2. Never make decisions about your long-term investments based on short-term financial/market conditions in the economy.

Read the link above about Bob, the worst market timer.

Look at this chart from Vanguard about the risk v. return for different levels of stock market allocation: https://personal.vanguard.com/us/insigh ... llocations

Consider one of these options for money that you are investing for the long-term: https://www.bogleheads.org/wiki/Lazy_portfolios

Good luck.
User avatar
JoeRetire
Posts: 5759
Joined: Tue Jan 16, 2018 2:44 pm

Re: Need serious help

Post by JoeRetire »

financenewbie111 wrote: Sun Aug 23, 2020 8:00 am I am in a complete financial mess right now and need recommendations. We are a three person household with annual income around 600k. Been working since last 5 years and was collecting money for a down payment on a house initially and for some reason didn’t end up buying a house. Paid off student loans. While I did that the market kept rising up and I made the worst decision to timing and not getting in and I have missed this entire bull run. I am now sitting with 750k in cash and I have no idea how to deploy this money. My fear still remains that I might end up losing a chunk especially now that the market is all time high but I know I have to invest this. Our 401k is seriously risk averse as well with more with just 20 - 25 percent In stocks.Any advice will be helpful. The more specific the advice the better I will be able to enact it. Yes I already am aware that I have committed a financial blunder. Thank you for your help.
You should talk with a fee-only fiduciary financial planner. They can discuss your goals, and help you come up with a plan to achieve them.
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
User avatar
Blister
Posts: 157
Joined: Fri Feb 17, 2012 8:59 am
Location: Tennessee

Re: Need serious help

Post by Blister »

You listed VXUS as domestic stock. I dont know if anyone else caught this but it is all international. VWOB is an emerging market bond fund??
Everthing works out in the end. If it doesn't then its not the end.
justsomeguy2018
Posts: 1188
Joined: Wed Oct 03, 2018 8:11 pm

Re: Need serious help

Post by justsomeguy2018 »

financenewbie111 wrote: Sun Aug 23, 2020 8:00 am I am in a complete financial mess right now and need recommendations. We are a three person household with annual income around 600k. Been working since last 5 years and was collecting money for a down payment on a house initially and for some reason didn’t end up buying a house. Paid off student loans. While I did that the market kept rising up and I made the worst decision to timing and not getting in and I have missed this entire bull run. I am now sitting with 750k in cash and I have no idea how to deploy this money. My fear still remains that I might end up losing a chunk especially now that the market is all time high but I know I have to invest this. Our 401k is seriously risk averse as well with more with just 20 - 25 percent In stocks.Any advice will be helpful. The more specific the advice the better I will be able to enact it. Yes I already am aware that I have committed a financial blunder. Thank you for your help.
I made some similar financial blunders over my lifetime so don't feel bad.

Here is what I would do:

(1) Re-allocate 401k to an appropriate allocation for someone in their mid-30s (this can be anything from 60/40 to 85/15 in my opinion). In theory you won't be touching this money for another 25 to 30 years so it is ok to not have it super conservative.

(2) Set aside your planned down payment for house and keep it in cash (by cash I mean either a MM, HYS, or penalty free CD even)

(3) Do the same thing for an Emergency Fund you are comfortable with (6 mos to 18 mos) and keep that in cash.

(4) Invest the rest in the market under the assumption that you won't be touching this money for years or decades even. If you are uncomfortable lump summing it in, you can dollar-cost average in over a period of several months. If the market tanks you can always Tax Loss Harvest to offset income taxes.
User avatar
LadyGeek
Site Admin
Posts: 66335
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: Need serious help

Post by LadyGeek »

I removed an off-topic post. As a reminder, see: General Etiquette
At all times we must conduct ourselves in a respectful manner to other posters.
Our experienced members should read: Please Do Not Bite the Newcomers
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
k b
Posts: 125
Joined: Tue Oct 15, 2013 8:43 pm

Re: Need serious help

Post by k b »

I second the idea that a fee only advisor or (even an expensive) one time consultation might help here. I get the feeling that you could afford a more aggressive portfolio, but a consultant might be able to help you realise/ acknowledge your own risk profile.
Topic Author
financenewbie111
Posts: 6
Joined: Sun Aug 23, 2020 7:47 am

Re: Need serious help

Post by financenewbie111 »

Any recommendations on a few only fiduciary advisor?
Outer Marker
Posts: 953
Joined: Sun Mar 08, 2009 8:01 am

Re: Need serious help

Post by Outer Marker »

financenewbie111 wrote: Sun Aug 23, 2020 1:51 pm Any recommendations on a few only fiduciary advisor?
Vanguard charges a reasonable 0.3%. The fact that you’re here, asking intelligent questions, tells me you don’t need one. You could do it for a year or so, then take off the training wheels and do it yourself. Or, just invest a bit of time and effort at the outset. If you post your situation here in the suggested format, you’re likely to get better advice than from most paid advisors. Take the Vanguard asset allocation quiz as a starting point for figuring out what your risk tollerance might be.
Xyz214
Posts: 76
Joined: Thu Jul 04, 2013 8:35 am

Re: Need serious help

Post by Xyz214 »

I was like you back in 2011 with smaller amount of money 500+K. I invested 10% in 2011 and invested the rest within 2 years or so. When the market dropped by more than 20%, I didn't panic and saw it as opportunity to buy more shares for my dollar. After this realization, I accelerated putting in my money to the market. I recommend you read "Investor's Manifesto" by William Bernstein. Good luck!
k b
Posts: 125
Joined: Tue Oct 15, 2013 8:43 pm

Re: Need serious help

Post by k b »

financenewbie111 wrote: Sun Aug 23, 2020 1:51 pm Any recommendations on a few only fiduciary advisor?
Vanguard's 0.3% (mentioned above) looks reasonable. I read elsewhere on this board that Rick Ferri charges ~500 dollars for one hour. Cullen Roche's ORCAM charges a few thousand $ a year.

IMO - you really only need guidance on initial asset allocation and to stay away from salesmen. Most other stuff you have mentioned above looks reasonable (again, IMHO)
User avatar
arcticpineapplecorp.
Posts: 6185
Joined: Tue Mar 06, 2012 9:22 pm

Re: Need serious help

Post by arcticpineapplecorp. »

financenewbie111 wrote: Sun Aug 23, 2020 1:51 pm Any recommendations on a few only fiduciary advisor?
https://www.garrettplanningnetwork.com/
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
retiredjg
Posts: 41890
Joined: Thu Jan 10, 2008 12:56 pm

Re: Need serious help

Post by retiredjg »

https://adviceonlyfinancial.com

This website is owned by a person who helps people find reliable "advice only" advisors. He charges a minimal fee to find and put together a list for his clients to find a suitable advisor.

Be careful of the term "fee only". That includes all the thousands of advisors who change a fixed fee to manage your assets. This is usually not the type of advisor suggested here.

Rick Ferri and Allan Roth are also advice-only advisors - not sure Roth is taking new clients though. Both are occasional posters here on this forum and both are Bogleheaded.

There are probably others. I just don't know who they are.

If you just want advice, use both this forum and an advice only advisor. If you want someone to manage your money, even temporarily, use Vanguard's PAS.
aristotelian
Posts: 8058
Joined: Wed Jan 11, 2017 8:05 pm

Re: Need serious help

Post by aristotelian »

Not getting in is different than getting out. You are probably just as well off as if you had been invested the whole time. I would suggest a conservative allocation. Then invest tomorrow like you should have all along.
chicagoperson78
Posts: 15
Joined: Mon Aug 07, 2017 2:03 am

Re: Need serious help

Post by chicagoperson78 »

financenewbie111 wrote: Sun Aug 23, 2020 10:15 am Planing to move states and buy house in one -two years. Aiming for a down payment of 25-30 percent with price range 650-700.
hi,

Having made some mistakes during the 2008 crisis, i took those learnings and did better this time around. It was hard to do something since there's a risk of loosing big and I can understand when you look at a mount this big and say you will have a 30% look -- that's huge in $$ numbers, so I get it.

My suggestion would be the following:

1. Put the $ what you need in a CD or equivalent. I know you may loose inflation for say a year and a half but it's ok if it makes you sleep well. DO NOTHING that compromises your well being and sleep!

2. Simply move the remaining to say a Vanguard brokerage account and do a ONE time decision to say enter the market in a year (or whatever you think is comfortable) and setup a buy to a total stock market fund. I understand folks will tell you that just do it one time and that's proven to be correct but we all understand that's math and probability and it doesn't seemt hat you will be most comfortable with it.

Once you do those 2 decisions, spend time with your family and do things that make you happy and give you joy.

My 2cs
retiredjg
Posts: 41890
Joined: Thu Jan 10, 2008 12:56 pm

Re: Need serious help

Post by retiredjg »

I'm going to change how the portfolio is displayed - it will make more sense to you and to us. That might help you make some decisions. However, I'm running into some problems that you need to clarify.


financenewbie111 wrote: Tax Rate: 25% effective Federal, 6% State
We need to know what your tax bracket is. An effective rate is not a helpful number for what we are doing here. Do you know how to determine your tax bracket?


Desired Asset allocation:Not sure - need advice
Desired International allocation: Not sure - need advice
Let's figure out what you have now. That might help you make a decision. For your ages, anything between about 20% bonds and 35% bonds might be a place to start thinking about.




Cash at hand 770K - $220 for down payment = $550k to be invested.


Retirement Portfolio

Taxable. $550k
cash

His 401k/brokeragelink 135k
Domestic Stock 28% VXUS. VXUS is not domestic stock - it is foreign stock. Do you have any domestic stock here?
Foreign Stock 7% VWOB VWOB is not foreign stock. It is foreign bonds. Do you have any foreign stock?
12% BND
52% CASH
2% GLD

His Roth IRA 70K
Domestic Stock 20% VXUS VXUS is not domestic stock - it is foreign stock. Do you have any domestic stock here?
Foreign Stock 8% VWOB VWOB is not foreign stock. It is foreign bonds. Do you have any foreign stock?
10% BND
60% CASH
2% GLD


HSA $5k. Same questions as above. What do you really have in this account?
Domestic Stock 24% $1,196
Foreign Stock 11% $523
Bonds 17% $832
Short Term 48% $2,347
Other 0% $8


Her 401K 160K. Same questions as above. What do you really have in this account?

Domestic Stock 36%
Foreign Stock 7%
Bonds 22%
Short Term 35% Cash
Unknown 0%
Other 0%

Her ROth 41k Same questions as above. What do you really have in this account?
41K

Domestic Stock 7%
Foreign Stock 3%
Bonds 1%
Short Term CASH 89%
Unknown 0%
Other 0%

Deferred compensation $1200. Who's account is this? Is it a governmental 457? A non-governmental 457?




529 - started last year 12000 50:50 mix - removing this from retirement portfolio

New annual Contributions
Maximize both our 401ks with match
Doing mega back door roths for two years and plan to keep doing that
We need to know how many dollars you are putting into each account each year, including the match. An approximation will do.

Are you really doing mega back door Roth? That involves your 401k plans. Or could you actually be doing plain old back door Roth.


Have all funds available through brokerage link
We don't know what that means. Where are these plans held? That might help.


I know I've asked a lot of questions, but they are all needed to figure out what you have. Once you can see what you have, you will have a better idea of where to go.

It seems you have copied some kind of spreadsheet. Something went wrong. And we actually need to know what funds you are holding (by name), not their asset class.
suemarkp
Posts: 381
Joined: Sun Nov 12, 2017 8:18 pm
Location: Kent, WA

Re: Need serious help

Post by suemarkp »

You make 3 times what you spend. You are in the accumulation phase where you can afford to lose some money. When you hit 50 then you want to look at preservation of what you have unless you plan to retire very early.

You can lose money two ways - suffering a market drop or putting your money in low yield "safe" places where you lose to inflation. Long term, stocks have shown to yield above inflation. That doesn't mean you won't have years when you lose money, but the growth tends to be high especially just before it crashes.

You will be fine if you save your excess funds (300k+ per year) and just leave them in the low yield cash fund. But you will need to contribute more money for a given size nest egg if you avoid stocks. You just need to decide do you want safe or have more money in the end but with volatility. The latter approach let's you retire sooner or spend more.
Mark | Kent, WA
Post Reply