All in on VTSAX

[JohnDindex]

At one point in time I held all VT or 50/50 us/international. I have never felt totally comfortable with international equities. At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. I think this plan is good enough, and beautifully simple. When I am older I will add some fixed income, either cds or BND. Right now just some cash and the rest in VTSAX.

Have any of you reached the same conclusion?

I know many disagree and that is OK with me. I just sold some deeply discounted shares in VXUS for you to pick up and get rich on.

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

John D

[l1am]

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

What could make you regret your decision?

[simplesimon]

If the move was really for simplicity, how is VTI more simple than VT?

[JohnDindex]

Because I do not want to invest money in international stocks.

[JohnDindex]

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

What could make you regret your decision?

I’m not sure, if something does I will do a post. With the information I have at this time, I feel unlikely to regret it.

[DesertDiva]

... At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. I think this plan is good enough, and beautifully simple. When I am older I will add some fixed income, either cds or BND...

... I just sold some deeply discounted shares in VXUS for you to pick up and get rich on.

If I regret my decision and decide to switch back...

John D

Is this a plan you can stick with? Will you change your mind down the road? Recall The Bogleheads® Philosophy:

1 Develop a workable plan
2 Invest early and often
3 Never bear too much or too little risk
4 Never try to time the market
5 Use index funds when possible
6 Keep costs low
7 Diversify
8 Minimize taxes
9 Keep it simple
10 Stay the course

I would work on your IPS and develop a plan that meets your needs. The next time you want to make changes, go back to your IPS and ask yourself why you feel compelled to change your strategy.

[jebmke]

Deleted

[NYCPete]

At one point in time I held all VT or 50/50 us/international. I have never felt totally comfortable with international equities. At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. I think this plan is good enough, and beautifully simple. When I am older I will add some fixed income, either cds or BND. Right now just some cash and the rest in VTSAX.

Have any of you reached the same conclusion?

I know many disagree and that is OK with me. I just sold some deeply discounted shares in VXUS for you to pick up and get rich on.

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

John D

I guess I'm curious why you held international in the first place if you never felt comfortable? You created an Investment Policy Statement back in early 2018 that included international.

viewtopic.php?f=1&t=242801

What exactly changed between 2018 and now to make you want to drop an entire asset class? International has underperformed U.S., sure. But it's not like Int'l has been some roller coaster ride that wasn't happening in VTSAX too. In my opinion, I think it's important that you can be honest with yourself about why you're doing this. (And this is far more important than being honest with Bogleheads.)

Methinks you're justifying bailing on int'l because it has underperformed US by saying you're "[not] totally comfortable" with international equities.
Also, by my read, it looks from this current post topic like you've bailed on your IPS plan for bonds as you age.

Why isn't this topic about a wholesale change of your IPS , not US vs int'l?

Sincerely,
Peter

[anon_investor]

At one point in time I held all VT or 50/50 us/international. I have never felt totally comfortable with international equities. At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. I think this plan is good enough, and beautifully simple. When I am older I will add some fixed income, either cds or BND. Right now just some cash and the rest in VTSAX.

Have any of you reached the same conclusion?

I know many disagree and that is OK with me. I just sold some deeply discounted shares in VXUS for you to pick up and get rich on.

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

John D

VTSAX and chill, sounds like a winning strategy!
Disclaimer: I hold 0 international

[All Seasons]

This sounds like a really imprudent plan motivated by recency bias and performance chasing.

[NYCPete]

From your IPS in 2018. Emphasis mine.

I am am a new poster but a long time reader. Over a year ago I created an IPS. Today, I almost made a decision to do something that is not in my IPS, that more than likely would have been risky, and not very smart. I am a recovering single stock investor...I'll leave it at that. The IPS saved me, I read it and felt stupid for even considering my old habits.

Anyways, I had my best returns ever in 2017 by holding a very simple portfolio...and not doing any tinkering. See below IPS, Thanks for keeping me on track.

Investment Policy:

Focus on controlling what you can, and nothing more. Costs, Taxes, and asset allocation.

Globally diversified and low cost portfolio. ⅓ of equities in international. Total market indexes preferred.

No slicing, dicing, tilts etc. Historical behavior has shown that I cannot maintain a high level of conviction and am best suited to stick with total market. S&P 500 index would be fine in place of total us market if it is the only option. Would not feel a need to add completion index.

Bonds, Age 30-34 90/10, 35-39 85/15, 40-44 80/20, 45-49 75/25, 50-54 70/30, 55-59 65/35, 60+ 60/40

Rebalance once per year on birthday. New money should should be applied to asset that is underweight.

Asset Location: Attempt to keep bond allocation in tIRA/401k, second choice would be Municipal bonds in taxable. Bonds in Roth IRA would be third choice. MM account for emergency fund in taxable and or savings account at bank.

It looks like the past version of you predicted this. Maybe you should think about Target Retirement Funds. Not everyone is cut out for DIY investing.

Sincerely,
Peter

[ruralavalon]

At one point in time I held all VT or 50/50 us/international. I have never felt totally comfortable with international equities [emphasis added]. At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. I think this plan is good enough, and beautifully simple. When I am older I will add some fixed income, either cds or BND. Right now just some cash and the rest in VTSAX.

Have any of you reached the same conclusion?

I know many disagree and that is OK with me. I just sold some deeply discounted shares in VXUS for you to pick up and get rich on.

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

John D

You need an asset allocation that makes you comfortable, not an asset allocation that makes other people comfortable.

[Laundry_Service]

Earlier this year I sold all of my international (VXUS). This was about 25% of my portfolio and I've held onto it for a long time. I'm comfortable moving on from international no matter how things turn out. I'm mostly VTI now and a handful of individual companies.

[bg5]

Wife and I are 100% VTSAX and we have 300k invested all in VTSAX.

I sleep very well at night but I have high risk tolerance and didn’t blink an eye during these crazy market swings.

[tibbitts]

It's a slippery slope from "All in on VTSAX" to "All in on TSLA."' Or substitute the individual stock or sector ETF of your choice.

[LiveSimple]

You plan is good as golden, just "Stay the course"

After reading some books and here, you have come with your plan that you can "stay on" for a long time.

Also you do not need to collect funds, to invest wisely, less is more. Enjoy.

[LiveSimple]

It's a slippery slope from "All in on VTSAX" to "All in on TSLA."' Or substitute the individual stock or sector ETF of your choice.

Not necessarily, if you believe in indexing you will never buy individual stocks again....if you do either you become super wealthy or the opposite.
Your choice, your money, your outcome !!!

[tibbitts]

It's a slippery slope from "All in on VTSAX" to "All in on TSLA."' Or substitute the individual stock or sector ETF of your choice.

Not necessarily, if you believe in indexing you will never buy individual stocks again....if you do either you become super wealthy or the opposite.
Your choice, your money, your outcome !!!

Index funds or etfs can be extremely concentrated. If you restrict your index choice to domestic-only due to outperformance, why not restrict yourself to growth if that outperforms? And if megacap growth outperforms smaller growth, then why not a megacap growth index?

[aktx97]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

[LiveSimple]

It's a slippery slope from "All in on VTSAX" to "All in on TSLA."' Or substitute the individual stock or sector ETF of your choice.

Not necessarily, if you believe in indexing you will never buy individual stocks again....if you do either you become super wealthy or the opposite.
Your choice, your money, your outcome !!!

Index funds or etfs can be extremely concentrated. If you restrict your index choice to domestic-only due to outperformance, why not restrict yourself to growth if that outperforms? And if megacap growth outperforms smaller growth, then why not a megacap growth index?

Mega cap growth index is not equal to Tesla

[anon_investor]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

FYI in a taxable account FZROX has the potential to be less tax effcient than an ETF. You might consider buying an ETF (VTI or ITOT) instead.

[ruralavalon]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

Is there no work-based plan available to you, like a 401k or 403b?

[anthonyphamy]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

FYI in a taxable account FZROX has the potential to be less tax effcient than an ETF. You might consider buying an ETF (VTI or ITOT) instead.

How come an ETF would be more tax efficient? I currently hold both VTSAX and VTIAX in my taxable account. Thank you!

[tibbitts]

It's a slippery slope from "All in on VTSAX" to "All in on TSLA."' Or substitute the individual stock or sector ETF of your choice.

Not necessarily, if you believe in indexing you will never buy individual stocks again....if you do either you become super wealthy or the opposite.
Your choice, your money, your outcome !!!

Index funds or etfs can be extremely concentrated. If you restrict your index choice to domestic-only due to outperformance, why not restrict yourself to growth if that outperforms? And if megacap growth outperforms smaller growth, then why not a megacap growth index?

Mega cap growth index is not equal to Tesla

Maybe you missed the "Or substitute the individual stock or sector ETF of your choice" part. The point is that if you base exclusions on past performance, you have to decide where to stop. And, since TSLA wasn't a megacap last I looked, let's try this:

Index funds or etfs can be extremely concentrated. If you restrict your index choice to domestic-only due to outperformance, why not restrict yourself to growth if that outperforms? And if large-cap growth outperforms smaller growth, then why not a large-cap-growth index? And if TSLA outperforms other large-cap growth index members over a certain period of time, why not TSLA instead of a large-cap-growth index?

[ruralavalon]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

FYI in a taxable account FZROX has the potential to be less tax effcient than an ETF. You might consider buying an ETF (VTI or ITOT) instead.

How come an ETF would be more tax efficient? I currently hold both VTSAX and VTIAX in my taxable account. Thank you!

At Vanguard the ETF is just a share class of the mutual fund, and the mutual fund is just as tax-efficient a the ETF.

That unique fund structure doesn't exist at other fund companies, and in general an ETF will be more tax-efficient than a regular mutual fund.

Wiki article, ETFs vs mutual funds, "Tax-efficiency" .

[arcticpineapplecorp.]

I started investing in 1998. At that time I knew nothing about international so I owned US only. From 2000-2009 my returns would have been better had I held international alongside US.

In 2013 I leared about international and started investing there (30% of equities)

I've been doing that ever since since US has gone up more than international. Good for my 70% US, not as good for my international.

you can say my returns would have been better US only but:
1. you only know something in hindsight
2. I like buying equities that are cheaper (which is what I did buying US from 2000-2009 and then international since 2013).

you are free to keep buying more expensive equities, but the goal is to buy lower, not higher.

you are taking country risk, which showed up from 2000-2009 and could show up again, as US returns going forward are expected to be lower than international.

[bloom2708]

This sounds like a really imprudent plan motivated by recency bias and performance chasing.

The OP and me and others will just have to live without all that future outperformance from International.

[anthonyphamy]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

FYI in a taxable account FZROX has the potential to be less tax effcient than an ETF. You might consider buying an ETF (VTI or ITOT) instead.

How come an ETF would be more tax efficient? I currently hold both VTSAX and VTIAX in my taxable account. Thank you!

At Vanguard the ETF is just a share class of the mutual fund, and the mutual fund is just as tax-efficient a the ETF.

That unique fund structure doesn't exist at other fund companies, and in general an ETF will be more tax-efficient than a regular mutual fund.

Wiki article, ETFs vs mutual funds, "Tax-efficiency" .

Thank you for that clarification and the link!

[geerhardusvos]

At one point in time I held all VT or 50/50 us/international. I have never felt totally comfortable with international equities. At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. I think this plan is good enough, and beautifully simple. When I am older I will add some fixed income, either cds or BND. Right now just some cash and the rest in VTSAX.

Have any of you reached the same conclusion?

I know many disagree and that is OK with me. I just sold some deeply discounted shares in VXUS for you to pick up and get rich on.

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

John D

I (like many others here) am a huge proponent of the TSM approach, and while ~80% of my assets are in VTSAX, I have ~20% in total international institutional shares in my 401K. My taxable account is ~100% VTSAX. You don’t need international. I have come to the conclusion that I would like some international exposure because the US stock market does not always outperform internationals (despite it doing so over the long haul). In someways my international stock is my bond allocation. I have almost no bonds.

Ultimately, whatever you choose, stop messing with it. Stick with your asset allocation for the long-haul. That’s the way to be successful.

[climber2020]

This move would have been way more impressive if domestic stocks had performed like garbage for the last 10+ years.

If domestic stocks perform like garbage for the next 10 years and international goes up 300% in the same period, will you stick to the plan?

[RJC]

100% VTSAX and I sleep well at night. Simple and efficient.

I can't imagine a scenario where INTL is crushing it while the US is stagnant especially with these current global businesses.

[aktx97]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

FYI in a taxable account FZROX has the potential to be less tax effcient than an ETF. You might consider buying an ETF (VTI or ITOT) instead.

The FZROX will be in my Roth and eventually one of those self-employed 401(k)s and an HSA account. I don't think I'll open a taxable account for a while.

[KlangFool]

OP,


If you can change your IPS based on your feeling at the moment, what is there to stop you from changing again? Nothing.


Pick a target retirement fund instead. You are not ready for a 3-funds portfolio yet. You cannot stop yourself from tinkering.


KlangFool

[anon_investor]

I'm 31 and just now starting my investing journey. I plan on buying FZROX and nothing else every month for at least the next decade.

FYI in a taxable account FZROX has the potential to be less tax effcient than an ETF. You might consider buying an ETF (VTI or ITOT) instead.

The FZROX will be in my Roth and eventually one of those self-employed 401(k)s and an HSA account. I don't think I'll open a taxable account for a while.

Perfectly good plan then!

[Pill]

I have recently switched to one fund, VTSAX. To include my Childs 529.

I'm 45, with 750k. And I sleep very well at night.

[Hiker8]

I think it’s a fine move. Simple and diversified. Most companies in the index are globally diversified as it is. You’ll find a lot of folks here wringing their hands huffing and puffing about not sticking to your IPS. Most have good intentions but some are just stubborn and speaking from their own experience and can’t seem to understand why anybody else might think differently. A little change here and there is fine in my opinion. Sure, maybe it breaks the “rules” a little, but you’re still adhering to index fund investing and are still broadly diversified.

[clown]

I share your basic structure and am quite comfortable with it.

As a retired person, I target 5 years withdrawals in cash with 100% of the rest in S&P500 index fund VOO. Could just as easily been VTSAX. The purpose of the large cash position to to insulate me from market swings. The market could be down for years before I would have to sell at a loss. I believe the possibility of that happening is very remote. When the market zigs and zags, as has happened recently with COVID jitters, I sleep like a baby. Reset once a year; sell some VOO if the market within 5% of its high, do nothing if the market is doing poorly. Simple. Easy for wife or heis to manage if I become incapacitated.

[lostdog]

This sounds like a really imprudent plan motivated by recency bias and performance chasing.

Correct. Prominent members will applaud him for it also. This board is turning into $#@#&. Bogleheads on reddit is the place to be.

[lostdog]

You plan is good as golden, just "Stay the course"

After reading some books and here, you have come with your plan that you can "stay on" for a long time.

Also you do not need to collect funds, to invest wisely, less is more. Enjoy.

I doubt they'll stay the course when they couldn't even stay the course the first time.

[lostdog]

This move would have been way more impressive if domestic stocks had performed like garbage for the last 10+ years.

If domestic stocks perform like garbage for the next 10 years and international goes up 300% in the same period, will you stick to the plan?

I doubt it.

[lostdog]

OP,


If you can change your IPS based on your feeling at the moment, what is there to stop you from changing again? Nothing.


Pick a target retirement fund instead. You are not ready for a 3-funds portfolio yet. You cannot stop yourself from tinkering.


KlangFool

+1000

[lostdog]

I think it’s a fine move. Simple and diversified. Most companies in the index are globally diversified as it is. You’ll find a lot of folks here wringing their hands huffing and puffing about not sticking to your IPS. Most have good intentions but some are just stubborn and speaking from their own experience and can’t seem to understand why anybody else might think differently. A little change here and there is fine in my opinion. Sure, maybe it breaks the “rules” a little, but you’re still adhering to index fund investing and are still broadly diversified.

It actually sounds like you're justifying that it's OK to tinker and move in and out of funds to chase performance.

[Taylor Larimore]

Bogleheads:

Stocks in The Three Fund Portfolio are 80% U.S. and 20% International. You can read my reasoning here (it's a compromise):

How Much International Stock? A Suggestion

Best wishes.
Taylor

Jack Bogle's Words of Wisdom (2010): "I continue to believe it is not necessary to stray too far from home."

[Trader Joe]

At one point in time I held all VT or 50/50 us/international. I have never felt totally comfortable with international equities. At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. I think this plan is good enough, and beautifully simple. When I am older I will add some fixed income, either cds or BND. Right now just some cash and the rest in VTSAX.

Have any of you reached the same conclusion?

I know many disagree and that is OK with me. I just sold some deeply discounted shares in VXUS for you to pick up and get rich on.

If I regret my decision and decide to switch back, I will come here and eat crow with another update.

John D

Yes I reached the same conclusion as you. You have a great plan.

FYI, I am 100% VFIAX and I am very happy with my investment results.

[drdrgolf]

I guess I am getting too old to post here. As I read through this topic I am amazed how SNARKY some people can be. In old fashion verbiage, I would say Peter let is NYC personality overpower his thoughts. I remember when posters were taken as peers on this site without spelling corrections or suggesting that posters were maybe not accurately stating their posts. Let's go back to posting your response without the snarkiness.
Dominic

[pkcrafter]

At one point in time I held all VT or 50/50 us/international. I have never felt totally comfortable with international equities. At the beginning of this year I dropped my exposure to under 25%. Recently I dropped it to Zero. I feel much better now. .

Just a note to say think you. Finally I'll get some outperformance from my 20% international.



Paul

[drumboy256]

On my slow journey of trying to become a passive investor, I've now moved from 10-20% of international to now just having 5-10% of international exposure. Why? The reality is the world runs from the capitalistic front--- which right now is the US. Will that change? Perhaps, but honestly, my only real international hedge is emerging markets which I think will grow faster than most think.

It's funny, as I'm trimmed exposure and risk, I personally have the following layout:
70% US (VTI)
10% INTL (VXUS)
20% Bonds (50/50 split of BND/FUAMX)

and the future state I want to be in:
75% US (VTI)
5% INTL (VXUS)
20% Bonds (aforementioned)

But hey--- everyone is different.

[JoMoney]

I've been effectively "all in on VTSAX" but really I use S&P 500 index funds (VFIAX, VINIX, FXAIX) since 2008.
Prior to being in a simple portfolio of all in on a broad US market index portfolio I held a large portfolio of individual stocks, which included a handful of stocks in giant multi-nationals that would have been considered "international". At one point I even held a small amount in VT (Vanguard's Total World ETF).
Maybe I am a "American Exceptionalist", but I'm not really sure what people mean when they say that. On this board I see that term thrown around in a pejorative sense, alluding to something that I don't think it means. I've never been an investor in "Emerging Markets", I'll skip naming specific countries, but their are risks and concerns that just don't sit well with me, and it's just been a "hard pass", I'll sleep better even if I'm missing out on some explosive future growth. Regardless, I don't have big issues with most of broad international stocks, I just don't think it's necessary for a reasonably diversified portfolio, and creates additional pieces to manage/complexity, along with tax concerns and fees, and issues I was trying to get away from in my portfolio.
I was eventually persuaded by Mr. Bogle and Warren Buffett's advice and came to the conclusion that the opportunities for errors and behavioral issues I was creating in my more complex stock-picking portfolio wasn't adding anything, if anything it was an investment strategy with much greater risks.
The results I've had since 2008 have been relatively great, I've seen the struggles international and slice-n-dice factor investors have had. Several years back, the historical returns for the S&P 500 vs a slice-n-dice portfolio did not look so good. I managed to stick with my plan, and stoutly resist temptations to explore other investments that looked (in hindsight) more lucrative. I expect periods where other things perform better will occur again, I hope the simplicity of my portfolio will help me stay the course... but I do wonder if some of those recently getting on board are just chasing recent performance. Hopefully they know themselves.

[Taylor Larimore]

FYI, I am 100% VFIAX (Vanguard 500 Index Fund) and I am very happy with my investment results.

Trader Joe:

I don't know your age or financial situation, but it is a good idea to never have more in stocks than you can afford to lose. (I remember when the Dow plunged 89%).

Best Wishes
Taylor

Jack Bogle's Words of Wisdom: "As we age, we usually have (1) more wealth to protect, (2) less time to recoup severe losses, (3)greater need for investment income, and (4) perhaps an increased nervousness as markets jump around. All four of those factors clearly suggest more bonds as we age."

[iamblessed]

I have thought about All in on VTSAX. The only thing is Vanguard and Fidelity keep upping their percent of international stocks in their funds. So by going all VTSAX I am betting against Vanguard and Fidelity. They are a lot smarter than me.