The primary reason for wanting to make this change is one we can't discuss here. But I have in mind Jack Bogle's admonition: "If you decide to sin, then sin only a little." (Approximate quote. Variously attributed to Bogle, and to Asness/Ilmanen/Maloney; 30min of searching didn't get a clear source.) So I propose to change my allocation a little, in order to get some peace of mind while avoiding anything stupid.
I'd like some opinions on the proposed change below (though not on my reasons for it).
I've simplified my actual portfolio a bit here, to remove distractions like how I merge taxable, tax-deferred, and tax-free accounts and concentrate on the overall allocation. All transactions will occur in tax-adavantaged accounts, anyway. All the funds are Vangaurd index funds. We are a retired couple; Social Security starts this next April, after my 70th birthday.
(Also: since it always comes up, note that the "international bond" allocation below is Vanguard's international bond index fund (VTABX), which has a currency hedge back to the dollar and thus little to no currency risk.)
Current allocation:
- 60/40 stock/bond
- 60/40 US/foreign stock
- 10% of equity in REITs
- 60/40 market stock/small-value stock (after REITs)
- 75/25 US Treasury/foreign bonds
Code: Select all
Short Treasury Idx 10.0%
Interm Treasury Idx 10.0%
Short TIPS Idx 10.0%
Intl Bond Idx 10.0%
US REIT Idx 3.6%
Intl REIT Idx 2.4%
World Stock Idx 32.4%
US Small Value Idx 13.0%
Intl Small Idx 8.6%
- 50/50 stock/bond
- 50/50 US/foreign stock
- 10% of equity in REITs
- 60/40 market stock/small-value stock (after REITs)
- 67/33 US Treasury/foreign bonds
Code: Select all
Short Treasury Idx 11.1%
Interm Treasury Idx 11.1%
Short TIPS Idx 11.1%
Intl Bond Idx 16.7%
US REIT Idx 2.5%
Intl REIT Idx 2.5%
World Stock Idx 20.7%
Intl Stock Idx 6.3%
US Small Value Idx 10.8%
Intl Small Idx 7.2%
Comments?
[Corrected to make the REIT slice be 50/50 US/Intl.]