Messy Portfolio -- Please Help - TIA!

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dlong
Posts: 54
Joined: Wed Nov 30, 2016 8:45 pm

Messy Portfolio -- Please Help - TIA!

Post by dlong » Thu Feb 01, 2018 6:18 pm

First off, I'd like to say that this post is ~2+ weeks in preparation and it seems, the longer I stare at the numbers and reading this board, the more questions comes up. I figure, I should stop and post what I have before it becomes a thesis or booklet.

Second, instead of (per the sticky) posting the requisite information in this first post, I am doing something a little different. And if people do not like it, I will convert what I have into this first post as it may not be mobile or tablet friendly (Just let me know!). The reason is that there is no table (nice clear formatting) support with here.

Anyway, all requisite information is located in a published Google Sheets (view only). There are multiple tabs. If you would like more information, let me know and I can add it!
retiredjg stated that he didn't like the tabbed spreadsheet format and preferred one long page (aka the requested format for posting in this forum) so, see this post:
viewtopic.php?p=3794268&sid=68de63cad9d ... a#p3767414
I really don't have any idea what I'm doing other than putting money in various funds and hope for the best (although, I have been reading the wiki and about 1/2 way through The Boglehead's Guide to Invest 2nd Ed.... Thank you in advance for any assistance!

---------------

Code: Select all

Facts
Emergency Funds			Yes (see investment tab)
Debt				None
Mortgage			None
Tax Filing			Married Joint
State of Residence		FL (no state tax)
Tax Rate (Effective)		25% (17% last filing)
Age, Her			44 ( * Pink = Her)
Her Salary			100000
Age, Him			46 ( * Blue = His)
His Salary			90000
Desired Asset Allocation	was 20/80 (20 Int'l), now, not sure, maybe 40/60 (10 Int'l) is what most people call for, I'm still thinking 20/80
Risk Tolerance (1-10)		7-8
Retirement Goal Age		9 years @ 55 (Used to be ~42-45, until I got married =|-) If I had to, I would work longer.)
Child(ren)			51 (10 yr old)
Plans This Year (2018):
♦ Plan on buying State's PrePaid 4-Year Univesrity Plan before Feb 28th, single payment $29k
♦ 10 kWDC Solar System $32K - 30% (year end tax credit)
♦ Sell current rental property (~100K)
Plans within 5 years
♦ Used (or new) car to replace '07 Fit 160K and/or '08 Prius 200K. Less than $20K.
♦ Buy rental property (~250K).

New Annual Contributions (All):
Addt'l to Taxable V.STAR	6240
Her Roth IRA			5500
Her 401k			8500+3% Maching (Front-loading 401k (has true-up provision)); Annual admin fee of 0.60% acct.bal.
His Roth IRA			5500
His 401k (+Roth 401K) 		18500+5% Matching (+ ~ $18,000 via with Mega Roth Backdoor), $9.60/yr admin. fee.
HSA				6000 (Not exactly "investment", see Investment Tab.)
Emergency+Short Term		2600


Symbol	Val	Notes	ER %	Asset Class		Plan Name	Fund Name
VMMXX	95K	_____	0.16	MM - _________________	Both - Taxable	V. Prime Money Market Fund (Emrgncy+Short Term Fund)
_____	16K	_____		HSA - ________________	___________	HSA - Health Equity (through company), not invested

Outside of Employee Plan (Taxable, Rollovers, IRAs, Roths, etc.)

Symbol	Val	%	ER %	Asset Class		Plan Name	Fund Name
VWLUX	69K	4.85%	0.09	Bond - Long-Term Bonds	Both - Taxable	V. Long-Term Tax-Exempt Fund Admiral Shares
VGSTX	81K	5.65%	0.32	Balanced - ____________	Both - Taxable	V. STAR Fund
VFIAX	53K	3.72%	0.04	Stock - Cap-Large Blend	His - Taxable	V. 500 Index Fund Admiral Shares
VEUSX	42K	2.93%	0.10	Global - Europe		His - Taxable	V. European Stock Index Fund Admiral Shares
VEXAX	57K	3.95%	0.08	Stock - Cap-Mid Blend	His - Taxable	V. Extended Market Index Fund Admiral Shares
VBTLX	20K	1.40%	0.05	Bond - Inter-Term Bonds	His - Taxable	V. Total Bond Market Index Fund Admiral Shares
VFINX	11K	0.73%	0.14	Stock - Cap-Large Blend	Her - tIRA 1	V. 500 Index Fund Investor Shares
VGELX	56K	3.89%	0.33	Stock - Sector - Energy	Her - tIRA 2	V. Energy Fund Admiral Shares
VGSLX	16K	1.09%	0.12	Stock - Sector - R.E.	Her - tIRA 2	V. REIT Index Fund Admiral Shares
VSGAX	20K	1.37%	0.07	Stock - Cap-Small Growth Her - tIRA 2	V. Small-Cap Growth Index Fund Admiral
VGSTX	108K	7.54%	0.32	Balanced - ____________	Her - rIRA	V. STAR Fund
VGELX	65K	4.54%	0.33	Stock - Sector - Energy	His - roIRA 1	V. Energy Fund Admiral Shares
VPADX	17K	1.22%	0.10	Global - Pacific/Asia	His - roIRA 1	V. Pacific Stock Index Fund Admiral Shares
VWNAX	148K	10.37%	0.25	Stock - Cap-Large Value	His - roIRA 1	V. Windsor II Fund Admiral Shares
VGENX	31K	2.19%	0.41	Stock - Sector - Energy	His - roIRA 2	V. Energy Fund Investor Shares
VGSLX	15K	1.04%	0.12	Stock - Sector - R.E.	His - roIRA 2	V. REIT Index Fund Admiral Shares
VFIAX	37K	2.58%	0.04	Stock - Cap-Large Blend	His - rIRA 1	V. 500 Index Fund Admiral Shares
VIMAX	38K	2.62%	0.06	Stock - Cap-Mid Blend	His - rIRA 1	V. Mid-Cap Index Fund Admiral Shares
VSMAX	38K	2.69%	0.06	Stock - Cap-Small Blend	His - rIRA 1	V. Small-Cap Index Fund Admiral Shares
VGSTX	96K	6.72%	0.32	Balanced - ____________	His - rIRA 2	V. STAR Fund
VGPMX	25K	1.77%	0.43	Stock - Sector - Metals	His - tIRA	V. Precious Metals and Mining Fund
	1044K	Sub-Total		* Pink = Hers  //  Blue = His  //   tIRA = Traditional IRA   //   rIRA = Roth IRA   //   roIRA = Rollover IRA

Her 401(k) NOTE:"An annual Plan administrative expense of 0.60% applies to each participant's account balance. "

Her 401k	Val	%	ER %	Asset Class		Fund #	Fund Name
VFIAX	20K	1.40%	0.04	Stock - Cap-Large Blend		0540	V. 500 Index Fund Admiral Shares
VIMAX	10K	0.68%	0.06	Stock - Cap-Mid Blend		5859	V. Mid-Cap Index Fund Admiral Shares
VSMAX	9K	0.66%	0.06	Stock - Cap-Small Blend		0548	V. Small-Cap Index Fund Admiral Shares
OIDIX	___	_____	0.89	Stock - Global Large Growth	_____	Oppenheimer International Diversified Institutional Fund
ODVIX	___	_____	0.88	Stock - Global Emerging Mkt	_____	Oppenheimer Developing Markets Institutional Fund
N/A	___	_____	0.74	Stock - Sector - R.E.		_____	Real Estate Securities Separate Account-Z
VEVRX	___	_____	0.59	Stock - Cap-Mid Blend		_____	Victory Sycamore Established Value R6 Fund (VEVRX)
GSSUX	___	_____	0.95	Stock - Cap-Small Blend		_____	Goldman Sachs Small Cap Value R6 Fund (GSSUX)
ERASX	___	_____	0.87	Stock - Cap-Mid Growth		_____	Eaton Vance Atlanta Capital SMID Cap R6 Fund (ERASX)
N/A	___	_____	0.77	Stock - Cap-Small Growth	_____	SmallCap Growth I Separate Account-Z
	39K	Sub-Total		* Note: Funds with 0 (or empty) are Available Funds in Company Plan   //   Global = International


His 401(k) NOTE: Charges a fixed $9.60/year admin. fee.

His 401k	Val	%	ER %	Asset Class		Fund #	Fund Name ((note: ~8K is Roth 401k))
VMFXX	___	_____	0.11	MM - Short Term Resv. Tax	0033	V. Federal Money Market Fund (for Mega Backdoor Roth)
VFWPX	87K	6.08%	0.07	Stock - Global Large Blend	1866	V. FTSE All-World ex-US Index Fund Institutional Plus
5797	54K	3.77%	0.028	Bond - Inter-Term Bonds		5797	V. Institutional Total Bond Market Index Trust	vs. 05% ER
5798	72K	5.01%	0.04	Stock - Cap-Mid Blend		5798	V. Institutional Extended Market Index Trust	vs .08% ER
5796	74K	5.15%	0.013	Stock - Cap-Large Blend		5796	V. Institutional 500 Index Trust	vs. 04% ER
VWILX	33K	2.32%	0.32	Stock - Global Large Growth	0581	V. International Growth Fund Admiral Shares
VPMAX	30K	2.06%	0.33	Stock - Cap-Large Growth	0559	V. PRIMECAP Fund Admiral Shares
_____	___	_____	0.05	Balanced - ____________		_____	Vanguard Target Retirement 2015 Trust Select	vs .15% ER
VBIPX	___	_____	0.04	Bond - Short-Term Bonds		_____	V. Short-Term Bond Index Fund Institutional Plus
DFCEX	___	_____	0.53	Stock - Global Emerging Mkt	_____	DFA Emerging Markets Core Equity Portfolio Institutional
DODGX	___	_____	0.52	Stock - Large Value Dom.	_____	Dodge & Cox Stock Fund (DODGX)
6339	___	_____	0.25	Bond - Inter-Term Bonds		6339	Loomis Sayles Core Plus Fixed Income Trust; Class D
PMEGX	___	_____	0.61	Stock - Cap-Mid Growth		_____	T. Rowe Price Institutional Mid-Cap Equity Growth Fund
3910	___	_____	0.64	Stock - Cap-Mid Value		3910	T. Rowe Price U.S. Mid Cap-Value Equity Trust; D Class
3247	___	_____	0.19	Bonds - TIPS __________		3247	Wellington Trust TIPS Portfolio
3246	___	_____	0.90	Stock - Cap-Small Dom.		3246	Wellington Trust Small Cap 2000 Portfolio
	349K	Sub-Total		* Note: Funds with 0 (or empty cells) are Available Funds in Company Plan   //   Global = International



		% of Total
	322K	22.49%		Taxable - Retirement
	901K	62.90%		Tax-Deferred - Retirement
	209K	14.61%		Tax-Deferred - Retirement - Roth

	1432K	100.00%		Total of All Retirement Accounts

	95K			Emergency + Short-Term Reserve
	16K			HSA (Currently not invested)

Vanguard Portfolio Watch (include all accounts including His & Her 401k):
https://drive.google.com/uc?export=view ... 3CsLd5c-ZN
https://drive.google.com/uc?export=view ... zBcrCs2ioy

Morningstar X-RAY (include all accounts including His & Her 401k):
https://drive.google.com/uc?export=view ... Q5FXr3s-ak
https://drive.google.com/uc?export=view ... ZC3q2ZBc7P


20+ years ago, I had AmEx (Ameriprise) do a portfolio analysis and create me a plan which, for a while, I mostly followed (they only suggested their funds) using Vanguard funds. Back then I only knew one thing, low ER. The last time I rebalanced was about 10 years ago, right before I got married. Ever since then I mostly just added into various funds and not thinking too much other than keeping his and her in matching/similar funds. I really haven't learned anything new since the low ER....
  1. General: Help!!!?!?!? :) Please help simplify the portfolio, rebalace, and reduce taxes?
  2. Is the advantage to keeping Roth/IRAs seaparate from Rollovers Roth/IRA for the built-in bankruptcy protection worth the hassle? Part B, Alternatives?
  3. Are there any reasons why I should not combine multiple IRA into a single IRA. Or multiple Roth IRA into a single Roth IRA? [This is different from Q2] Multiple Rollovers into a single Rollover? [This may or may not be different than part 1 of Q3]
  4. Dump V.Star fund for Life Strategy or Target Date funds?
  5. Dump everything (outside of company 401k) into a single fund from Q4?
  6. I'm not sure what the allocation should be anymore. I ran through Vanguard's a few times it suggested between 40/60 and 30/70 (bond/stocks). How much international?
  7. (What or) Would I gain anything from asking Vanguard CFP to create a plan (or is just a review) for me (free via Flagship)?
  8. Should I be contributing to Roth IRA or IRA?
  9. (Assuming, this fund is used after the rebalancing), move the Total Bond from taxable account into 401K/Roth/IRA? How to reduce tax drag/erosion?
  10. In His & Her 401k available funds, short of the Vanguards, do any of the other funds look decent for my situation?
  11. How should I organize the funds with regards to taxes, which funds should go into tax-advantaged?
  12. This doesn't quite have anything to do with the portofilo... For my 401k plan, I can withdraw or perform an in-plan Roth Conversion of Traditional After-tax contributions from the Plan at any time. Is it better to convert the Traditional After-tax contributions to Roth 401k or Roth IRA? Pros / Cons (excluding the available funds, since monies can be shifted around)?
I re-iterate, I really have no idea what I am doing other than just saving money by throwing money into various funds and hope for the best....
Last edited by dlong on Wed Feb 21, 2018 6:49 pm, edited 16 times in total.

BigMoneyNoWhammies
Posts: 116
Joined: Tue Jul 11, 2017 11:58 am

Re: Messy Portfolio -- Please Help - TIA!

Post by BigMoneyNoWhammies » Thu Feb 01, 2018 8:35 pm

FWIW I actually prefer how you posted your information over the standard for this board. It was clear and easy to keep track of.

My first thought when I looked at your portfolios is that you own too many funds, and with some of your bond assets in taxable instead of tax advantaged you might not be investing in the most tax efficient manner. It also looks like some of your funds overlap (ex: VSTAR/VGSTX is a 60/40 stock/bond fund with both domestic and international exposure, but then you own a bond fund, an international fund, and an s&p fund individually in the same account, which are already covered by VGSTX). Some of the funds you've selected have higher ER than I'd personally want as well.

I don't know what kind of tax hit it would be for you to reorganize this portfolio (there are others on this board who would be much better advising you on that aspect as I haven't had to personally rebalance large chunks of my AA and don't have any experience dealing with the tax implications of a big reallocation in my taxable accounts), but assuming it isn't a huge tax bill coming your way it would make more sense to me to keep as much of your bond allocation as possible in tax advantaged space as well as any assets that can be a big tax liability like your REIT fund should you chose to stay invested in one. Most here would advocate the 3 fund portfolio or some close iteration of it, and that would be sound advice here. Just tailor it to your desired level of risk tolerance. You want to retire early so depending on your withdrawal rate you may have to be more aggressive with your AA than most on this board would be at your age.

You are doing far better than a large % of people your age with how much you've already accrued and maxing out your tax advantaged accounts yearly. With continued savings at your current rate and some simplification of your portfolio I think you're well on your way to retiring comfortably, although whether you can retire in 9 years depends in part on market returns for the next decade, but also on how much you're expecting to need per year to live off of in retirement.

User avatar
dlong
Posts: 54
Joined: Wed Nov 30, 2016 8:45 pm

Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Fri Feb 02, 2018 1:27 am

BigMoneyNoWhammies wrote:
Thu Feb 01, 2018 8:35 pm
FWIW I actually prefer how you posted your information over the standard for this board. It was clear and easy to keep track of.
Thanks! That's what I was hoping for with the various tables. Which, unfortuntely, the forum does not support. So Google to the rescue. :happy
BigMoneyNoWhammies wrote:
Thu Feb 01, 2018 8:35 pm
My first thought when I looked at your portfolios is that you own too many funds, and with some of your bond assets in taxable instead of tax advantaged you might not be investing in the most tax efficient manner. It also looks like some of your funds overlap (ex: VSTAR/VGSTX is a 60/40 stock/bond fund with both domestic and international exposure, but then you own a bond fund, an international fund, and an s&p fund individually in the same account, which are already covered by VGSTX). Some of the funds you've selected have higher ER than I'd personally want as well.
Yes, I do need to either pick 3/4 funds or pick a V.STAR, LifeStrategy, or Target Retirement fund. I am not sure about doing a 3-4 fund or a single fund. And if a single fund, which of the three. Not totally sure the differences between the single funds.
BigMoneyNoWhammies wrote:
Thu Feb 01, 2018 8:35 pm
I don't know what kind of tax hit it would be for you to reorganize this portfolio (there are others on this board who would be much better advising you on that aspect as I haven't had to personally rebalance large chunks of my AA and don't have any experience dealing with the tax implications of a big reallocation in my taxable accounts), but assuming it isn't a huge tax bill coming your way it would make more sense to me to keep as much of your bond allocation as possible in tax advantaged space as well as any assets that can be a big tax liability like your REIT fund should you chose to stay invested in one. Most here would advocate the 3 fund portfolio or some close iteration of it, and that would be sound advice here. Just tailor it to your desired level of risk tolerance. You want to retire early so depending on your withdrawal rate you may have to be more aggressive with your AA than most on this board would be at your age.
I was not even thinking about the tax consequences with regards to the reorganization of the portfolio. I hope someone can shed more light on this topic based on the provided information. If anyone needs more information, let me know.

BigMoneyNoWhammies wrote:
Thu Feb 01, 2018 8:35 pm
You are doing far better than a large % of people your age with how much you've already accrued and maxing out your tax advantaged accounts yearly. With continued savings at your current rate and some simplification of your portfolio I think you're well on your way to retiring comfortably, although whether you can retire in 9 years depends in part on market returns for the next decade, but also on how much you're expecting to need per year to live off of in retirement.
Thanks. Help with simplification by the members (the experts!) would be greatly appreciated! Once simplified, it should be easier to manage and easier to "see" the portfolio has a whole.

TwstdSista
Posts: 986
Joined: Thu Nov 16, 2017 4:03 am

Re: Messy Portfolio -- Please Help - TIA!

Post by TwstdSista » Fri Feb 02, 2018 2:01 am

Not taking into account tax consequences for the taxable portion of your portfolio, here is a super simple 60/40 portfolio with 10% of equities in international:

both taxable:
$100,000 VTSAX Vanguard Total Stock Market Index Fund Admiral (.04%)
$50,000 VTIAX Vanguard Total International Market Index Fund Admiral (.011%)

his taxable:
$172,000 VTSAX Vanguard Total Stock Market Index Fund Admiral (.04%)

her tIRA:
$211,000 VBTLX Vanguard Total Bond Market Index Fund Admiral (.05%)

his RolIRA 1:
$230,000 VBTLX Vanguard Total Bond Market Index Fund Admiral (.05%)

his RolIRA 2:
$46,000 VBTLX Vanguard Total Bond Market Index Fund Admiral (.05%)

his rIRA 1:
$113,000 VTSAX Vanguard Total Stock Market Index Fund Admiral (.04%)

his rIRA 2:
$96,000 VTSAX Vanguard Total Stock Market Index Fund Admiral (.04%)

his tIRA:
$25,000 VBTLX Vanguard Total Bond Market Index Fund Admiral (.05%)

his 401k:
$250,000 V. Institutional 500 Index Trust
$50,000 V. FTSE All-World ex-US Index Fund Institutional Plus
$50,000 V. Institutional Total Bond Market Index Trust

her 401k:
$39,000 V. Small-Cap Index Fund Admiral Shares

Combing the two taxable accounts and the two "his RolIRA" accounts would help to further simplify.

User avatar
dlong
Posts: 54
Joined: Wed Nov 30, 2016 8:45 pm

Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Fri Feb 02, 2018 12:46 pm

TwstdSista wrote:
Fri Feb 02, 2018 2:01 am
Not taking into account tax consequences for the taxable portion of your portfolio, here is a super simple 60/40 portfolio with 10% of equities in international:
:sharebeer Thank you for recommendation! Looks like it boils down to a 3-fund portfolio but taking advantage of the lower fees in the institutional from the 401k? What are your thoughts on the single funds (Life Strategy and Target Date funds) for the monies outside of 401k :?:
  • Bond
    • VBTLX V. Total Bond Market Index Fund Admiral (.05%)
    • V. Institutional Total Bond Market Index Trust (.028% vs .05%)
  • International
    • VTIAX V. Total International Market Index Fund Admiral (.011%)
    • VFWPX V. FTSE All-World ex-US Index Fund Institutional Plus (.07% vs .11%)
  • Stock
    • V. Institutional 500 Index Trust (.013 vs .04%)
    • VSMAX V. Small-Cap Index Fund Admiral Shares (.06%)
    • VTSAX V. Total Stock Market Index Fund Admiral (.04%)
Any thoughts if I wanted to keep the sector stocks :?: REIT, Energy, & Metal. (maybe even add health care.. or not)
TwstdSista wrote:
Fri Feb 02, 2018 2:01 am
Combing the two taxable accounts and the two "his RolIRA" accounts would help to further simplify.
I agree, however, I am worried :? about the built-in protection regarding rollovers. Q2 & Q3 (copied below for reference), any ideas :?:
2 Is the advantage to keeping Roth/IRAs seaparate from Rollovers Roth/IRA for the built-in bankruptcy protection worth the hassle? Part B, Alternatives?
3 Are there any reasons why I should not combine multiple IRA into a single IRA. Or multiple Roth IRA into a single Roth IRA? [This is different from Q2] Multiple Rollovers into a single Rollover? [This may or may not be different than part 1 of Q3]

Sincerely,

-d

Jon H
Posts: 104
Joined: Sun Jan 21, 2018 2:50 pm

Re: Messy Portfolio -- Please Help - TIA!

Post by Jon H » Fri Feb 02, 2018 12:50 pm

What's TIA?
Consider gain and loss, but never be greedy and everything will be alright (fortune cookie)

User avatar
dlong
Posts: 54
Joined: Wed Nov 30, 2016 8:45 pm

Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Fri Feb 02, 2018 2:43 pm

Jon H wrote:
Fri Feb 02, 2018 12:50 pm
What's TIA?
Don't you hate that? Seeing acyronym and not know them. I know I do! In the future, I need to remember to link the definition. My TIA is Thanks (You) In Advance.
Last edited by dlong on Wed Feb 21, 2018 6:18 pm, edited 3 times in total.

TwstdSista
Posts: 986
Joined: Thu Nov 16, 2017 4:03 am

Re: Messy Portfolio -- Please Help - TIA!

Post by TwstdSista » Sat Feb 03, 2018 5:49 am

I used the both the three fund portfolio as well as the tax efficient placement (see Bogleheads wiki) in building my suggested portfolio -- bonds in pre-tax, equities in post tax and taxable. The Life Strategy and Target Date funds are excellent options, but make it harder to track and rebalance your overall portfolio, more calculations, etc. Those funds are great if you can use the same fund in all accounts -- 1 calculation! But they are not tax efficient for taxable accounts.

I don't know enough about the built-in protection regarding rollovers and bankruptcy, so I cannot comment or give any reasonable advice on that issue.

Go for the lower ER index fund where possible, keeping in mind tax efficiency placement. The difference between Admiral Shares and Institutional Shares is minimal. The main thing is to simplify and create an easy tracking system for rebalancing purposes (for both yourself and your spouse). I love one fund accounts! But make sure you have to ability to rebalance, so you need at least one three fund account [as an example, the husband and I have 6 total accounts -- 4 with a single fund, and two with all three so we rebalance within the two accounts].

User avatar
dlong
Posts: 54
Joined: Wed Nov 30, 2016 8:45 pm

Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Sun Feb 04, 2018 11:41 pm

Anyone else have any experience/information regarding:
  • 2. Is the advantage to keeping Roth/IRAs seaparate from Rollovers Roth/IRA for the built-in bankruptcy protection worth the hassle? Part B, Alternatives?
  • 3. Are there any reasons why I should not combine multiple IRA into a single IRA. Or multiple Roth IRA into a single Roth IRA? [This is different from Q2] Multiple Rollovers into a single Rollover? [This may or may not be different than part 1 of Q3]
Thanks!

Chip
Posts: 2202
Joined: Wed Feb 21, 2007 4:57 am

Re: Messy Portfolio -- Please Help - TIA!

Post by Chip » Mon Feb 05, 2018 6:24 am

dlong wrote:
Sun Feb 04, 2018 11:41 pm
Anyone else have any experience/information regarding:
  • 2. Is the advantage to keeping Roth/IRAs seaparate from Rollovers Roth/IRA for the built-in bankruptcy protection worth the hassle? Part B, Alternatives?
  • 3. Are there any reasons why I should not combine multiple IRA into a single IRA. Or multiple Roth IRA into a single Roth IRA? [This is different from Q2] Multiple Rollovers into a single Rollover? [This may or may not be different than part 1 of Q3]
Thanks!
You can search the site and/or google for "asset protection by state". There's even some info in the wiki. It appears to this non-attorney that rollover IRAs/Roths have no special protections in FL vs. other IRAs/Roths. If that is truly the case, then combining them probably makes sense. The only other reason I know of to keep them separate is if you want to roll them back into a 401k. My understanding is that some 401k plans won't allow a "roll-in" if the IRA contains any assets that didn't originate in another 401k plan. Or something like that -- I have no personal experience.

I like TwstdSista's portfolio plan. Personally I would want a higher allocation to foreign equities and I would put them all in taxable accounts. But that of course is your decision, not mine.

Do you like being a landlord?

I would be tempted to use the Vanguard CFP to confirm/tweak what you decide based on feedback here.

Nice job on the "thesis". :) I suspect you learned a great deal in the process of putting it together.

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dlong
Posts: 54
Joined: Wed Nov 30, 2016 8:45 pm

Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Mon Feb 05, 2018 5:38 pm

Chip wrote:
Mon Feb 05, 2018 6:24 am
dlong wrote:
Sun Feb 04, 2018 11:41 pm
Anyone else have any experience/information regarding:
  • 2. Is the advantage to keeping Roth/IRAs seaparate from Rollovers Roth/IRA for the built-in bankruptcy protection worth the hassle? Part B, Alternatives?
Thanks!

You can search the site and/or google for "asset protection by state". There's even some info in the wiki. It appears to this non-attorney that rollover IRAs/Roths have no special protections in FL vs. other IRAs/Roths. If that is truly the case, then combining them probably makes sense. The only other reason I know of to keep them separate is if you want to roll them back into a 401k. My understanding is that some 401k plans won't allow a "roll-in" if the IRA contains any assets that didn't originate in another 401k plan. Or something like that -- I have no personal experience.
Thank you for the link. That wiki gave me some keywords (the FL statue) to do a google search. Yes, I agree with your non-attorney assessment as well (I am also not an attorney), it looks like Florida may protect both IRA and Roth IRA for assets "held" in Florida including inherited and rollovers as well. However, it looks like because Vanguard does not have a branch in FL, that money isn't "held" in FL. An example one article gave was, "if a Georgia resident opens an IRA account at a Georgia branch of a national brokerage and subsequently moves to Florida, the IRA account may not be exempt because it is deemed to be anchored at the branch where it was opened." It does look like the 3 Vanguard offices in AZ, NC, and PA also have similar laws... further reading implies federally there is a limit of $1M for IRA (excluding Rollovers) which FL law states unlimited. Laywers and politicians, need to take them all out and shoot them or something.... http://www4.floridabar.org/DIVCOM/JN/JN ... A700452F6B very confusing.

More reading tells me if I wanted more protection, I should roll my IRA into my 401k for 'additional' protection. :oops:
Chip wrote:
Mon Feb 05, 2018 6:24 am
I like TwstdSista's portfolio plan. Personally I would want a higher allocation to foreign equities and I would put them all in taxable accounts. But that of course is your decision, not mine.
Taking a second look at TwstdSista's portfolio plan, I wonder if I should roll my rollover IRA and IRA into my 401k plan and take advantage of the lower fees for the same fund (Total Bond Market Index).
Chip wrote:
Mon Feb 05, 2018 6:24 am
Do you like being a landlord?
Being a landlord has it's up and down. Some tenants are great, others are like pulling teeth, your own. I have not used a management company (usually 10% of rent) but that seems to work for some people, although, I am not sure that it really reduces the work and it probably depends on the management company and how much you pay them. I am selling my current rental because it is very old and getting harder to maintain, especially since I am a DIY person with a full time job. It would be nice if I had to courage to buy a nice quad-family unit. It would make some of the maintenance easier to deal with.
Chip wrote:
Mon Feb 05, 2018 6:24 am
I would be tempted to use the Vanguard CFP to confirm/tweak what you decide based on feedback here.

Nice job on the "thesis". :) I suspect you learned a great deal in the process of putting it together.
That's a good point w/r/t the Vanguard CFP. I wonder if s/he has any insight on the IRA protection w/r/t various states laws. You mean besides how big of a mess it has become... ? :D

retiredjg
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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Mon Feb 05, 2018 6:27 pm

dlong wrote:
Thu Feb 01, 2018 6:18 pm
Second, instead of (per the sticky) posting the requisite information in this first post, I am doing something a little different.
I hope you get the answers you are looking for. If not, consider trying again using the posted format.

The format we use makes it easy for others to see what you have and what you need to do and to answer your questions without a lot of flipping back and forth and writing things down. In other words, it makes it easy for people to help you.

The way you posted the information is probably great for your own personal analysis and might be fine if the information were on paper, but I didn't find it easy to work with myself.

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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 06, 2018 3:34 pm

retiredjg wrote:
Mon Feb 05, 2018 6:27 pm
dlong wrote:
Thu Feb 01, 2018 6:18 pm
Second, instead of (per the sticky) posting the requisite information in this first post, I am doing something a little different.
I hope you get the answers you are looking for. If not, consider trying again using the posted format.

The format we use makes it easy for others to see what you have and what you need to do and to answer your questions without a lot of flipping back and forth and writing things down. In other words, it makes it easy for people to help you.

The way you posted the information is probably great for your own personal analysis and might be fine if the information were on paper, but I didn't find it easy to work with myself.
Thanks for the feedback on the format. I've edited the first post and placed screen captures of the spreadsheet and graphics so that it's all on a single page. Would you have preferred actual text so that it can be copied and pasted or are the screen captures acceptable in your opinion?

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Tue Feb 06, 2018 4:46 pm

dlong, keep in mind that I am only one of the people who do portfolio suggestions. Others may/will have a different opinion.

Unfortunately, moving everything to this page does help some, but your format is not something I can use and here's why. The portfolio does not add up to 100%. You've got bits and pieces here and there, but all 30 (or however many there are) funds you hold need to add up to 100%. That is something I can work with.

I can't even figure out what the percentages mean. For example, the funds in "His Taxable" don't add up to 100%. They add up to about 53%. There may be some logic in what you have done, but it will take time to find it. In reality, it might take me an hour or more to figure out what you have on paper there and put it in a format I can use. Only then could I actually start to formulate an answer for you.

Also, there is a lot of extraneous information there, hundreds of words that just clutter up the field. They are probably helpful to you in what you want to do, but to me they are simply visual clutter. In order to help you, all I need is
  • -The type of account it is (and custodian if there is more than one)
    -the holding's percentage of the entire portfolio
    -Ticker if there is one
    -Fund name
    -ER
Something like this is easy to understand (although I realize that you have more accounts than this)

Taxable
10% Fund A
15B Fund B

His 401k
30% fund C

Her 401k
30% fund D

His Roth IRA at Custodian 1
5% Fund F

Her Roth IRA at Custodian 2
10% Fund G

I can look through that list in 15 seconds and know what the stock to bond ratio is in the portfolio (assuming no balanced funds). By the time I've looked it over once, I know if there are tax-efficiency problems and if there are cost problems (funds with high ERs) that need to be addressed.

One other thing is that I have no way to copy and paste what you have posted. I use copy and paste a lot and I like to answer questions one at at time because it is less confusing to you, the reader.

Lastly, when a person actually follows the order and the instructions in the format, I know exactly where to look for a tiny piece of information. It makes things go much faster for me. Tax bracket is found in the top 10 or 15 lines. Contributions are found near the bottom. No need to go hunting for information because I already know where it is.

Now.....having said all that, I'm not trying to be critical of what you have done. Not at all. I think it is great and fine for your use.

What I'm saying is that it is not ready made for me (and others who want to know what you have) to jump in and start formulating an answer for you within 5 minutes. You seemed to be interested in why it is important which is why I've bothered to put all this into writing. You seemed to be interested in why your way is harder for helpers and I figured you deserved a complete answer. :happy

And finally, since you have gone to all this trouble, I will spend the time in reformatting your information when I have some time. At that point, I may say your portfolio is perfect (by my standards) or that you should consider this and that or the other. I'm not sure if I will get to it tomorrow or it might even be on the weekend, but I will get to it if you want more input on your questions.

Right now, I'd say that holding the STAR fund in taxable is a poor idea because it is not tax-efficient and a balanced fund just makes more math when analyzing your portfolio. You may have reasons to use it, but that is not apparent at this point.

You really do need some consolidation and simplification. I'll be happy to help you with that if you have not gotten the answers you are looking for.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Tue Feb 06, 2018 4:59 pm

I hope you are not sorry you asked.... :D

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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 06, 2018 6:17 pm

in response to
retiredjg wrote:
Tue Feb 06, 2018 4:46 pm
...
Thank you for the detailed response! You had a lot of stuff and rather than have a huge quote...
  • It's interesting that you don't see the format I've used is very similar to the requested format except with a couple more fields. Agreed that it does add additional text.
  • You say that "His Taxable" don't add up to 100%, but neither does your example. And it's not supposed to since it is only a portion of the whole portfolio. Correct? But you're right, the original graphic had incorrect math. :oops: I have taken the graphic out and replaced it with "code snippet format". The percentage inside each grouping was breaking down between taxable, tax-deferred, and tax-referred Roth. It is visually complicated and really should just be a percentage of the total of all assets. With the new text, I changed it (as well as in the spreadsheet) that reflect that.
  • ]In the end, I suppose if the subscribed to format is what people are used to seeing, then that is want people will want to see new posts in the same format. Something like the format below. Hopefully, this will save you from having to reformat the data from the first post.
  • Finally, yes, I may have to re-post a new thread with the correct format so that I will get more response.
Facts
Emergency Funds: Yes (see investment tab)
Debt: None
Mortgage: None
Tax Filing: Married Joint
State of Residence: FL (no state tax)
Tax Rate (Effective): 25% (17% last filing)
Age, Her: 44
Her Salary: 100000
Age, Him: 46
His Salary: 90000
Desired Asset Allocation: Used to be 20/80 (20 Int'l), but now, I'm not sure, I think 40/60 (10 Int'l) is what most people call for..., I'm still thinking 20/80....
Risk Tolerance: (1-10) 7-8
Retirement Goal Age: 9 years @ 55 (Used to be ~42-45, until I got married =|-) If I had to, I would work longer.)
Child(ren): 1 (10 yr old)
Plans This Year (2018)
♦ Plan on buying State's PrePaid 4-Year Univesrity Plan before Feb 28th, single payment $29k
♦ 10 kWDC Solar System $32K - 30% (year end tax credit)
♦ Sell current rental property (~100K)
Plans within 5 years
♦ Used (or new) car to replace '07 Fit 160K and/or '08 Prius 200K. Less than $20K.
♦ Buy rental property (~250K).

New Annual Contributions (All)
Addt'l to Taxable V.STAR 6240
Her Roth IRA 5500
Her 401k 18500+3% Maching (Front-loading 401k (has true-up provision))
His Roth IRA 5500
His 401k (+Roth 401K) 18500+5% Matching (+ ~ $18,000 via with Mega Roth Backdoor)
HSA 6000 (Not exactly "investment", see Investment Tab.)
Emergency+Short Term 2600


Taxable (Both)
__%_ Val Fund Name ER %
4.85% 69K V. Long-Term Tax-Exempt Fund Admiral Shares (0.09)
5.65% 81K V. STAR Fund (0.32)

Taxable (His)
3.72% 53K V. 500 Index Fund Admiral Shares (0.04)
2.93% 42K V. European Stock Index Fund Admiral Shares (0.10)
3.95% 57K V. Extended Market Index Fund Admiral Shares (0.08)
1.40% 20K V. Total Bond Market Index Fund Admiral Shares (0.05)

Her IRA
0.73% 11K V. 500 Index Fund Investor Shares (0.14)
3.89% 56K V. Energy Fund Admiral Shares (0.33)
1.09% 16K V. REIT Index Fund Admiral Shares (0.12)
1.37% 20K V. Small-Cap Growth Index Fund Admiral (0.07)

Her Roth IRA
7.54% 108K V. STAR Fund (0.32)

His Rollover IRA 1
4.54% 65K V. Energy Fund Admiral Shares (0.33)
1.22% 17K V. Pacific Stock Index Fund Admiral Shares (0.10)
10.37% 148K V. Windsor II Fund Admiral Shares (0.25)

His Rollover IRA 2
2.19% 31K V. Energy Fund Investor Shares (0.41)
1.04% 15K V. REIT Index Fund Admiral Shares (0.12)

His Roth IRA 1
2.58% 37K V. 500 Index Fund Admiral Shares (0.04)
2.62% 38K V. Mid-Cap Index Fund Admiral Shares (0.06)
2.69% 38K V. Small-Cap Index Fund Admiral Shares (0.06)

His Roth IRA 2
6.72% 96K V. STAR Fund (0.32)

His IRA
1.77% 25K V. Precious Metals and Mining Fund (0.43)
Sub-Total 1044K

His 401k ((note: ~8K is Roth 401k), charges $9.60/yr admin. fee)
__%_ Val Fund Name ((note: ~8K is Roth 401k)) ER %
_____ ___ V. Federal Money Market Fund (for Mega Backdoor Roth) (0.11)
6.08% 87K V. FTSE All-World ex-US Index Fund Institutional Plus (0.07)
3.77% 54K V. Institutional Total Bond Market Index Trust (0.028)
5.01% 72K V. Institutional Extended Market Index Trust (0.04)
5.15% 74K V. Institutional 500 Index Trust (0.013)
2.32% 33K V. International Growth Fund Admiral Shares (0.32)
2.06% 30K V. PRIMECAP Fund Admiral Shares (0.33)
_____ ___ Vanguard Target Retirement 2015 Trust Select (0.05)
_____ ___ V. Short-Term Bond Index Fund Institutional Plus (0.04)
_____ ___ DFA Emerging Markets Core Equity Portfolio Institutional (0.53)
_____ ___ Dodge & Cox Stock Fund (DODGX) (0.52)
_____ ___ Loomis Sayles Core Plus Fixed Income Trust; Class D (0.25)
_____ ___ T. Rowe Price Institutional Mid-Cap Equity Growth Fund (0.61)
_____ ___ T. Rowe Price U.S. Mid Cap-Value Equity Trust; D Class (0.64)
_____ ___ Wellington Trust TIPS Portfolio (0.19)
_____ ___ Wellington Trust Small Cap 2000 Portfolio (0.90)

Her 401k (An annual Plan administrative expense of 0.60% applies to each participant's account balance)
__%_ Val Fund Name ER %
1.40% 20K V. 500 Index Fund Admiral Shares (0.04)
0.68% 10K V. Mid-Cap Index Fund Admiral Shares (0.06)
0.66% 9K V. Small-Cap Index Fund Admiral Shares (0.06)
_____ ___ Oppenheimer International Diversified Institutional Fund (0.89)
_____ ___ Oppenheimer Developing Markets Institutional Fund (0.88)
_____ ___ Real Estate Securities Separate Account-Z (0.74)
_____ ___ Victory Sycamore Established Value R6 Fund (VEVRX) (0.59)
_____ ___ Goldman Sachs Small Cap Value R6 Fund (GSSUX) (0.95)
_____ ___ Eaton Vance Atlanta Capital SMID Cap R6 Fund (ERASX) (0.87)
_____ ___ SmallCap Growth I Separate Account-Z (0.77)

Everything is @ Vanguard with the exception of Her 401k.
Last edited by dlong on Tue Feb 13, 2018 6:10 pm, edited 5 times in total.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Tue Feb 06, 2018 7:04 pm

dlong wrote:
Tue Feb 06, 2018 6:17 pm
I was thinking of something like the format below. It's the only way to keep columns without having to massively enter spaces between column and was fairly easy to copy and paste from the spreadsheet with very minor editing to get the columns to align.
I remember when I first started this, I too was uncomfortable with the lack of columns. And putting in spaces does not work. It was a little disconcerting at first.

But now, it is very easy for me to understand "25% Vanguard Total Stock VTSMX .12%." All the info I need is there in very little space. I don't have to scan across a whole page. I don't have to scroll. I don't have to screen out unnecessary data. I can mentally process dozens of funds in very little time if they are in the right order (which I sometimes have to do by cutting and pasting).

However, the down side is that the text is in a fixed container and the reader would have to scroll both up and down to read the full text.
Scrolling? Ain't gonna happen. :D


As all of us old farts cycle out of the way, it may happen for you younger folks who were weaned on spreadsheets. Your brain wiring finds that presentation "normal". Mine does not. I was well into my third career before people even had computers or ever thought about processing numbers using an electronic spreadsheet.


I still can't figure out what your percentages mean. Do you know?

Again, not trying to say your methods don't have value for you. Not saying that at all.

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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 06, 2018 7:35 pm

retiredjg wrote:
Tue Feb 06, 2018 7:04 pm
I remember when I first started this, I too was uncomfortable with the lack of columns. And putting in spaces does not work. It was a little disconcerting at first.

But now, it is very easy for me to understand "25% Vanguard Total Stock VTSMX .12%." All the info I need is there in very little space. I don't have to scan across a whole page. I don't have to scroll. I don't have to screen out unnecessary data. I can mentally process dozens of funds in very little time if they are in the right order (which I sometimes have to do by cutting and pasting).

Scrolling? Ain't gonna happen. :D
Yes, I guess it all depends on what one is used to.

retiredjg wrote:
Tue Feb 06, 2018 7:04 pm
As all of us old farts cycle out of the way, it may happen for you younger folks who were weaned on spreadsheets. Your brain wiring finds that presentation "normal". Mine does not. I was well into my third career before people even had computers or ever thought about processing numbers using an electronic spreadsheet.

I still can't figure out what your percentages mean. Do you know?
It was supposed to be a breakdown of each taxable, tax deferred, and Roth tax referred. Hopefully the above post will make it easier. :)

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Tue Feb 06, 2018 7:36 pm

Oh my. Your last post disappeared, making my last post moot! Not to worry, I think I can work with what you have done here. It would be helpful if you would include the information about tax bracket (not marginal effective, but bracket) and your desired AA and your contributions with this information. Then it is all in one place.

[*]You say that "His Taxable" don't add up to 100%, but neither does your example. And it's not supposed to since it is only a portion of the whole portfolio. Correct?
No, you are correct, but if each account added up to 100%, I could have then recalculated the numbers. But your numbers did not add up to anything that made sense. I was bewildered. It appears you've fixed that now.

I won't work on this tonight, but a few questions....

Are you keeping "his Taxable" separate for a reason?

What is the purpose of the taxable account(s)? Retirement, home downpayment, vacation, college?
Last edited by retiredjg on Wed Feb 07, 2018 9:20 am, edited 1 time in total.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Tue Feb 06, 2018 7:40 pm

dlong wrote:
Tue Feb 06, 2018 7:35 pm
It was supposed to be a breakdown of each taxable, tax deferred, and Roth tax referred. Hopefully the above post will make it easier. :)
The way you had it may have some value to you personally and to your analysis. But in order for us to make suggestions for what to do with your portfolio (dump this, buy that), everything has to be represented as a percentage of the portfolio. It's the only way for it to work.

One last question - the charts from Vanguard, are they just your Vanguard accounts or are the 401ks represented in there as well?

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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 06, 2018 11:30 pm

retiredjg wrote:
Tue Feb 06, 2018 7:36 pm
It would be helpful if you would include the information about tax bracket (not marginal, but bracket) and your desired AA and your contributions with this information. Then it is all in one place.

Are you keeping "his Taxable" separate for a reason?

What is the purpose of the taxable account(s)? Retirement, home downpayment, vacation, college?
I guess, I don't understand the use case for the tax bracket vs effective tax rate (I need more reading (not that I need more as I am still on the Bogle list of books.)...). But based on 2017's tax return, our AGI of 148k ($190 gross) puts us in the 25%.

I've updated the information to include AA so it is now all in one place.

No particular reason, it just how it was before I was married so it just continued on in that fashion.

The purpose of the taxable account is just more money for retirement.

retiredjg wrote:
Tue Feb 06, 2018 7:40 pm
dlong wrote:
Tue Feb 06, 2018 7:35 pm
It was supposed to be a breakdown of each taxable, tax deferred, and Roth tax referred. Hopefully the above post will make it easier. :)
The way you had it may have some value to you personally and to your analysis. But in order for us to make suggestions for what to do with your portfolio (dump this, buy that), everything has to be represented as a percentage of the portfolio. It's the only way for it to work.

One last question - the charts from Vanguard, are they just your Vanguard accounts or are the 401ks represented in there as well?
Actually, it had no purpose at the time it was created, it was just another way of viewing information, that I thought might be useful in the future.

The charts from vanguard include all accounts including His & Her 401k.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Wed Feb 07, 2018 9:19 am

I guess, I don't understand the use case for the tax bracket vs effective tax rate
Before I get to the reason, I meant to say "we need bracket not effective". I said "marginal" - a misspeak which I will change above.

First, effective tax rate does not even have a firm definition that I know of. Some people start with gross salary, some with take home salary, some with taxable income, and I think there are even more variations that I can't remember right now. However it's done, effective rate sort of reflects how much of your money goes to taxes. That can be an important thing to know, but it is not the number you use to make decisions.

The number used to make decisions is your marginal tax rate which is usually (not always) the same as your tax bracket. "If I do ____ with $1,000, what will it cost in taxes?" If your marginal rate is 25%, it will cost you $250. That tells you the actual tax cost of the decision you are trying to make. If you used effective rate for this, you'd think it cost $170 which would be incorrect.

Since it is not possible for others to know your actual marginal rate, we generally talk about tax bracket since that will be your marginal rate if you are not in some kind of phase out. It's the best we can do. If you want to be sure, you have to actually work through your taxes to find out.

But based on 2017's tax return, our AGI of 148k ($190 gross) puts us in the 25%.
Your AGI is used for many things, but not for determining your taxes. AGI is the last line on the first page of your tax form. It is the number before your standard deduction, exemptions (last year, not in the future), and maybe some other stuff.

The number used to figure your taxes is your taxable income which should be on line 43 of Form 1040.

Be careful that you do not get your AGI and your taxable income confused.


I've updated the information to include AA so it is now all in one place.
Thank you. This is something I can actually work with. :D

It appears, without a significant change in income, you are now in the 22% tax bracket (married filing jointly).

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Wed Feb 07, 2018 10:44 am

Let's start here.
dlong wrote:
Thu Feb 01, 2018 6:18 pm
Desired Asset Allocation: Used to be 20/80 (20 Int'l), but now, I'm not sure, I think 40/60 (10 Int'l) is what most people call for..., I'm still thinking 20/80....
I don't think you need to move to 40% in bonds, but I do think that only 20% in bonds is a little light for your ages, especially if you are considering an early retirement.

My usual suggestion is "age in bonds" for a conservative portfolio ranging to "age minus 20 in bonds" for an aggressive portfolio. So my suggestion would be to move to 30% bonds for the next 5 years which will bring you to about "age minus 20" (at the end of the 5 years). At that point, move another 5% into bonds for the following 5 years. If you are retiring about that time, I'd move to 60% stocks and 40% bonds by retirement time.




Taxable (Both) 10.5%
4.85% 69K V. Long-Term Tax-Exempt Fund Admiral Shares (0.09) <-in your tax bracket, -you are probably getting less return on this than a taxable bond fund (I have not checked. Have you?)
5.65% 81K V. STAR Fund (0.32) <--need to sell this - not tax-efficient because it contains taxable bonds which throw off taxable dividends each year

Taxable (His) 12%
3.72% 53K V. 500 Index Fund Admiral Shares (0.04)
3.95% 57K V. Extended Market Index Fund Admiral Shares (0.08)
2.93% 42K V. European Stock Index Fund Admiral Shares (0.10)
1.40% 20K V. Total Bond Market Index Fund Admiral Shares (0.05) <--sell this too, same reason as STAR

His 401k 24.39%((note: ~8K is Roth 401k))

5.15% 74K V. Institutional 500 Index Trust (0.013)
5.01% 72K V. Institutional Extended Market Index Trust (0.04)
6.08% 87K V. FTSE All-World ex-US Index Fund Institutional Plus (0.07)
3.77% 54K V. Institutional Total Bond Market Index Trust (0.028)
2.32% 33K V. International Growth Fund Admiral Shares (0.32) <---not needed, just clutter
2.06% 30K V. PRIMECAP Fund Admiral Shares (0.33)<--more clutter, but harmless and a lot of people like it

_____ ___ V. Federal Money Market Fund (for Mega Backdoor Roth) (0.11)
_____ ___ Vanguard Target Retirement 2015 Trust Select (0.05)
_____ ___ V. Short-Term Bond Index Fund Institutional Plus (0.04)
_____ ___ DFA Emerging Markets Core Equity Portfolio Institutional (0.53)
_____ ___ Dodge & Cox Stock Fund (DODGX) (0.52)
_____ ___ Loomis Sayles Core Plus Fixed Income Trust; Class D (0.25)
_____ ___ T. Rowe Price Institutional Mid-Cap Equity Growth Fund (0.61)
_____ ___ T. Rowe Price U.S. Mid Cap-Value Equity Trust; D Class (0.64)
_____ ___ Wellington Trust TIPS Portfolio (0.19)
_____ ___ Wellington Trust Small Cap 2000 Portfolio (0.90)

Her 401k 2.74%
1.40% 20K V. 500 Index Fund Admiral Shares (0.04)
0.68% 10K V. Mid-Cap Index Fund Admiral Shares (0.06)
0.66% 9K V. Small-Cap Index Fund Admiral Shares (0.06)

_____ ___ Oppenheimer International Diversified Institutional Fund (0.89)
_____ ___ Oppenheimer Developing Markets Institutional Fund (0.88)
_____ ___ Real Estate Securities Separate Account-Z (0.74)
_____ ___ Victory Sycamore Established Value R6 Fund (VEVRX) (0.59)
_____ ___ Goldman Sachs Small Cap Value R6 Fund (GSSUX) (0.95)
_____ ___ Eaton Vance Atlanta Capital SMID Cap R6 Fund (ERASX) (0.87)
_____ ___ SmallCap Growth I Separate Account-Z (0.77)

His Rollover IRA 1 16.13% <--combine this with His Rollover 2 or roll both into His 401k
4.54% 65K V. Energy Fund Admiral Shares (0.33)
1.22% 17K V. Pacific Stock Index Fund Admiral Shares (0.10)
10.37% 148K V. Windsor II Fund Admiral Shares (0.25)

His Rollover IRA 2 3.23% <--combine with HIs Rollover 1 or roll both into His 401k
2.19% 31K V. Energy Fund Investor Shares (0.41)
1.04% 15K V. REIT Index Fund Admiral Shares (0.12)

His IRA 1.77% <---Consider if you want to convert this to Roth, combine it with rollover IRAs, or roll into His 401k; critical question - is this money pre-tax, post-tax, or a combination?
1.77% 25K V. Precious Metals and Mining Fund (0.43)


Her IRA 7.08% <--an account this small should have only 1 fund; consider rolling into Her 401k
0.73% 11K V. 500 Index Fund Investor Shares (0.14)
3.89% 56K V. Energy Fund Admiral Shares (0.33)
1.09% 16K V. REIT Index Fund Admiral Shares (0.12)
1.37% 20K V. Small-Cap Growth Index Fund Admiral (0.07)

Her Roth IRA 7.54%
7.54% 108K V. STAR Fund (0.32) <--holding balanced funds and individual funds at the same time makes more math



His Roth IRA 1 7.89% <--combine this with His Roth IRA 2?
2.58% 37K V. 500 Index Fund Admiral Shares (0.04)
2.62% 38K V. Mid-Cap Index Fund Admiral Shares (0.06)
2.69% 38K V. Small-Cap Index Fund Admiral Shares (0.06)

His Roth IRA 2 6.72%
6.72% 96K V. STAR Fund (0.32)


[*]General: Help!!!?!?!? :) Please help simplify the portfolio, rebalace, and reduce taxes?
The above are some general suggestions about how to simplify a lot and reduce taxes a little. Once you make these decisions and we know how much space is where, funds can be chosen for each account.


[*]Is the advantage to keeping Roth/IRAs seaparate from Rollovers Roth/IRA for the built-in bankruptcy protection worth the hassle? Part B, Alternatives?
You could be asking several things here. If you are asking if there is a need to keep His Rollover 1 separate from His Rollover 2, I don't know of any reason to do that. This assumes that each is entirely composed of pre-tax money.

Do you have a Rollover Roth IRA? Is there even such a thing?

Do you consider yourself at risk for liability lawsuits/bankruptcy? Some professions just get sued a lot.... I'm not sure what you learned about what your needs in Florida are.

Since this is a concern for you, I'm thinking it would be a good idea to roll all the IRAs (not Roth) into His and Her 401k if those plans will accept them.


[*]Are there any reasons why I should not combine multiple IRA into a single IRA. Or multiple Roth IRA into a single Roth IRA?
None that I know of. [This is different from Q2] Multiple Rollovers into a single Rollover? [This may or may not be different than part 1 of Q3]


[*]Dump V.Star fund for Life Strategy or Target Date funds?
STAR is a fine fund, but more costly than LifeStrategy or Target. However, I don't think it contains international bonds (need to check) if that is of interest to you.

However, I think your question should be whether to be using balanced funds at all. Using balanced funds just mucks up the math because you have to figure out 3 different things for each one (how much US stock, international stock, and bonds). Since you think by spreadsheet, balanced funds may be fine for you because your spreadsheet tells you what your stock to bond ratio is.


[*]Dump everything (outside of company 401k) into a single fund from Q4?
I was wondering if you might like to do this. The answer is yes and no.

You do not want the balanced funds in your taxable accounts. And it appears there is no good balanced choice in Her 401k. But there is no reason you could not fill all the other accounts with a balanced fund or a combination of balanced funds to give you the stock to bond ratio you want. Then you would manage the taxable accounts and Her 401k separately (but all together).


[*]I'm not sure what the allocation should be anymore. I ran through Vanguard's a few times it suggested between 40/60 and 30/70 (bond/stocks). How much international?
I think this is a good suggestion myself. Since you are a more aggressive investor, I think 70% stocks and 30% bonds would be fine for you until near retirement. Unless you just have more money than you can ever spend, I would not enter retirement with more than 60% in stocks.

As for how much international, the usual suggestions (if you hold any) is between 20% and 40% of the stocks, up to 50% of the stocks if you want market weight.


[*](What or) Would I gain anything from asking Vanguard CFP to create a plan (or is just a review) for me (free via Flagship)?
I can see nothing to loose and possibly much to gain by doing this.


[*]Should I be contributing to Roth IRA or IRA?
Roth IRA, no question. You cannot deduct your contributions to tIRA.


[*](Assuming, this fund is used after the rebalancing), move the Total Bond from taxable account into 401K/Roth/IRA? How to reduce tax drag/erosion?
Yes, as suggested above.


[*]In His & Her 401k available funds, short of the Vanguards, do any of the other funds look decent for my situation?
You've got good choices in each plan. In fact, there is no reason to even use all the choices you are using.

If you'd rather simplify and automate, you could use the target fund in His 401k. Alone, not with other funds.


[*]How should I organize the funds with regards to taxes, which funds should go into tax-advantaged?
The bond funds and the REIT. Some say it is OK to hold bonds in taxable.


[*]This doesn't quite have anything to do with the portofilo... For my 401k plan, I can withdraw or perform an in-plan Roth Conversion of Traditional After-tax contributions from the Plan at any time. Is it better to convert the Traditional After-tax contributions to Roth 401k or Roth IRA? Pros / Cons (excluding the available funds, since monies can be shifted around)?
Either is fine, but this is a much bigger question than can be answered here. Short answer - you get more flexibility by rolling out to Roth IRA. But there is more to it than this.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Wed Feb 07, 2018 12:46 pm

I forgot to mention earlier, there is a major disconnect between Portfolio Watche's interpretation of your portfolio and the one done by Morningstar's x-ray.

X ray shows a HUGE HUGE tilt to large cap growth which you do not have. And it shows your bonds are all low quality. Neither of these can possibly be a correct analysis of the funds you have listed. Something is amiss.

There is also a somewhat significant difference in the stock to bond ratios.

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Wed Feb 07, 2018 8:00 pm

retiredjg wrote:
Wed Feb 07, 2018 12:46 pm
I forgot to mention earlier, there is a major disconnect between Portfolio Watche's interpretation of your portfolio and the one done by Morningstar's x-ray.

X ray shows a HUGE HUGE tilt to large cap growth which you do not have. And it shows your bonds are all low quality. Neither of these can possibly be a correct analysis of the funds you have listed. Something is amiss.

There is also a somewhat significant difference in the stock to bond ratios.
Sorry!!!! I am what people call an idiot. Some where between switching between windows and clicking on different things, and not paying attention to the information on the screen, I ended looking at their example page and that's what I took a screen capture and posted. I have corrected the image to show the 'free instant x-ray'.

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Re: Messy Portfolio -- Please Help - TIA!

Post by raisinsaregrapes » Wed Feb 07, 2018 8:29 pm

I went to the three fund strategy. I'm relatively young so moving all my stuff around wasn't to difficult. But I created a spreadsheet to tell me how to balance, I just update my account balances then it tells me how to balance between funds.

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Thu Feb 08, 2018 6:32 pm

retiredjg wrote:
Wed Feb 07, 2018 9:19 am
I guess, I don't understand the use case for the tax bracket vs effective tax rate
The number used to make decisions is your marginal tax rate which is usually (not always) the same as your tax bracket. "If I do ____ with $1,000, what will it cost in taxes?" If your marginal rate is 25%, it will cost you $250. That tells you the actual tax cost of the decision you are trying to make. If you used effective rate for this, you'd think it cost $170 which would be incorrect.
That make total sense. Thanks!
retiredjg wrote:
Wed Feb 07, 2018 9:19 am
But based on 2017's tax return, our AGI of 148k ($190 gross) puts us in the 25%.
Your AGI is used for many things, but not for determining your taxes. AGI is the last line on the first page of your tax form. It is the number before your standard deduction, exemptions (last year, not in the future), and maybe some other stuff.

The number used to figure your taxes is your taxable income which should be on line 43 of Form 1040.

Be careful that you do not get your AGI and your taxable income confused.
I'm not confused between AGI and taxable income... because I didn't know there was such a term. :twisted: I will have to check to see which I put up above... but I guess it really isn't needed.
retiredjg wrote:
Wed Feb 07, 2018 9:19 am
I've updated the information to include AA so it is now all in one place.
Thank you. This is something I can actually work with. :D

It appears, without a significant change in income, you are now in the 22% tax bracket (married filing jointly).
:?: Okay, more confusion on my part. $190k married filing jointly. How did you arrive at the 22% tax bracket? I checked 2016, 2017, and 2018. 2016 and 2017, for 190k the tax bracket is 28%. For 2018, the tax bracket is 24%.

Is it because 18,500 x 2 for the 401k reduced the income to 153K, so the bracket is 22% ??

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Thu Feb 08, 2018 6:58 pm

$190,000
-24,000 Standard deduction
-18,500 His 401k
-18,500 Her 401k
$129,000 taxable income which is in the 22% bracket. Even considering it is an estimate and you actually use some Roth 401k, it still seems to be the 22% bracket.

Ignore your income. Use the taxable income on line 43 of Form 1040 and compare it to this chart for the past several years to find your tax bracket for each year. It will be higher than the number you've been looking at (effective bracket). My guess is that you have been in the 25% bracket for a little while.

http://www.moneychimp.com/features/tax_brackets.htm

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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Mon Feb 12, 2018 7:15 pm

Sorry for the silence. Pretty tried these days. I have read through the post but haven't really put together a plan of action yet.
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Let's start here.
dlong wrote:
Thu Feb 01, 2018 6:18 pm
Desired Asset Allocation: Used to be 20/80 (20 Int'l), but now, I'm not sure, I think 40/60 (10 Int'l) is what most people call for..., I'm still thinking 20/80....
I don't think you need to move to 40% in bonds, but I do think that only 20% in bonds is a little light for your ages, especially if you are considering an early retirement.

My usual suggestion is "age in bonds" for a conservative portfolio ranging to "age minus 20 in bonds" for an aggressive portfolio. So my suggestion would be to move to 30% bonds for the next 5 years which will bring you to about "age minus 20" (at the end of the 5 years). At that point, move another 5% into bonds for the following 5 years. If you are retiring about that time, I'd move to 60% stocks and 40% bonds by retirement time.
That's a pretty good suggestion, I like it.

retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Taxable (Both) 10.5%
4.85% 69K V. Long-Term Tax-Exempt Fund Admiral Shares (0.09) <-in your tax bracket, -you are probably getting less return on this than a taxable bond fund (I have not checked. Have you?)
5.65% 81K V. STAR Fund (0.32) <--need to sell this - not tax-efficient because it contains taxable bonds which throw off taxable dividends each year

Taxable (His) 12%
1.40% 20K V. Total Bond Market Index Fund Admiral Shares (0.05) <--sell this too, same reason as STAR
I just checked. You are correct, a taxable fund (like V. Long-Term Investment-Grade Fund Admiral Shares (VWETX)) which yields 7.49% would be better than my current choice, the V. Long-Term Tax-Exempt Fund Admiral Shares which yields 4.81%. In the 25% bracket, 4.81% is equivalent to 6.414. The ER for the taxable is .11% vs .09%.

I do need to move the bonds into the non-taxable accounts. And the stocks (i.e. index 500) into the taxable accounts.

retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His 401k 24.39%((note: ~8K is Roth 401k))
5.15% 74K V. Institutional 500 Index Trust (0.013)
5.01% 72K V. Institutional Extended Market Index Trust (0.04)
6.08% 87K V. FTSE All-World ex-US Index Fund Institutional Plus (0.07)
3.77% 54K V. Institutional Total Bond Market Index Trust (0.028)
2.32% 33K V. International Growth Fund Admiral Shares (0.32) <---not needed, just clutter
2.06% 30K V. PRIMECAP Fund Admiral Shares (0.33)<--more clutter, but harmless and a lot of people like it
Would you just move the Int'l Growth to the FTSE All-World? And the PRIMECAP to 500 Index?
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His Rollover IRA 1 16.13% <--combine this with His Rollover 2 or roll both into His 401k
His Rollover IRA 2 3.23% <--combine with HIs Rollover 1 or roll both into His 401k
Not sure which is better, combine the two or roll both into 401k. I've posted a question asking about how Vanguard 401k handle multiple rollover accounts into the 401k.
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His IRA 1.77% <---Consider if you want to convert this to Roth, combine it with rollover IRAs, or roll into His 401k; critical question - is this money pre-tax, post-tax, or a combination?
I really don't know if it's pre-tax or post-tax or combination. I know that I opened an account and added $2000 a year for a few years a long time ago. So looking at transaction history, I see:
12/23/1996 Buy $2k
04/02/1997 Buy $2k
07/02/1998 Transfer $6,243.67 -- to Roth IRA (I guess I converted it).
05/31/2005 Buy $19,308.62 -- 2005 EMPLOYEE ROLLOVER

So, it looks like it's all pre-tax from 401k? I wonder if I was doing rollovers into 401k, if Vanguard 401k would accept this account.
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Her IRA 7.08% <--an account this small should have only 1 fund; consider rolling into Her 401k
0.73% 11K V. 500 Index Fund Investor Shares (0.14)
3.89% 56K V. Energy Fund Admiral Shares (0.33)
1.09% 16K V. REIT Index Fund Admiral Shares (0.12)
1.37% 20K V. Small-Cap Growth Index Fund Admiral (0.07)
I will have to check, but I don't believe her 401k accepts non-rollover or mixed accounts. From a quick glance, it looks like they accept rollovers from IRA into 401k. I will have to go through and make sure it's not mixed. Although, Vanguard normally names them as Rollover if it's a rollover from a 401k. Interesting. It looks like it's a rollover 2012 EMPLOYEE ROLLOVER, but it's not named as such by Vanguard.

Although, I'm not sure it's a good idea to roll into her 401k. This was not included in any of the 'facts' but her 401k is Principle and the plan that her employer picked charges a percentage of the total asset as a management fee, "An annual Plan administrative expense of 0.60% applies to each participant's account balance. "
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Her Roth IRA 7.54%
7.54% 108K V. STAR Fund (0.32) <--holding balanced funds and individual funds at the same time makes more math
Yes, that's one of the questions...should I be just using a single fund...


For the questions/answers, I'll do that in another post. Thanks retiredjg.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Tue Feb 13, 2018 10:51 am

dlong wrote:
Mon Feb 12, 2018 7:15 pm
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Taxable (Both) 10.5%
4.85% 69K V. Long-Term Tax-Exempt Fund Admiral Shares (0.09) <-in your tax bracket, -you are probably getting less return on this than a taxable bond fund (I have not checked. Have you?)
5.65% 81K V. STAR Fund (0.32) <--need to sell this - not tax-efficient because it contains taxable bonds which throw off taxable dividends each year

Taxable (His) 12%
1.40% 20K V. Total Bond Market Index Fund Admiral Shares (0.05) <--sell this too, same reason as STAR
I just checked. You are correct, a taxable fund (like V. Long-Term Investment-Grade Fund Admiral Shares (VWETX)) which yields 7.49% would be better than my current choice, the V. Long-Term Tax-Exempt Fund Admiral Shares which yields 4.81%. In the 25% bracket, 4.81% is equivalent to 6.414. The ER for the taxable is .11% vs .09%.
I would not recommend holding a long term taxable bond like VWETX at all. Long term bonds are more sensitive to increases in interest rates. They also do not hold up as well in a downturn.

You may be wondering why it is "OK" to hold long term muni bonds. Well, they are not really all that "long" and often you have no choice if you are looking for a state specific muni bonds.

I do need to move the bonds into the non-taxable accounts. And the stocks (i.e. index 500) into the taxable accounts.
I prefer the method where the bonds are in the tax-advantaged accounts. But there is no need to "move" stocks into taxable other than to rebalance (compensate for moving the bonds out of taxable).


retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His 401k 24.39%((note: ~8K is Roth 401k))
5.15% 74K V. Institutional 500 Index Trust (0.013)
5.01% 72K V. Institutional Extended Market Index Trust (0.04)
6.08% 87K V. FTSE All-World ex-US Index Fund Institutional Plus (0.07)
3.77% 54K V. Institutional Total Bond Market Index Trust (0.028)
2.32% 33K V. International Growth Fund Admiral Shares (0.32) <---not needed, just clutter
2.06% 30K V. PRIMECAP Fund Admiral Shares (0.33)<--more clutter, but harmless and a lot of people like it
Would you just move the Int'l Growth to the FTSE All-World? And the PRIMECAP to 500 Index?
Not sure yet. You should move them to whatever you need to make up the allocations you want. It is too soon to say what will be needed in this account.

retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His Rollover IRA 1 16.13% <--combine this with His Rollover 2 or roll both into His 401k
His Rollover IRA 2 3.23% <--combine with HIs Rollover 1 or roll both into His 401k
Not sure which is better, combine the two or roll both into 401k. I've posted a question asking about how Vanguard 401k handle multiple rollover accounts into the 401k.
This is a question for your 401k custodian and/or administrator. Why does it matter to you?


retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His IRA 1.77% <---Consider if you want to convert this to Roth, combine it with rollover IRAs, or roll into His 401k; critical question - is this money pre-tax, post-tax, or a combination?
I really don't know if it's pre-tax or post-tax or combination. I know that I opened an account and added $2000 a year for a few years a long time ago. So looking at transaction history, I see:
12/23/1996 Buy $2k
04/02/1997 Buy $2k
07/02/1998 Transfer $6,243.67 -- to Roth IRA (I guess I converted it).
05/31/2005 Buy $19,308.62 -- 2005 EMPLOYEE ROLLOVER

So, it looks like it's all pre-tax from 401k? I wonder if I was doing rollovers into 401k, if Vanguard 401k would accept this account.
You will have to figure out if the 1996 and 1997 contributions were deductible or not-deductible. If non-deductible, you should have done a Form 8606 but many people don't know that and fail to file them. You can look on your tax returns if you still have them. I think it is about line 15?

Interesting that you only contributed $4k and then you converted over $6k. Did that leave the balance at $0? See what else you can find out about this because you really can't make a plan until you do.

You will have to ask your 401k provider or check the documents you have to see if accept the rollover.



retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Her IRA 7.08% <--an account this small should have only 1 fund; consider rolling into Her 401k
0.73% 11K V. 500 Index Fund Investor Shares (0.14)
3.89% 56K V. Energy Fund Admiral Shares (0.33)
1.09% 16K V. REIT Index Fund Admiral Shares (0.12)
1.37% 20K V. Small-Cap Growth Index Fund Admiral (0.07)
I will have to check, but I don't believe her 401k accepts non-rollover or mixed accounts. From a quick glance, it looks like they accept rollovers from IRA into 401k. I will have to go through and make sure it's not mixed. Although, Vanguard normally names them as Rollover if it's a rollover from a 401k. Interesting. It looks like it's a rollover 2012 EMPLOYEE ROLLOVER, but it's not named as such by Vanguard.

Although, I'm not sure it's a good idea to roll into her 401k. This was not included in any of the 'facts' but her 401k is Principle and the plan that her employer picked charges a percentage of the total asset as a management fee, "An annual Plan administrative expense of 0.60% applies to each participant's account balance. "
That could be a good reason not to roll money in there.




For the questions/answers, I'll do that in another post. Thanks retiredjg.
Please do. No progress can be made until more things are know.

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 13, 2018 5:48 pm

Part two.
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
dlong wrote:
Thu Feb 01, 2018 6:18 pm
[Q2*] Is the advantage to keeping Roth/IRAs separate from Rollovers Roth/IRA for the built-in bankruptcy protection worth the hassle? Part B, Alternatives?
You could be asking several things here. If you are asking if there is a need to keep His Rollover 1 separate from His Rollover 2, I don't know of any reason to do that. This assumes that each is entirely composed of pre-tax money.

Do you have a Rollover Roth IRA? Is there even such a thing?

Do you consider yourself at risk for liability lawsuits/bankruptcy? Some professions just get sued a lot.... I'm not sure what you learned about what your needs in Florida are.

Since this is a concern for you, I'm thinking it would be a good idea to roll all the IRAs (not Roth) into His and Her 401k if those plans will accept them.
I am no expert, but if there is a Rollover IRA why not a Rollover Roth IRA?

While neither of us are in a profession where we would get sued. Currently not in a situation where bankruptcy is a concern but we may want to buy/open a business. However, as for liability; a kid using the sidewalk in front of the house trips over a cement patch that a tree root has displaced and the parents decides to sue you for not cutting down the tree and fixing the sidewalk. Or a kid climbs over the fence to play in the pool and drowns. Dumb lawsuits like are why I would like to protect my retirement monies.

retiredjg wrote:
Wed Feb 07, 2018 10:44 am
[Q4*] Dump V.Star fund for Life Strategy or Target Date funds?
STAR is a fine fund, but more costly than LifeStrategy or Target. However, I don't think it contains international bonds (need to check) if that is of interest to you.

However, I think your question should be whether to be using balanced funds at all. Using balanced funds just mucks up the math because you have to figure out 3 different things for each one (how much US stock, international stock, and bonds). Since you think by spreadsheet, balanced funds may be fine for you because your spreadsheet tells you what your stock to bond ratio is.
Hmmm... I guess, before we look at this, I need to consolidate the accounts so it is easier to see allocations and availability of funds and such.

retiredjg wrote:
Wed Feb 07, 2018 10:44 am
[*] (What or) Would I gain anything from asking Vanguard CFP to create a plan (or is just a review) for me (free via Flagship)?
I can see nothing to loose and possibly much to gain by doing this.
Made an appointment for March 13th as it was the earliest date where they had a late evening time slot.

retiredjg wrote:
Wed Feb 07, 2018 10:44 am
[Q8*] Should I be contributing to Roth IRA or IRA?
Roth IRA, no question. You cannot deduct your contributions to tIRA.
Your answer wasn't even something that I was thinking about but I should of been. The question I was thinking of was today's taxes vs future taxes.

retiredjg wrote:
Wed Feb 07, 2018 10:44 am
[Q11*] How should I organize the funds with regards to taxes, which funds should go into tax-advantaged?
The bond funds and the REIT. Some say it is OK to hold bonds in taxable.
What is their reasoning that it is okay to hold bonds in taxable?

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 13, 2018 6:06 pm

retiredjg wrote:
Tue Feb 13, 2018 10:51 am
dlong wrote:
Mon Feb 12, 2018 7:15 pm
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His Rollover IRA 1 16.13% <--combine this with His Rollover 2 or roll both into His 401k
His Rollover IRA 2 3.23% <--combine with HIs Rollover 1 or roll both into His 401k
Not sure which is better, combine the two or roll both into 401k. I've posted a question asking about how Vanguard 401k handle multiple rollover accounts into the 401k.
This is a question for your 401k custodian and/or administrator. Why does it matter to you?
I did call Vanguard 401k and it sounds like they create a new single account ("source") for all IRA rollovers. Monies inside 401k have better protection against Judgments. Also less accounts or "sources" means less maintenance when re-balancing.

retiredjg wrote:
Tue Feb 13, 2018 10:51 am
dlong wrote:
Mon Feb 12, 2018 7:15 pm
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
His IRA 1.77% <---Consider if you want to convert this to Roth, combine it with rollover IRAs, or roll into His 401k; critical question - is this money pre-tax, post-tax, or a combination?
I really don't know if it's pre-tax or post-tax or combination. I know that I opened an account and added $2000 a year for a few years a long time ago. So looking at transaction history, I see:
12/23/1996 Buy $2k
04/02/1997 Buy $2k
07/02/1998 Transfer $6,243.67 -- to Roth IRA (I guess I converted it).
05/31/2005 Buy $19,308.62 -- 2005 EMPLOYEE ROLLOVER

So, it looks like it's all pre-tax from 401k? I wonder if I was doing rollovers into 401k, if Vanguard 401k would accept this account.
You will have to figure out if the 1996 and 1997 contributions were deductible or not-deductible. If non-deductible, you should have done a Form 8606 but many people don't know that and fail to file them. You can look on your tax returns if you still have them. I think it is about line 15?

Interesting that you only contributed $4k and then you converted over $6k. Did that leave the balance at $0? See what else you can find out about this because you really can't make a plan until you do.

You will have to ask your 401k provider or check the documents you have to see if accept the rollover.
Yes, the balance was $0 after the $6K conversion. I guess it was exceptional growth as the share price went from $70 to $106 in ~2 years. I'll have to dig up my taxes tonight (if I remember) and see if I filled a 8606. I certianly don't remember filing it. However, most of the time, I do my taxes using Intuit (or last two years, H&R Block) software so it could of been automated. I know I have a few years of 199x taxes, just not how far back.

@Home now and so, it looks like in 1996 and 1997, I did them by hand (ahhh, the good old day, :wink:). The 1996 and 1997 $2000s are pre-taxed because on line 23a (1996)/23 (1997) each $2000 was used to reduce my income. There were no 8606 filed for either year.

In 1998, there was an 8606 filed with Part II (Conversions from Traditional IRAs to Roth IRAs) completed.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Wed Feb 14, 2018 3:16 pm

dlong wrote:
Tue Feb 13, 2018 5:48 pm
I am no expert, but if there is a Rollover IRA why not a Rollover Roth IRA?
I suppose because people are not going to roll a Roth IRA to anything other than a Roth IRA - it does not matter where the money came from.

There was a time when a 401k would not accept a rollover from anything other than an IRA that contained only rollover money. Thus "rollover IRA" became a thing. This is not needed for Roth IRA. While a Roth IRA may contain money from a rollover, I don't recall ever hearing the term "rollover Roth IRA".

What is their reasoning that it is okay to hold bonds in taxable?
It's very long story and much too complicated to explain here. It is just a different opinion of the best place to hold bonds. And I'm not saying that one should never put a bond fund in taxable. I'm saying that bonds held for the long term like retirement are best held in an IRA or a 401k type plan. I mentioned that not everyone agrees because it is fair that you know there is more than one opinion on the matter.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Wed Feb 14, 2018 3:22 pm

dlong wrote:
Tue Feb 13, 2018 6:06 pm
@Home now and so, it looks like in 1996 and 1997, I did them by hand (ahhh, the good old day, :wink:). The 1996 and 1997 $2000s are pre-taxed because on line 23a (1996)/23 (1997) each $2000 was used to reduce my income. There were no 8606 filed for either year.

In 1998, there was an 8606 filed with Part II (Conversions from Traditional IRAs to Roth IRAs) completed.
So, it appears that all the money in that account is from a 401k rollover. It seems that account might be rolled into your 401k if you want to do it.

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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Wed Feb 14, 2018 3:37 pm

Just to gather my thoughts, here is where I think we are on your accounts. We'll figure out funds later when you make a final decision on the accounts.

Taxable (Both) 10.5%
4.85% 69K V. Long-Term Tax-Exempt Fund Admiral Shares (0.09) <-in your tax bracket, -you are probably getting less return on this than a taxable bond fund (I have not checked. Have you?)
5.65% 81K V. STAR Fund (0.32) <--need to sell this - not tax-efficient because it contains taxable bonds which throw off taxable dividends each year

Taxable (His) 12%
3.72% 53K V. 500 Index Fund Admiral Shares (0.04)
3.95% 57K V. Extended Market Index Fund Admiral Shares (0.08)
2.93% 42K V. European Stock Index Fund Admiral Shares (0.10)
1.40% 20K V. Total Bond Market Index Fund Admiral Shares (0.05) <--sell this too, same reason as STAR
These will get a clean up - getting rid of the tax-inefficient funds.

His 401k 24.39%((note: ~8K is Roth 401k))

5.15% 74K V. Institutional 500 Index Trust (0.013)
5.01% 72K V. Institutional Extended Market Index Trust (0.04)
6.08% 87K V. FTSE All-World ex-US Index Fund Institutional Plus (0.07)
3.77% 54K V. Institutional Total Bond Market Index Trust (0.028)
2.32% 33K V. International Growth Fund Admiral Shares (0.32) <---not needed, just clutter
2.06% 30K V. PRIMECAP Fund Admiral Shares (0.33)<--more clutter, but harmless and a lot of people like it
Roll 3 IRAs into this one and get rid of a couple of clutter funds


Her 401k 2.74%
1.40% 20K V. 500 Index Fund Admiral Shares (0.04)
0.68% 10K V. Mid-Cap Index Fund Admiral Shares (0.06)
0.66% 9K V. Small-Cap Index Fund Admiral Shares (0.06)
Maybe some small changes - she does not need 3 funds in here.


His Rollover IRA 1 16.13% <--combine this with His Rollover 2 or roll both into His 401k
4.54% 65K V. Energy Fund Admiral Shares (0.33)
1.22% 17K V. Pacific Stock Index Fund Admiral Shares (0.10)
10.37% 148K V. Windsor II Fund Admiral Shares (0.25)

His Rollover IRA 2 3.23% <--combine with HIs Rollover 1 or roll both into His 401k
2.19% 31K V. Energy Fund Investor Shares (0.41)
1.04% 15K V. REIT Index Fund Admiral Shares (0.12)

His IRA 1.77% <---Consider if you want to convert this to Roth, combine it with rollover IRAs, or roll into His 401k; critical question - is this money pre-tax, post-tax, or a combination?
1.77% 25K V. Precious Metals and Mining Fund (0.43)
These 3 disappear into His 401k

Her IRA 7.08% <--an account this small should have only 1 fund; consider rolling into Her 401k
0.73% 11K V. 500 Index Fund Investor Shares (0.14)
3.89% 56K V. Energy Fund Admiral Shares (0.33)
1.09% 16K V. REIT Index Fund Admiral Shares (0.12)
1.37% 20K V. Small-Cap Growth Index Fund Admiral (0.07)
Leave this account since rolling into Her 401k adds a .6% management fund.

Her Roth IRA 7.54%
7.54% 108K V. STAR Fund (0.32) <--holding balanced funds and individual funds at the same time makes more math
Keep the account, change the fund.

His Roth IRA 1 7.89% <--combine this with His Roth IRA 2?
2.58% 37K V. 500 Index Fund Admiral Shares (0.04)
2.62% 38K V. Mid-Cap Index Fund Admiral Shares (0.06)
2.69% 38K V. Small-Cap Index Fund Admiral Shares (0.06)

His Roth IRA 2 6.72%
6.72% 96K V. STAR Fund (0.32)
Consolidate these into one.


Bottom line....you should have 4 fewer accounts and many fewer funds to keep up with.

A lot of this depends on whether your current 401k will accept the rollovers. Start talking to them and find out their requirements.

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 20, 2018 6:03 pm

Just a quick update: I have started the "rollover in" process from the Retail Vanguard IRA account to the Vanguard 401k for the following accounts.

His Rollover IRA 1 16.13% 230K
His Rollover IRA 2 3.23% 46K
His IRA 1.77% 25K

I does not seem that His Vanguard 401k allows Roth IRA rollovers unless it is a "Rollover IRA that contains Roth monies". So at this point, I am combining His two Roth into A single Roth which contains only contains the V. STAR Fund.

His Roth IRA 1 7.89% 113K <--combine this with His Roth IRA 2?
His Roth IRA 2 6.72% 96K V. STAR Fund (0.32)

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Tue Feb 20, 2018 6:53 pm

On a different note, does anyone know why in Post #1 the accounts & funds and certain things (maybe everything) is double spaced? Whereas in later posts they are single spaced? Anyone know how to fix?

EDIT: Fixed it, not sure WHY but when using the image tag, it doubles spaces everything. Take that out and everything is single spaced again.
Last edited by dlong on Wed Feb 21, 2018 6:20 pm, edited 1 time in total.

retiredjg
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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Wed Feb 21, 2018 9:06 am

This is progress. If you wish to discuss what funds to be using, let us know.

About the spacing problem, I noticed a problem when I was adding my comments to your comments. Some things just would not do what they were supposed to do even with numerous tries. I thought it was the result of all the formatting you had done in your original post.

A discussion of this issue came up in another thread as well. Not sure what the problem is, but I would not worry much about it.

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Wed Feb 21, 2018 7:13 pm

retiredjg wrote:
Tue Feb 13, 2018 10:51 am
dlong wrote:
Mon Feb 12, 2018 7:15 pm
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Taxable (Both) 10.5%
4.85% 69K V. Long-Term Tax-Exempt Fund Admiral Shares (0.09) <-in your tax bracket, -you are probably getting less return on this than a taxable bond fund (I have not checked. Have you?)
I just checked. You are correct, a taxable fund (like V. Long-Term Investment-Grade Fund Admiral Shares (VWETX)) which yields 7.49% would be better than my current choice, the V. Long-Term Tax-Exempt Fund Admiral Shares which yields 4.81%. In the 25% bracket, 4.81% is equivalent to 6.414. The ER for the taxable is .11% vs .09%.
I would not recommend holding a long term taxable bond like VWETX at all. Long term bonds are more sensitive to increases in interest rates. They also do not hold up as well in a downturn.

You may be wondering why it is "OK" to hold long term muni bonds. Well, they are not really all that "long" and often you have no choice if you are looking for a state specific muni bonds.
So what would you recommend instead? This is money that may be used in 3-6 years.
retiredjg wrote:
Tue Feb 13, 2018 10:51 am
This is progress. If you wish to discuss what funds to be using, let us know.
Thanks, but let's wait a bit until all the current money moves and see where the money ends up...

retiredjg
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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Thu Feb 22, 2018 8:09 am

dlong wrote:
Wed Feb 21, 2018 7:13 pm
retiredjg wrote:
Tue Feb 13, 2018 10:51 am
dlong wrote:
Mon Feb 12, 2018 7:15 pm
retiredjg wrote:
Wed Feb 07, 2018 10:44 am
Taxable (Both) 10.5%
4.85% 69K V. Long-Term Tax-Exempt Fund Admiral Shares (0.09) <-in your tax bracket, -you are probably getting less return on this than a taxable bond fund (I have not checked. Have you?)
I just checked. You are correct, a taxable fund (like V. Long-Term Investment-Grade Fund Admiral Shares (VWETX)) which yields 7.49% would be better than my current choice, the V. Long-Term Tax-Exempt Fund Admiral Shares which yields 4.81%. In the 25% bracket, 4.81% is equivalent to 6.414. The ER for the taxable is .11% vs .09%.
I would not recommend holding a long term taxable bond like VWETX at all. Long term bonds are more sensitive to increases in interest rates. They also do not hold up as well in a downturn.

You may be wondering why it is "OK" to hold long term muni bonds. Well, they are not really all that "long" and often you have no choice if you are looking for a state specific muni bonds.
So what would you recommend instead? This is money that may be used in 3-6 years.
I'd recommend a short term bond fund for money that might be used in 3 years. Of course, you will not make as much money on a short term bond fund but the money is more likely to be there when you need it.

If you just can't stand it, a mix of short term and intermediate term bond funds (no more than half) will probably do. A long term taxable bond is a nice thing to have for the yield, but is not considered an appropriate investment for a short term goal.

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Thu Mar 08, 2018 7:28 pm

Just a quick update, this is where we stand now:
1) Vanguard is finishing up the rollver-in from Vanguard Retail to Vanguard 401k (hence the 283K in V. MM in 401k).
2) We still need to contact Principal to see if we can roll in co-mingled monies. Ideally, we'd rollover-in both of Her tIRA and shortly thereafter, roll it back out to a single account to 1) 'whitewash' the co-mingled money, 2) avoid paying the .4% annual management fee, and 3) get federal and maybe better state protection as it will all be tagged as "rollover IRA". Instead of rolling it out, would rather leave it in the 401k except for the dang .4%.

Symbol Val Fund Name (ER %)
-------------------------------------------------------------------------------------------------------------------------------------------
Taxable
VWLUX 69K V. Long-Term Tax-Exempt Admiral (0.09)
VGSTX 81K V. STAR _____ _____ (0.32)
VTSAX 165K V. Total Stock Market Index Admiral (0.04)

Her - IRA
_____ 11K V. 500 Index (0.14) * comingled
VGELX 56K V. Energy Fund Admiral Shares (0.33) * 100% rollover
VGSLX 16K V. REIT Index Fund Admiral Shares (0.12) * 100% rollover
VSGAX 20K V. Small-Cap Growth Index Fund Admiral (0.07) * 100% rollover

Her - Roth IRA
VGSTX 108K V. STAR Fund (0.32) * comingled

His - IRA
VTSAX 203K V. Total Stock Market Index Admiral (0.04)

His 401k (note: ~8K is Roth 401k)
_____ 283K V. MM
VFWPX 86K V. FTSE All-World ex-US Index Institutional Plus (0.07)
_____ 78K V. Institutional Total Bond Market Index Trust (0.028)
_____ 71K V. Institutional Extended Market Index Trust (0.04)
_____ 333K V. Institutional 500 Index Trust (0.013)
VPMAX 29K V. PRIMECAP Admiral (0.33)

Her 401k
VSMAX 45K 0548 V. Small-Cap Index Admiral (0.06)

retiredjg
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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Fri Mar 09, 2018 8:19 am

dlong wrote:
Thu Mar 08, 2018 7:28 pm
2) We still need to contact Principal to see if we can roll in co-mingled monies.
What do you mean by this?

A clarification - you cannot roll co-mingled money into a 401k. The question is if they will accept the pre-tax money from an account that holds both pre-tax and post-tax money. Some will (you may have to certify you are not sending them after-tax money), some won't, and I think some don't ask (but you still may be certifying you are not sending them after tax money).

Not sure what you mean about Her Roth being co-mingled. Not sure that is possible.

Good to see that you are making progress. Let us know when/if you want help picking the funds.

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dlong
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Re: Messy Portfolio -- Please Help - TIA!

Post by dlong » Mon Mar 12, 2018 11:02 am

retiredjg wrote:
Fri Mar 09, 2018 8:19 am
dlong wrote:
Thu Mar 08, 2018 7:28 pm
2) We still need to contact Principal to see if we can roll in co-mingled monies.
What do you mean by this?

A clarification - you cannot roll co-mingled money into a 401k. The question is if they will accept the pre-tax money from an account that holds both pre-tax and post-tax money. Some will (you may have to certify you are not sending them after-tax money), some won't, and I think some don't ask (but you still may be certifying you are not sending them after tax money).

Not sure what you mean about Her Roth being co-mingled. Not sure that is possible.

Good to see that you are making progress. Let us know when/if you want help picking the funds.
It seems that some 401k plans will only roll money that is 100% rollover and will not take IRA even if it has 100% pre-tax but some of the money is from pre-tax individual contributions. Some allow self-certifying. Might be left over before some law passed but the plans didn't update?

Roth IRA + Rollover Roth IRA = co-mingled. Although, since we can't roll a Roth IRA into a 401k, I guess it doesn't really matter.

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Re: Messy Portfolio -- Please Help - TIA!

Post by FPS_dapdap » Mon Mar 12, 2018 11:29 am

dlong wrote:
Fri Feb 02, 2018 2:43 pm
Jon H wrote:
Fri Feb 02, 2018 12:50 pm
What's TIA?
Don't you hate that? Seeing acyronym and not know them. I know I do! In the future, I need to remember to link the definition. My TIA is Thanks (You) In Advance.
Or it could mean "aunt".

retiredjg
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Re: Messy Portfolio -- Please Help - TIA!

Post by retiredjg » Mon Mar 12, 2018 2:07 pm

dlong wrote:
Mon Mar 12, 2018 11:02 am
It seems that some 401k plans will only roll money that is 100% rollover and will not take IRA even if it has 100% pre-tax but some of the money is from pre-tax individual contributions. Some allow self-certifying.
That is correct.
Roth IRA + Rollover Roth IRA = co-mingled. Although, since we can't roll a Roth IRA into a 401k, I guess it doesn't really matter.
You are right - it does not matter. Roth IRA is Roth IRA no matter how the money got in there.

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