L1 visa-help build portfolio

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newhere2017
Posts: 4
Joined: Fri Feb 23, 2018 10:37 pm

L1 visa-help build portfolio

Post by newhere2017 » Tue Sep 11, 2018 8:20 pm

Hi,

We are here on an L1 visa expiring on 2020. Green card process to start next year along with the option of renewing the l1 one more time. We are currently a single income family which will change to double income starting next month. Our current portfolio only consists of maxing out 401k ($18k) managed by Fidelity (no vanguard options)
- investment grade bond (northern trust and jp Morgan) - 34% (expense ratio : 0.19%)
- growth equity fund (northern trust) - 30% (expense ratio: 0.13%)
- target 2040 fund (blackrock) - 19% (expense ratio: 0.13%)
- small to mid cap stock (blackrock) - 10% (expense ratio: 0.13%)
- own company stock as match

I would love to get advice on if this is ok/can be optimized. Apart from this, we have $40k in cash. I am very confused on where we should be investing this.
- concerns around easy to manage/withdraw if visa issues and need to move back to home country (ok to leave it invested even if we are not in the US)
- will buy a house if green card comes through (hopefully should have it in 3-4 years). So would like to be able to use this towards down payment if we decide to buy. If not buying, it will remain invested long term.

Insurance cover by employer. We have 2 kids (4 years, 18 months). Tax bracket:28%, state: NC this year, NJ from next. Only car payments in debt.

Would appreciate any guidance you can provide on how we should plan our investments. Specific funds/instruments would be great since new here and the set up seems much more complicated than back home (exposed to equity markets in India). I continue to keep reading the forum posts to learn. I am not sure if we should consider CD/mm through taxable account (tdameritrade) or Roth IRA/anything similar since our savings will increase from next month (I will have 401k and max that as well).

Thanks!

tenkuky
Posts: 481
Joined: Sun Dec 14, 2014 4:28 pm

Re: L1 visa-help build portfolio

Post by tenkuky » Wed Sep 12, 2018 6:33 am

In your previous posts, you have gotten some advice on parking cash in online savings etc, so won't repeat that.
Will opine on retirement options only:
1. Annual limit is $18,500 not $18,000 so make sure you are adjusting your payroll deductions for the 401K to maximize this before end of year.
2. Open a Roth IRA for you and a separate one for your wife. Use any of the large houses (Schwab, Fidelity, Vanguard). You need to start the clock on the "5 year rule" (see the wiki: https://www.bogleheads.org/wiki/Roth_IRA). For this, be sure you are not over the income limit for contributions (also see wiki for this).
3. What is your asset allocation plan (you don't mention your age)? Hard to understand your AA in your 401K, doesn't add up to 100% unless the 6% is company stock.
4. Can you provide all the funds with expense ratios available to you? I sense some overlap in your current selections. Also, you are at 35-36% in bonds right now (counting the bond fund and target date bond percent).

newhere2017
Posts: 4
Joined: Fri Feb 23, 2018 10:37 pm

Re: L1 visa-help build portfolio

Post by newhere2017 » Sat Sep 15, 2018 11:10 am

Thanks for your inputs.

To the questions above:
- Yes, 6% is company stock
- The funds available to me right now are:
- SHORT TERM FIXED INC (Exp Ratio: 0.13%)
- VALUE/YIELD EQUITY (Exp Ratio: 0.13%)
- S&P 500 EQUITY INDEX (Exp Ratio: 0.07%)
- GLOBAL REIT FUND (Exp Ratio: 0.24%)
- INTERNATIONAL STOCK (Exp Ratio: 0.25%)

Rgds

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