Help with first self-managed portfolio

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BajaMig
Posts: 21
Joined: Sat Jul 28, 2018 1:01 pm

Help with first self-managed portfolio

Post by BajaMig » Wed Nov 07, 2018 3:32 pm

Greetings all. I will manage our family portfolio moving forward as of 11/10/18. I would appreciate suggestions and help with picking nits.

Emergency funds: I have six months of expenses in a money market account
Debt: mortgage only, 3.5%, will own house in 11 years
Tax Filing Status: Married Filing Jointly
Tax Rate: 28% Federal, 04% State
State of Residence:Louisiana
Age:45
Planned retirement age 65, but wishing for financial independence by 60. I'll keep working for fun.


Current SEP is in the high 6 figures
Current Asset Allocation: will roll-over my SEP-IRA into a 401(k) and will open a Roth for my wife and start funding again the Roth I opened years ago.

Below are the asset allocations along with the funds I have researched, but not necessarily chosen;thus, the capitlazied OR between them

45% Total US stock market
Vanguard total Stock market index fund admiral shares Expense Ratio = 0.04%

5% Small Value
Vanguard small-cap value ETF Expense Ratio = 0.07%
OR
Vanguard small-cap value index fund admiral shares Expense Ratio = 0.07%
OR
Vanguard small-cap index fund admiral shares Expense Ratio = 0.05%

20% Total International stock market
Vanguard total international stock index fund admiral shares Expense Ratio = 0.11%
OR
Vanguard total international stock index fund Expense Ratio = 0.17%

20% Total US Bond market
Vanguard total bond market index fund admiral shares Expense Ratio = 0.05%
OR
IShares national muni bond ETF Expense Ratio = 0.07%
OR
Schwab US aggregate bond index fund Expense Ratio = 0.04%
OR
10% TIPS
Vanguard inflation protected securities fund admiral shares Expense Ratio = 0.10%
OR
Schwab Treasure he inflation protected securities index fund Expense Ratio = 0.05%

PFInterest
Posts: 2588
Joined: Sun Jan 08, 2017 12:25 pm

Re: Help with first self-managed portfolio

Post by PFInterest » Thu Nov 08, 2018 5:00 pm

BajaMig wrote:
Wed Nov 07, 2018 3:32 pm
45% Total US stock market
Vanguard total Stock market index fund admiral shares Expense Ratio = 0.04%

5% Small Value
Vanguard small-cap value index fund admiral shares Expense Ratio = 0.07%


20% Total International stock market
Vanguard total international stock index fund admiral shares Expense Ratio = 0.11%

30% Total US Bond market
Vanguard total bond market index fund admiral shares Expense Ratio = 0.05%
this.
i dont think you need tips at 45 or with 70% stocks.
you can pick either etf or MF doesnt matter
you dont need munis as your fixed income portion should fit in your 401k.

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nedsaid
Posts: 10508
Joined: Fri Nov 23, 2012 12:33 pm

Re: Help with first self-managed portfolio

Post by nedsaid » Thu Nov 08, 2018 5:01 pm

It looks to me like you have a good plan here. A 70% stock/30% bond portfolio for a 45 year old is A-OK. I have had an Asset Allocation of 60%-70% stocks for years and it has worked great for me. I am age 59 and right now I have about 65% stocks and 35% bonds and cash.

I think a 50% US Stocks/20% International Stocks/20% US Bond Index/10% TIPS is a very good portfolio. I am a fan of TIPS as they give you inflation protection on the Bond side of your portfolio. I also like that you have a Small Value tilt.

For the taxable part of your account, do some math and check your tax bracket. See whether or not a Muni-Bond fund will be better than a taxable bond fund.

I am assuming that you have tax deferred and taxable accounts. Do some research on the most tax efficient placement of asset classes in accounts.

As far as which fund or ETF to buy in each category, I will leave that up to you. Your choices below are all good. Good job.
A fool and his money are good for business.

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