When to get in.

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Rockyleo123
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When to get in.

Post by Rockyleo123 » Tue Nov 05, 2019 10:46 am

Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.

bloom2708
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Re: When to get in.

Post by bloom2708 » Tue Nov 05, 2019 1:53 pm

Today is the best day to re-arrange inside the 401k.

The market is setting new highs many times per year. We believe that 20 years from now, these numbers will not be "high".

You have no gains or losses to deal with inside the 401ks. (or Roth IRA or Traditional IRA).

You may want to look at your overall mix of stocks and bonds. Try to keep Roth IRA and Taxable accounts mostly/all stock index funds. Put your bond allocation in your 401ks if you have the space. Say you want to be 75% stocks/25% bonds. Calculate 25% of your total portfolio. That is how much you should have in bonds. Put that in his/her 401ks in a good/low expense ratio intermediate term bond fund (if you have one). Most have one reasonable option. Fill the balance with stock index funds.

Note, each account does not have to have all 3 funds. Place based on amounts and the best/lowest cost/broad market index funds in each account.

If today doesn't work, tomorrow is another great day to adjust. Good luck!
"People want confirmation, not advice" Unknown | "We are here to provoke thoughtfulness, not agree with you" Unknown | Four words. Whole food, plant based. Bing it.

mcraepat9
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Re: When to get in.

Post by mcraepat9 » Tue Nov 05, 2019 1:59 pm

Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Question is, markets high right now.
You can find many many many posts on Bogleheads just like this from 2011, 2012, 2015, 2017 etc. By the time the "markets cool off" you won't want to put money in (would you have wanted to put money in the market in the late 2008/early 2009)? Do it today and move on.
Amateur investors are not cool-headed logicians.

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David Jay
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Re: When to get in.

Post by David Jay » Tue Nov 05, 2019 2:01 pm

What is the current asset allocation (stock-to-bond) in the 401K and what will be the new AA? If it is largely in stocks now why should the allocation be any different using a 3-fund than in the current fund choices?

Additionally, the stock market spends nearly 60% of the time at-or-near all time highs. This is not a particularly special time for the market.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

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1789
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Re: When to get in.

Post by 1789 » Tue Nov 05, 2019 2:05 pm

Hi Mike
Congrats on finishing the book and adopting BH philosophy. Markets were at all time high 2-3 months ago as well as couple years ago. I remember a morningstar video on youtube where they advised “investors should be conservative as bull market is 6 years old (2015)” . Market kept going up and up since then. People missed a lot opportunity by not being in market. Decide an asset allocation you are comfortable with and buy today. You will never know when is the right time to buy. Market will go down 10%, you will think it will go down more and than it will come backup before you buy 😂. Nobody is a successful player in this field.
Last edited by 1789 on Tue Nov 05, 2019 2:06 pm, edited 1 time in total.
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)

retired@50
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Re: When to get in.

Post by retired@50 » Tue Nov 05, 2019 2:05 pm

Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.
If your wife's 401k is currently invested in stock funds, presumably they too are at all time highs, so you're trading one "inflated" or "expensive" asset for another. What you may be gaining by doing the switch is saving on expense ratios, gaining simplicity, and future ease of re-balancing. Regards,

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Taylor Larimore
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Re: When to get in.

Post by Taylor Larimore » Tue Nov 05, 2019 2:22 pm

Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.
Rockyleo123:

Welcome to the Bogleheads Forum!

I am pleased that you would like to exchange into The Three-Fund Portfolio with its many benefits.

My suggestion is that you use Vanguard Portfolio Allocation Models to help you decide the allocation you can live with if the stock market takes a dive tomorrow--then invest NOW in that allocation.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "The beauty of owning the market is that you eliminate individual stock risk, you eliminate market sector risk, and you eliminate manager risk."
"Simplicity is the master key to financial success." -- Jack Bogle

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ruralavalon
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Re: When to get in.

Post by ruralavalon » Tue Nov 05, 2019 5:18 pm

Welcome to the forum :) .
Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.
If she knows what funds she wants to switch to, then she should just go ahead and make the change now. There is no advantage to waiting.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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dogagility
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Re: When to get in.

Post by dogagility » Tue Nov 05, 2019 5:26 pm

Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.
A cardinal rule of investing is not to try and time the market.
Stay invested.
Taking "risk" since 1995.

Copernicus
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Re: When to get in.

Post by Copernicus » Tue Nov 05, 2019 5:36 pm

Taylor Larimore wrote:
Tue Nov 05, 2019 2:22 pm
My suggestion is that you use Vanguard Portfolio Allocation Models to help you decide the allocation you can live with if the stock market takes a dive tomorrow--then invest NOW in that allocation.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "The beauty of owning the market is that you eliminate individual stock risk, you eliminate market sector risk, and you eliminate manager risk."
+1
+1
+1

snailderby
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Re: When to get in.

Post by snailderby » Wed Nov 06, 2019 10:20 am

Taylor Larimore wrote:
Tue Nov 05, 2019 2:22 pm
My suggestion is that you use Vanguard Portfolio Allocation Models to help you decide the allocation you can live with if the stock market takes a dive tomorrow--then invest NOW in that allocation.
+1. Get in now. But make sure you have an asset allocation that you can live with no matter what the stock market does tomorrow. Because no one knows what the stock market will do tomorrow.

TaxingAccount
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Re: When to get in.

Post by TaxingAccount » Wed Nov 06, 2019 10:40 am

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Last edited by TaxingAccount on Sun Nov 10, 2019 10:25 am, edited 1 time in total.

bloom2708
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Re: When to get in.

Post by bloom2708 » Wed Nov 06, 2019 10:42 am

TaxingAccount wrote:
Wed Nov 06, 2019 10:40 am
So you don't think the s&p 500 is going to 300?
It might go to 300. Will it stay at 300 or will it go back up after the next "big drop"?
"People want confirmation, not advice" Unknown | "We are here to provoke thoughtfulness, not agree with you" Unknown | Four words. Whole food, plant based. Bing it.

TaxingAccount
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Re: When to get in.

Post by TaxingAccount » Wed Nov 06, 2019 10:43 am

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Last edited by TaxingAccount on Sun Nov 10, 2019 10:25 am, edited 1 time in total.

Keenobserver
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Re: When to get in.

Post by Keenobserver » Wed Nov 06, 2019 11:14 am

Was gona go in 2015..but decided to wait for mRkey to cool down. Still waiting...missed 20% gains every year..sigh

chevca
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Re: When to get in.

Post by chevca » Wed Nov 06, 2019 11:26 am

Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.
You're already in if you're a long time investor and this 401k has been in anything other than a stable value fund. Just make the switch. Nothing to it.

Grt2bOutdoors
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Re: When to get in.

Post by Grt2bOutdoors » Wed Nov 06, 2019 12:11 pm

Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.
Long term investors don't care about today's prices, they care about tomorrow's prices when they make retirement withdrawals. Is your wife retiring tomorrow? If not, then do it today.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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jabberwockOG
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Re: When to get in.

Post by jabberwockOG » Wed Nov 06, 2019 12:37 pm

The only prices that matter are the prices in place when you put money in and when you eventually have to take money out of the market. Any market fluctuations and price changes in between those two times are 100% irrelevant and just noise that should be ignored by a smart investor

If you have money to put into the market put it in asap. The long term trend is up so there is a better than even chance that today's market price is lower than anything you will see in the future. Or dollar cost average in several even dollar chunks over several months if it make you feel better.

In my accumulation phase I put money in twice a month every single month for 30+ years regardless of stock market being up or down at the time. It worked out pretty well over the long term and I tried to ignore the short term as best I could.

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HomerJ
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Re: When to get in.

Post by HomerJ » Thu Nov 07, 2019 3:00 pm

TaxingAccount wrote:
Wed Nov 06, 2019 10:43 am
bloom2708 wrote:
Wed Nov 06, 2019 10:42 am
TaxingAccount wrote:
Wed Nov 06, 2019 10:40 am
So you don't think the s&p 500 is going to 300?
It might go to 300. Will it stay at 300 or will it go back up after the next "big drop"?
If it goes to 300 you would need a 900% gain just to get your money back. How many years would it take to make it back? At least a hundred.
1982-1999 was a 1000% gain, so why would one need at least a hundred years to gain 900%?

Besides, new money would be buying in at those low prices, so to get back to even wouldn't require a full bounce-back.
The J stands for Jay

dtee
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Re: When to get in.

Post by dtee » Thu Nov 07, 2019 4:06 pm

“The best time to plant a tree was 20 years ago. The second best time is now.”
Don't think about it. Just do it

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JoeRetire
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Re: When to get in.

Post by JoeRetire » Thu Nov 07, 2019 7:08 pm

Rockyleo123 wrote:
Tue Nov 05, 2019 10:46 am
Hello, new to sight but long term investor with Bogles Index funds. Just read the Three-Fund Potrfolio book and would like to make changes to my wife’s 401-k (as in sell all and invest in these three funds). Question is, markets high right now. Do I sell, hold in a money market account, then change over to the three fund plan when market cools off or do I just sell high and buy high and get in. Thoughts, thanks, mike in NY.
The market went up today.
So obviously you have have invested yesterday.
Don't be a lemming.

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1789
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Re: When to get in.

Post by 1789 » Thu Nov 07, 2019 10:20 pm

OP,
What did you decide to do?
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)

Topic Author
Rockyleo123
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Joined: Mon Nov 04, 2019 7:59 pm

Re: When to get in.

Post by Rockyleo123 » Mon Nov 18, 2019 8:00 pm

I converted it all, 70 Total US stock, 15 International and 15 Total US bond. She's got over a Mil and I want to double it in 10-12 years. We're in our early 50's. AA a little heavy but I like the time line. Thanks all.

02nz
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Re: When to get in.

Post by 02nz » Mon Nov 18, 2019 8:04 pm

85/15 is a very aggressive allocation for someone in their early 50s. It also depends on what other income (e.g., pensions) she'll have in retirement. There's no right or wrong answer for everyone, but how did you arrive at 85/15? Wanting to double your money in X years is not how you decide on an asset allocation.

Topic Author
Rockyleo123
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Re: When to get in.

Post by Rockyleo123 » Mon Nov 18, 2019 9:16 pm

We both work, ie 401-ks, IRA's and I have a brokerage account=2 mil plus. I'm retiring next month with a defined pension and taking 25 percent up front, $530k approx. House is paid off and two private colleges for kids are done. We work hard and live within our means. I figured stay aggressive, if market dumps I can live through it, thank God. Other splits are 70/30 and 60/40.

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