Portfolio Overlap

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Binx
Posts: 64
Joined: Thu Mar 20, 2008 8:59 pm

Portfolio Overlap

Post by Binx » Mon Jan 13, 2020 2:23 pm

Two questions:

1. I have 5 portfolio's that I oversee, all at Fidelity. (My own rollover IRA, my wife's rollover IRA, my daughters ROTH IRA, my daughters rollover IRA and an inherited IRA). Like many people here I value low cost broad index's, I personally like ETF's. I have ended up with the same investments in all these IRA's. Those investments are; VTI-Vanguard Total Stock Market, VXUS-Vanguard All World ex-US Stock Fund, BND-Vanguard Total Bond Market. It seems very simplistic, but works for me. Should I try to diversify within my IRA's? Maybe add REIT ETF's?

2. My daughter is 27. Should her IRA be essentially all stocks?

Thanks for any suggestions you might have~

retired@50
Posts: 992
Joined: Tue Oct 01, 2019 2:36 pm

Re: Portfolio Overlap

Post by retired@50 » Mon Jan 13, 2020 2:36 pm

Binx wrote:
Mon Jan 13, 2020 2:23 pm
Two questions:

1. I have 5 portfolio's that I oversee, all at Fidelity. (My own rollover IRA, my wife's rollover IRA, my daughters ROTH IRA, my daughters rollover IRA and an inherited IRA). Like many people here I value low cost broad index's, I personally like ETF's. I have ended up with the same investments in all these IRA's. Those investments are; VTI-Vanguard Total Stock Market, VXUS-Vanguard All World ex-US Stock Fund, BND-Vanguard Total Bond Market. It seems very simplistic, but works for me. Should I try to diversify within my IRA's? Maybe add REIT ETF's?

2. My daughter is 27. Should her IRA be essentially all stocks?

Thanks for any suggestions you might have~
It sounds to me like you actually have two portfolios. Your accounts and your wife's accounts should be treated as one "marital" portfolio and invested according to your desired asset allocation. Including REITs, if desired, should likely be done in a Roth IRA, if you have one. I don't really think it's necessary to include REITs since the VTI fund holds those companies already. Including a REIT index would "overweight" the Real Estate sector.

The second portfolio belongs to your daughter, and should be invested according to HER asset allocation. Again, if REITs are to be included, I'd suggest using some of the space in a Roth IRA.

For your daughter's assets, I'd suggest that you begin to involve her in the process of determining her own asset allocation desires and risk tolerances. Holding primarily stock at a young age (27) is common, but that doesn't mean it's what SHE wants.

Regards,
Boggle - a game from Parker Brothers. Bogle - investor, founder of Vanguard.

bloom2708
Posts: 7082
Joined: Wed Apr 02, 2014 2:08 pm
Location: Fargo, ND

Re: Portfolio Overlap

Post by bloom2708 » Mon Jan 13, 2020 2:45 pm

One simple change would be to have all your bond allocation in the 401k/workplace accounts/Rollover IRAs.

Have only stock index funds in Roth IRAs. Highest growth items. Longest window to use. Tax free withdrawals.

Taxable accounts can vary based on intended uses and allocation.

You don't need every fund in each account. 1 or 2 (maybe 3 in a couple) funds per account has worked good for us.
"People want confirmation, not advice" Unknown | "We are here to provoke thoughtfulness, not agree with you" Unknown | Four words: Whole food, plant based

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305pelusa
Posts: 1236
Joined: Fri Nov 16, 2018 10:20 pm

Re: Portfolio Overlap

Post by 305pelusa » Mon Jan 13, 2020 3:47 pm

Binx wrote:
Mon Jan 13, 2020 2:23 pm

2. My daughter is 27. Should her IRA be essentially all stocks?
Almost certainly yes.

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