I got lost in a wormhole of recent (and not so recent) “bonds in taxable” threads. You all have taught me that bonds are of course better in tax-deferred space, but that it also doesn’t matter much when interest rates are so low. Until we have 401k/HSA access again and can shift bond weight to those spaces, I kept them in our Roth IRAs (per advice on an earlier post) for now. Looking to KISS. It’s all so interesting, but I’m as beginner as they come.
Emergency funds: Yes, 6 months + future house down payment in a laddered CD
Tax Filing Status: Married Filing Jointly
Age: Both 32
Tax Rate: Federal 22%
Desired Asset Allocation: 75% stocks / 25% bonds
Desired International Allocation: 20%
Portfolio size: mid 200k
Current Retirement Assets
Her Roth IRA at Fidelity:
(18%) FSKAX Fidelity Total Market Index Fund – 0.015%
(10%) FXNAX Fidelity U.S. Bond Index - 0.025%
His Roth IRA at Vanguard
(11%) VTSAX Vanguard Total Stock Market Index Fund - 0.04%
(12%) VBTLX Vanguard Total Bond Market Fund – 0.05%
(1%) CORE, cash for medical reimbursements if needed
(2%) VBMPX Vanguard Total Bond Market IDX INSTLPLS – 0.03%
Her Taxable at TD Ameritrade:
(20%) SPTM, SPDR Portfolio Total Stock Market ETF – 0.03%
His Taxable at E-trade:
(26%) Domestic Stock (Employee Purchased Shares/Vesting Stock Grants) – we sell as soon as we can, to be replaced with VTSAX
(2%) Husband’s fun money – (keeping this at or under 3% of our total portfolio, per earlier advice)
Coverdell with Schwab - (90/10 AA, 20% International): $2000
Schwab U.S. Broad Market ETF, SCHB - 0.03%
International Equity Index ETF, SCHF - 0.06%
Schwab U.S. Aggregate Bond ETF, SCHZ – 0.05%
His 529B for Future Kid 1 - $5000
Utah / Age-based Aggressive Plan - 0.175%
Her 529B for Future Kid 2 - $5000
Utah / Age-based Aggressive - 0.175%
New Annual Contributions:
[*] $6,000/each Roth IRA contributions (or via backdoor)
[*] I’ll have about $7000 in freelance income via our husband/wife Partnership LLC that I could invest in a Solo 401k (more bond space!) but even typing that makes me tired. I have a bunch more reading to do (slash stalking Spirit Rider) :^)
- Is this as easy as I could make things (in lieu of target date funds) to easily rebalance each year?
- Any suggestions for different funds than my choices?
- I started to get bleary-eyed with the Bond descriptions in the Bogleheads’ Guide to Investing, but I’ve gathered from other threads that maybe tax-exempt bonds in the taxable accounts may be a better option?
- Any historical learnings/suggestions I could apply to this plan during the current COVID State of the Union?
I have already read the Getting Started, rebalancing, tax efficient fund placement, 3-fund portfolio, book recommendations, and IPS Wikis. Huge thanks to this great, kind community.