Throwing In The Towel on Portfolio Management

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

I've come to a fork in the road with respect to managing my investment portfolio. DW isn't interested at all in managing the portfolio and I'm tiring of it. Even the 3-fund portfolio is too much work. I can get someone to manage it for me (for a cost) or I can establish a passive portfolio that takes very little energy to manage.

My current thought is to liquidate our current investments (all index ETFs) in our IRAs and gradually and prudently liquidate (minimizing Capital gains) our after-tax brokerage account and use the proceeds to buy two target funds: SWYAX (Schwab 2010 Index Target Fund [Exp Ratio .08%]) and VTINX (Vanguard Target Retirement Income Fund [Exp Ratio .12%]). I plan to invest 50% of our retirement investment portfolio in each. As our CDs mature, we'll simply increase our positions in the two funds. And yes, we'll continue will maintain a substantial emergency fund at a local financial institution.

I can hear the gasps....I know there are better places for the money and better tactics to attain a passive portfolio but this simple low cost solution fits us well.

Why these funds? They are funds of low cost diversified index funds with allocations similar to our current portfolio with the lowest expense ratios on the planet. The funds were designed by way smarter people than me and I'd expect them to perform just fine with the level of risk appropriate for DW and myself. I can buy them and sell them at no cost at Schwab (I've got a special deal at Schwab to buy Vanguard funds for free). No rebalancing is required meeting my main objective of simplicity and being nearly effort free. My DW can manage easily if I should move on the heaven. The return will easily be sufficient to supplement our spending needs.

I'd welcome your learned thoughts. If this plan is folly I'd like to know before I implement it. Thanks in advance!
Investor.Saver1 | | Experience is something you don't get until just after you need it.
Normchad
Posts: 5648
Joined: Thu Mar 03, 2011 6:20 am

Re: Throwing In The Towel on Portfolio Management

Post by Normchad »

investor.saver1 wrote: Tue Sep 15, 2020 5:24 pm I've come to a fork in the road with respect to managing my investment portfolio. DW isn't interested at all in managing the portfolio and I'm tiring of it. Even the 3-fund portfolio is too much work. I can get someone to manage it for me (for a cost) or I can establish a passive portfolio that takes very little energy to manage.

My current thought is to liquidate our current investments (all index ETFs) in our IRAs and gradually and prudently liquidate (minimizing Capital gains) our after-tax brokerage account and use the proceeds to buy two target funds: SWYAX (Schwab 2010 Index Target Fund [Exp Ratio .08%]) and VTINX (Vanguard Target Retirement Income Fund [Exp Ratio .12%]). I plan to invest 50% of our retirement investment portfolio in each. As our CDs mature, we'll simply increase our positions in the two funds. And yes, we'll continue will maintain a substantial emergency fund at a local financial institution.

I can hear the gasps....I know there are better places for the money and better tactics to attain a passive portfolio but this simple low cost solution fits us well.

Why these funds? They are funds of low cost diversified index funds with allocations similar to our current portfolio with the lowest expense ratios on the planet. The funds were designed by way smarter people than me and I'd expect them to perform just fine with the level of risk appropriate for DW and myself. I can buy them and sell them at no cost at Schwab (I've got a special deal at Schwab to buy Vanguard funds for free). No rebalancing is required meeting my main objective of simplicity and being nearly effort free. My DW can manage easily if I should move on the heaven. The return will easily be sufficient to supplement our spending needs.

I'd welcome your learned thoughts. If this plan is folly I'd like to know before I implement it. Thanks in advance!
I’m not gasping...... I like simplicity......

When I’m all done, I might be 100% in a single fund, VSMGX, Lifestrategy Moderate Growth.

There are lots of appealing one fund solutions out there. Honestly, I’d also be okay with 100% Vanguard Wellington or 100% Vanguard Balanced Index.

So your idea, of simplifying greatly is a good one.
000
Posts: 8211
Joined: Thu Jul 23, 2020 12:04 am

Re: Throwing In The Towel on Portfolio Management

Post by 000 »

I'm not gasping.

Two questions:
1. Would it be simpler to not sell anything in taxable and just redirect dividends to the new fund?
2. Have you considered tax-managed balanced or balanced index in taxable? Foreign tax credit is not available for the foreign holdings in the balanced funds you mentioned (not enough foreign source income), which is another drag.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

000 wrote: Tue Sep 15, 2020 5:34 pm I'm not gasping.

Two questions:
1. Would it be simpler to not sell anything in taxable and just redirect dividends to the new fund?

I hadn’t considered doing this, but yes it would be simpler and more tax efficient with respect to the equity funds. I’ll study this.

2. Have you considered tax-managed balanced or balanced index in taxable? Foreign tax credit is not available for the foreign holdings in the balanced funds you mentioned (not enough foreign source income), which is another drag.
Another great suggestion which I’ll study.

Thanks!!!
Investor.Saver1 | | Experience is something you don't get until just after you need it.
livesoft
Posts: 86076
Joined: Thu Mar 01, 2007 7:00 pm

Re: Throwing In The Towel on Portfolio Management

Post by livesoft »

We own a Fidelity Freedom Index fund and a Vanguard LifeStrategy Moderate Growth fund, so your plan sounds great to me.

The main issue is taxes. You may wish to simply stop managing your taxable account and let it carry on as if you were dead.
Wiki This signature message sponsored by sscritic: Learn to fish.
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Throwing In The Towel on Portfolio Management

Post by David Jay »

I am putting all accounts (one tIRA and two Roth) into a LifeStrategy fund because my spouse can continue to hold that “forever”.

So no “gasp” from me.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
chassis
Posts: 2183
Joined: Tue Mar 24, 2020 4:28 pm

Re: Throwing In The Towel on Portfolio Management

Post by chassis »

investor.saver1 wrote: Tue Sep 15, 2020 5:24 pm I've come to a fork in the road with respect to managing my investment portfolio. DW isn't interested at all in managing the portfolio and I'm tiring of it. Even the 3-fund portfolio is too much work. I can get someone to manage it for me (for a cost) or I can establish a passive portfolio that takes very little energy to manage.

My current thought is to liquidate our current investments (all index ETFs) in our IRAs and gradually and prudently liquidate (minimizing Capital gains) our after-tax brokerage account and use the proceeds to buy two target funds: SWYAX (Schwab 2010 Index Target Fund [Exp Ratio .08%]) and VTINX (Vanguard Target Retirement Income Fund [Exp Ratio .12%]). I plan to invest 50% of our retirement investment portfolio in each. As our CDs mature, we'll simply increase our positions in the two funds. And yes, we'll continue will maintain a substantial emergency fund at a local financial institution.

I can hear the gasps....I know there are better places for the money and better tactics to attain a passive portfolio but this simple low cost solution fits us well.

Why these funds? They are funds of low cost diversified index funds with allocations similar to our current portfolio with the lowest expense ratios on the planet. The funds were designed by way smarter people than me and I'd expect them to perform just fine with the level of risk appropriate for DW and myself. I can buy them and sell them at no cost at Schwab (I've got a special deal at Schwab to buy Vanguard funds for free). No rebalancing is required meeting my main objective of simplicity and being nearly effort free. My DW can manage easily if I should move on the heaven. The return will easily be sufficient to supplement our spending needs.

I'd welcome your learned thoughts. If this plan is folly I'd like to know before I implement it. Thanks in advance!
@investor.saver1 Thanks for posting this, simplicity is a good thing. Some questions, if you care to share.

1. What is your age?
2. Are you retired, meaning do you receive an income for your time as an employee?
3. How many hours per day, week or month were you spending managing your portfolio when you decided it was too much work?

Thanks for anything you care to reply to.
iamblessed
Posts: 1808
Joined: Sat Jun 09, 2018 11:52 am
Location: St. Louis

Re: Throwing In The Towel on Portfolio Management

Post by iamblessed »

Why not one fund one of the Vanguard LifeStrategy funds?
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

iamblessed wrote: Tue Sep 15, 2020 8:22 pm Why not one fund one of the Vanguard LifeStrategy funds?
Easy...LifeStrategy doesn’t hold TIPs which I consider an essential inflation hedge for a retired individual. I could add TIPs on my own but again I’m adding complexity and that’s what I’m getting away from.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

chassis wrote: Tue Sep 15, 2020 7:55 pm
@investor.saver1 Thanks for posting this, simplicity is a good thing. Some questions, if you care to share.

1. What is your age?
2. Are you retired, meaning do you receive an income for your time as an employee?
3. How many hours per day, week or month were you spending managing your portfolio when you decided it was too much work?

Thanks for anything you care to reply to.
Early 70s. DW and I are retired. I retired at 62 and DW retired with pension in her late 50s. No pension for me. Social Security for both of us.
I’ve spent several hours a day since I retired managing our portfolio and looked at it as fun. But Now it has become a chore.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
tj
Posts: 9368
Joined: Wed Dec 23, 2009 11:10 pm

Re: Throwing In The Towel on Portfolio Management

Post by tj »

investor.saver1 wrote: Tue Sep 15, 2020 9:39 pm
chassis wrote: Tue Sep 15, 2020 7:55 pm
@investor.saver1 Thanks for posting this, simplicity is a good thing. Some questions, if you care to share.

1. What is your age?
2. Are you retired, meaning do you receive an income for your time as an employee?
3. How many hours per day, week or month were you spending managing your portfolio when you decided it was too much work?

Thanks for anything you care to reply to.
Early 70s. DW and I are retired. I retired at 62 and DW retired with pension in her late 50s. No pension for me. Social Security for both of us.
I’ve spent several hours a day since I retired managing our portfolio and looked at it as fun. But Now it has become a chore.
Were you day trading stocks? How did the hours add up so much?
User avatar
Brianmcg321
Posts: 1875
Joined: Mon Jul 15, 2019 8:23 am

Re: Throwing In The Towel on Portfolio Management

Post by Brianmcg321 »

I like your plan.

The more I have learned over the years about investing the more I like the one fund approach. When I retire I will probably just put all our traditional IRAs in one of the life strategy funds or balanced index, and keep our Roths in VTSAX.

If we ever use our Roths I will change them accordingly.
Rules to investing: | 1. Don't lose money. | 2. Don't forget rule number 1.
jimkinny
Posts: 1856
Joined: Sun Mar 14, 2010 1:51 pm

Re: Throwing In The Towel on Portfolio Management

Post by jimkinny »

Target Funds are a good choice. I would likely do better if I owned one.
User avatar
celia
Posts: 16774
Joined: Sun Mar 09, 2008 6:32 am
Location: SoCal

Re: Throwing In The Towel on Portfolio Management

Post by celia »

I think you need to think about the long-range plan. If you and DW were in a coma or had cognitive decline, who would you want to pay your bills and handle your financials? Do you already have a designated Durable Power of Attorney? I think a better idea is to finish your estate planning and then turn at least part of the work over to your designated person.

The benefit of doing this now instead of after you die, is that your designated person will have time to ask you questions and get to know your investment philosophy. DH and I both have parents who turned everything over to their kids to manage about age 90. The age doesn't matter so much, but when it becomes a "chore", your kids (or someone else) need to help you (and themselves) by making things simpler.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

tj wrote: Tue Sep 15, 2020 10:25 pm
investor.saver1 wrote: Tue Sep 15, 2020 9:39 pm
chassis wrote: Tue Sep 15, 2020 7:55 pm
@investor.saver1 Thanks for posting this, simplicity is a good thing. Some questions, if you care to share.

1. What is your age?
2. Are you retired, meaning do you receive an income for your time as an employee?
3. How many hours per day, week or month were you spending managing your portfolio when you decided it was too much work?

Thanks for anything you care to reply to.
Early 70s. DW and I are retired. I retired at 62 and DW retired with pension in her late 50s. No pension for me. Social Security for both of us.
I’ve spent several hours a day since I retired managing our portfolio and looked at it as fun. But Now it has become a chore.
Were you day trading stocks? How did the hours add up so much?
I'm lumping all investment related activity together....reading/studying/researching blogs, websites, etc...into those hours. I was always looking for the best tweak to make to the portfolio. I've constructed a number of tracking/monitoring shreadsheets with dashboards to monitor the nuances of the portfolio. On and on it goes in terms of activity focused around the investments. In reality, little was accomplished in all those hours, weeks, years to improve our return. I have every confidence if I had made the move into target funds when I first retired, I'd be ahead of where I am today financially -- although I've done quite well. While I did trade a few stocks and options for a very brief time period, most of my energy went into tweaking the larger portfolio.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

jimkinny wrote: Wed Sep 16, 2020 5:35 am Target Funds are a good choice. I would likely do better if I owned one.
And have more time to enjoy life!
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

celia wrote: Wed Sep 16, 2020 5:53 am I think you need to think about the long-range plan. If you and DW were in a coma or had cognitive decline, who would you want to pay your bills and handle your financials? Do you already have a designated Durable Power of Attorney? I think a better idea is to finish your estate planning and then turn at least part of the work over to your designated person.

The benefit of doing this now instead of after you die, is that your designated person will have time to ask you questions and get to know your investment philosophy. DH and I both have parents who turned everything over to their kids to manage about age 90. The age doesn't matter so much, but when it becomes a "chore", your kids (or someone else) need to help you (and themselves) by making things simpler.
There's wisdom in what you've said Celia. We're not at that point yet. We've done estate planning and are prepared. For us, the joy of being in the minutia of portfolio management has faded. We just would rather do other things now. Things that bring more satisfaction in life and are memorable. Travel, walks in the woods, etc.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

livesoft wrote: Tue Sep 15, 2020 7:17 pm We own a Fidelity Freedom Index fund and a Vanguard LifeStrategy Moderate Growth fund, so your plan sounds great to me.

The main issue is taxes. You may wish to simply stop managing your taxable account and let it carry on as if you were dead.
I'll give this some thought livesoft. Doing nothing in the taxable account could indeed be the right solution.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
chassis
Posts: 2183
Joined: Tue Mar 24, 2020 4:28 pm

Re: Throwing In The Towel on Portfolio Management

Post by chassis »

investor.saver1 wrote: Tue Sep 15, 2020 9:39 pm
chassis wrote: Tue Sep 15, 2020 7:55 pm
@investor.saver1 Thanks for posting this, simplicity is a good thing. Some questions, if you care to share.

1. What is your age?
2. Are you retired, meaning do you receive an income for your time as an employee?
3. How many hours per day, week or month were you spending managing your portfolio when you decided it was too much work?

Thanks for anything you care to reply to.
Early 70s. DW and I are retired. I retired at 62 and DW retired with pension in her late 50s. No pension for me. Social Security for both of us.
I’ve spent several hours a day since I retired managing our portfolio and looked at it as fun. But Now it has become a chore.
@investor.saver1 Thanks very much, I appreciate your insights.
index245
Posts: 239
Joined: Wed Feb 12, 2020 8:28 pm

Re: Throwing In The Towel on Portfolio Management

Post by index245 »

I didn't gasp. I'm in my 40's and feel the same way! Very close to going "one fund" in all tax advantaged accounts. Lifestrategy, Balanced or Target Date (or combination).
User avatar
Sage16
Posts: 277
Joined: Sun Mar 27, 2016 11:06 pm

Re: Throwing In The Towel on Portfolio Management

Post by Sage16 »

we are getting to the same place. We have been retired for 5 years and keep a very simple primarily 3 fund portfolio. But I find I have spent a lot of time this year in particular second guessing our stock/bond allocation with the market setting records and interest rates near zero. My wife has no interest in learning or managing our portfolio if for some reason I can't. After discussions with our Flagship Rep, we are looking at test driving PAS with her IRA account which is a portion of our portfolio. I want the ability to get advice across our portfolio not just what we give them under PAS and I don't want her IRA invested in a lifecycle look alike allocation with a higher management fee. When I look at the cost for PAS, I have come to realize her account today in a 3 fund portfolio can fluctuate more in a day than PAS costs for a year. In our case we are looking for more of a comprehensive relationship than just placing it in a lifecycle fund and willing to pay slightly more fees for advice and assistance across our financial spectrum. We will see how it goes and can always bail out if the value to us isn't there or if do see the value turn it all over to them. I have always felt no way am I paying AUM but coming to realize the value to us may now be there and we can focus more energy on our other interests. We shall see, your mileage will vary.
Bogle on investing: Diversify, focus on low costs, invest for the long term. Don't speculate and don't be distracted by volatility.
MotoTrojan
Posts: 11259
Joined: Wed Feb 01, 2017 7:39 pm

Re: Throwing In The Towel on Portfolio Management

Post by MotoTrojan »

If you are going to go through all this effort I would find a single fund that meets your objectives and really go for maximum simplicity.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

Sage16 wrote: Wed Sep 16, 2020 2:52 pm we are getting to the same place. We have been retired for 5 years and keep a very simple primarily 3 fund portfolio. But I find I have spent a lot of time this year in particular second guessing our stock/bond allocation with the market setting records and interest rates near zero. My wife has no interest in learning or managing our portfolio if for some reason I can't. After discussions with our Flagship Rep, we are looking at test driving PAS with her IRA account which is a portion of our portfolio. I want the ability to get advice across our portfolio not just what we give them under PAS and I don't want her IRA invested in a lifecycle look alike allocation with a higher management fee. When I look at the cost for PAS, I have come to realize her account today in a 3 fund portfolio can fluctuate more in a day than PAS costs for a year. In our case we are looking for more of a comprehensive relationship than just placing it in a lifecycle fund and willing to pay slightly more fees for advice and assistance across our financial spectrum. We will see how it goes and can always bail out if the value to us isn't there or if do see the value turn it all over to them. I have always felt no way am I paying AUM but coming to realize the value to us may now be there and we can focus more energy on our other interests. We shall see, your mileage will vary.
Seems as though the enjoyment of self managing dissipates after a time. Our investments are at Schwab and they too offer low-cost management. I weighed going with their PAS equivalent against the target retirement funds that I chose. It dawned on me that both Vanguard and Schwab invested a lot of thought in defining their allocations within their target fund lineup and most likely the allocations were reviewed at many levels by very senior people. That's when I concluded that paying out of pocket for advice from a fairly inexperienced "advisor" with a set of plug and play algorithms most likely would not bring me increased value over the target fund allocation. Everyone is different. Wishing you great success.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
TomatoTomahto
Posts: 17158
Joined: Mon Apr 11, 2011 1:48 pm

Re: Throwing In The Towel on Portfolio Management

Post by TomatoTomahto »

investor.saver1 wrote: Wed Sep 16, 2020 8:23 am
livesoft wrote: Tue Sep 15, 2020 7:17 pm We own a Fidelity Freedom Index fund and a Vanguard LifeStrategy Moderate Growth fund, so your plan sounds great to me.

The main issue is taxes. You may wish to simply stop managing your taxable account and let it carry on as if you were dead.
I'll give this some thought livesoft. Doing nothing in the taxable account could indeed be the right solution.
+1. You spend hours per day doing things that you initially enjoyed but that are now chores.

I don’t do any of those things, and my portfolio chugs along just fine. I might spend an hour per month on my portfolio.
I get the FI part but not the RE part of FIRE.
bloom2708
Posts: 9859
Joined: Wed Apr 02, 2014 2:08 pm

Re: Throwing In The Towel on Portfolio Management

Post by bloom2708 »

Why 2 funds that do the exact same thing?

1 target Income OR 1 LifeStrategy fund. No reason to do 2 of the same thing.
Normchad
Posts: 5648
Joined: Thu Mar 03, 2011 6:20 am

Re: Throwing In The Towel on Portfolio Management

Post by Normchad »

TomatoTomahto wrote: Wed Sep 16, 2020 3:43 pm
investor.saver1 wrote: Wed Sep 16, 2020 8:23 am
livesoft wrote: Tue Sep 15, 2020 7:17 pm We own a Fidelity Freedom Index fund and a Vanguard LifeStrategy Moderate Growth fund, so your plan sounds great to me.

The main issue is taxes. You may wish to simply stop managing your taxable account and let it carry on as if you were dead.
I'll give this some thought livesoft. Doing nothing in the taxable account could indeed be the right solution.
+1. You spend hours per day doing things that you initially enjoyed but that are now chores.

I don’t do any of those things, and my portfolio chugs along just fine. I might spend an hour per month on my portfolio.
I estimate I spend less than two hours per year on my portfolio.
I spend less than 3 hours a year doing my taxes.
I do spend about an hour a day on this site, which is time very well spent.

So all in all, I spend about an hour a day on finance stuff.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

Normchad: I only wish I could be content to be so disconnected from my portfolio. Kudos to you. Hoping my simplistic approach allows me the same.
Last edited by investor.saver1 on Wed Sep 16, 2020 6:06 pm, edited 1 time in total.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

bloom2708 wrote: Wed Sep 16, 2020 3:48 pm Why 2 funds that do the exact same thing?

1 target Income OR 1 LifeStrategy fund. No reason to do 2 of the same thing.
Only because I wanted a bit of diversification in the fund management. Why put all my eggs in one basket when I can use two. No other reason. I guess I’d ask why not.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

bloom2708 wrote: Wed Sep 16, 2020 3:48 pm Why 2 funds that do the exact same thing?

1 target Income OR 1 LifeStrategy fund. No reason to do 2 of the same thing.
Diversity of management is the reason. Spreading management risk. Yes, I realize it’s negligible.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
1210sda
Posts: 1865
Joined: Wed Feb 28, 2007 7:31 am

Re: Throwing In The Towel on Portfolio Management

Post by 1210sda »

investor.saver1 wrote: Wed Sep 16, 2020 6:04 pm
bloom2708 wrote: Wed Sep 16, 2020 3:48 pm Why 2 funds that do the exact same thing?

1 target Income OR 1 LifeStrategy fund. No reason to do 2 of the same thing.
Only because I wanted a bit of diversification in the fund management. Why put all my eggs in one basket when I can use two. No other reason. I guess I’d ask why not.
I'm confused....What's to be managed, aren't they're index funds!
Explorer
Posts: 769
Joined: Thu Oct 13, 2016 7:54 pm

Re: Throwing In The Towel on Portfolio Management

Post by Explorer »

I would prefer a combination of an active and a passive fund such as Wellesley and Vanguard Target Retirement, In fact at the moment, these 2 are my largest holdings... I need to come up with a timeline to replace the rest with these 2 funds.
marc in merrimack
Posts: 577
Joined: Tue Feb 20, 2007 9:15 am
Location: Massachusetts

Re: Throwing In The Towel on Portfolio Management

Post by marc in merrimack »

livesoft wrote: Tue Sep 15, 2020 7:17 pm We own a Fidelity Freedom Index fund and a Vanguard LifeStrategy Moderate Growth fund, so your plan sounds great to me.

The main issue is taxes. You may wish to simply stop managing your taxable account and let it carry on as if you were dead.
Speaking of taxes, how do those two fund-of-funds fit into your strategy for tax loss harvesting?
chrisam314
Posts: 131
Joined: Tue Jun 28, 2016 9:22 pm

Re: Throwing In The Towel on Portfolio Management

Post by chrisam314 »

VSMGX and let it ride.
iamblessed
Posts: 1808
Joined: Sat Jun 09, 2018 11:52 am
Location: St. Louis

Re: Throwing In The Towel on Portfolio Management

Post by iamblessed »

chrisam314 wrote: Wed Sep 16, 2020 6:51 pm VSMGX and let it ride.
+1
livesoft
Posts: 86076
Joined: Thu Mar 01, 2007 7:00 pm

Re: Throwing In The Towel on Portfolio Management

Post by livesoft »

marcwd wrote: Wed Sep 16, 2020 6:33 pm
livesoft wrote: Tue Sep 15, 2020 7:17 pm We own a Fidelity Freedom Index fund and a Vanguard LifeStrategy Moderate Growth fund, so your plan sounds great to me.

The main issue is taxes. You may wish to simply stop managing your taxable account and let it carry on as if you were dead.
Speaking of taxes, how do those two fund-of-funds fit into your strategy for tax loss harvesting?
Those two funds are in inherited IRAs and don't have any effect on the TLH that we do in our taxable accounts that hold things like VTI, VEU, and VEA. OK, our taxable accounts also hold some other equity funds/ETFs last purchased in 2009 that are not going to be tax-loss harvested unless something really really really really bad happens in the stock market. I want to also make it clear that since we are no longer contributing to our taxable account in retirement, we rarely have any reason to tax-loss harvest because no positions nor lots have any loss. In other words, our taxable accounts carry on by themselves as if we were dead.
Wiki This signature message sponsored by sscritic: Learn to fish.
User avatar
LilyFleur
Posts: 3499
Joined: Fri Mar 02, 2018 9:36 pm

Re: Throwing In The Towel on Portfolio Management

Post by LilyFleur »

About two years ago, I thought it would be a brilliant, streamlined move to put a lot of money in a balanced index fund in my 401k. It drove me crazy. I like to be able to see the moving parts and what they are doing. Now I have the money in a bond index fund, an S&P 500 fund and a stable value fund. I can look at it every day or every year. I just cannot make myself give up the option of taking money to pay my bills out of the bond fund in a year that equities are down, and taking money out of equities when they are doing quite well.

Have you considered having a total bond index fund at one institution, and some sort of index stock fund at the other institution? No hands-on management would be required. You could look at it if you wanted, or not look at it.
User avatar
Rowan Oak
Posts: 851
Joined: Mon May 09, 2016 2:11 pm
Location: Yoknapatawpha

Re: Throwing In The Towel on Portfolio Management

Post by Rowan Oak »

David Jay wrote: Tue Sep 15, 2020 7:51 pm I am putting all accounts (one tIRA and two Roth) into a LifeStrategy fund because my spouse can continue to hold that “forever”.

So no “gasp” from me.
I've done the same for all IRAs, but our taxable account remains a The Three-Fund Portfolio for tax loss harvesting purposes.

At some point even our taxable account will be moved to one of the Vanguard LifeStrategy Funds, because this will be easier for my spouse to manage when I'm gone or no longer able to manage the more complicated Three-Fund Portfolio.
Last edited by Rowan Oak on Wed Sep 16, 2020 7:40 pm, edited 1 time in total.
“If you can get good at destroying your own wrong ideas, that is a great gift.” – Charlie Munger
User avatar
Taylor Larimore
Posts: 32842
Joined: Tue Feb 27, 2007 7:09 pm
Location: Miami FL

Target Funds

Post by Taylor Larimore »

I can hear the gasps....I know there are better places for the money and better tactics to attain a passive portfolio but this simple low cost solution fits us well.
investor.saver1:

You will get no "gasps" from me. I think a low-cost target fund, designed by experts, and with the appropriate stock/bond allocation, is an excellent choice for many investors.

For reassurance, please read my "Simplicity" link below.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "Target-date funds have proved to be the most powerful fund-industry-changing concept since the money market mutual fund and the index mutual fund."
"Simplicity is the master key to financial success." -- Jack Bogle
SimplicityNow
Posts: 605
Joined: Fri Aug 05, 2016 10:31 am

Re: Throwing In The Towel on Portfolio Management

Post by SimplicityNow »

TomatoTomahto wrote: Wed Sep 16, 2020 3:43 pm
investor.saver1 wrote: Wed Sep 16, 2020 8:23 am
livesoft wrote: Tue Sep 15, 2020 7:17 pm We own a Fidelity Freedom Index fund and a Vanguard LifeStrategy Moderate Growth fund, so your plan sounds great to me.

The main issue is taxes. You may wish to simply stop managing your taxable account and let it carry on as if you were dead.
I'll give this some thought livesoft. Doing nothing in the taxable account could indeed be the right solution.
+1. You spend hours per day doing things that you initially enjoyed but that are now chores.

I don’t do any of those things, and my portfolio chugs along just fine. I might spend an hour per month on my portfolio.
Same here. My portfolio is much more complicated due to my wife's numerous employers over the years.
I spend about 2 hours a month bringing our spreadsheet up to date. I could automate it and it could take 5 mins but I like the mental exercise.

Eventually I may move most of it to a lifecycle fund as my wife has no interest in managing it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Target Funds

Post by investor.saver1 »

Taylor Larimore wrote: Wed Sep 16, 2020 7:35 pm
I can hear the gasps....I know there are better places for the money and better tactics to attain a passive portfolio but this simple low cost solution fits us well.
investor.saver1:

You will get no "gasps" from me. I think a low-cost target fund, designed by experts, and with the appropriate stock/bond allocation, is an excellent choice for many investors.

For reassurance, please read my "Simplicity" link below.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "Target-date funds have proved to be the most powerful fund-industry-changing concept since the money market mutual fund and the index mutual fund."
Thank you Taylor for reassuring me. I’ve been on this learning journey for a long time and have benefited greatly from your wisdom here on the blog. I’ve been chasing the illusion of the ideal portfolio for a very long time. Now the race is finally over and it feels very good! Time for DW and me to take a walk and enjoy life a bit more.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
1789
Posts: 2223
Joined: Fri Aug 16, 2019 3:31 pm

Re: Throwing In The Towel on Portfolio Management

Post by 1789 »

VBIAX (60/40) is another great choice for one fund option.
"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)
User avatar
burritoLover
Posts: 4097
Joined: Sun Jul 05, 2020 12:13 pm

Re: Throwing In The Towel on Portfolio Management

Post by burritoLover »

Target date funds in 401k and taxable here. Automatically rebalances. Automatically increases bond allocation as the years tick by. Well diversified. I just plow money into it. Market crash? Market up? - don’t care - don’t have to do anything except continue to buy.
bigskyguy
Posts: 406
Joined: Sat Jan 24, 2015 3:59 pm

Re: Throwing In The Towel on Portfolio Management

Post by bigskyguy »

Many great ideas and advice here. But while it is indeed important to consider simplifying where you keep your assets, don’t stop there. Consider this step one in the simplifying or clarifying algorithm.
1 - simplify your withdrawal portfolio
2 - develop a clear and easily administered withdrawal algorithm. I have a written document that details how much to withdraw, where and when to withdraw, and where to have the funds that have been withdrawn for the purposes of annual expenditures. It goes year by year, starting in 2019 and continuing to 2049, and provides guidance to my wife as to how I presently would access our retirement funds.
3 - in parallel with the withdrawal document, I have written an expenditure document that derails year by year our expenditures, based upon our expenditures now. I realize it is impossible to predict precisely what our expenses will be 10-20 years down the road, but at least I can provide a base understanding of what our present lifestyle costs and use that as the best template for our future expenditures.
4 - finally, realize that at some point neither you nor your life partner will be around. Providing specific guidance to your heirs and your estate’s executor as to how you two wish to have your estate dealt with when you both are gone is similarly important. It is, after all, your legacy in so many ways, and your final opportunity to leave your mark.
What I’m really trying to get at is that your question is only step one. Don’t stop there.
Call_Me_Op
Posts: 9881
Joined: Mon Sep 07, 2009 2:57 pm
Location: Milky Way

Re: Throwing In The Towel on Portfolio Management

Post by Call_Me_Op »

I have my mom in a single Lifestrategy fund. It's perfect for her. All she does is receive an annual RMD check. That's it.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein
User avatar
Wiggums
Posts: 7051
Joined: Thu Jan 31, 2019 7:02 am

Re: Target Funds

Post by Wiggums »

Taylor Larimore wrote: Wed Sep 16, 2020 7:35 pm
I can hear the gasps....I know there are better places for the money and better tactics to attain a passive portfolio but this simple low cost solution fits us well.
investor.saver1:

You will get no "gasps" from me. I think a low-cost target fund, designed by experts, and with the appropriate stock/bond allocation, is an excellent choice for many investors.

For reassurance, please read my "Simplicity" link below.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "Target-date funds have proved to be the most powerful fund-industry-changing concept since the money market mutual fund and the index mutual fund."
+1
"I started with nothing and I still have most of it left."
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

LilyFleur wrote: Wed Sep 16, 2020 7:14 pm About two years ago, I thought it would be a brilliant, streamlined move to put a lot of money in a balanced index fund in my 401k. It drove me crazy. I like to be able to see the moving parts and what they are doing. Now I have the money in a bond index fund, an S&P 500 fund and a stable value fund. I can look at it every day or every year. I just cannot make myself give up the option of taking money to pay my bills out of the bond fund in a year that equities are down, and taking money out of equities when they are doing quite well.

Have you considered having a total bond index fund at one institution, and some sort of index stock fund at the other institution? No hands-on management would be required. You could look at it if you wanted, or not look at it.
LilyFleur...thank you for posting! Your investing path is exactly the one I was on. It has taken me a long time to realize my time and energies are much better spent on enjoying life than on micromanaging my investments myself. Have you considered the fact that when expert fund managers rebalance assets within a fund they are selling high and buying low...and they do it with great disciple. After years of self managing I came to the conclusion that I'm not as sophisticated nor as learned as the professionals. My time is worth way more to me invested in things I enjoy. Monitoring my investments was fun for a while, but not so much fun now. Don't get me wrong...I'm still planning to keep an eye on things occasionally, but it's no longer is my daily priority.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

bigskyguy wrote: Thu Sep 17, 2020 7:40 am Many great ideas and advice here. But while it is indeed important to consider simplifying where you keep your assets, don’t stop there. Consider this step one in the simplifying or clarifying algorithm.
1 - simplify your withdrawal portfolio
2 - develop a clear and easily administered withdrawal algorithm. I have a written document that details how much to withdraw, where and when to withdraw, and where to have the funds that have been withdrawn for the purposes of annual expenditures. It goes year by year, starting in 2019 and continuing to 2049, and provides guidance to my wife as to how I presently would access our retirement funds.
3 - in parallel with the withdrawal document, I have written an expenditure document that derails year by year our expenditures, based upon our expenditures now. I realize it is impossible to predict precisely what our expenses will be 10-20 years down the road, but at least I can provide a base understanding of what our present lifestyle costs and use that as the best template for our future expenditures.
4 - finally, realize that at some point neither you nor your life partner will be around. Providing specific guidance to your heirs and your estate’s executor as to how you two wish to have your estate dealt with when you both are gone is similarly important. It is, after all, your legacy in so many ways, and your final opportunity to leave your mark.
What I’m really trying to get at is that your question is only step one. Don’t stop there.
Thanks for your wisdom here bigskyguy! Right you are that I've just accomplished step one of a multistep process. I shall take your recommendations and implement them!
Investor.Saver1 | | Experience is something you don't get until just after you need it.
User avatar
Wiggums
Posts: 7051
Joined: Thu Jan 31, 2019 7:02 am

Re: Throwing In The Towel on Portfolio Management

Post by Wiggums »

Good luck to you. You are on the right track...
"I started with nothing and I still have most of it left."
iamblessed
Posts: 1808
Joined: Sat Jun 09, 2018 11:52 am
Location: St. Louis

Re: Throwing In The Towel on Portfolio Management

Post by iamblessed »

User avatar
Topic Author
investor.saver1
Posts: 367
Joined: Sun Jan 02, 2011 8:43 pm

Re: Throwing In The Towel on Portfolio Management

Post by investor.saver1 »

iamblessed wrote: Thu Sep 17, 2020 11:59 am Read this viewtopic.php?t=287967
Thank you for the link iamblessed.
Investor.Saver1 | | Experience is something you don't get until just after you need it.
Post Reply