Portfolio Review

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Topic Author
zdr
Posts: 16
Joined: Fri Apr 23, 2010 3:41 pm

Portfolio Review

Post by zdr »

Hello -
I became a disciple of Bogleheads back in 2010, when I began self-directing my investments per guidelines from this website and some of Bogle's books. Thanks to all that helped back then. I have made some minor modifications along the way and am currently in the process of re-balancing. I am also planning to retire in about a year (at age 56), followed about 3 years later by my wife. We both have pensions or lump sum options when we retire (I'll probably do 50/50). I feel we have saved enough to be comfortable in retirement and get our two boys through college. I would be grateful for input on my current portfolio. I was briefly considering hiring an investment advisor (Personal Capital) who reviewed things and felt I needed fairly significant changes based on heavy weighting towards tech and finance, mostly because of the weighting of the index funds I have. They suggested more funds focusing on energy, utilities and materials to better diversify. Thoughts on this?

Emergency funds: Have this (11% cash - probably too much)

Debt: none. Paid off mortgage last year. Pay off credit cards monthly

Tax Filing Status: Married Filing Jointly, 2 dependent children

Tax Rate: 35% Federal, 10 % State (but only small portion of our income is taxed by OR, as most of our work is done in WA)

State of Residence:WA

Age: 54

Desired Asset allocation: 50-60% stocks / 40-50% bonds ?
Desired International allocation: 10-15% of stocks

Approximate size of your total portfolio - low 7 figures

Current portfolio

Taxable
12% cash (for investing – less 2% for emergency funds)
13% Vang Total Stock Mkt IF Admiral (VTSAX) (0.04)
1.3% Fid Zero Total Mkt IF(FZROX) (0)
0.7% FId US Sustainability IF (FITLX) (0.11)
0.8% Fid Zero Extended Mkt IF (FZIPX) (0)
6% Vang Total International Stock IF Admiral (VTIAX) (0.11)
0.4% Fid US Bond IF (FXNAX) (0.025)
2% AAPL

His Tax Deferred (Mostly 401k, small Roth and BDA IRA's)
11% Fid Zero Total Mkt (FZROX) (0)
5.3 Fid Zero Extended Mkt (FZIPX) (0)
5.4 Vang Small Cap IF Institutional (FSCIX) (0.04)
0.4 Fid Zero International (FZILX) (0)
4.3 iShares Core US Aggregate Bond (AGG) (0.04)
4.3 Fid US Bond IF (FXNAX) (0.025)
10 iShares TIPS Bond ETF (TIP) (0.19)
2.5 Vang Real Estate IF ETF (VNQ) (0.12)
2.5 Fid Real Estate IF (FSRNX) (0.07)

Her Tax Deferred (401k)
13% Vang Institutional Total Stock Mkt (VITPX) (0.02)
5% Vang Total Bond IF Institutional Plus (VBMPX) (0.03)

Her Roth
1% BRK
_______________________________________________________________

Questions:
1. Any significant need for rebalancing seen?
2. Where should i put my cash?
3. My initial goals included 15% TIPS, 15% international stocks and 25% bonds, none of which I am currently meeting. Thoughts on these?
4. Need for commodities/materials or anything else for better diversification?
5. Should I move to a lower cost TIPS fund such as SCHP (0.05)?

Thanks!
User avatar
Beensabu
Posts: 1556
Joined: Sun Aug 14, 2016 3:22 pm

Re: Portfolio Review

Post by Beensabu »

zdr wrote: Mon Jan 03, 2022 2:41 pm Desired Asset allocation: 50-60% stocks / 40-50% bonds ?
Desired International allocation: 10-15% of stocks
_______________________________________________________________

Questions:
1. Any significant need for rebalancing seen?
2. Where should i put my cash?
3. My initial goals included 15% TIPS, 15% international stocks and 25% bonds, none of which I am currently meeting. Thoughts on these?
4. Need for commodities/materials or anything else for better diversification?
5. Should I move to a lower cost TIPS fund such as SCHP (0.05)?
You're pretty close to 60/40. If you rebalanced from US equities and upped your TIPS allocation to your initial goal (if it was 15% of portfolio), then that would put you there and keep international around 10% of equities. It's up to you if you want to up your international allocation to 15% of equities, but that would just mean grabbing another 2% or so from US equities.

You can put however much of your cash you want to in that bond fund you have, but it's in taxable... so you could just leave it as cash. Or you could use it to buy stocks in taxable and then sell the same amount of stocks in tax-deferred and buy bonds there.

Before you get all into diversifying/concentrating into sectors, I'd focus on bringing that international allocation a tad bit closer to market cap (say 20% of equities?). But that's just me.

Less expensive for the same thing is usually better, right?
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next." ~Ursula LeGuin
Topic Author
zdr
Posts: 16
Joined: Fri Apr 23, 2010 3:41 pm

Re: Portfolio Review

Post by zdr »

OK, thanks very much!
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