Advice on how to organize brokerage account with multiple goals?

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sicembears
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Advice on how to organize brokerage account with multiple goals?

Post by sicembears » Sat Jul 13, 2019 10:41 pm

Currently with my bank I have 7-8 different savings accounts which have monthly contributions (long term savings for future home down payment, savings for future cars, etc...) I would like to move these longer term savings to my Vanguard Brokerage account. Don't plan on using the money for 3-5 years and will keep adding monthly.

I have really enjoyed having the multiple savings accounts with specific goals and am slightly at a loss of how to do something similar with a brokerage account. Do people open up multiple brokerage accounts in a similar way? How will I know what money is designated/budgeted for what in 3-5 years with continual contributions? I am very comfortable with excel but that would be a difficult and taxing spreadsheet to figure out.

Thanks for the help

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FiveK
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Re: Advice on how to organize brokerage account with multiple goals?

Post by FiveK » Sat Jul 13, 2019 11:13 pm

sicembears wrote:
Sat Jul 13, 2019 10:41 pm
How will I know what money is designated/budgeted for what in 3-5 years with continual contributions? I am very comfortable with excel but that would be a difficult and taxing spreadsheet to figure out.
Excel could take a single savings account balance and split it into various cells. Would that suffice?

bikesandbeers
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Re: Advice on how to organize brokerage account with multiple goals?

Post by bikesandbeers » Sun Jul 14, 2019 1:08 am

For short term, I like my online savings account which has a direct deposit from every paycheck, but i don't look at on a regular basis. this is a car and vacation fund.

If you have multiple goals and it makes sense to put stuff in a portfolio with maybe a couple of funds, excel would be simple to track the value of each "account" within the brokerage say you put $1000 a month in there and $200 is vacation fun, $400 house fund $250 is car fund and $150 other fund. Pretty easy to multiple by .2, .4, .25 or .15.

You would have to change the percentages when you "withdraw" fro on of the accounts. the only challenge is if you are invested across funds, you'd have to decide which fund to sell.

Ned Nederlander
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Re: Advice on how to organize brokerage account with multiple goals?

Post by Ned Nederlander » Sun Jul 14, 2019 7:17 am

With Merrill Edge I opened multiple brokerage accounts in minutes. You have to fill out paperwork for each one, but it doesn’t take much time after you open the first one because the info is saved. So I have two different IRAs and two different taxable accounts, 1 for each child. I name each account so it’s easy to keep track, “Child 1,” “Child 2,” etc.

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Sandtrap
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Re: Advice on how to organize brokerage account with multiple goals?

Post by Sandtrap » Sun Jul 14, 2019 7:31 am

How I compartmentalize:

I have brokerage accounts at Fidelity, Schwab, and Vanguard. ACH transfer links between them and several "brick and mortar" banks for working capital, household income, etc. One bank is only for business, rental income, R/E transactions, etc.

But, as far as keeping the amounts physically seperate, in doing so you might not be as efficient financially.
Keep your short and intermediate term funds in the places best suited for the "duration", not the end use.


(As far as keeping track of the balances, the back of an envelope or "mental math" works good enough for me.)

Thus:
Very short term and/or EF: High Yield Accounts, MM, etc.
Short/Intermed Term 3-5 years: CD ladders, treasury funds, etc. Or as part of the main portfolio fund allocation if you're comfortable with that.

Lot's of ways to do this for everyone.
j
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SantaClaraSurfer
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Re: Advice on how to organize brokerage account with multiple goals?

Post by SantaClaraSurfer » Sun Jul 14, 2019 9:40 am

We park our cash for goals in a single Money Fund at Schwab and track it.

We use GoodBudget.

Ex. 5000 in Money Fund

GoodBudget folders:

1000 Vacation
2500 Car
1500 Home Improvement

We reconcile once a month. It can be tricky when you've spent money and there's money coming in. But that's a good problem to have.

Fwiw, we also have two different overall Schwab accounts, one roughly for "us" and one roughly for "kids/family." It was easy to set up and works well.

So, basically, a mix.

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1955Chevy
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Re: Advice on how to organize brokerage account with multiple goals?

Post by 1955Chevy » Sun Jul 14, 2019 8:17 pm

I hoping @livesoft will chime in for you here. I know he's big on keeping little ca$h and just one big investment in taxable.

I'm a fan of keeping everything in taxable in one fund, something cheap and efficient like VTSAX. I use a spreadsheet to keep the taxable account money separated for each family member: us parents, and four kids. The trick, I think, comes down to what exactly happens when the market is down and you need to sell. You can exchange bonds to stocks in your 401k to cover the sale, for say, a new minivan. But how that works specifically down in the tall grass, I'm not sure.
"Investment success accrues not so much to the brilliant as to the disciplined." | Bernstein

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