Randolph Freelander
Member
No, there's no problem doing that. In fact, you'd be more likely trigger alarms from a banking perspective if you tried to split it up.
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How to Invest for Retirement
- Thread starter Piecake
- Start date
No, there's no problem doing that. In fact, you'd be more likely trigger alarms from a banking perspective if you tried to split it up.
Icefire1424
Member
Funny you mention. Started as a Target Date fund, but now appears to be more dependent on what the Advisory Service views as a better investment. Either way, current investments are broken down as follows:
49%: S&P 500 Index (Domestic Stock)
21.5%: TMPL Intl Equity (Foreign Stock)
21%: Bond Equity (Bonds)
4.5%: Capital Preservation (Short Term)
4%: Small Cap Blend (Short Term)
Regarding comfort level, I think I'm okay with where I am now, knowing that having an 11 month old at home will require a bit more disposable income for awhile. Still able to contribute a pretty good amount per pay period, but like to know my options after kiddo is out of diapers and daycare in a couple years, and I'll have the opportunity to contribute more to retirement and her 529. I think the hesitation came from knowing I started contributing a bit late (when I was 29), so doing what I can to ensure I'm contributing enough now (I'm 32, for the record). The priority over the last few years was just to get things rolling and contribute, but now that I actually have a bit of money invested, I've taken more of an interest in it. Kindof addicting actually.
Thanks all for the feedback!
I have a few questions as to what I should do with my Roth IRA. I recently moved it to Vanguard and made the rest of my 2014 contribution, so I have some cash available. I am fairly young so I have 20-40 years until retirement (the 20 being a best case scenario).
My asset allocations are:
My asset allocations are:
- 12% - SHY (0.15% expense ratio)
- 33% - SCHF (0.08%)
- 28% - SCHB (0.04%)
- Rest - Cash
- How would I rebalance this with the cash? Continuing to plow into SCHF seems like throwing good money after bad.
- My 401k is invested in Vanguards Target Retirement 2050 Trust II, which has had a decent amount of growth while my IRA really hasn't had any (SCHB is up big but it's offset by SCHF being down). Is there an asset class I should try to have that I dont right now?
- Is it a good idea to bite the bullet and get some VTSMX/VTSAX and swap out the Schwab funds? Not sure how much transaction costs are going to affect me. going forward, and if I read right only cash in vanguard funds gets you Voyager status later on.
I'm relatively new working for my state government and we have a deferred comp plan that I get a small Pre-Tax match for (I think like $350 a year from my union and I'm taking $50 each paycheck towards an After-Tax Roth), and I have no idea how I should be allocating my Roth After-Tax funds and the Pre-Tax match. I am currently 100% in on "MN Target Retirement Income Fund". I've listed my options below, any help or suggestions would be much appreciated.
Fund Name Across All Sources
MONEY MARKET/FIXED INTEREST
SIF Fixed Interest
SIF Money Market
US FIXED INCOME
Dodge & Cox Income
Vanguard Total Bond Index Inst
BALANCED
Vanguard Balanced Index Inst
US LARGE CAP EQUITY
Janus Twenty
Vanguard Inst Index Plus
US MID CAP EQUITY
Vanguard Mid Cap Index Inst
US SMALL CAP EQUITY
T Rowe Price Small Cap Stock
INTERNATIONAL EQUITY
Vanguard Total Intl Stock Index
Fidelity Diversified Intl
TARGET DATE FUNDS
MN Target Retirement 2060 Fund
MN Target Retirement 2055 Fund
MN Target Retirement 2050 Fund
MN Target Retirement 2045 Fund
MN Target Retirement 2040 Fund
MN Target Retirement 2035 Fund
MN Target Retirement 2030 Fund
MN Target Retirement 2025 Fund
MN Target Retirement 2020 Fund
MN Target Retirement 2015 Fund
MN Target Retirement Income Fund
Fund Name Across All Sources
MONEY MARKET/FIXED INTEREST
SIF Fixed Interest
SIF Money Market
US FIXED INCOME
Dodge & Cox Income
Vanguard Total Bond Index Inst
BALANCED
Vanguard Balanced Index Inst
US LARGE CAP EQUITY
Janus Twenty
Vanguard Inst Index Plus
US MID CAP EQUITY
Vanguard Mid Cap Index Inst
US SMALL CAP EQUITY
T Rowe Price Small Cap Stock
INTERNATIONAL EQUITY
Vanguard Total Intl Stock Index
Fidelity Diversified Intl
TARGET DATE FUNDS
MN Target Retirement 2060 Fund
MN Target Retirement 2055 Fund
MN Target Retirement 2050 Fund
MN Target Retirement 2045 Fund
MN Target Retirement 2040 Fund
MN Target Retirement 2035 Fund
MN Target Retirement 2030 Fund
MN Target Retirement 2025 Fund
MN Target Retirement 2020 Fund
MN Target Retirement 2015 Fund
MN Target Retirement Income Fund
TangoAlphaLima
Member
Holy cow, this guy gives Mr. Money Mustache a run for his... well, you know...
http://www.neogaf.com/forum/showthread.php?t=1004779
http://www.neogaf.com/forum/showthread.php?t=1004779
At a guess, this is aimed at people who are already retired. I'm assuming you're fairly young, in which case this is insanely conservative.
That's what it appears to be - it's 65% bonds (click on one of the fund names). As described in the literature, the fund is intended to provide predictable income in retirement, not to save for retirement.
The performance over the past 10 years was 6.7%. Other, longer term retirement funds from that list did ~12%. SummitAve, I'd advise allocating little if any to that fund given your age.
Thanks! That is just what was selected by default so I'll probably end up allocating it towards my target year and some of the higher performing ones from that link.
linkeurena
Member
Hi guys I'm new to all this and need some help, my employer is offering me a 401k through fidelity and they'll match 4% of my contributions, I've been reading online and also this thread before I make a decision, originally I was going to contribute 8-10% but after reading i'm not sure that's they best thing to do, I'm thinking to only contribute 4% to the 401k and the rest in a Roth IRA.
I need to make a decision for the 401k before Monday.
Also if I go with that route I was thinking of opening the Roth IRA with Vanguard.
What do you guys think, any advice?
I need to make a decision for the 401k before Monday.
Also if I go with that route I was thinking of opening the Roth IRA with Vanguard.
What do you guys think, any advice?
TangoAlphaLima
Member
That's the advice of many financial experts. 401k to the match (free money is hard to beat), then Roth to the max, then top off the 401k, in that order, obviously stopping when you run out of money to invest.
Randolph and I had a discussion on the merits of fully funding a 401k versus a Roth a couple pages ago if you want to read. I'm a big fan of the Roth for a variety of reasons.
PflargBlarg
Member
What's the opinion on funds that pay out dividends? I may be confused on how you turn the investments into income once you're retired.
1. You're invested in ETFs that automatically reinvest dividends. Do you get income by periodically selling off units of the ETFs and moving it to your bank account? I've honestly never looked at how you turn investments into actual cash that you can use.
2. You sell off all your investments and buy into some sort of fund that pays out enough in dividends for you to live on. Is this a thing that's viable?
I just somehow never thought about this until now.
1. You're invested in ETFs that automatically reinvest dividends. Do you get income by periodically selling off units of the ETFs and moving it to your bank account? I've honestly never looked at how you turn investments into actual cash that you can use.
2. You sell off all your investments and buy into some sort of fund that pays out enough in dividends for you to live on. Is this a thing that's viable?
I just somehow never thought about this until now.
Whats the expense ratio on the TMPL fund? If it is high, like over .5%, then I would recommend finding an alternative international fund or simply dumping that into the SP 500
Well, if you are with vanguard now it probably makes sense to move over to vanguard equivalent funds. I mean, why pay money on transaction costs if you do not have to? I am not sure about the whole vanguard funds and voyager thing so I can't help you out there.
I would not worry about international. It might be painful dumping in money into a down fund, but that is the whole point of having an asset allocation so that you are forced to dump more money into a down fund so that you buy low and sell high.
As for asset allocation, I recommend sticking with what you have unless your philosophy has changed. Chasing returns or trying to get on new hot asset class is never a good idea. I think a philosophical change has to be more profound then, wow, international sucks right now, I better get out or lower my exposure.
TangoAlphaLima
Member
Your income from retirement savings is only based off what you withdraw from your accounts, it has nothing to do with dividends. For a 401k/Traditional IRA, there are required minimum distributions after you reach 70.5 years old, so you're forced to take some out every year at that point, and it's taxed as ordinary earned income. For a Roth, there are currently no required minimum distributions, and anything withdrawn is tax free.
You'll also be receiving payments from social security, or perhaps a pension, so you may not need to withdraw much from your retirement accounts if you live a frugal lifestyle and have no debts entering retirement.
PflargBlarg
Member
Yes, it was more a question of what the source of the withdrawals would be.
If you're getting dividends paid into your retirement accounts, then that is cash that is free to withdraw. If that is not the case, then you have to sell off units of stock in order to have cash in your retirement account, which you would then withdraw.
For instance, I previously had a mutual fund with a little bit of money invested in it that was paying me $13.33 every month directly into my retirement account, not being reinvested. I could easily just withdraw that cash into my bank account, or reinvest it myself into whatever.
I currently have ETFs that automatically reinvest in themselves. If I want to get cash out of them, I must sell part of my investment and then withdraw that cash into my bank account.
Once retired, is it a better strategy to use a fund that pays dividends directly into the account, or to stay in ETFs and sell off units for cash as needed? Or are they just 'different' and not necessarily better.
I feel like I'm not explaining my question very well. :\
TangoAlphaLima
Member
Generally you have your accounts set to reinvest the dividends, not just leave those dividends in cash. Additionally, once you're at retirement age, a fair portion of your account should probably be in conservative investments that won't pay out much, if any, dividends.
Mostly it's an irrelevant issue anyway. You reallocate your accounts to be more conservative as you approach retirement, and you just let dividends reinvest for the portion of your account that is still in aggressive growth.
You can basically do one of three things.
1) Let dividends continue to be reinvested, and make your withdrawals by selling shares of the fund as needed for income.
2) Direct your account to deposit the dividends in cash, rather than reinvesting them, and then withdraw the dividends from the cash. This way you don't sell shares, but just live off the income the investments generate. You should have that option in your account (in most accounts, reinvestment is the default, but you should have the option).
3) A combination of the above.
I haven't put enough thought into this to know what is the best option. In an ideal world we could live off the income out investments generate, but that in all likelihood will not be sufficient. Just off the top of my head, the simplest thing to do would be to set up automated withdrawals (sales) of shares, for income, and just let the dividends keep reinvesting - option 1). But we've got some time to decide.
TangoAlphaLima
Member
You can basically do one of three things.
1) Let dividends continue to be reinvested, and make your withdrawals by selling shares of the fund as needed for income.
2) Direct your account to deposit the dividends in cash, rather than reinvesting them, and then withdraw the dividends from the cash. This way you don't sell shares, but just live off the income the investments generate. You should have that option in your account (in most accounts, reinvestment is the default, but you should have the option).
3) A combination of the above.
I haven't put enough thought into this to know what is the best option. In an ideal world we could live off the income out investments generate, but that in all likelihood will not be sufficient. Just off the top of my head, the simplest thing to do would be to set up automated withdrawals (sales) of shares, for income, and just let the dividends keep reinvesting - option 1). But we've got some time to decide.
Since there are no capital gains consequences of a sale of retirement investments, it doesn't really matter. The only way it matters is if you don't want dividends reinvested in a risky fund, but that shouldn't matter either, because you should be actively managing your retirement accounts to keep a portion in conservative investments for use in the short term.
For example, keeping 100% of your retirement investments in aggressive growth funds is a bad idea if you're approaching retirement age. Living off cash generated from dividends from those funds would be risky. Instead, you'd be better off keeping money needed in the short term (i.e. 5 years) in conservative investments, withdrawing from that as necessary, while the rest of your money grows in more aggressive funds, and the dividends generated from those funds get reinvested in those same funds.
Selling part of your holding and receiving a dividend for the same amount, barring tax consequences, amount to the same thing. Generally a stock that goes ex-dividend will drop in price by that amount.
Since the value of your holding is number of shares x price of shares, the change in value works out the same either way. It just changes which of those two things is decreasing.
Since the value of your holding is number of shares x price of shares, the change in value works out the same either way. It just changes which of those two things is decreasing.
I've always felt the same. I probably shouldnt be saying this since I havent looked into dividend stock strategy at all, but the reason for liking them always struck me as emotional and comforting rather than 'logical' because you are 'earning' money for owning them.
Randolph Freelander
Member
Dividends are the entire point of owning stocks, even stocks (such as growth stocks) not currently paying them. Tell me, absent dividends, what exactly do you get from stock ownership? Don't say "well, the price could increase" without providing why it would increase. (Hint: it's the expectation of future dividends.)
Right. To clarify my post, it assumed we know that all options were tax neutral. Just trying to answer his question; in the end it probably best do just do the simplest.
But if dividends are paid and then the stock goes down by how much they paid you in dividends...where's the plus side?
I'm not saying I don't believe your explanation; it just doesn't make sense to me.
Apple didn't pay dividends from 1995 until 2012. All of that stock price increase was because investors were expecting dividends eventually? I don't mean to cherry-pick--I just remember reading about how Apple didn't pay dividends for the longest time. I'm not sure if that's anywhere close to a common occurrence.
Randolph Freelander
Member
Microsoft didn't pay dividends for the longest time either, but the expectation was always that they would, and the same was true for Apple and is for other non-paying stocks.
Basically, the thought is this: if the stock does not (or will not) pay dividends, what exactly do you get for your stock ownership? What is going to drive the price up or down? Why is there a price at all? You can't reach into the till and extract money, you know. Your only means of deriving any value from your ownership is receiving a share of the profit, that's what you're paying for, and that's what the individual who buys the stock from you pays for. You might not think of it that way, but you're ultimately paying for the dividends you expect to receive.
It's been a while since I've taken a finance course, and there could certainly be other models to consider, but look into the "dividend discount model" of stock prices. The quick upshot is that the stock price today equals the net present value of the future series of dividend payments, and this holds despite the daily volatility of the market. That 35 cents that's getting paid out every quarter, if that series of payments continues forever and ever, what would you pay for it? Figure that out, and you've arrived at the value of that particular stock.
Interesting. Thanks for the crash-course!
PflargBlarg
Member
I guess you gotta do what you gotta do. I wouldn't keep any less than 5000 available in liquid cash myself.
TangoAlphaLima
Member
3 to 6 months in expenses is what both Suze Orman and Dave Ramsey recommend. $5k wouldn't be anywhere close to that for me, and $500 would have me positively frightened. But a lot of it will depend on your personal circumstances and tolerance for risk. I've got a wife, two kids, and a mortgage, I can't afford to be risky with my emergency savings.
Bleah, cross border taxes suck.
Apparently my RRSP (401k equivalent) gains are considered taxable income in the California (not federal, just state), and my wife's TFSA (kinda IRA equivalent) is taxed at both levels.
Lots of other tom foolery to go through just to get all our tax information too.
Oh well, hopefully this doesn't cost me an arm and a leg.
Apparently my RRSP (401k equivalent) gains are considered taxable income in the California (not federal, just state), and my wife's TFSA (kinda IRA equivalent) is taxed at both levels.
Lots of other tom foolery to go through just to get all our tax information too.
Oh well, hopefully this doesn't cost me an arm and a leg.
You'd be better off using your Roth IRA as an emergency fund if you are not going to hold 3-6 months of expenses in a bank account
http://www.bogleheads.org/wiki/Roth_IRA_as_an_emergency_fund
Taking out a loan for emergencies is pretty stupid. I can't imagine that those would be quick and that banks would let you borrow money for random expenditures. What would be offered to you are credit cards and payday loans, which are obviously terrible. I could be wrong, but Ive never heard of people taking out a bank loan to pay for unexpected expeditures or a bank allowing that. Of course, I could be totally sheltered or completely blanking right now.
TangoAlphaLima
Member
Loss of job? Medical debt? Sudden, massive auto or home repair?
Maybe you don't have the risk of all of these things happening, but surely you could have one happen.
I would literally go insane if I had only $500 in liquid assets (that weren't contributions I could pull out of retirement accounts anyway). Hell, I'm about to write a down payment check for a house and the thought of dropping to low five-digit levels is freaking me out a bit.
Well, he either did not use retirement accounts, cashed out of his 401k when he quit his job, and/or takes the penalty when taking money out of his 401k/IRA.
Worth noting that he has substantial rental property income, so he doesn't have to withdraw much from savings. Not sure what he draws down for the rest of his living expenses, but from how high his savings rate was, a good hunk of it would have had to go outside of retirement accounts.
RumblingRosco
Member
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Regarding the Mr Money Moustache "strategy", there is one point that I'm not sure that I am clear on and/or I don't feel like re-reading to figure it out: He says to reduce expenses to about 25% of take home pay, and after you've accumulated 25x that yearly expense amount you're good to retire. I get this. My problem is, I think this strategy assumes that you keep your expenses at that same level forever. So hes not advocating a sprint to retirement so much as hes talking about a low cost lifestyle forever.
I checked my credit card total from 2014 and I spent something like 30% of my take home pay on credit cards...not counting mortgage, taxes, car payment. I'm not living like a king here and I don't have a bunch of toys. In order to hit the levels of spending that MMM is talking about I'd have to seriously rearrange into a situation that I'm not sure that I really want to be in.
Am I understanding MMM's strategy correctly?
I checked my credit card total from 2014 and I spent something like 30% of my take home pay on credit cards...not counting mortgage, taxes, car payment. I'm not living like a king here and I don't have a bunch of toys. In order to hit the levels of spending that MMM is talking about I'd have to seriously rearrange into a situation that I'm not sure that I really want to be in.
Am I understanding MMM's strategy correctly?
I think the point is more so that how fast you're able to retire is a function of both how much money you're making and how much money you spend, not that you have to live a certain lifestyle. He gives the 25x yearly expenses as a guideline as to how much would be enough to retire, and that you could reach that a lot faster if you reduced you're expenses because you'd be both increasing your savings rate and reducing how much money you need to retire.
It might help to note that MMM was an engineer making pretty good money before he retired, so maybe for him living on 25% is quite a different thing from most people trying to live on 25% of their income.
Wellington
BAAAALLLINNN'
MMM's mortgage is also paid off. That accounts for 58% of my spending. If I could ever get my mortgage paid off I'd live like a king.
RedBaron17
Member
Hi GAF, don't know if this is the right thread but I figured I'll ask anyways and maybe someone will point me in the right direction.
I was just going over my Emails and it turns out I just recieved some RSU's from the company I work for. Honestly, I have a very limited idea of what these are. I just know that restricted stock units ("RSU") represents the unsecured right to receive one share of Common Stock in the future. Before I google, would some friendly GAFfers give me some info/tips? Many thanks in advance.
I was just going over my Emails and it turns out I just recieved some RSU's from the company I work for. Honestly, I have a very limited idea of what these are. I just know that restricted stock units ("RSU") represents the unsecured right to receive one share of Common Stock in the future. Before I google, would some friendly GAFfers give me some info/tips? Many thanks in advance.
I receive RSU's from my employer as well. They are shares of stock, but they generally vest over a period of time, in my case four years. In case you are unfamiliar (and apologies if you are), vesting means ownership is transferred from your employer to you over a period of time. If they vest over four years, you get 25% of the grant in one year, then another 25% the following year, etc. They are generally used as benefit to encourage workers to stay on (what my employer calls "long term compensation"), since you have to stick around to fully receive the grant.
Different employers may handle it differently, but I am taxed on the shares at the time that they vest, with the tax manifesting as shares withheld. For example, if my grant is 100 shares, on the vesting date I get ~60 deposited into my stock account. The rest was held back for federal and state taxes. Both the income from the stock and the taxes then appear on my W-2 so it's pretty easy from a tax standpoint to account for them. I'm not sure if this is standard, or if you might get all of them and then have to report the incremental income - and pay taxes on it - at year end. Hopefully your employer has some information on how their particular RSU program works.
Once they are deposited in your account, you can sell them at any time. Gains or losses from the time they are deposited until you sell them have the usual tax implications of selling stock for a gain or a loss.
Guys, what do you think about this Nasdaq index fund? Is it too risky?
What about this managed fund?
Keep in mind that the MER is included in the performance numbers
What about this managed fund?
Keep in mind that the MER is included in the performance numbers
First one is decent. I'd like more companies than just the top 100 Nasdaq ones though. The MER is high, but youre in Canada, so you guys seem to get screwed on that.
The second one is terrible. That MER is WAY too high. The fund does not even mention the turnover rate, which can add another 1-2% MER depending on how high the number is.
http://www.daveramsey.com/article/investing-calculator/lifeandmoney_investing/#/entry_form
Play around with that. Make sure to invest for about 30+ years and compare a fund with a MER of 2-4% compared to a fund with a MER of .1 to .5%
Randolph Freelander
Member
I like the Nasdaq 100. I'm in it ~13% through my 401K (expense ratio: 0.07%). It's a bit heavy on Apple, and it overlaps with the S&P 500 to a degree, but it's my roll of the dice for higher returns (total 10 year return of 184.7%, versus 67.26% in S&P 500) and it's just a slice of my overall large cap exposure (S&P 500 is > 48% of my balance).
I wouldn't go heavy into it or anything, but making it slice of your portfolio? Sure, why not.
Wellington
BAAAALLLINNN'
Stay the course during this volatility. Hate to say it but if it continues to swing downward it becomes a great buying opportunity.
I've been thinking lately of funneling more of my money into paying off my mortgage. The interest on the loan is only 5% but I have an additional PMI payment on top of it for $160 a month. I've got years before I can get to a point where the payment disappears, so I was looking to start popping in more cash on a regular basis to try and get there faster. I just hate having to flush that money down the toilet. The last few months I've put $100 extra into the principle but I am debating on ramping that up.
I know it's the most illiquid place I can put my money but it is nice to see that mortgage note come down faster as well as the knowledge that 1) Every dollar I put in now becomes approximately $3 in savings through the life of the loan (70 months into the mortgage) and 2) I would have the house paid off at around 50 years old.
Ultimately the goal is to buy off my freedom from corporate america, so I get that maybe this isn't the wisest move.
I've been thinking lately of funneling more of my money into paying off my mortgage. The interest on the loan is only 5% but I have an additional PMI payment on top of it for $160 a month. I've got years before I can get to a point where the payment disappears, so I was looking to start popping in more cash on a regular basis to try and get there faster. I just hate having to flush that money down the toilet. The last few months I've put $100 extra into the principle but I am debating on ramping that up.
I know it's the most illiquid place I can put my money but it is nice to see that mortgage note come down faster as well as the knowledge that 1) Every dollar I put in now becomes approximately $3 in savings through the life of the loan (70 months into the mortgage) and 2) I would have the house paid off at around 50 years old.
Ultimately the goal is to buy off my freedom from corporate america, so I get that maybe this isn't the wisest move.
maks
Member
Hey guys, I'm planning on making some changes to my 401k. I've been contributing to T. Rowe 2040 target date fund for a couple years and it hasn't done bad. I've accumulated about 20k in there. But after reading a few threads and Edelmans retirement book I feel that I should change this. Luckily I have some Vanguard options I can go with.
Vanguard Small Cap Index Instl VSCIX (Small Cap)
Frontegra Small Cap Core
Vanguard Mid Cap Index Ins VMCIX (Mid Blend)
MidCap Core Stock Fund
Vanguard Institutional Index Fund VINIX (Large Blend)
Vanguard Total Bond Market Index Inst VBTIX (Int. Bond)
Putnam Stable Value Fund
T. Rowe Price Retirement Target Fund (2030, 2035, 2040, etc) I have 2040. My Expense ratio around .47
Vanguard Total Intl Stock Index Instl VTSNX (Foreign Large)
International Core Stock Fund
MFS Blended Research US Core Equity I
Metropolitan West Total Return Bond Plan
There are a couple things I haven't quite figured out yet.
1) I have not contributed to the 2014 Roth IRA yet. I have the money, I will do so, and will continue to fund on monthly basis from now on.
2) For my 401k I was thinking of the plan below. I'm not sure if i should move all of my existing Trowe funds to Vanguard. I didn't include VINIX since the share price is nearly $200. I probably shouldn't worry about that. How would you guys handle it considering i have this option in my 401k and I need to contribute to Roth.
40% Vanguard Small Cap Index Instl VSCIX
40% Vanguard Mid Cap Index Ins VMCIX
20% Vanguard Total Intl Stock Index Instl VTSNX
Vanguard Small Cap Index Instl VSCIX (Small Cap)
Frontegra Small Cap Core
Vanguard Mid Cap Index Ins VMCIX (Mid Blend)
MidCap Core Stock Fund
Vanguard Institutional Index Fund VINIX (Large Blend)
Vanguard Total Bond Market Index Inst VBTIX (Int. Bond)
Putnam Stable Value Fund
T. Rowe Price Retirement Target Fund (2030, 2035, 2040, etc) I have 2040. My Expense ratio around .47
Vanguard Total Intl Stock Index Instl VTSNX (Foreign Large)
International Core Stock Fund
MFS Blended Research US Core Equity I
Metropolitan West Total Return Bond Plan
There are a couple things I haven't quite figured out yet.
1) I have not contributed to the 2014 Roth IRA yet. I have the money, I will do so, and will continue to fund on monthly basis from now on.
2) For my 401k I was thinking of the plan below. I'm not sure if i should move all of my existing Trowe funds to Vanguard. I didn't include VINIX since the share price is nearly $200. I probably shouldn't worry about that. How would you guys handle it considering i have this option in my 401k and I need to contribute to Roth.
40% Vanguard Small Cap Index Instl VSCIX
40% Vanguard Mid Cap Index Ins VMCIX
20% Vanguard Total Intl Stock Index Instl VTSNX
Randolph Freelander
Member
Share price shouldn't be a concern with these funds. You want VINIX, and if you're trying to follow a total market approach, then this fund will be your biggest piece of the pie. For example, if we applied Vanguard's total market ratios to your domestic 80%, then it would look like 58% VINIX, 15% VMCIX, and 7% VSCIX. You can tilt towards mid and small caps if you'd like, but the larger point is that the large cap blend fund is something you want to be a part of your mix, and likely a significant part of it.