A Simple 60/40 for the Newly Widowed: A Dedicated ETF

Over the last year or so, I have been on the lookout for an ETF that is by itself dedicated to the beleaguered but recently resuscitated 60/40 portfolio. Surprisingly, it’s been a long and tedious slog.

At 80 and beset by assorted health challenges, I am realistic in supposing that I will pass before my younger and healthier wife. I know Vanguard’s Wellington (VWELX) would fit the bill, but Alberta will have enough responsibilities to shoulder without having to worry about any mutual fund restrictions or redemption fees that might someday be imposed. (Yes, I am aware that Vanguard  just reduced many fund fees, but I have learned that the future is an uncertain devil.)

Just recently, I hit upon a worthy candidate—the iShares Core Growth Allocation ETF (AOR). The name is misleading because it’s not a growth fund by any stretch. Like the Wellington mutual fund, it’s a balanced ETF and even comes with a respectable 20% international exposure. Its expense ratio is .20 (.15 through 2026), about the same as for the Vanguard offering.

During the distribution phase, the simplification inherent in having your 60/40 allocation in just a single fund has a significant advantage over a multiple-fund strategy. Retirees or their beneficiaries can easily sell shares and withdraw the proceeds without having to concern themselves with the precise amount to redeem from each fund to maintain the 60/40 balance, as well as the domestic/international and large/small stock ratios. The iShares ETF is a highly diversified one-shot deal that can ease the burden of a retiree or beneficiary suddenly thrust into an unfamiliar world of fund investment. Just a thought.