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I’ve read lots of articles about asset allocation, and how and when to rebalance a portfolio. One facet I that haven’t seen discussed often is how do couples execute their asset allocation and rebalancing when they both have similar accounts. My wife and I each have Vanguard accounts with Traditional IRAs, Roth IRAs, a joint brokerage account, and online joint banking accounts.
We treat all our accounts as one. Our asset allocation has evolved over our working years, and during retirement. I began saving in my company’s 401k as soon as I could, and increased the amount each year. Because of child rearing and subsequent career growth, Vicky’s retirement savings really took off in the last twenty years of her career. She is almost entirely invested in a low-cost total market index fund, and it has grown significantly. I’ve typically done any family-level portfolio rebalancing in my IRA, mainly because I’m the one who tracks things. But there is no specific reason for that.
I’d be interested in knowing how other couples manage asset allocation and rebalancing when they each have accounts, and especially if they are of similar amounts.
It has been so helpful to have a summary of investments across accounts through the Schwab web interface. This includes investments at other brokerages. Other brokers, including Fidelity, offer similar tools, but I’m not as familiar with them.
As far as investing, I rank the accounts according to tax status and life expectancy, and make transactions according to that ranking when possible.
It surprises me that the brokerages do not do a better job providing interfaces for managing multiple accounts as one portfolio, but this topical discussion is showing me it is perhaps not as common as I assume it would be.
I have a Morningstar premium membership and they have a portfolio tracker which analyzes the portfolio to minutiae. I utilize it primarily for tracking the percentage of each asset class to let me know when an asset is increased enough that I need to rebalance. You can link all your accounts from all mutual fund companies. I manually update quarterly as because of general security concerns I don’t want all my retirement account numbers collated in one website.
I only rarely use it to analyze potential changes in my funds as I’m pretty much set on the funds that I will be utilizing the rest of my days here on this small blue marble.
Morningstar also provides invaluable articles on investing.
I keep an eye on all accounts as one portfolio for general planning. And I have each person’s accounts on their own
spreadsheet, to manage/match rebalancing.
As the opportunity arises, I’ve rolled over money to pair down the number of accounts (originally 13 the year before retirement, now down to 4) to simplify management.
In my excel workbook, I keep a notes page, to explain any changes I make, and document reasons for rebalancing differently between the two people.
Rick, I’ve always approached our finances (wife and I) as one. I started tracking all investments in an Excel spreadsheet, and lumped similar assets into asset allocation categories (with a column letting me know where the asset was located) for tracking. This has helped me know at one glance what is where, and why- such as growth assets in a Roth, and fixed income in a Traditional IRA. Not too complicated, and I update the spreadsheet a few times a year, or more often if I think a rebalance band may be getting triggered.
Took the words right out of my keyboard. I keep a spreadsheet for each account and have a consolidated spreadsheet for all of our holdings. In each case, I track my equity/fixed allocation as I have different allocations for different a/c’s, but also want to know what my overall allocation is. I find it very helpful to keep me on target and rebalance when things get too far out of line.
We combine the assets in those accounts in a spreadsheet. I now also use Boldin and Monarch (thank you, Rob Berger).
My wife is not as interested in finance as I am, so I do all the asset allocation and rebalancing, but I show her my spreadsheets each quarter and she is happy with the arrangement. She has detailed instructions on how to handle things should I be incapacitated. We look at all the investments as “ours” as opposed to individually held. We have no children, and we are agreed on what happens to whatever is left after we both have died.
In 2014, after we retired, I moved all of our investments into Vanguard, except for my 403b, which is through the state of North Carolina and (because of when I opened the account and a fortuitous legal ruling) is not subject to NC income tax; I would lose that tax advantage if I were to move that account to Vanguard. At Vanguard, we have a joint taxable account that just contains Vanguard Total Stock Fund. In addition, we each have an IRA and a Roth, and each of these contains a subset of four funds: Total Stock, Total International Stock, Short-Term Treasury Index, and Short-Term TIPS. We also have a joint Vanguard Cash Plus account, several jointly held T-bills at Treasury Direct, and credit union accounts we use for short-term expenses.
I have a spreadsheet with the accounts and holdings on the left, types of holdings on the top, and totals for each class (e.g. total US stock) on the bottom, along with a line below the totals showing the percentages held in each class.
I have a second spreadsheet with rows for each of the classes, the current percentage in that class, the desired percentage, and the dollar amount needed to adjust the class to the desired allocation.
Most of the money is in IRAs or Roths, and I do all our rebalancing within these, since there are no tax consequences to making moves within these tax-advantaged accounts. For simplicity, and to get only Admiral shares (which have lower expenses) in each fund, we have a minimal number of funds in each account. The 403b just has an international index fund, and I generally just leave that alone. Our IRAs each have just Short-Term Treasuries and TIPS. My Roth has just Total Stock and Total International, and my wife’s Roth has both stock funds and the Short-Term Treasury Index. To shift funds from one class to another, I do the shift in an account, e.g., my Roth, that has funds in those two classes.
I used to rebalance quarterly, even when we were not far off the desired allocation. Now I still update my spreadsheet (and an associated balance sheet) quarterly, but I only rebalance when we get too far off. If there is a sell-off exceeding 20% (as in the 2020 lockdown), I take Jonathan’s advice and rebalance early to get stocks at bargain prices.
Hi Brian,
Why not have your wife’s Roth all in equities and have her bonds in her traditional account?
The reason we have this arrangement is equities over the long haul vastly exceed bonds in their returns. Also generally Roths are the last funds to be tapped and are not subject to federal income tax, nor RMDs. With all her bonds in her traditional account it will have a lower return and thus lower RMDs.
In this scenario the Roth will have a higher return and be tax free and the traditional will have a lower return and again result in lower RMDs/taxes.
Just food for thought.
David, you make a good point. It got me thinking about whether it still makes sense to do things the way I have been doing under current conditions. In 2010, as I was working to simplify my investments, I decided to keep my 457 account, rather than moving that into Vanguard, because it is not subject to North Carolina income tax. In addition, funds rolled over from an IRA to the 457 would also not be subject to NC income tax. Unfortunately, the 457 has a very limited set of investment options, and their bond options have not performed well. The only fund they have that has essentially the same holdings as any of my four preferred Vanguard funds is the NC international stock index, so that is where I put the money.
To answer your question, the reason I did not have all the equities in a Roth is as follows: Between my retirement (at 60) and my wife starting to get Social Security seven years later, I did Roth conversions each year, getting us to the top of the 12% tax bracket each time. Our overall asset allocation is 40/60, and our Roths are 40% of the total investments. 14% of the total is in our taxable account, in the Total Stock fund. Another 13% of the total is in my 457. That leaves just 13% of the total to be invested in stocks, and since the Roths are 40% of the total, we must have some bonds there to reach our admittedly conservative overall allocation of 40/60.
NC income taxes have dropped since 2010, when they were 7.75% for those with over $50,000 and an additional 2% above $100,000. NC income tax will be 3.99% in 2026. Also, I found out yesterday that since 2016, funds rolled over into the 457 are now subject to NC tax.
I decided to run the numbers under the current conditions. I made a spreadsheet that computed the tax I will pay on the funds 457 funds if I leave them as they are, versus moving them to my IRA and shifting money into a Roth, keeping the asset allocation the same. As long as stocks beat short-term bonds by around 2% on average, it makes sense to have the stocks in a Roth and pay the NC tax on them. In addition, transferring the 457 funds to Vanguard simplifies my accounting, and that will get increasingly important as I age.
I appreciate your question. You saved me some money down the road.
Since my wife has no interest in the management of our retirement accounts I perform all of the changes and review with her both our investment and total net worth when calculated quarterly. I view our retirement accounts as two parts of an overall account.
My retirement account is about 2/3 of the total funds. We have both Roths and traditional accounts. I am trying to convert all of her traditional IRA into a Roth so I only have to manage RMDs from my traditional account thus decreasing the dollar amount of my future RMDs.
As a result her Roth will eventually be 100% VT (Vanguard Total World Stock ETF) as there is a good chance it will never be touched and inherited tax free by our children. This will also allow my much larger traditional account to be solely utilized for living expenses. As a result a large portion of my portfolio is in bonds (45% of our total portfolio) and cash (@10%).
When we claim Social Security at 70 in two years it, along with a small pension, will most likely cover all of our essential expenses. At 73 I will only have to take RMDs from my account.
Also at that time I will institute a pure bucket portfolio approach which should mean that nearly all of my portfolio will revert to stocks as all of our expenses will be met with SS, pension, and RMDs.
I suppose there are a few factors to consider. Risk tolerance and capacity as well as age.
My spouse is 10 years younger and theoretically should live longer. She has 5 years before she is required to take RMDs. I am drawing from my retirement savings, as required. All things considered my portfolio should be more conservative than hers, if for no other reason than to protect 5-7 years of withdrawals. We each have Roth IRAs as well as traditional IRAs.
For allocation purposes I evaluate the sum of each of our portfolios. We also look at our portfolios individually and combined (Roth + Trad + brokerage) to determine the overall allocation. We have a sum excluded from our portfolios. That’s our short-term and emergency cash.
My portfolio throws off sufficient cash that I haven’t had to sell stocks for 5 years. I did purchase stock in 2024 and I do use excess dividends to purchase stocks.
Our combined portfolios are 55% stocks. My portfolio is 53% stocks and my spouse is 58% stocks. The styles are “core” and according to Morningstar each of our portfolios “stock exposure is spread evenly across the market and includes a good mix of small, medium, and large companies, as well as a fairly even mix of conservatively priced value stocks and high-flying growth stocks:”
Both portfolios are 14% foreign stocks (25% of the stock portion). Her stock portion is about 16% aggressive growth while mine is 7.2%. Hers is 6% speculative growth and mine is 2% speculative growth. I think the difference in growth stocks is the primary reason her stock portfolio has recently outperformed mine, on an annual percentage basis.
I use the Morningstar X-ray tool to evaluate the portfolios. It provides a uniform basis.
I ask my spouse from time to time how she feels about her allocation and risk factors and she is fine with it. Considering her portfolio horizon of perhaps 30 years I concur.
My stock portfolio is about 42% value, 29% core and 30% growth. I’m okay with that.
If the time comes that I do think a change is necessary, I’ll evaluate each of the Roths and traditional IRAs and make a decision for each.
Our portfolio I treat as one big pot of money. Harry Sit, the Finance Buff, had a great idea that you can do most rebalancing in a big traditional IRA. I’m implementing that strategy by rolling over both of my 401(k)s to that IRA. It will contain almost all our bonds and cash and whatever stocks don’t fit in taxable, Roth, and HSAs.
Randy, thanks. I like Harry Sit and will look for the article you reference.
Except for the account we pay bills from, all of our accounts are individual, including the taxable ones, but we treat the sum of them as one portfolio. I rebalance in whatever account it’s most convenient or makes the most sense at the time.
Someone mentioned keeping their and their spouse’s allocations the same. I don’t manage what our individual allocations are. Since we manage it all as one portfolio, and since upon death the survivor will own everything, I find the individual allocations are largely meaningless.
Michael, thanks for the reply. Part of the reason for this post was to see if there are good reasons or strategies for rebalancing in or multiple accounts. It seems it works either way.
I think it does, but one reason I can think of is if there are different intentions for different accounts should one person pass. For example, let’s say a couple considers all their accounts as one portfolio while both alive, but one spouse designates a child from a previous marriage to be the primary beneficiary on their IRA. In such a case, they might treat that account differently for allocation purposes.
Our asset allocation (AA) changed earlier in 2025 driven by an advancing and ongoing health event my spouse has. Our previous combined AA of approximately 70/30 is now approximately 40/60 with an outstanding home equity line of credit (HELOC) balance treated as a negative part of the bond/fixed portion of our combined AA. Like you, our various investment accounts are at a single broker. I will pay the HELOC balance down to a nominal balance in early 2026 from my 2026 RMD and other traditional 2026 IRA distributions with tax cost driving the timing of the pay down.
Negative health events can and did, for us, cause fear in the acceptable AA when life events changes the willingness to bear uncertain investment risk by one or both spouses. I am now the care partner providing needed activities of daily living (ADL) for my spouse and I also expect I will no longer have any future earned income in my much more important current and future role.
For me, much financial planning for the future is focused on controlling investment costs, particularity tax costs and on asset location for tax efficiency. At my age of 75 with a four year younger disabled spouse I strongly consider and am primarily concerned about the consequences for my spouse should I become unable to assist her or if I predecease her.
Bill, I’m sorry to hear that your wife’s health has declined this year. It sounds like you are meeting that challenge with love and grace. I wish you both the best.
Bill, Thanks for the reply. I’m sorry for your wife’s health challenges, and wish both of you the best. You are in my thoughts.
My wife and I have all our accounts at Fidelity. They provide tools that allow you to aggregate the accounts for asset allocation purposes. We keep our IRA’s at 90% equity (indexes) and 10% TIPS. Our joint taxable account is 60% equity and 40% fixed income. All dividends and interest on the taxable accounts are distributed and used for expenses or reinvested in fixed income. This minimizes the rebalancing efforts and provides cash flow.
Harold, thanks or the reply. It sounds like you have a well-thought out plan.
We handle our finances as a household and I manage them. When I retired about a year ago, we consolidated all of our investment accounts at Fidelity. I keep a financial spreadsheet that makes quarterly rebalancing to 55% stock/ 40% bond/ 5% cash very easy. We keep slower growth bonds and cash in the pre-tax accounts. Ken
Ken, thanks for the reply. I’m glad you instituted a sound process that works for you.
My 401(k) is with Voya, and our available funds are mostly garbage. My wife’s 401(k) is with Fidelity, and has a much better selection of funds to choose from.
My HSA is all in VTI.
I just add up all our investments, figure out 25%, and put that 25% in DIPSX (US Treasury Notes/Bonds) in my wife’s 401(k).
The remaining money in her account is in total market index funds, and my 401(k) is all in a large cap fund, as that’s the only option I have with low fees.
We’re up 21.4% so far this year, so I can’t complain.
David, thanks for the reply. When we retired we rolled our 401ks into Vanguard for similar – investment choice – reasons. My company used Voyager also, and the choices improved over time. Are you planning to consolidate at some point in retirement?
Hi Rick, yes, once we retire I will consolidate everything at Fidelity. I have a few household accounts there already, and I’ve been happy with their customer service.
I work for a financial company, and I suspect they purposely limit the available funds in our 401(k) to drive people to funds with high expense ratios, and of course their own business partners.
Here is a bit dated online article titled How to Find & Calculate VOYA 401(k) Fees
Your comment about Voya is interesting. My wife’s 403b is with VOYA and we kept it there after she retired because fund availability is good and fees are very low.
I work for a financial company, and I suspect they purposely limit the available funds in our 401(k) to drive people to funds run by their business partners, with high expense ratios.
The fund selection is terrible. There isn’t even a total market index fund such as VTI or FZROX.
No big deal, though, I’ll be retired in a couple of years and will just move everything to Fidelity.
For asset allocation we treat all our accounts as one. However, I figure my wife will outlive me, so her accounts are slightly biased towards longer term growth, with a higher % equity than bonds or cash, than mine.
Jeff, Thanks for the comment. We also bias my wife’s account toward growth. Her grandmother lived to 97, and her mom 88.
My wife and I are in our early 70s and meet monthly for a complete portfolio review. We use E-money provided by Fidelity so we can see everything in one place including accounts at other institutions. We only rebalance if percentages move by 10% from our baseline which sometimes does not happen for several years and sometimes happens every month. We have multiple account types so buy or sell in the accounts that make the most tax sense usually. It works for us as it minimizes anxiety over risk.
Howard, thanks for the comment. Sounds like you guys are on top of your portfolio.
My answer will sound like the one OldITGuy gave below. Second marriage for both of us. We keep a joint account for bills and travel. Everything else we own is separate, and handled as much as possible via a trust. I have investment and IRA accounts. The asset allocation is different for them because my kids will inherit the investment account, and my wife will inherit the IRA. The one designated for the kids is invested more aggressively because it has a longer time horizon. My wife has smaller investments and IRA, both invested conservatively because that’s her profile – – – but has a state pension.
Jeff, thanks for the comment. Second marriages definitely add a layer of complexity that I’ve nit had to deal with!!!
Of our total household portfolio (rollover and Roth IRA’s) my spouse’s (6+ years younger) accounts make up 34% and mine 66%. While I have a spreadsheet that lists each of our accounts separately (with corresponding asset allocations), I have a grand total at the bottom that is then broken down in % asset classes.
When I rebalance, I just look at the grand total and then select the account(s) that I can most easily adjust to accomplish my goal. Having said that, I do take into account the most efficient asset location. For example, I recently sold some of the stock position in my rollover IRA and bought bonds to rebalance the grand total back to 60% stocks and also to increase that account’s bond % so it will grow more slowly over time and thus limit my (her as survivor) RMDs– which I will need to begin taking in four years.
The assumption I make for the above is that we have named each other the beneficiary for each of our accounts, so the survivor will end up owning all of the accounts. I would welcome critique as to whether this a valid assumption.
Bill, thanks. Your process makes sense and is similar to ours.
Rick, it’s great to see your post. We are in the “our money” camp. Chris doesn’t have any interest in managing our investments, I keep our allocations the same.
From my experience, having only one person handle investments is quite common. This is actually a bigger concern to me than the allocating chore. We periodically review our portfolio, and I have detailed instructions for Chris in the event that I die first.
One son-in-law is a financial advisor, the other is an estate attorney. Both are familiar with our finances, and both are trustworthy. They will monitor and help Chris as needed.
Dan, thanks. We have similar situations with our spouses. We’re also lucky to have 2 smart sons that we trust completely.
Rick I asked this on a different thread but didn’t get any response: “I’m curious: when you, for example, rebalance after a 5% allocation drift, do you use absolute drift or relative drift as your decision point? Since I rebalance only once a year, I’ve never really considered what choice others who rebalance more regularly make.” How do you handle it, or maybe like myself you only balance yearly?
Answered on the other thread; I do 5% absolute or 20% relative, whichever is smaller.
Mark, I have to admit any rebalancing we do is pretty casual. With a nice pension and 2 strong SS payments, I’ve felt fairly comfortable with a more aggressive portfolio, especially during the accumulation phase while still working. The last few years have included some significant changes in our housing situation, which complicated our overall financial picture. We are in the process of simplifying our financial lives, and I’m looking at what that portfolio should be and what is a good process (like the one you described in your post) to manage it.
Suzie and I are a textbook case of joint mental accounting with our investments. Suzie has a lower risk tolerance than I do, so Suzie’s portfolio is 40:60. I maintain 70:30 in mine, which gives us roughly 60:40 combined. While not individually optimal, this approach keeps us both comfortable with our strategy—happy partner, happy life. We handle any rebalancing together in late March or early April to coincide with the UK tax year end.
What happens if one of you runs out of money?
I’ve no answer to that. I can say neither of us would have retired if we had any thought that was even a remote possibility.
Mark, thanks for the reply. It sounds like you and Suzie have excellent communication.
My wife and I married 11 years ago when I was 59 and she was 54 so we both wanted to keep our money separate. We each contribute to a joint account we use to run the household and travel. I have kids and am interested in passing on a legacy, while my wife doesn’t and has no such interest. Consequently our individual portfolios have different goals. My wife is more interested in income and generally more conservative in her investment choices, while I have a bit more interest in growth. We share ideas, but we each manage our portfolios separately. We do coordinate and plan ahead so we don’t create unexpected tax/IRMAA consequences. My RMD’s start next year while hers starts 5 years later. But rebalancing and investment decisions generally are individual. Gene
Gene, thanks for the reply., It sounds like you and your wife have a sound plan that meets your needs.
Rick, this is a great topic for couples to consider. I think the first important point you make is to treat all the accounts as one portfolio. There may be exceptions to how couples organize their spending–and I’ve known of couple who split some expenses–but I suspect most consider the money “ours” rather than “yours and mine”. Other readers could comment if they see things differently.
My wife and I moved to a similar asset allocation in our various types of accounts a number of years ago, but just a couple of years ago I did a little thinking about asset placement due to my required minimum distributions starting three and one half years before hers. We decided to keep things as they are, but I’d be interested to know a different opinion.
To finally answer your question, we re-balance with an eye toward keeping our asset allocation the same, for simplicity.
Ed, thanks for the response. I hadn’t thought much about RMDs since we are 6 months apart in age. We are still 5 years away and I may do some more Roth conversions, but that is certainly a consideration. Thanks.
I haven’t thought about RMDs either with my wife 18 months younger. That sounds like an Optimizer 😄