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I know the HD readers have much in common. I’m interested to find out about our diversity.
What I’m interested in, is not the size of anyone’s portfolio, but it’s contents.
If your portfolio is a thousand, a million, or even multi millions doesn’t matter…. What is it invested in and it’s percentages.
As an example I would answer this inquiry I know that basically VUG and VTV are VOO (V Vanguard S&P 500). My wife who doesn’t really understand etf’s said it’s always done so well we should keep it. We have never had a money argument so I’m not starting now 😉
70% VT ( Vanguard Total World)
10% VTV (Vanguard Total Value)
10% VUG (Vanguard Growth)
10% Cash Online Money Market
I’m sure a lot are indexers but many are not
Good question. I have always been heavily invested in equity. The current weighting of tech stocks has me concerned. I am interested in having equal weight index funds but Vanguard does not seem to have any. I simplified to just Vanguard as I got older but would like to find equal weight index funds.
We are similar. We are 100% equities , all in Vanguard index etf’s. . I also wish they offered equal weighted index etf’s
KISS-the simpler the portfolio in case someone one day needs to take it over
3-5funds MAX. anything else is a waste of time and energy
In the KISS approach I’m guessing TIPS are not included…just a broad bond fund (e.g., BND)?
I have worked hard in the last year to simplify our portfolio, mainly on the fixed income side.
65/35 Equity overall, 28% International
Taxable brokerage acct: 70/30 Equity with Index funds. A mix of Dimensional/Vanguard/I-shares with a small cap/value tilt. These funds have significant imbedded capital gains. I have recently begun buying DFAW (Dimensional World Equity) as my individual bonds mature over the next 5 years. Ultimately, I will be around 90/10 Equity. The Interest and dividends have been funding our living expenses before Social Security/Railroad Retirement. My wife and I will start drawing that next year.
Roth- 100% Equity Mainly Dimensional ETF’s with a value tilt. Converted a significant portion of our taxable IRA’s to Roth over the last 5+ years.
Taxable IRA -100% TIPS I have a bond ladder for my estimated RMD’s into my early 80’s. Balance is in VTIP (Short term TIPS ETF).
Harold,
Thanks for providing your portfolio details…another variant that works for you…nice.
Including TIPs in my portfolio is another decision I’m trying to make…currently include none.
As an FYI to you and the HD community here’s Jesse Cramer’s take on TIPs:
https://podcasts.apple.com/us/podcast/personal-finance-for-long-term-investors/id1553180943.
(Episode 142, feel free to listen to all topics, but pick it up at 18:20 for TIPS discussion)
I’ve really enjoyed this forum topic (thanks again, Larry!) and would like any and all to continue the discussion.
Thanks for posting. I agree with you, I believe it’s an ongoing topic that continuously changes at different stages of life. For some more than others
Watched a discussion between John Rekenthaler and William Bernstein recently in which both agreed that the very simple three asset portfolio of U.S. stock index, international stock index, US bond index should have a fourth asset for retirees: TIPS.
I also watched that YouTube video from the Bogleheads 2025 conference.
The recommendation about adding TIPS was a one word reply, “yes”, from both during the Q&A period.
Thanks! Most experts and DIYs are recommending adding. I didn’t hear anything about TIPS until the recent inflation jump and persistence. Or maybe my ears have been more opened to all ideas as I approach retirement
🤔😉.
Here is a summary of the portfolio. Several accounts for the different tax accounts between spouse and me (we all in US have to deal with this). I like mostly indexing, but still like to dabble. Taxable account contains some investments that have accumulated over the years and have capital gains and I have a messy sandbox in my Roth that I may simplify in the coming years when I don’t want to play anymore :-). There are overlapping (or same) funds used in multiple accounts, so isn’t as messy/complicated as it may first appear. Some clean-up is desired, but mostly like the current moderately aggressive allocation.
Overall AA:
82% equity / 18% fixed income
50% US Large Cap
14% US Small Cap (some Mid cap with use of VB/VSMAX)
05% US REIT
02% company stock
11% International
10% bond mix of US Treasury short/int and Inv-grade corporate short/int
08% cash
Tax-type Accounts:
60% Tax-deferred / 20% Roth / 18% Taxable / 2% HSA
Tax-deferred (60%) – 3 accounts (spouse, my active retirement & old 401k)
1) (07%) VSMAX, VSBSX, VSIGX, (with sweep account VMFXX)
2) (13%) VUG, VTV, VSMAX, VSBSX, VBIRX
3) (40%) FXAIX, FTIHX, VGSNX
Note: likely to covert ~10% to Roth over next several years
Roth (20%) – 2 accounts (spouse and mine with VMFXX sweep accounts)
1) (07%) VUG, VTV, VCIT
2) (13%) My “sandbox”
PRLAX, VEA, VWO, VB, XLV, XBI
Stocks: DVN, FANG, SLB, T, VZ, UNH, UBER, SNOW, NNN
Taxable (18%)
OAKMX, OAKIM, VWENX, VB, VIOO, AMZN, VUSXX, company stock
(with VMFXX sweep account, cash flow checking/savings accounts)
HSA (2%)
VFIAX, VBIRX, Cash
Fantastic post providing real insights on portfolio approaches. My favorite takeaway is an increased comfort that some retirees likewise maintain limited bond allocations and many looking elsewhere for income – REITs, Dividends, Annuities, etc.
Asset Allocation
50% S&P 500 & Growth ETFs (VOO, VGT, VUG, SMH)
10% individual stocks – half tech, half dividend (AAPL, GOOGL, XOM, COP largest positions)
10% Covered-Call ETFs for income & price stability (JEPI & GPIX)
10% Energy Pipelines for income & price stability (EPD, KMI, OKE, ENB, AMLP)
13% individual bonds bought in late 2023 (avg remaining maturity ~4.5 years)
4% Cash
3% Gold ETF (GLD) bought for diversification a decade ago
The allocations present as 80/20 stocks/fixed income but function with 60/40 like volatility. The 20% in covered-call ETFs and pipeline stocks provides high income with relatively stable valuations (up modestly). They serve as a sort of “bond surrogate” for us since we have never loved bonds nor owned a bond fund.
We landed on this basic structure nearly four years ago, and performance is bit below the S&P’s with lower volatility. The portfolio’s 3% annual income beats the S&P’s 1% and hopefully helps us see through the next sustained pullback.
Tax Buckets
70% Tax-deferred, 20% Roth (100% growth ETFs), and 10% Taxable (individual stocks w/gains)
We are aged 70 and aggressively Roth converting. Several investment buddies and I agree with UofODuck that the market seems stretched, and on the margin, I have (mistakenly so far) rebalanced several percent of tech ETFs to more conservative ETFs.
This thread worthy of additional HD posters and perspectives.
Great topic! I plan to summarize my portfolio later.
but first…What do folks think of including a REIT ETF in their portfolio. I’ve read mixed reviews on the necessity of a REIT fund; more correlated with broad market, so not necessary. Thoughts?
No REITs as I am with Bill C and concerned about real estate valuation pulling back, especially empty commercial buildings.
For high yield (4-7.5%), I much prefer energy pipelines as US energy demand is expanding due to AI and global needs; the pipelines are nicely growing toll-takers and just like utilities, essentially agnostic about energy prices; and their stock prices have low volatility with slow increases through the bull market.
For investors concerned about MLP tax reporting, half the pipeline companies and several ETFs are not structured as MLP’s and have absolutely no tax prep issues. Even most of the MLPs can be held in tax-deferred accounts without annual tax reporting issues until sold, because their high depreciation creates negative UBTI which eliminates tax reporting issues.
John,
Thanks for your thoughts on REITs and dividend income.
For dividend yield as a diversifier and agree with your take that energy need is REAL…I have some energy stocks: DVN, FANG, SLB (buying mostly during the 2020 dip, have sold XOM but may repurchase)…and would like to add a midstreamer. I want to avoid MLPs though, even though you state tax issues can be dealt with; my personal preference is to avoid. I also own T and VZ (I built my positions in these two at the right time :-)).
I’ve struggled with this dividend play approach, considering some of those covered call ETFs (high yield era but don’t like the concept that over time it’s a decaying proposition), other high dividend ETF such as VYM, SCHD. But for now, I have settled on buying some individual dividend paying stocks. I plan to keep working this portion of my portfolio.
Andy – The following pipelines are not MLPs – KMI, OKE, ENB, AMLP ETF (includes some MLPs and diversified), and WMB (kind of expensive). I also own XOM, EOG and CNQ oils.
Since I enjoy tinkering, I also juice yields by selling covered-calls on a portion of some low PE, high dividend stocks – this takes effort, caps the gains in up markets, lowers downside risk, but often adds 5-7%/year call earnings to a stock’s annual dividends depending upon strike price – typically I sell out-of-the-money calls. In addition to calls on energy stocks, I have sold calls on TROW, TGT, PRU, ALL, MET, BMY and MO.
Most of the calls expire unexercised, and the call money is pocketed. In a few cases, a fair bit of money is left on the table when stocks pop (TGT and EOG for example), but these trades were structured for the income. When called away, the stocks regularly provide 15+% annualized returns which is plenty for me. Calls of around three months out provide a peak of yield premium, but I often sell calls six to nine months out just to reduce the effort (churn) of this strategy.
I have never been disappointed padding yield on dividend stocks by selling covered calls even when called away – this portion of the portfolio is designed for income, and the growth portion of the portfolio does the heavy lifting for gains. In other words, this income padding strategy provides comfort to maintain a higher stock allocation.
John,
These are good pipeline stock suggestions. Thanks for providing. I have considered those, although I hadn’t heard of the AMLP ETF.
I’ve read up on call strategies and it seems like a doable do, but one that I have not tried to implement. Wishing you continued success.
I held VNQ for about 17 years, but dropped it in 2020 as was concerned about impacts from COVID work from home mandates, and its impact on commercial real estate. Since then have worked towards simplicity, and reducing funds, and allocations to specialty sectors.
Thanks for your reply, Bill.
I put 10% of my portfolio in VNQ in 2008 for around $25 after real estate collapsed. It was one of my best decisions. It would not stop going up so I had to keep selling to rebalance which turned out to be one of my worst decisions. Go figure. Now I have none because I stopped making sector bets a few years ago.
I started investing in REITs after the GC in a 401(k). I didn’t really look at returns. I just wanted to be the diversified in that asset as many experts recommended a portion of your portfolio to be an REITs.
However, now I’m considering not investing in REITs but just capturing real estate returns in broad-base index funds that I’m already invested in.
I used to have a REIT fund but now that money is in my total market index fund as it includes REITs.
Seems like an appropriate strategy. I’m leaning towards doing just that. Thanks for your reply.
I still have a separate 4-5% REIT position. I’m considering whether to keep or to divest and fold into another portion of the portfolio.
Nice Barron’s summary article yesterday on all the places to capture yield:
These are the best income investments now. Where to find yields of 5% or more.
John,
Thanks for providing the link! Very good article, I enjoyed the read…covers a lot.
Great topic.
Two books, “A Richer Retirement” by William Bengen and “Risk and Reward” by Ben Carlson, have influenced where my wife and I invest our money.
Bengen recommends investing equally in a wide range of asset classes.
Carlson discusses that every asset class is cyclical. In other words, it may have performed near the top of all asset classes for 10 years, only to be replaced by another asset class that had underperformed over the previous 10 years. He also recommends a diversified portfolio because of this cyclical nature.
So here are my asset classes and weightings. I invest in index funds only.
Large Cap: 12%
Large Value: 12%
Foreign: 12%
Mid Cap: 11%
Small Cap: 12%
Micro Cap: 12%
Balanced: 11%
Bonds: 11%
Cash: 7%
I’m a 75 yr. old man; I’ve been retired 5 years. My wife (73) has a small pension (~1k/mo.); our social security covers our monthly expenses. Our Fidelity portfolio includes a small Roth acct and a small brokerage account (~ 2.5% each of our portfolio) and two tax-deferred IRAs (95% of portfolio). We have 5% of our assets in high interest savings accounts. Within our Fidelity accts all positions are indexed or sector specific mutual funds or ETFs. (We own no individual stocks or bonds.) The balance is 80% equities (including 10% intl stock funds) and 20% bond funds. We have no debt except monthly credit card expenses which we pay off. Within each Fidelity account my rule of thumb is to have 7 or fewer funds. The largest is FXAIX (Fidelity 500 Index) with about 33% of all equities. (I’ve tried to keep things simple.) We use our savings accounts, RMDs, and our brokerage account for travel, major expenses, and occasional support for our 3 adult children and our granddaughter.
For the past 6 or 7 years, HD has been our financial north star thanks to Jonathan, Adam, Dennis, Richard and many other contributors and commentators. I am so grateful to all of you! For now, with my wife’s assent, I manage our assets. As I age I anticipate hiring a financial advisor to give my wife peace of mind (assuming I’m the first one to sign off). Probably TMI. Until about 10 years ago I thought v. little about retirement. I just knew that saving and living below one’s means was a good idea.
75 years old. 76% in equities (large % in US) 8% short term bonds (VUSB), and 16% VG money market. We have a mixture of 8 ETFs and 7 long held stocks. We have no pension and each have SS. Fortunately the portfolio is very large so the cash position can carry us through any downturn, along with SS. We have no debt either.
Great question and article. Our portfolio is like this:
5 ETF’s, mostly S&P500 Fidelity and Vang, & QQQ 75%
Mag 7 12%
Cash 13%
As an Electronic Engineer I put my money where my mouth is, and it is working, over weight in Electronics. My best stock ever in Apple and accounts for 6% of all Equities. I went for 40 years trying to pick the right stocks, about 50, now down to 10 along with my ballast ETF’s. This is working for me. No bonds, using cash in Internet Banks.
What is your age, is I may ask. I’m always interested in how it affects it would tolerance. Personally, I like your investments
40% each in FSPGX and FXAIX, 20 percent caps in SPAXX. Oh and I got 10 shares of SpaceX for fun. I had never participated in an IPO before.
Simple. I like it
60/40 allocation, using SPY, MDY, NHFIX, VNQ, VNQI, VEA, VYMI and VBIAX as my primary investment tools. At the moment, cash is 5%+ as a buffer in retirement a/c’s against a sudden correction. International is now approaching 10% as a hedge against the Dollar. Our average annual return over 12 years of retirement has been 8.0%+. Total expenses run about 13 basis points. We also both receive SS and I have a small defined pension benefit from a long ago employer.
We have benefitted from a long upward bias in markets, which has allowed us to spend freely and help our son when needed. However, this market is looking a bit long in the tooth and I spend more time thinking about how to better position our investments against a sharp downturn.
403b (interest at 7.5%) = 54%
Equities = 30%
IRA (Equities) = 8%
Secured secondary notes = 2.5%
Private Equity = 2.5%
iBonds = 2.5%
Cash = .5%
It’s interesting to see how people are invested. I think it would also be helpful to include life stage or current age, as I noticed some commenters did not appear to have any bond/fixed positions in their AA, while others did.
We’ve been fully in decumulation mode for four years of a 42 year plan with 38 years to go.
Tax Class Equity Fixed
=======================
Tax Deferred 53% 47%
Tax Exempt 57% 43%
Taxable 60% 40%
——————————————
Total 57% 43%
The above is tilted toward fixed due to:
If I include only the portion of our portfolio that is invested in traditional stocks/bonds (mostly ETFs), then it looks like this:
Tax Class Equity Fixed
=======================
Tax Deferred 55% 45%
Tax Exempt 100% 0%
Taxable 92% 8%
——————————————
Total 72% 28%
Equity is divided 3/4 domestic (mostly VTI), 1/4 international. Fixed is mostly BND and STIP.
50 years old. Spouse 47. Both work. Four children (8,11,13,18)
Total combined investments:
Roth IRA’s: ~30% (AVUV)
Taxable: ~7.5% (AVUV)
403B: ~63% (50% VSMAX, VINIX 40%, VVIAX 10%)
Gotta keep portfolio VERY SIMPLE as in most homes one person is managing it all on their own; unfortunate but true but finance is now being taught throughout the country in high school
Our son is a high school history teacher. Over his years of teaching his courses have changed. He now teaches Financial Literacy only
10% Total US Mkt Index VTI
4% Cash
10% Total International Index VXUS
10% Total World Index VT
30% TIPs Ladder
18% Berkshire Hathaway
10% VPMAX VANGUARD PRIMECAP ADMIRAL
8% Gold IAU
Total expense per Vanguard: 0.09%
Where are annuities in the answers? Are we the only household with 25% in an annuity?
Should Social Security be counted as an asset? I argue yes. (Although now a risky one…)
Also, the answers don’t include expected tax liabilities. Appreciated.assets in a Roth IRA are worth a lot more than in a taxable account.
Estate planning has additional considerations…
SS is my annuity. Despite the doomsayers, it’s not going away. Maybe it will be means tested at some point.
We have a little less than a 1K monthly pension that I chose with a small (compared to our portfolio balance) pension balance from one of my employers. I compared what I could get with a commercial annuity for the same amount and the payment was significantly lower. I figured that if I were to ever buy annuity this was the time. The pension was with a local hospital which included many physicians. I figured that the pension would do their due diligence when it came to choosing the insurance company. As an added bonus I only had to sign one piece of paper to complete the process.
I have a significant pension and SS I would not say they are an asset. We also have two small annuities that sit there an accumulate, they are assets in my mind.
Very interesting responses to the question. In reading through the portfolios, I did not see one mention of any senior loan funds (also called bank loan funds and floating rate funds). These funds are portfolios of loans made to less than investment grade companies who choose not to issue bonds. The loans are collateralized and are usually at the top of the capital structure, so even though the companies are not investment grade, there is some protection in a bankruptcy. The duration is negligible since the interest rates charged on the loans usually reset every quarter. The best feature for me is that these funds react to interest rate changes the opposite of conventional bonds. I use two funds, one from Fidelity and one from T Rowe Price. They yield 6-7% lately and the funds are very stable, not much price change, even in choppy markets. They pay interest monthly and this is an area where a managed fund can beat an index due to the need for intensive research. This is an underutilized asset class that belongs in many portfolios to the tune of 5-10% of the fixed income portion. Let me know what you think.
I can’t comment as to if I believe they are a good idea or a bad idea. But I do know, they are way over my “keep it simple” portfolio
I held the Fidelity Floating Rate Fund (FFRHX) leading up to the Great Financial Crisis. It tanked over 25% very quickly as the market crashed that fall. It was a sobering lesson for me as I thought I held something that was less volatile than that. That said, it’s a very good investment for those desiring income. I would just caution that one needs be ready to sell it if we have another crisis. It lost about 18% in a blink of an eye during the Covid financial panic.
I have a history with the fund I’ll now share. My father in law, an immigrant with little to no understanding of money, came to me with $30K and asked me to invest it. We used a Fidelity account in my wife’s name and invested it in the FFRHX in about 2005. Every quarter my wife would give him the dividends in cash for which he was always elated and grateful. He had never put money to work before. We paid the taxes which were invisible to him. Then the crisis hit, the fund dropped, and he passed away a while later. A family member came to me and said, “Where is the $30K?”. I explained there was this thing, the GFC, and the $30K was now $24K.” He said, “Give me $30K back.” I suppose I could have said the money is in my wife’s name, sorry, or he would have wanted us to have it–that sort of thing. Instead, I wrote the check and took measure of the man. When people die without a will, and there is reliance on the good faith of certain family members, well…all kinds of things can happen. So there you have my complicated history with the FFRHX fund, a lesson learned.
We used to hold Fidelity Floating Rate High Income. Still think it’s a good choice, just decided to keep things simple. Managers of our biggest bond holding Fidelity Total
Bond can invest in these issues if they want.
From what I see here, you could put every possible investment on a wall and throw darts at them and you would come up with someone’s investment mix.
I don’t recall seeing any REITs or Municipal bond Funds though.
Dick – I suspect Muni utilization may be low for many Boomer retirees because we have ended up with much larger tax-deferred account balances relative to taxable account balances. Thus, fixed-income allocations are taken within tax-deferred accounts where higher-yield fixed-income works best. Munis work best in taxable accounts.
For sure, but in my case the muni funds are in our brokerage account which is slightly larger in total than my rollover IRA.
Someone mentioned VNQ (US REIT ETF) and VNQI (Global ex US REIT ETF).
We are invested in various types of REIT as an inflation buffer but because of the taxation issues we put them in our Roth accounts.
I considered a muni fund but Vanguard’s only one for my state is long-term, and I want only short-term bond funds, so no.
I have short, intermediate and long term bonds, only the largest fund holding of the three is in my state.
Good observation. A bit surprising especially the absence of munis.
We used to hold a muni bond fund but at some point decided just to hold all bonds inside tax-deferred accounts. However we’re running out of space there so we may own a muni fund again at some point.
Have also considered REITs since we have no real estate exposure through owning a home. However I think REITs are more of a commercial estate play.
I have a grand consolidated spreadsheet across my five accounts.
About 56 different common and preferred stocks: 50%
Cash: 19.8%
4-week T-bills: 23.2%
2-year T-bills: 6.2%
Well, now you know. If the market crashes, I will definitely be a buyer.
So interesting to see the responses!
My portfolio is in Vanguard index funds in the traditional and Roth IRAs, and in cash + tax-managed, index-adjacent stock funds (slight tilt toward growth and small-cap) in the taxable account. Percentages of total portfolio are shown.
taxable (12%):
07% tax-managed cap apprec (VTCLX)
01% tax-managed small cap (VTMSX)
04% fed money market (VMFXX)
tIRA (64%):
16% short-term treas (VSBSX)
32% short-term infl prot bond (VTAPX)
16% tot world stock (VTWAX)
rIRA (24%):
24% tot world stock (VTWAX)
overall stocks/bonds+cash = 48/52.
This has been on a rising glide path from 30/70 when I retired in 2021, aiming gradually for 50/50.
VTWAX is currently 60.5% U.S., so overall ratio U.S. to ex-U.S. stocks is about 68% to 32%.
Social Security delayed to age 70 was still not enough to cover my annual CCRC fees and other expenses, so to fill the gap I have a SPIA with 5% compound annual increase and withdraw about 2.5% of the portfolio, reinvesting any unneeded remainder of my RMD in VTCLX. Finally, I have a QLAC to start in 2034.
Great question. All you need is Total Stock Total Intl and Small Cap Index for the stock part of your portfolio. KISS
Curious, how much of each of the total (domestic?) stock, total international and small cap index by percentage?
Retired with overall 60/40 portfolio and no other assets (like a house).
Stock side is mostly broad indexes, with about a third in individual stocks. One is 5% of the total portfolio and all others are less. Those will be going down gradually as we sell assets to fund life, so some organic simplification happening as that happens. Stock funds are ~37% international, about the same as a global stock index fund.
Our largest bond holding is a core plus fund followed by a TIPS index fund. Most of our cash is in a 401(k) stable value fund.
We are about 60% equities, 30% bonds and 10% cash across traditional/Roth IRAs and taxable account.
44%: US total/blend/value, large/mid/small cap index (VTI, SCHB, SCHX, SCHD, VO, VB)
16%: Foreign developed and emerging (VEA, VWO)
30%: Intermediate/short-term total, corporate, treasury (SCHZ, SPIB, VGIT, IGSB, VGSH)
10%: CD ladder, ultra-short and money market (SGOV, SWVXX)
Continuing to simplify funds to total market, lifestyle or target date, assuming my spouse outlives me and is not interested in managing choices.
Thanks for sharing. My biggest concern going forward is also that my wife isn’t interested in finances so I try to simplify ours
We are about 27% domestic, 23% foreign, 24% bonds, 26% cash.
¾ of the stock funds are Vanguard index ETFs, ¼ are a few managed funds that I like. The bonds are short and medium duration. ⅓ of the cash is a CD ladder (in case hard times befall us). The balance is cash sitting in SPAXX (in case things go on sale).
One of my managed funds is Fidelity Contra. The fact that its manager, Will Danoff is retiring, has my guard up. If I sell it, I will probably use the proceeds to buy the index funds.
I have been giving serious thought to an all in one fund like the Vanguard Lifestyle funds or similar. If I croak first, Chrissy will have no interest in re-balancing every year.
“… Chrissy will have no interest in re-balancing every year. ”
My spouse is also that way. I personally have 2 fears, one if I past first before her, or, if I become disable either physically or mentally. So I have set up a ‘love letter’ instruction & also advised my eldest daughter to take over if and when BOTH of us are disable. I have been developing a relationship with the Wealth Management advisor in our local Fidelity office, if she or our daughter do not feel comfortable w him, my other suggestion is my recommendation of a flat hourly fee advisor I have in my letter. Things can get complicated to think things through.
PS: I thought Fidelity Contra Fund is a very extremely good investment but changing manager may not be any better. I couldn’t get into it when I was working because it was closed to new investors.
I would do Vanguard Lifestyle funds also, except I don’t feel the need for a bond portion because of our high current income stream compared to our expenses. For that reason I stay fully invested in stock index etf’s
Dan, I’m sure you’re already aware but the VG LifeStrategy and similar “funds of funds” may not be good fits for taxable accounts due to the constant re-balancing and resultant taxable gains they may throw off. May be good option for tax deferred accounts, though. Also, if you still enjoy managing and tweaking the portfolio, carry on and just leave your lovely spouse suggestions for replacing your expertise upon your demise. Could be a vetted financial planner, VG’s Personal Advisor Services, etc.
I was going to say the same, but I will add for someone who has no interest in managing money a Vanguard personal advisor with their low fee would be worth every penny, and you would have to assume they would continue on a similar path as to what you are doing now.
My wife has been told that the first monetary move after I die is to call Vanguard and set this up.
David, .3% on $1.7 million is still over $5,000/year, and some may have to double or triple that amount. Why not recommend a flat fee financial advisor like a Facet or Range at less than $3,000 annnually?
I have touted my faith in Vanguard for decades to my wife. Hopefully I have a couple of decades left to manage our assets. After that the compounding fees will have less of an effect. Finally, and most importantly, since my wife has shown only a passing interest (most recently) I don’t think in her eighties she would want to be making a decision on a fee only advisor in her late eighties, and in that case Vanguard and their potential 5K is fee looks like a bargain.
Mark, thanks, I really do appreciate your opinion.
AA = 50/48/2 (equities, bonds, cash)
50% = VTSAX + VFIAX (total stock + S&P500 indexes)
49% = VSBSX (short-term treasury index)
2% = VUSXX (treasury MMF)
No muss, no fuss. Retired 15 years.
We’re 70% Equities split 62/38 US v International (VTSAX and VTIAX), 20% in VG Intermediate Treasury Fund, and 10% Cash (mostly TSP G Fund).
60% is tax deferred, 36% is Roth, 4% is taxable.
Roths are 100% equities. Bonds, Cash and remaining Equities in tax deferred and taxable.
Still doing Roth conversions in next few years, the extent of which is still being contemplated. Debating between nibbling around top of tax bracket vs “go big or go home”.
My percentages:
33% Cash (online money market)
38% Growth – VOO, VTI, VUG
28% Income – SCHD, VNQ, VDE, VYM
2% Risk Plus – MRNA, USAR
But here’s the reality: eight tickers across two sleeves don’t represent eight different bets. VOO, VTI, and VUG all hold the same mega-cap names — Apple, Microsoft, Nvidia, Amazon — as their top positions. VTI is just VOO plus some small/mid-caps, and VUG is a growth-tilted slice of largely that same large-cap universe. So 38% “Growth” is really one concentrated US large-cap bet, counted three times.
The Income sleeve has some real diversification — VNQ (REITs) is genuinely different — but SCHD and VYM overlap heavily in the same dividend-paying large caps, and VDE’s energy names show up in SCHD too. And those same large caps already appear in VOO/VTI from the Growth sleeve. So there’s overlap within sleeves and across them.
Net result: my 8-ticker, 4-sleeve portfolio is really “US large-cap” + “REITs” + “energy tilt” + cash. Three asset classes, not eight bets.
And here’s your reality, Larry: your 70/10/10/10 has the same issue, just more elegantly disguised. VT (Total World) is a market-cap-weighted blend that already includes value and growth stocks globally — it’s the whole pie. VTV and VUG are just slices of that same pie, split by factor. So your “three equity funds” are really one global equity position with a slight value/growth tilt layered on top.
The lesson for both of us: counting tickers isn’t counting diversification. What matters is the underlying holdings, asset classes, and correlations — not how many fund names appear on the statement. A portfolio with 10 funds that all hold the same top-5 positions isn’t more diversified than one with 2 — it’s just more paperwork.
I will be making changes
Our portfolio target date is 45/45/10. Right now we are off by 1-2%.
Ages 68 1/2, and 67 1/2
Dividend Appreciation 8%
Intermediate Bond 2.5%
Short Term Bond 14%
Short Term TIPS 8.5
Target 2030 7%
Total Bond 16%
Total International Stock 55%
Total (US) Stock 8%
Total World (100% Roth accounts) 22%
When Roth conversions are completed (hopefully year end 28) portfolio will consist of Total World still 100% only in Roths; my traditional, which will be the only RMD account will have bonds (1/3 each total, short term, short term TIPS); and stocks taking into consideration the allocation of the total world allocation, to equal 2/3 US, 1/3 international in our total portfolio. My traditional is split into different funds so at 73 will I be able to withdraw RMDs quarterly from higher return assets.
Just looked on my Morningstar account and our largest holding is Apple at 1.8%. We are very diversified as a result of utilizing broad index funds.
Great topic. Mine looks a little different from the indexers.
I’m semi-retired, 61, with a long-running dividend reinvestment portfolio as the foundation — 28 positions built through ComputerShare DRIP since 2004. Think PG, JNJ, KO, XOM, LMT, UNP, ABBV and similar.
31% Individual dividend stocks (ComputerShare DRIP, 28 positions, full reinvestment through 2030)
41% Broad index funds — VTSAX, VTIAX, VGSLX, VBTLX across a traditional IRA, plus SCHD building toward a target share count, and index funds in a 401K
16% Cash / money market — intentional 5-7 year expense buffer, not idle cash
10% Individual equities — energy overweight across EPD, XOM, CVX, COP, PSX, SHEL; deliberate thesis given the current macro backdrop
3% Treasury ladder — running off, maturities rolling into SCHD
Account structure: ~57% deferred, ~11% Roth, ~32% taxable
When I was first started out investing, I have joined an investment club, and the 80s & 90s I also did about 50 DRIPS, some through ComputerShare or the stock own DRIP account. All was very, very well, then the dot com crash came, and over 6 months I lost about 1.5 million paper lost. It took me over 7 years to recover, but it had the DRIP programs to help with the recovery.
32% USTotal Mkt Index
5% US SCV
13% Total International Index
20% Short term Treasuries and CDs (1-3 years)
20% TIPs (1-5 years) and IBonds
10% Total Bond Index Fund
Currently retired, holding a 50/50 asset allocation. Planning to glide to a 60/40 allocation in a few years when take SS at age 70. Holding small amount in cash to meet 3-4 months expenses.
Interesting topic, I’m sure not two of us will have similar portfolios. Individuality is going to be the name of the game. Hers mine ripped from a spreadsheet.
Asset Allocation
Cash Reserves: 20%
20% Cash / Short-Term Reserves (Held separately from the main portfolio following business sale)
Global Equities: 68%
32% Developed World (ex-UK)
16% Developed Europe (ex-UK)
12% UK High Dividend Yield
8% Asia Pacific
Fixed Income & Defensive: 12%
8% Global Bonds (hedged to Sterling)
4% Individual Inflation-Protected Bonds (Arranged in a declining ladder to fund immediate consumption)
There’s also a ten year term annuity in the mix. I’ve no clue how to incorporate that into the asset allocation since it’s an income stream.
I suspect you probably do know how to value an annuity in your asset allocation, but if you want to convert it to a lump sum for the purposes of portfolio management, an easy approximation is to value it as the amount of money that would be throwing off that income with an equivalent level of risk. For instance, a traditional annuity might have about the level of risk of a home mortgage, now paying perhaps 5% depending on origination date, so 10,000 in annual cash represents about $200000. Of course it’s not precise, but I think it works pretty well for allocation purposes.
Steve, you’re correct, I simply couldn’t be bothered working it out for my reply! On a note of technical interest, a better benchmark would probably be the ten-year US Treasury yield — since the annuity pays a fixed nominal income stream, matching it to a nominal rate is a cleaner fit than an inflation-linked one. It’s also broadly the rate insurers use when pricing a ten-year term annuity.
40% FZROX (Total Stock Market Index)
20% FZILX (International Index)
10% FNILX (Large Cap Index)
10% FIMVX (Mid Cap Value Index)
10% SGOV (0-3 Month Treasury)
10% FIPDX (Inflation-Protected Bond Index)
Total portfolio expense ratio = 0.019%.
Well done!
Thank you! I pay close attention to those expense ratios. It is amazing how much we can give away over our lifetime if we don’t pay attention to them!
Neat topic, thanks. Our basic setup:
Whilst calculating these percentages, I was pleased to see that our home and cars only came to 20% of our net worth. Here in Australia, there are lots of people with relatively high net worth, but a lot of that is tied up in their home and cars.
Your net worth is not that high if it’s tied up in your house. I know real estate in Australia is expensive, but if you are wealthy your financial assets should be at least five or six times the value of your primary residence.
“Here in Australia, there are lots of people with relatively high net worth, but a lot of that is tied up in their home and cars”.
I think that’s true in the US as well. I didn’t bother with the cars, one is only worth $15K, the other is a lease, the house stands at 26% of total net worth. I agree that a lower % can be an indication of financial health. I include the house in our net worth for two reasons; it is a potential source of income, and it will be converted to cash by us or our beneficiaries at some point in the future.
Our primary home can be an inflation beater if you have much equity in it but not so much w the cars, or any thing with wheels on them. But in my investment assessment, I would exclude both.
I believe it is a mistake to include your cars, and more controversially, your house in your net worth. Neither are liquid assets. Neither contributes to your funds available for spending/living. You have to live somewhere….. Mild exception ; if you have a reverse mortgage.
We do not include our house. It costs a lot to have a house. Insurance and taxes this year are $30k. It needs constant repairs. The capital tied up in the house is inaccessable because even if we cashed out, we’d have to use the cash for housing. The cash tied up also can’t be invested elsewhere. A loan against the equity would have a high interest rate.
My heirs, on the other hand, see the house as a pile of cash.
Thanks Mark. I keep two totals – net worth and net investable. My percentages above all reflect the net investable total.
My comment about house and cars was more a reflection on the role that housing plays in the personal finances of many Australians.
Yes. For a retiree, home equity can be a reasonable consideration as a contingency fund for unanticipated spending shocks.
It’s a significant source of equity for anyone with a DWZ perspective. Why exclude it?