Hi,
I'm new here and only started seriously reading about and creating a portfolio the past week. I'm hoping to get some advice and feedback on whether I'm understanding things correctly and if this is a reasonable plan. Thanks in advance!
Overall I have 3 accounts - Roth IRA, 401k, and a taxable account. I plan to open an account with Vanguard for the taxable account and Roth IRA.
If it matters, I am 35 and hoping to be financially independent early (around age 55).
I was planning on an Asset Allocation of 75% stocks and 25% bonds:
43% Total Stock Market Index - (VTSAX)
25% International Stock Index - (VTIAX)
7% REIT Index - (VGSLX)
25% Bond Index - (VBTLX)
I was thinking of allocating the money to something similar to this. Let's say I have about $500k total.
Roth IRA (12% of total portfolio - $60k):
7% REIT - $35k
5% Bond index - $25k
401k (23% of total portfolio - $115k):
20% Bond - $100k
3% Total Stock Market Index - $15k
Taxable account (65% of total portfolio - $325k):
40% Total Stock Market Index - $200k
25% International Stock Index - $125
Does this make sense?
Moving forward, I will be putting most of my monthly extra income into the taxable account - let's say about $10k/month into the taxable and $1500/month into 401k. I would keep this 75/25 balance by making all the 401k additions into bonds and adding a bond index in the taxable account?
Also my 401k investments are limited. The lowest expense ratio bond investment is NATIONWIDE BOND INDEX FUND - GBIAX at 0.68. There is also an S&P500 index fund BLACKROCK S&P 500 INDEX INSTL - BSPIX at 0.11. Does this affect how much bonds to put in my 401k?
Thanks!
I'm new here and only started seriously reading about and creating a portfolio the past week. I'm hoping to get some advice and feedback on whether I'm understanding things correctly and if this is a reasonable plan. Thanks in advance!
Overall I have 3 accounts - Roth IRA, 401k, and a taxable account. I plan to open an account with Vanguard for the taxable account and Roth IRA.
If it matters, I am 35 and hoping to be financially independent early (around age 55).
I was planning on an Asset Allocation of 75% stocks and 25% bonds:
43% Total Stock Market Index - (VTSAX)
25% International Stock Index - (VTIAX)
7% REIT Index - (VGSLX)
25% Bond Index - (VBTLX)
I was thinking of allocating the money to something similar to this. Let's say I have about $500k total.
Roth IRA (12% of total portfolio - $60k):
7% REIT - $35k
5% Bond index - $25k
401k (23% of total portfolio - $115k):
20% Bond - $100k
3% Total Stock Market Index - $15k
Taxable account (65% of total portfolio - $325k):
40% Total Stock Market Index - $200k
25% International Stock Index - $125
Does this make sense?
Moving forward, I will be putting most of my monthly extra income into the taxable account - let's say about $10k/month into the taxable and $1500/month into 401k. I would keep this 75/25 balance by making all the 401k additions into bonds and adding a bond index in the taxable account?
Also my 401k investments are limited. The lowest expense ratio bond investment is NATIONWIDE BOND INDEX FUND - GBIAX at 0.68. There is also an S&P500 index fund BLACKROCK S&P 500 INDEX INSTL - BSPIX at 0.11. Does this affect how much bonds to put in my 401k?
Thanks!
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