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  • Asset allocation questions

     

    I just spoke with a financial advisor (fiduciary and fee based).  I am 44, new to the USA, first time using 401 k and she recommends I start putting my contributions into the following :
    59% Vanguard Total Stock Market Index

    30% Vanguard Total International Stock Market Index

    11% Vanguard Total Bond Market Index 


    I just want to check what you folks think ...


    Thank you

  • #2
    Very reasonable.  11% bonds is a little aggressive for your age, but plenty of people would still find that perfectly acceptable.  Sounds like you found a good advisor.  Those are good cheap funds she recommended.

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    • #3
      Agree with hightower - a bit aggressive to only have 11% bonds at age 44.  But otherwise, solid 3 fund portfolio!

      Comment


      • #4




         

        I just spoke with a financial advisor (fiduciary and fee based).
        Click to expand...


        Fee based or fee only?

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        • #5
          thanks guys for your advice  8-)

          re the fee : She charges 2000-3000 for inital plan depending on if you have kids , then 200 per hour after that

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          • #6
            while the choice of funds are great/perfect even, the % is strange.

            why 89:11? why is that better than 90:10 or 85:15? that makes no sense to me.

            also why 33.7% in international stocks? Vanguard rec between 20-40% and they have chosen 40%. Used to be 30% as the sweet spot. Some argue 0 all the way to market cap (55% now i think?).

            this advice is not worth 2-3k. that is a rip off.

            edit to add: also do you have previous retirement accounts (401k, IRA, SEP, etc). these need to be taken into account as well and the whole pot should be looked at as one.

            also per the comments above, it might be a little risky. if you are 89% stock, expect to lose half, or 44.5% of your portfolio in the next downturn (seriously....why 89??  :| ). might be fine for your income at 44, might not be. only you can answer that.

            why not this:

            - 80:20 stocks to bonds

            - 30% of stock in international

            - so final of: 56% US: 24% Intl : 20% Bond/FI

            - adjust as desired or as want/need/willingness for risk changes

             

            thank you in advance for my check in the mail  

            Comment


            • #7
              Well the fee is more than what I would have paid.  You could get that kind of advice here for free.

              But, at any rate,, the mix seems fine.  Assuming you aren't the sort of person who is going to panic if the market goes down 60%.  If you think you might be, then 90% in equity may be too much.

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              • #8




                while the choice of funds are great/perfect even, the % is strange.

                why 89:11? why is that better than 90:10 or 85:15? that makes no sense to me.

                also why 33.7% in international stocks? Vanguard rec between 20-40% and they have chosen 40%. Used to be 30% as the sweet spot. Some argue 0 all the way to market cap (55% now i think?).

                this advice is not worth 2-3k. that is a rip off.

                edit to add: also do you have previous retirement accounts (401k, IRA, SEP, etc). these need to be taken into account as well and the whole pot should be looked at as one.

                also per the comments above, it might be a little risky. if you are 89% stock, expect to lose half, or 44.5% of your portfolio in the next downturn (seriously….why 89??   ). might be fine for your income at 44, might not be. only you can answer that.

                why not this:

                – 80:20 stocks to bonds

                – 30% of stock in international

                – so final of: 56% US: 24% Intl : 20% Bond/FI

                – adjust as desired or as want/need/willingness for risk changes

                 

                thank you in advance for my check in the mail
                Click to expand...


                He mentioned that the $2-3k was for the initial planning, hourly after that. My guess is there was more in the conversation than just 401k investment allocation (I hope).

                On just this thread so far he has gotten different suggestions. For someone who is new to this and the country, that probably only makes it even more confusing to start.

                Personally, the fact that he found an advisor who charges an initial planning fee and hourly after that (No AUM), is a great start. Once The Doc becomes more comfortable and settles into the country he/she can decide if they want to take a more active role in their finances & investments.

                Comment


                • #9
                  Yes , the initial fee includes a plan with projections , includes cashflow, net worth, retirement planning etc . then the hourly fee is for any further questions and implementation of the plan itself, they told me if I want they can even screenshare with me and show me how to set up retirement accounts etc if I wanted to..  It might be worth doing once for the purpose of speeding things up ,  I would suggest any procrastinators  :P  should use a financial advisor at least once to get started based my expernience ..

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