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Brief Portfolio Question on Retirement Accounts

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  • Brief Portfolio Question on Retirement Accounts

    Hello,
    I was hoping for clarification on a portfolio question. I am preparing to go it alone with investments for my wife and I, and have thoroughly enjoyed reading this forum and books suggested.

    Mid career both aged 46 yrs - looking to work another 12 yrs, and have primarily 403b and Roth IRA accounts for both myself and wife. We both have sizable pensions that will kick in, so although this may look retirement light, we are in a good financial place.

    Looking at all accounts (2 x 403b and 2 x Roth IRA totaling ~ $1million) and then breaking into the following funds and % asset contributions (following the lazy portfolio approach).

    Total Market Index Fund - 48%
    Total International Index Fund - 12%
    REITs Index Fund - 5%
    Total Bond Market Index Fund - 20%
    (TIPS) Inflation-Protected Indexed Bonds - 15%

    My main question: With 403b being tax deferred, and Roth tax free upon withdrawal, my newbie understanding was to place major bond contributions into the tax deferred accounts - 403b, and largest growth (Total Market, Total International and REITs) into Roth tax free. The percentage breakdowns of asset contributions will not work out perfectly to put all funds into said accounts - more so I was just curious which account should be "heavy" with what type of fund. Or maybe it doesn't really matter as all accounts are non or delayed taxable.

    Sorry to post such a simple question compared with other types of questions posted, clarification would just help us tremendously. Thank you in advance for any and all responses.

  • #2
    Hope this answers your questions

    Comment


    • #3
      New money (contributions) should follow your plan. You may not be able to get too much into a Roth until after you retire unless you have access to a Roth 401K. You can plan to convert assets from your 401K to a Roth IRA after retirement. It really depends on how large your pensions are. More info gets you better responses.

      Comment


      • #4
        if you have decent pensions that are guaranteed, how are you factoring that in your asset allocation? I would suggest finding out what the pension balance is for each of you and considering that balance as part of a bond in your overall asset allocation

        Comment


        • #5
          Depending on the size of your pensions and tax brackets, you might consider also roth 403b contributions if you have access to them. Paying for professional help in this scenario may be worthwhile.

          Comment


          • #6
            I think you have it about right.

            Comment


            • #7
              Originally posted by Sstrath View Post
              Hello,
              I was hoping for clarification on a portfolio question. I am preparing to go it alone with investments for my wife and I, and have thoroughly enjoyed reading this forum and books suggested.

              Mid career both aged 46 yrs - looking to work another 12 yrs, and have primarily 403b and Roth IRA accounts for both myself and wife. We both have sizable pensions that will kick in, so although this may look retirement light, we are in a good financial place.

              Looking at all accounts (2 x 403b and 2 x Roth IRA totaling ~ $1million) and then breaking into the following funds and % asset contributions (following the lazy portfolio approach).

              Total Market Index Fund - 48%
              Total International Index Fund - 12%
              REITs Index Fund - 5%
              Total Bond Market Index Fund - 20%
              (TIPS) Inflation-Protected Indexed Bonds - 15%

              My main question: With 403b being tax deferred, and Roth tax free upon withdrawal, my newbie understanding was to place major bond contributions into the tax deferred accounts - 403b, and largest growth (Total Market, Total International and REITs) into Roth tax free. The percentage breakdowns of asset contributions will not work out perfectly to put all funds into said accounts - more so I was just curious which account should be "heavy" with what type of fund. Or maybe it doesn't really matter as all accounts are non or delayed taxable.

              Sorry to post such a simple question compared with other types of questions posted, clarification would just help us tremendously. Thank you in advance for any and all responses.
              It looks like it’s been a pretty rough month. You’ve aged four years and your net worth is down by over half! (Roughly $526,000 from your first post on the forum to your second.). At least you’re two years closer to retirement.
              https://forum.whitecoatinvestor.com/...ll-now-or-wait

              Comment


              • #8
                Originally posted by Hank View Post

                It looks like it’s been a pretty rough month. You’ve aged four years and your net worth is down by over half! (Roughly $526,000 from your first post on the forum to your second.). At least you’re two years closer to retirement.
                https://forum.whitecoatinvestor.com/...ll-now-or-wait
                Poirot!

                LOL.

                Awesome post.

                Comment


                • #9
                  Originally posted by Hank View Post

                  It looks like it’s been a pretty rough month. You’ve aged four years and your net worth is down by over half! (Roughly $526,000 from your first post on the forum to your second.). At least you’re two years closer to retirement.
                  https://forum.whitecoatinvestor.com/...ll-now-or-wait
                  Nice sleuthing - but also: OP is quite a strange troll...?

                  Comment

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