As I construct a Roth IRA for my 18 year old, it occurs to me that such a portfolio construction (100% equity) might be appropriate for any uber aggressive investor, early in one's career (resident, new attending with a Backdoor Roth, etc.). I want it to make sense and be easy for my son to understand and maintain as he takes over his finances in the coming years. I also am encouraging to learn and understand why one should want more than the S&P 500 (why international?, why small value?, why emerging markets?).
So here's what I have planned and implemented:
70% US (split between total stock market and small value) and 30% international (split between total developed market and emerging market)
We are a Fidelity family family
, so I am using ishares ETFs (that trade free at Fidelity) in the following proportions:
itot (er 0.03) 50%
ijs (er 0.25) 20%
iefa (er 0.08) 20%
iemg (er 0.14) 10%
Thus far, the money that has seeded the account has been taken from his W-2 and 1099 earnings over the last two years as a lifeguard, camp counselor and swim instructor, and he has a little north of $7000 in the account. I take 50% of his paycheck and match it with my money. (If he earns a few extra bucks as a tip or $20 cash from a private lesson, I do not include it.) When I add the money to the account and place the trade, I do so with him present and encourage him to ask questions and discuss.
So here's what I have planned and implemented:
70% US (split between total stock market and small value) and 30% international (split between total developed market and emerging market)
We are a Fidelity family family

itot (er 0.03) 50%
ijs (er 0.25) 20%
iefa (er 0.08) 20%
iemg (er 0.14) 10%
Thus far, the money that has seeded the account has been taken from his W-2 and 1099 earnings over the last two years as a lifeguard, camp counselor and swim instructor, and he has a little north of $7000 in the account. I take 50% of his paycheck and match it with my money. (If he earns a few extra bucks as a tip or $20 cash from a private lesson, I do not include it.) When I add the money to the account and place the trade, I do so with him present and encourage him to ask questions and discuss.
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