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  • Retirement Fund Allocation

    I’m a little over halfway through residency and currently maxing out a Roth IRA every year through Betterment. I currently have my portfolio set to 100% stocks and 0% bonds. I get that this is considered too risky for an investment portfolio, but if this is money that will essentially grow (hopefully) untouched for over 30 years, why should I be at all conservative with the allocation? If I’m mentally capable of watching it lose considerable value in an economic downturn knowing that it will recover long term, why not keep it at 100% stocks while I’m still young and reap the benefits of a 30 year market cycle?

  • #2




    I’m a little over halfway through residency and currently maxing out a Roth IRA every year through Betterment. I currently have my portfolio set to 100% stocks and 0% bonds. I get that this is considered too risky for an investment portfolio, but if this is money that will essentially grow (hopefully) untouched for over 30 years, why should I be at all conservative with the allocation? If I’m mentally capable of watching it lose considerable value in an economic downturn knowing that it will recover long term, why not keep it at 100% stocks while I’m still young and reap the benefits of a 30 year market cycle?
    Click to expand...


    I do not disagree with your approach. 100% equities is totally acceptable in your circumstances. 120% equities may even be preferable, for some.

    I do disagree with "I'm mentally capable of watching it lose considerable value..." as you will not know your capacity until you experience it.

    Congrats on getting a jump on saving and investing.

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    • #3
      100% stocks is fine if you plan on working a long time. Why Betterment though? You can’t tax loss harvest in a retirement account. Why not go straight to Vanguard (or whatever funds you are invested in) and avoid the layer of fees.

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      • #4




        I’m a little over halfway through residency and currently maxing out a Roth IRA every year through Betterment. I currently have my portfolio set to 100% stocks and 0% bonds. I get that this is considered too risky for an investment portfolio, but if this is money that will essentially grow (hopefully) untouched for over 30 years, why should I be at all conservative with the allocation? If I’m mentally capable of watching it lose considerable value in an economic downturn knowing that it will recover long term, why not keep it at 100% stocks while I’m still young and reap the benefits of a 30 year market cycle?
        Click to expand...


        Its not at all considered too risky, especially given your age and the actual amount you have compared to your long term total.

        Best not to look in a downturn, its one thing to say something, its wholly another to watch it go down and you may find new feelings arise you werent aware of.

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        • #5
          I should have placed more emphasis on the "if" when I spoke to being mentally capable of losing money in a downturn. I haven't looked into Vanguard yet. Mainly Betterment made it easy to set up the Roth and the fees are low (0.25%). They rebalance the account and diversify the portfolio for me. Their website says they tax loss harvest but maybe I'm missing something and my account isn't eligible for tax loss harvesting?

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          • #6
            Not sure how one would tax loss harvest in a non-taxable Roth IRA.  Guessing TLH is more of a factor/utilized in a taxable account.  Maybe an Joanna or Spirit can shed some light on TLH in retirement accounts.

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            • #7




              Not sure how one would tax loss harvest in a non-taxable Roth IRA.  Guessing TLH is more of a factor/utilized in a taxable account.  Maybe an Joanna or Spirit can shed some light on TLH in retirement accounts.
              Click to expand...


              There isn't any benefit to tax loss harvesting in a retirement account.  The biggest benefit you are getting from using Betterment is having them manage your Asset Allocation and any rebalancing.

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