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FIRECALC Total Market/Income
Old 02-11-2013, 10:57 AM   #1
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FIRECALC Total Market/Income

Been running some FIRECalc simulations with varying AA (Equities/Fixed Income). Here are some numbers I got for my specific situation.

75/25 - Baseline
50/50 - +1488
25/75 - +504
5/95 - -1805

All are right in the ballpark for my decision to ER this summer Suffering from the "one more year" syndrome, but hopefully we can make the leap of FIRECalc faith.

My question is what portfolio would folks suggest to reach these percentages? Right now I have my portfolios spread across 10 low cost VG funds, but would simplifying to these two be reasonable to attain FIRECalc results?

VGSAX - Total Market
VBTLX - Total Bond Market


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Old 02-11-2013, 11:56 AM   #2
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I read books by Malkiel, Ellis, Swedroe & Bob Clyatt & came up with my own mix of large cap, small cap, international, emerging, reits, mid term treasuries & corp bonds, short term corp bonds & TIPS. All mutual fund or ETFs.

One of Swedroe's books goes into a good discussion on setting your bond allocation - based on number of years of safe expenses, ability to handle a 50% equity down turn etc. I can't remember the name though - it may the the "Best investment policy" or something like that. He has the worst names for his books

All the best.

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Old 02-11-2013, 12:17 PM   #3
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How about some exposure to international equities? I use VTIAX for my international exposure.

FWIW, I use VBTLX for bonds (like you), VTSAX for my Total Market, and VTIAX for international.
ER, for all intents and purposes. Part-time income <5% of annual expenditure.
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Old 02-11-2013, 01:32 PM   #4
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Originally Posted by Major Tom View Post
How about some exposure to international equities? I use VTIAX for my international exposure.
+1. Unless you want to buy a fund of funds or something like Wellington, Wellesley (perfectly good choices) - I consider 3-4 funds to be a good place to draw the lower limit line for a DIY AA number of funds. I have 11 funds (tilts, tax avoidance from career income days, etc.), but that will decrease as I age, and I'd be fine with 3-4.

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No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
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Old 02-11-2013, 01:38 PM   #5
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I recently setup a mini-portfolio of 70/30 VTSAX/VBILX just to see how they perform. I don't have an international component, mainly because I'm leary of the increased risk.

Long term, I've pretty much decided to maintain my first 10 years of ER funds in Wellesley (40/60) the next 20+ years in Wellington (60/40), and use 50/50 for FireCalc purposes.

But I want to see how my mini-portfolio does for a few years.
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Old 02-11-2013, 02:32 PM   #6
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Wouldn't there be tax implications to move from one set of funds to another ?

"For the time being no discipline brings joy, but seems grievous and painful; but afterwards it yields a peaceable fruit of righteousness to those who have been trained by it." ~
Hebrews 12:11

ER'd in June 2015 at age 52. Initial WR 3%. 50/40/10 (Equity/Bond/Short Term) AA.
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