Free Vanguard Plan - Opinions?

[Jeb-NY]

I'm 58 retired, married and setting up my long term asset allocation. I'm rolling my lump sum and 401K funds to Vanguard and took them up on a free Financial Plan. Had the phone meeting yesterday and thought I would do, like so many others, and ask for a free assessment of their plan from the experts here.

Vanguard says I should be 50/50 stock and bonds, I was leaning to 60/40 and they said that was still in bounds of what they could support, and obviously I can do whatever I want.

They recommended moving all my pretax money to a few VG funds and blended in my taxable accounts to match the allocation, since they did not want to cause any tax events.

The big picture:
US Large Cap - 24%
US Mid/Small - 13%
International - 13%
Intermediate Bonds - 50%
Short-term Reserve - 0

In truth I held back about 5% that I already have planned for expenses over the next 1.5-2 years that is not included in their allocations.

They suggested these funds to blend with what I already have
Vanguard US Value Fund <VUVLX> - 2% - or Windsor II
Vanguard Total Bond Fund Admiral<VBTLX> - 50%
Vanguard Developed Markets Fund<VDMIX> - 8%
Vanguard Morgan Growth Fund<VMRAX> - 2%
Vanguard Total Stock Market Admiral<VTSAX> - 16%
My other funds that make up the rest of 50% Stocks are:
Janus 20
Janus WorldWide
Dreyfus Midcap Value
DWS Small Cap Core
DWS Latin America

I plan to have VG put some of the bond side in a Shorterm Reserve fund, not sure what, other than money market at this point.

So what do you think of VGs AA and the suggested Vanguard funds?

Jeb

[ats5g]

I'm curious as to why Vanguard suggested 2% in US Value Fund or Windsor II and 2% in Morgan Growth Fund. Since you're going to use VTSAX, doesn't 2% in large value and 2% in large growth even out to 4% in large blend while you're paying a hell of a lot more in expense ratio? I think I'd just nix that 4% and put it into VTSAX.

btw - why not Total International [VGTSX] instead of developed markets [which doesn't include EM]?

- Alec

[Jeb-NY]

Quote:

Originally Posted by ats5g I'm curious as to why Vanguard suggested 2% in US Value Fund or Windsor II and 2% in Morgan Growth Fund. Since you're going to use VTSAX, doesn't 2% in large value and 2% in large growth even out to 4% in large blend while you're paying a hell of a lot more in expense ratio? I think I'd just nix that 4% and put it into VTSAX. btw - why not Total International [VGTSX] instead of developed markets [which doesn't include EM]? - Alec

I asked about the Morgan Growth Fund and US Value Fund. Those were suggested for my wife and my Roth accounts. I didn't think about that the two together was basically a blended large cap. I'm considering keeping my current Roth accounts. One is in a health sector fund and the other has 3 ETF in small, medium and energy.

I didn't ask but I assumed they picked Developed Markets instead of total because of my DWS Latin America fund and they didn't want any more exposure to emerging markets.

Jeb