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Only one fund?
Old 11-29-2017, 11:25 AM   #1
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Only one fund?

My friend wants a simple investment for her tIRA that is roughly 70/30 AA. The new VG Global Wellington is around 65/35, so I was thinking this could be a good one fund solution. Thoughts?
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Old 11-29-2017, 11:28 AM   #2
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VBIAX is cheaper and broader, although closer to 60/40.
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Old 11-29-2017, 11:32 AM   #3
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Your friend could probably do a lot worse.
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Old 11-29-2017, 11:34 AM   #4
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Even in a tIRA, I would not pick an actively-managed fund. So one fund that is a fund of index funds would be
Vanguard LifeStrategy Moderate Growth, but it is 60/40
Vanguard Target Retirement 2030 is 71/29
there are others, but these will get one going along the right path.
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Old 11-29-2017, 12:27 PM   #5
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Quote:
Originally Posted by LOL! View Post
Even in a tIRA, I would not pick an actively-managed fund. ... Vanguard Target Retirement 2030 is 71/29 ...
This. One thing that tends to get forgotten: Target date funds can be purchased even if the target date is unrelated to one's expected retirement date. As @LOL! implies, just shop for one that has an AA that you like. You'll have to watch it every year or two as it drifts to being more conservative, then decide whether to keep it or trade to on that is more aggressive, but that's not much of a burden and no tax issue at all in an IRA.
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Old 11-29-2017, 01:03 PM   #6
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Fidelity Balanced FBALX is also a good choice. It's advertised as 60% stocks/40% bonds, but has been tracking at 65%/35% the past couple of years.
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Old 11-29-2017, 02:22 PM   #7
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Fidelity's Four-In-One fund (FFNOX) is a "fund of funds":
60% US stock index (S&P 500 plus extended),
25% International stock index, and
15% US bond index.

The overall Expense Ratio (including underlying funds) is just 0.11% as they use Institutional shares of the underlying funds that normally require $100,000,000 initial investment.

Self balancing and easy to work with, although a little lighter in bonds allocation than the OP stated.
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Old 11-29-2017, 03:19 PM   #8
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I agree that if you want foreign exposure, the Target Date or Strategy funds would be less expensive than the active Wellington Global. However, if you don't need the foreign exposure, Wellington Admiral fund is .15 expense and is close to your Asset Allocation. You may be able to do better, but you could do far worse as well.

Past results do not predict future results- but Wellington has many years of success, and Global Wellington is brand new. I know the management will be similar, but actual results might trump the management team.

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Old 11-29-2017, 06:35 PM   #9
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Thanks to all who responded. She's thinking about whether she wants 70/30 or 80/20. Seems like good options would be:
- Target date fund matching desired AA
- FFNOX is she is ok with 85/15
- a global stock ETF and bond ETF in appropriate proportions that she will have to keep an eye on and rebalance.
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Old 11-29-2017, 07:21 PM   #10
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If 80/20, then Vanguard LifeStrategy Growth fund which is 80/20.

I had my daughter start her Roth IRA with FFNOX, but that's 85:15.
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Old 11-29-2017, 08:01 PM   #11
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+1 on the LifeStrategy fund. That’d be my choice if I ever went to a single fund.
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Old 11-30-2017, 02:27 AM   #12
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Great idea, thanks!
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