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Old 03-18-2014, 11:04 AM   #1
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Advice for a newbie

Hi,

I'm recently an ex-Ameriprise client!! And I am moving my funds to Vanguard and need some advice on what to invest in. My wife and I are 34 with a 3 yo daughter. I currently am invested in the Vanguard target retirement 2045 fund but am thinking of also investing in either Wellington or Wellesley funds. My AA I think would probably be around 65 stocks and 35 bonds. I think the Wellington fund has performed well and matches my AA. Thought about the Wellesley fund also but with the rise of interest rates I wasn't sure if this was a good idea since it has more in bonds. Any advice is very much appreciated!! I absolutely love this forum and the people. TIA!
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Old 03-18-2014, 11:20 AM   #2
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Is all of your money currently in tax deferred accounts? You generally put traditional bond funds in tax deferred, and municipal bond funds in taxable accounts.

You could get your desired 65/35 AA by going with VTSAX and VTIAX for equities and then choosing a suitable bond fund depending on tax status.
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Old 03-18-2014, 11:24 AM   #3
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Originally Posted by Ready View Post
Is all of your money currently in tax deferred accounts? You generally put traditional bond funds in tax deferred, and municipal bond funds in taxable accounts.



You could get your desired 65/35 AA by going with VTSAX and VTIAX for equities and then choosing a suitable bond fund depending on tax status.
I have about 50% of our funds in a 401k and 50% in Roth IRA.
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Old 03-18-2014, 11:29 AM   #4
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I have about 50% of our funds in a 401k and 50% in Roth IRA.
OK, so no funds in traditional taxable accounts. I would still go with VTSAX/VTIAX for equities, and maybe VBTLX for your bond holdings. It's hard to get excited about bond funds right now, but by separating your equity and bond holdings, you can adjust your AA as you age or life situations change for you. With an all in one fund like Wellesley, you can't do that.

Of course I'm giving you investment advice while knowing very little about you, so I'll also add that reading a book or two on investment basics will make you feel much more comfortable about the recommendations anyone gives you. Many books have been referenced here, but I still find Investing for Dummies to be the best starter for getting to know the basics.
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Old 03-18-2014, 12:47 PM   #5
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OK, so no funds in traditional taxable accounts. I would still go with VTSAX/VTIAX for equities, and maybe VBTLX for your bond holdings. It's hard to get excited about bond funds right now, but by separating your equity and bond holdings, you can adjust your AA as you age or life situations change for you. With an all in one fund like Wellesley, you can't do that.



Of course I'm giving you investment advice while knowing very little about you, so I'll also add that reading a book or two on investment basics will make you feel much more comfortable about the recommendations anyone gives you. Many books have been referenced here, but I still find Investing for Dummies to be the best starter for getting to know the basics.

Oops!! Sorry. Maybe about 50% in traditional IRA/401k and 25% in Roth an 25% in taxable. Forgot about the taxable accounts. You make very good points!!! Thanks for the advice! I will definitely read investing for dummies! Thanks Ready!!!
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