mountainsoft
Thinks s/he gets paid by the post
About four years ago I moved my retirement savings from my local bank to Vanguard. At that time I put everything in VBIAX (Vanguards balanced index fund) and have been happy with the performance. It's about 60% stocks, 40% bonds, and a low .07% expense ratio. Other than a small blip at the end of 2018 it has been a steady uphill climb since I chose it.
Of course, all good things come to an end, and I see historically VBIAX has lost up to 30% of it's value (around 2008/2009). Now that we're only 3-4 years from retiring, I'm getting a little nervous about a drop that large. My simulations in Flexible Retirement Planner shows we would still do OK (using 7.5% return, 7.5% deviation), but there are still a few random failures about ten years in before we start social security. I guess I'm overly cautious and would prefer 100% probability of success with zero failures.
At this point I'm willing to give up some gains in exchange for a little less volatility.
Anyway, I've been looking at a few other funds, most notably the VWINX Wellesley fund, and the VSCGX life strategy fund. VSCGX has a low .12 expense ratio, but doesn't seem to perform as well.
VWINX seems to perform well (roughly 6% return, 5% deviation), with the biggest drop in 2008/2009 being less than 10%. The .23% expense ratio seems high to me after having .07 in VBIAX, but I don't know if that's something to be worried about.
I really prefer the simplicity of a single "Set and Forget" fund, but I did test some 30/70 and 40/60 runs of VBTLX (Vanguard Total Bond Fund) and VTSAX (Vanguard Total Stock Fund) in the Backtest Portfolio Visualizer and was surprised that VWINX still seemed to perform better.
I'm kind of leaning towards switching to VWINX, but am curious if there are any downsides to that fund, or if there are other alternative funds that might be a better choice. Or just stay with the VBIAX balanced index fund?
Of course, all good things come to an end, and I see historically VBIAX has lost up to 30% of it's value (around 2008/2009). Now that we're only 3-4 years from retiring, I'm getting a little nervous about a drop that large. My simulations in Flexible Retirement Planner shows we would still do OK (using 7.5% return, 7.5% deviation), but there are still a few random failures about ten years in before we start social security. I guess I'm overly cautious and would prefer 100% probability of success with zero failures.
At this point I'm willing to give up some gains in exchange for a little less volatility.
Anyway, I've been looking at a few other funds, most notably the VWINX Wellesley fund, and the VSCGX life strategy fund. VSCGX has a low .12 expense ratio, but doesn't seem to perform as well.
VWINX seems to perform well (roughly 6% return, 5% deviation), with the biggest drop in 2008/2009 being less than 10%. The .23% expense ratio seems high to me after having .07 in VBIAX, but I don't know if that's something to be worried about.
I really prefer the simplicity of a single "Set and Forget" fund, but I did test some 30/70 and 40/60 runs of VBTLX (Vanguard Total Bond Fund) and VTSAX (Vanguard Total Stock Fund) in the Backtest Portfolio Visualizer and was surprised that VWINX still seemed to perform better.
I'm kind of leaning towards switching to VWINX, but am curious if there are any downsides to that fund, or if there are other alternative funds that might be a better choice. Or just stay with the VBIAX balanced index fund?