Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Funds at Vanguard for rollover IRA
Old 12-26-2020, 12:14 PM   #1
Moderator
 
Join Date: Jul 2017
Posts: 5,664
Funds at Vanguard for rollover IRA

Hello All,

I am seeking help choosing funds at Vanguard for a rollover IRA. I will be rolling out my 401(k) from my job into Vanguard January 2nd. (Unfortunately, the fees do not make it worthwhile for me to keep it there. The administrative fees (which come in on top of the fund fees) are assessed against the account, so that the employer does not have to pay. Did a back-door Roth, and this is the final part of the story. I should be retiring in the first half of 2021.

I intend to do Roth conversions out of this account between 2021 - 2025. It is doubtful that I would take an straight withdrawals from the IRA (unless for some reason I wanted to pay taxes out of it, i.e. did not calculate my estimated properly, but that is not in the plan at the moment.) I will reassess what to do with what remains in the account in 2026.

I am looking to choose funds, and am looking for recommendations. These are the funds at which I am considering (although I really want the first two):


Vanguard Total (US) Stock Market - VTSAX (looking at 30%)

Vanguard Total International Stock - VTIAX (looking at 20 %)

Wellseley (about 1/3 bonds of approx 8.2 duration? - from memory so may not be accurate) (looking at 10 %)

Dividend Appreciation - VDAIX - looking at 5%

U.S Growth VWUSX - looking at 5%

International Growth VWIGX - looking at 5%

Vanguard Total Bond - VBTLX - (approx 6.7 duration) looking at 5%

Vanguard Total Interational Bond VTABX (approx 8.5 duration) looking at 5%

Healthcare (for fun/ too risky) VGHCX looking at 5%

Money market - looking at 5 -10 % (earning nada but gives a little flexibility)

I have bond fund concerns; although I don't believe that the Fed wants to raise interest rates for a while. Knowing me, I will be asleep at the wheel when they do so. (I tend to be slow to react in any event and look with horror at impending doom in total paralysis.)

Any thoughts are to whether I should get more bonds in Wellesley in place of pure bond funds (since they are doing the picking)? Or the very short term bonds (although is there much upside with them over the MM?).

Thank you.
__________________
Use it up, wear it out, make it do or do without.
MarieIG is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 12-26-2020, 12:36 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
OldShooter's Avatar
 
Join Date: Mar 2017
Location: City
Posts: 10,337
Too complicated. VTSAX and VTIAX will do it on the equity. A bunch of very small/5% positions that duplicate holdings that are already in the total market funds is a bookkeeping exercise with little or no payoff. In fact your ratio of VTSAX and VTIAX is about the same ratio as the holdings of VTWAX, so you could even go to just one fund.
__________________
Ignoramus et ignorabimus
OldShooter is offline   Reply With Quote
Old 12-26-2020, 12:41 PM   #3
Moderator
 
Join Date: Jul 2017
Posts: 5,664
Quote:
Originally Posted by OldShooter View Post
Too complicated. VTSAX and VTIAX will do it on the equity. A bunch of very small/5% positions that duplicate holdings that are already in the total market funds is a bookkeeping exercise with little or no payoff. In fact your ratio of VTSAX and VTIAX is about the same ratio as the holdings of VTWAX, so you could even go to just one fund.
Ok thanks OldShooter. They are low cost so that is a benefit . . . I will take a peek at WTWAX.
__________________
Use it up, wear it out, make it do or do without.
MarieIG is offline   Reply With Quote
Old 12-26-2020, 01:18 PM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
OldShooter's Avatar
 
Join Date: Mar 2017
Location: City
Posts: 10,337
Quote:
Originally Posted by MarieIG View Post
Ok thanks OldShooter. They are low cost so that is a benefit . . . I will take a peek at WTWAX.
Another thing you can do is to go to https://www.portfoliovisualizer.com/ and create two portfolios, one with the equity funds you have w. percentages adjusted to total 100% and one with just the two funds. Compare them over different periods and see if the difference is significant to you. PV uses historical data, so IMO it is good for comparing different approaches over long periods but it is not predictive and over short periods any of this is a crap shoot.
__________________
Ignoramus et ignorabimus
OldShooter is offline   Reply With Quote
Old 12-26-2020, 01:18 PM   #5
Moderator
MBAustin's Avatar
 
Join Date: Jul 2010
Posts: 7,925
Agree that simpler is better. I went the more complicated route several years ago and still haven't undone it all. Hmmm...might be a good project for next week.
__________________
"One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute." William Feather
----------------------------------
ER'd Oct. 2010 at 53. Life is good.
MBAustin is offline   Reply With Quote
Old 12-26-2020, 01:23 PM   #6
Moderator
 
Join Date: Jul 2017
Posts: 5,664
Quote:
Originally Posted by OldShooter View Post
Another thing you can do is to go to https://www.portfoliovisualizer.com/ and create two portfolios, one with the equity funds you have w. percentages adjusted to total 100% and one with just the two funds. Compare them over different periods and see if the difference is significant to you. PV uses historical data, so IMO it is good for comparing different approaches over long periods but it is not predictive and over short periods any of this is a crap shoot.
That looks facinating. I will try it.
__________________
Use it up, wear it out, make it do or do without.
MarieIG is offline   Reply With Quote
Old 12-26-2020, 01:50 PM   #7
Moderator
 
Join Date: Jul 2017
Posts: 5,664
I should have hit the save button!

I ran it once (then erased my entries - sigh). The 60/40 vs. the five other funds 20% each, from 2000 - current, no rebalancing, got 9.43 v. 13.01.
__________________
Use it up, wear it out, make it do or do without.
MarieIG is offline   Reply With Quote
Old 12-26-2020, 02:24 PM   #8
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
OldShooter's Avatar
 
Join Date: Mar 2017
Location: City
Posts: 10,337
Quote:
Originally Posted by MarieIG View Post
I should have hit the save button!

I ran it once (then erased my entries - sigh). The 60/40 vs. the five other funds 20% each, from 2000 - current, no rebalancing, got 9.43 v. 13.01.
Sorry, I wasn't clear. Enter your current portfolio in the proportions you're holding. For example, if you're 80% equities and 30% of total portfolio is VTSAX, then enter 37.5% into PV(30 divided by 0.8), VTIAX at 25%, and so on. Try different 5-year periods, too.

In the comparison portfolio, VTSAX at 60% and VTIAX at 40%.
__________________
Ignoramus et ignorabimus
OldShooter is offline   Reply With Quote
Old 12-26-2020, 02:41 PM   #9
Moderator
 
Join Date: Jul 2017
Posts: 5,664
Quote:
Originally Posted by OldShooter View Post
Sorry, I wasn't clear. Enter your current portfolio in the proportions you're holding. For example, if you're 80% equities and 30% of total portfolio is VTSAX, then enter 37.5% into PV(30 divided by 0.8), VTIAX at 25%, and so on. Try different 5-year periods, too.

In the comparison portfolio, VTSAX at 60% and VTIAX at 40%.
Thanks, I'll try. The rollover is coming over from my 401k which is John Handcock. Tiny little bits and pieces of bond and growth funds (about 5% total), about 30 percent income fund and the rest (approx 65% percent) in an S&P 500. (The S&P had the lowest fee - there were no total stock fund choices.) Plus there was a big, fat, administration fee plopped on top of it for some weath management company that my employer hired to do their book keeping. When I had asked them about in service conversations they did not know what I was talking about and when they finally figured it out - said that it would be a lot of work; when I asked them about scheduling monthly withdrawals upon retirement, appearantly an additional $95 per withdrawal would apply; and they kindly offered me an annuity with an approx 4.2 percent cost; not to mention a surrounder change. Nope, I'm not bitter.
__________________
Use it up, wear it out, make it do or do without.
MarieIG is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
IRA Rollover and picking funds - Sanity check tmm99 Active Investing, Market Strategies & Alternative Assets 10 04-28-2016 11:33 PM
Question re: Rollover from High-Fee 401K to IRA, and Possibly to Roth IRA Mo Money FIRE and Money 6 06-27-2015 03:27 PM
Rollover to Vanguard Target Funds? Deer Whisperer FIRE and Money 12 02-20-2013 04:17 PM
Vanguard IRA rollover/Direct managed Fund by Financial Advisor unknownxz FIRE and Money 13 10-26-2010 07:30 AM
Do you prefer Fidelity or Vanguard for rollover 401k to IRA? spncity FIRE and Money 14 04-28-2007 06:06 PM

» Quick Links

 
All times are GMT -6. The time now is 03:09 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.