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Portfolio:Simple vs. Complicated
Old 11-30-2016, 09:39 AM   #1
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Portfolio:Simple vs. Complicated

I purposely imitated the title for the excelllent recent thread about simple vs. complicated bond fund choices since I'm wondering about parallel issues for my overall portfolio.

I'm ER'd on a far-from-ideal (too small) nest egg and at 60 (with DW only 53) have to be really careful about sharp drawdowns between now and taking SS somewhere between 65 and 70. Current portfolio is very U.S.-centric, which given U.S. vs. intl'l and EM equity valuations seems unwise going forward.

Like many here I'm a big fan of Vanguard and one option I'm considering is just duplicating the allocation in their LifeStrategy Conservative Growth fund (42% Total Bond, 18% Int'l Bond, 24% Total Stock, 16% Int'l Stock). That gets me plenty of diversification globally and across asset classes, low ER's and simplicity but of course no tilts to small/value etc.

The other thing I'm looking at is paying $2500 a year (fixed fee, not % of assets which I would never pay) to an FA I know and trust for a much more complex DFA slice and dice allocation that would also have 40-45% in equities. The fee of course goes against my cheapskate, DIY nature but I also think there's a high probablility that the more precise targeting of market segments and disciplined tilting to small and value will more than make up for it.

Any thoughts appreciated.

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Old 11-30-2016, 10:11 AM   #2
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There are a number of threads on the Bogleheads site discussing VG vs DFA ports. Opinions seem to vary considerably.

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Old 11-30-2016, 12:40 PM   #3
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You can implement a simple or complex portfolio with either Vanguard or DFA. Simplicity is preferred unless the potential return of a complex portfolio is significantly higher than that of a simple portfolio. Remember that "past performance may not be indicative of future returns."
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Old 11-30-2016, 04:37 PM   #4
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We use VG. Not a fan of international bonds. I tilt on my own, no FA for me. Sounds like you have the right general ideas.
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Old 11-30-2016, 04:46 PM   #5
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Sounds like a waste of $2,500.
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Old 11-30-2016, 05:03 PM   #6
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Thanks everyone.

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