vanguard ira question

[knucklehead 61]

so i rolled over an ira to vanguard.
it is all cash, approx 75k+.
i am 48 so it will sit for at least 12 years before i can touch it.
i also have a 1m+ 401k account elsewhere.
we own 22 rental properties, only 9 are mortgaged.

so, what vanguard funds should i look into?
put it all into 1? or equal amounts into 3 or 5 funds?
vhcix looks good to me. any opinions or suggestions?

 

[Sunset]

VTI, VXUS

I consider rentals the same as bonds so don't feel the need to have any with your 22 rental properties.

 

[pb4uski]

It depends on what your target AA is compared to your existing AA of your 401k, your IRA and your properties.

 

[Sunset]

VTI, VXUS

I consider rentals the same as bonds so don't feel the need to have any with your 22 rental properties.

I'll fix my answer:
Your rentals are like bonds (in my mind) so assume each is worth 100K.
22 of them are 2.2 Million

You have 1m+ 401k account elsewhere, even if its all stock that means your AA is too heavy in non-stock stuff.

That's why I suggested VTI and VXUS for the 75K cash investment.
Personally I'd at least do 50/50 split on the two of them, or go full VXUS if all your 1m + 401k are US based stocks.

 

[DEC-1982]

I recommend the Vanguard Health Care fund (not the Vanguard Health Care Index) for a portion of your portfolio. It has a great long term record (since 1984). People have to keep spending on health regardless of boom/normal/bust. But note that it is a sector fund, and you should limit any of your investments in a sector fund.

I think of it as an answer to the 7% inflation cost for health care. (I don't know if 7% is accurate; it just happens to be what Fidelity Retirement Income Planner uses for planning purposes).

 

[mickeyd]

so i rolled over an ira to vanguard.

Why?

 

[knucklehead 61]

Why?

i sold a crappy annuity & it went into my merrill lynch account.
my manager sat on it in cash for the last 6 months so i was frustrated & had been wanting to move some $ to vanguard so it seemed like a perfect time.

 

[Koolau]

No recommendations as such, but check to see if splitting the cash into more than one fund precludes you achieving "Admiral" status. You'd think I would know the rules since DW and I both use Vang. But I don't. I Just know that ALL of our funds are now Admiral (which simply means you have a lower fee basis - and it is a significant saving.) Still no problem with splitting funds, but it might cost more fees. Just a thought for you to check out. YMMV

None of my business, but curious about how the rental bidness is going for you. We had one rental - back when we had a "future retirement home" as well as our principal residence. We did "just okay" because we were too lazy to keep up with the market AND we were too nice to our tenants - though they were VERY nice in return. Long story, short: It worked for us - but it could have worked much better if we had payed more attention.

 

[knucklehead 61]

No recommendations as such, but check to see if splitting the cash into more than one fund precludes you achieving "Admiral" status. You'd think I would know the rules since DW and I both use Vang. But I don't. I Just know that ALL of our funds are now Admiral (which simply means you have a lower fee basis - and it is a significant saving.) Still no problem with splitting funds, but it might cost more fees. Just a thought for you to check out. YMMV

None of my business, but curious about how the rental bidness is going for you. We had one rental - back when we had a "future retirement home" as well as our principal residence. We did "just okay" because we were too lazy to keep up with the market AND we were too nice to our tenants - though they were VERY nice in return. Long story, short: It worked for us - but it could have worked much better if we had payed more attention.

the rentals far exceed what i was making in my after tax accounts, so i liquidated the account & started buying foreclosures, rehabbing them, & renting them out. gross rents are approx. 300k / yr, net is about 150.
only 3 are worth less than i paid for them (bought those in 2007 & 2008)
all others are worth more than what they cost inc. rehab costs, so ill make even more when or if i sell them, but the plan is to live off the rental income which should cover about 85% of living costs & make up the other 15% with other sources. then when i am 60 or so i can tap into my 401k & ira to supplement my income if needed.
we have no debt other than 9 mortgages. i drive a company truck & when i quit ill try to buy the truck or just drive my 2 jeep cherokees.

 

[turbo89]

the rentals far exceed what i was making in my after tax accounts, so i liquidated the account & started buying foreclosures, rehabbing them, & renting them out. gross rents are approx. 300k / yr, net is about 150.
only 3 are worth less than i paid for them (bought those in 2007 & 2008)
all others are worth more than what they cost inc. rehab costs, so ill make even more when or if i sell them, but the plan is to live off the rental income which should cover about 85% of living costs & make up the other 15% with other sources. then when i am 60 or so i can tap into my 401k & ira to supplement my income if needed.
we have no debt other than 9 mortgages. i drive a company truck & when i quit ill try to buy the truck or just drive my 2 jeep cherokees.

That's pretty fantastic, congrats!

Not to hijack your thread... but I'm a young investor, who has been kicking around the idea of rental properties. Any advice and / or books you could recommend (I'm an engineer and a very hands-on guy, so rehab doesn't scare me)?

Thanks,
Turbo

 

[gauss]

That's pretty fantastic, congrats!

Not to hijack your thread... but I'm a young investor, who has been kicking around the idea of rental properties. Any advice and / or books you could recommend (I'm an engineer and a very hands-on guy, so rehab doesn't scare me)?

Thanks,
Turbo

Have you been to biggerpockets.com yet? I briefly visited and the jury is still out from my perspective. Curious to what others think?

-gauss

 

[knucklehead 61]

Have you been to biggerpockets.com yet? I briefly visited and the jury is still out from my perspective. Curious to what others think?

-gauss

TONS of good info on bigger pockets.com
i buy in a somewhat low cost state (oregon) and have a variety of types of homes there. hi end duplex, mid duplex, entry level duplex, tiny 2 bed cottage, beach cottage, 3 bed house with shop, barn, & horse property, & a bunch of various 2, 3, & 4 bedroom houses in varying conditions. i watch the market daily & throw a lot of darts (read: write lowball offers), typically on fixer uppers & foreclosures, mostly all cash, quick close, as is offers. i have a pretty good idea of what my rehab costs will be & do not flip, i buy for the rental income & instant sweat equity so if i had to sell it would be at at least 10% net profit (above the rental income). so far it's working out pretty good.

 

[Greathusky74]

Vanguard Health Care has been a total winner for me over the year. People will always get sick and die.

That is the most sophisticated advice you will ever receive.