F.I.R.E User
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So small cap indexes would outperform something like VTSAX/FXROX?
Edward Jones FA had me in the following funds in my 401k. I need advice.
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So small cap indexes would outperform something like VTSAX/FXROX?
SevenUp
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Maybe, maybe not.
See Which are best recommended Boglehead small-cap value indices? Is it worth to tilt to small cap value? for much more detail.
F.I.R.E User
Thinks s/he gets paid by the post
Or underperform?
RetireeRobert
Thinks s/he gets paid by the post
If you want a crystal ball, you will need to supply your own.
Seems like you are perhaps overanalyzing things.
Pick a rationale, pick a fund (or two, or three, if your rationale points you that way) and run with it.
F.I.R.E User
Thinks s/he gets paid by the post
If you want a crystal ball, you will need to supply your own.
Seems like you are perhaps overanalyzing things.
Pick a rationale, pick a fund (or two, or three, if your rationale points you that way) and run with it.
Sorry for all these questions. I am trying to keep things simple like JL Collins says in his book.
bada bing suggestion of the 85/15, 2 index fund approach seems like that is what I am leaning on.
RetireeRobert
Thinks s/he gets paid by the post
That is simple, provides broad diversification, low costs, and should serve you well.
Good luck!
F.I.R.E User
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Yes but I don’t mind taking a big hit like in 2008 and 2020 so I can DCA. These 2 funds would satisfy that?
RunningBum
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I see a lot of questions. I don't see much analyzing.
Assuming the OP is legit, I think they need the hand-holding of an FA. But I'm not at all sure my assumption is valid.
texasdiver
Recycles dryer sheets
I think your bigger problem is that you are paying Edward Jones a lot of money to put you in funds like Vanguard Target Retirement 2045 that you can easily get yourself for free just by going to the Vanguard Web site or as ETFs.
That is really what will bleed your future returns more than fussing about which specific funds(s) you are in.
1% annual fee x 30 years = 30% of your total portfolio getting transferred to your "advisor" by the time you are age 73. Is the advice you are getting worth 1/3 of your total retirement nest egg?
EDIT: I re-read your post and see that you left Edward Jones so ignore the above. In any event, regarding your portfolio:
My comment is that Target Retirement 2045 is a comprehensive one-and-done fund that has four basic components
Vanguard Total Stock Market (53%)
Vanguard Total Int'l Stock Market (36%)
Vanguard Total Bond Market (7.7%)
Vanguard Int'l Bond market (3.2%)
The other components of your portfolio (S&P500, Small Cap, Int'l, and Bond funds) all basically duplicate the holdings that are already in Target Retirement 2045.
I would recommend dumping your entire portfolio into Target Retirement 2045 if it matches your desired stock vs bond ratio. Or pick another Target Retirement Fund if you want a different stock vs bond ratio. And then if you want to fine tune things you can do so by adding a fund here or there on the margins. For example, if you like Target Retirement 2045 but want a little lower Int'l allocation, just supplement it with Vanguard Total Stock Market and that will drop your Int'l allocation. If you want to raise it, supplement it with Total Int'l Stock. And so forth. If you have balances pushing into the 7 figures then you can reduce your fees a bit by buying the individual components of the Target Retirement funds instead (just building it yourself by hand). But at lower account balances the difference in fees is probably trivial.
In other words, pick one comprehensive fund as your core holding and then adjust as necessary to tweak your allocations as necessary. For what it's worth. I used to do this obsessively and had maybe 10 different funds. Then I eventually decided that the Vanguard people were smarter than I was and I just decided to stick with their core holdings. My wife and I are well into the 7 figures in our retirement holdings and it is all basically in two target retirement funds: Vanguard Target Retirement 2035 and the Federal TSP Target Retirement 2030 funds. With those two funds we own the ENTIRE domestic and international stock and bond markets. Any additional funds would just duplicate those holdings in slightly different proportions. To what end? I'm not smart enough to know what tilts to make anyway.
That is really what will bleed your future returns more than fussing about which specific funds(s) you are in.
1% annual fee x 30 years = 30% of your total portfolio getting transferred to your "advisor" by the time you are age 73. Is the advice you are getting worth 1/3 of your total retirement nest egg?
EDIT: I re-read your post and see that you left Edward Jones so ignore the above. In any event, regarding your portfolio:
My comment is that Target Retirement 2045 is a comprehensive one-and-done fund that has four basic components
Vanguard Total Stock Market (53%)
Vanguard Total Int'l Stock Market (36%)
Vanguard Total Bond Market (7.7%)
Vanguard Int'l Bond market (3.2%)
The other components of your portfolio (S&P500, Small Cap, Int'l, and Bond funds) all basically duplicate the holdings that are already in Target Retirement 2045.
I would recommend dumping your entire portfolio into Target Retirement 2045 if it matches your desired stock vs bond ratio. Or pick another Target Retirement Fund if you want a different stock vs bond ratio. And then if you want to fine tune things you can do so by adding a fund here or there on the margins. For example, if you like Target Retirement 2045 but want a little lower Int'l allocation, just supplement it with Vanguard Total Stock Market and that will drop your Int'l allocation. If you want to raise it, supplement it with Total Int'l Stock. And so forth. If you have balances pushing into the 7 figures then you can reduce your fees a bit by buying the individual components of the Target Retirement funds instead (just building it yourself by hand). But at lower account balances the difference in fees is probably trivial.
In other words, pick one comprehensive fund as your core holding and then adjust as necessary to tweak your allocations as necessary. For what it's worth. I used to do this obsessively and had maybe 10 different funds. Then I eventually decided that the Vanguard people were smarter than I was and I just decided to stick with their core holdings. My wife and I are well into the 7 figures in our retirement holdings and it is all basically in two target retirement funds: Vanguard Target Retirement 2035 and the Federal TSP Target Retirement 2030 funds. With those two funds we own the ENTIRE domestic and international stock and bond markets. Any additional funds would just duplicate those holdings in slightly different proportions. To what end? I'm not smart enough to know what tilts to make anyway.
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RetireeRobert
Thinks s/he gets paid by the post
^ ^ ^
Yes, that is it in a nutshell.
OP, just run with the two funds at 85%/15% suggested earlier in this thread, and be done with it. You will be far ahead of where you were with Edward Jones. Good luck. Let us know when you've got it done.
LastBoomer
Dryer sheet aficionado
Leave everything the way it is. The EJ guy has you in a pretty good selection. If you really must have just one fund: FFNOX. Fidelity 4-in-1 index fund: FXAIX, extended market, intl market, and US Bond index.
F.I.R.E User
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Appreciate your support.
F.I.R.E User
Thinks s/he gets paid by the post
I did leave EJ. He put me on the funds I posted so my FA did not pick any Vanguard Target fund for me.
I don’t want to be in bonds at all. I want to maximize my returns in the long term. I am also waiting on Fidelity to settle my sale of all my American Funds shares into cash and then I will buy FZROX for my Roth IRA.
My F.I.R.E # is $2M by age 55-60.
F.I.R.E User
Thinks s/he gets paid by the post
^ ^ ^
Yes, that is it in a nutshell.
OP, just run with the two funds at 85%/15% suggested earlier in this thread, and be done with it. You will be far ahead of where you were with Edward Jones. Good luck. Let us know when you've got it done.
Oh ok.
F.I.R.E User
Thinks s/he gets paid by the post
Yes but fees matter too and it can get better. Why bonds?
If you want just one fund, why not just put 100% in Vanguard Target 2045. It is about 90% equity, but has some good diversification with international and a little bonds. The international has been a drag on performance over the past decade, but as a result, international is now a much better value. It's the performance over the next ten years that matters, and the odds favor international outperforming. Not so much I would go all in on international, but I certainly wouldn't exclude it.
mailbagman
Dryer sheet wannabe
Ed Jones
Look at them shortly before I retired. There high commissions drove me away.
Look at them shortly before I retired. There high commissions drove me away.
Argus
Dryer sheet aficionado
A question to the OP: you listed a Fundrise account, how do you like it? I've looked into it, but have also read varying reviews of the platform. I like simplicity investing (3-fund portfolios all around), so have avoided committing.
Just wondering your opinion of them?
F.I.R.E User
Thinks s/he gets paid by the post
Target isn’t all stocks meaning it wouldn’t be too aggressive. I want max ROI and don’t mind the big drops. I can DCA.
F.I.R.E User
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How long were you with EJ?
F.I.R.E User
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I only put in $1,000 in September of 2018. It is now worth $1,327.26. I don’t like it. I was in the long term growth eREITs plan so higher appreciation and lower dividends. I am looking to get out.
F.I.R.E User
Thinks s/he gets paid by the post
Target changes to Bonds. I don’t like that. I want max ROI and don’t mind the big drops like 2008 and 2020 because I would DCA.
F.I.R.E User
Thinks s/he gets paid by the post
So should I go with the 2 fund approach suggested or a target fund?
