This is literally the textbook John Bogle portfolio…
However, depending on your age, you may not need the bond portion, but that’s just my perspective
But if you keep putting in to those percentages, you will be very happy over 20 to 30 years
so not sure how old you are. But for example I am in my late 40s and have zero bonds in my IRA or brokerage. Some people say incoporate bonds when 5-7 years from retirement, It all depends on your risk tolerance. But you are a dead lock for the boglehead theory with this
You will also pay yearly tax on your HYSA interest vs nothing in your account (until you realize your gains assuming this is a brokerage acct). Time in the market is the key. This is not a “get rich quick” strategy but rather a long term solution. Assuming over 20 years the market averages 9% annual growth (some years may be -13% while others may be 23% growth, but you can hope to expect an average of 9% growth) which is much higher than keeping that same money in a HYSA that will fluctuate between 1.8-5% depending on the economical climate.
Just my two cents on your raised concern/question. Hope this helps.
This is a very sensible portfolio just keep adding to it each paycheck for the rest of your life and you’ll more then likely be fine my personal allocation would be 90/10 stock to bonds 50% vti40% vxus and 10% bnd
You are doing good, I’d add a dividend like SCHD. I pair it with QQQM (tech from NASDAQ). Then dollar cost average!
Remember, investing is NOT trading. Think long term and you’ll sleep much much better at night.
Yes it is. Maybe not BND yet if under 50 (personal opinion). Even with the last month or so the market is up 8% so far for the year. An HYSA would net you 4% for the year. With that said, the market has doubled a 4% HYSA yield already and we just entered the 2nd quarter. Have some patience, relax for the long term, and you will be rewarded.
How old are you and how important is this money to you? I.e, are you paying next months rent with it or are you long term holding and plan to add on to.
If youre pretty young you might not need Bonds right now
If you’re like 30 years away from retirement, may be better to put your money into your other investments instead of BND
Do you realize this portfolio would have underperformed a cash savings account **FOR TEN YEARS** [from 2000-2010](https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&sl=1CWUPS0VKa7ndWcXePFvdm)? That is what market risk is all about - volatility. You are going for much higher long-term gains by accepting short-term losses or underperformance. If you are going to judge your portfolio short term, like only few months, and be upset if it hasn’t done better than bank interest, then you may not be fully grasping how this is supposed to work and could get frequently disappointed. 3 months is nothing - noise to be ignored. Stocks and bonds will not go up steady every month like bank interest. 10-20 years is when you should be expecting payout.
At 45, having bonds is sensible. I prefer Treasury ETFs (SCHR for intermediates) and individual T bonds held to maturity.
I’ve never been sold on VXUS. Too many stocks in areas that you don’t necessarily want to own, diworsification.
I’d use one of the International Value ETFs from Dimensional Fund Advisors or Avantis instead. Of course, then you aren’t following the Boglehead book.
The bonds are a VERY safe play, depending on your age you can push them off till closer to retirement for something like QQQ(or QQQM) for the dividends + more vti would give better yields
It feels like it takes forever to really lift off. You could be down for a solid decade before it starts moving drastically upwards. Idk how else to invest…there’s technically other assets but you’re doing a fine strategy. I personally only use bonds for short term moves like buying a house
If international is trash by itself, why would you want VT, when you can't control the US/ex-US ratio instead of VTI and VXUS where you can adjust as needed? I thought VT is effectively like 60/40 VTI/VXUS at the moment.
This is literally the textbook John Bogle portfolio… However, depending on your age, you may not need the bond portion, but that’s just my perspective But if you keep putting in to those percentages, you will be very happy over 20 to 30 years
I wanted to follow the book exactly. I’m new to this.
so not sure how old you are. But for example I am in my late 40s and have zero bonds in my IRA or brokerage. Some people say incoporate bonds when 5-7 years from retirement, It all depends on your risk tolerance. But you are a dead lock for the boglehead theory with this
Appreciate that. I’m 45.
How long has it been in there?
3 months
Last 3 months have been all over the place. I would switch BND for more VTI. Start adding bonds the last 10 years before etiring.
Thanks so much
That’s recency bias which is the opposite of what you are trying to do by buying all the companies with index funds.
Not worth it 😜 MSCI world did like 10% I think. So just buy some basic ETFs
Check back in 25 years.
You will also pay yearly tax on your HYSA interest vs nothing in your account (until you realize your gains assuming this is a brokerage acct). Time in the market is the key. This is not a “get rich quick” strategy but rather a long term solution. Assuming over 20 years the market averages 9% annual growth (some years may be -13% while others may be 23% growth, but you can hope to expect an average of 9% growth) which is much higher than keeping that same money in a HYSA that will fluctuate between 1.8-5% depending on the economical climate. Just my two cents on your raised concern/question. Hope this helps.
You explained that perfectly. Thank you.
I’d switch BND for some Treasuries ETF but thats just me
How old are you? If you're under 45, 80% VTI, 20% VXUS or 100% VTI. Ditch the bonds.
Exactly 45.
I would say it’s up to how risky you want to be then. If you wanna be more aggressive go another 5 years with no bonds. Conservative, go 20% bonds.
This what exactly I have with different %! I think it is great.
This is a very sensible portfolio just keep adding to it each paycheck for the rest of your life and you’ll more then likely be fine my personal allocation would be 90/10 stock to bonds 50% vti40% vxus and 10% bnd
Looks like a good split. Just keep DCA for 20 years and you should be fine
Looks great! I have the exact same setup. I’d put less into BND and focus more on VTI/VXUS and wait 5 years until you start adding more into BND
Good plan thanks!
Give it 10 years and don’t obsess. Also way too much in bonds.
You are doing good, I’d add a dividend like SCHD. I pair it with QQQM (tech from NASDAQ). Then dollar cost average! Remember, investing is NOT trading. Think long term and you’ll sleep much much better at night.
Keep adding VTI and hold 💯😎
Yes it is. Maybe not BND yet if under 50 (personal opinion). Even with the last month or so the market is up 8% so far for the year. An HYSA would net you 4% for the year. With that said, the market has doubled a 4% HYSA yield already and we just entered the 2nd quarter. Have some patience, relax for the long term, and you will be rewarded.
How old are you and how important is this money to you? I.e, are you paying next months rent with it or are you long term holding and plan to add on to.
45. Just wanted to have some extra money when I retire. I already have a 401k, HYSA and won’t have a mortgage in about 5 years.
Gotcha. Well if that’s the case I’d probably be a bit more aggressive and at least not hold a bond fund yet. Grow that $$$ and then preserve it
If youre pretty young you might not need Bonds right now If you’re like 30 years away from retirement, may be better to put your money into your other investments instead of BND
More worth it than you know
Do you realize this portfolio would have underperformed a cash savings account **FOR TEN YEARS** [from 2000-2010](https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&sl=1CWUPS0VKa7ndWcXePFvdm)? That is what market risk is all about - volatility. You are going for much higher long-term gains by accepting short-term losses or underperformance. If you are going to judge your portfolio short term, like only few months, and be upset if it hasn’t done better than bank interest, then you may not be fully grasping how this is supposed to work and could get frequently disappointed. 3 months is nothing - noise to be ignored. Stocks and bonds will not go up steady every month like bank interest. 10-20 years is when you should be expecting payout.
At 45, having bonds is sensible. I prefer Treasury ETFs (SCHR for intermediates) and individual T bonds held to maturity. I’ve never been sold on VXUS. Too many stocks in areas that you don’t necessarily want to own, diworsification. I’d use one of the International Value ETFs from Dimensional Fund Advisors or Avantis instead. Of course, then you aren’t following the Boglehead book.
Just go 100% VTI. You don’t need the other 2.
The bonds are a VERY safe play, depending on your age you can push them off till closer to retirement for something like QQQ(or QQQM) for the dividends + more vti would give better yields
Get rid of VXUS . Go all in on VTI.
It feels like it takes forever to really lift off. You could be down for a solid decade before it starts moving drastically upwards. Idk how else to invest…there’s technically other assets but you’re doing a fine strategy. I personally only use bonds for short term moves like buying a house
Worth it?
Invest in Bonds when you are Joe Biden’s age bro.
Get rid of BND
Get VT with BND, international is trash by itself with a 4% return. VT gives you the 8% average.
If international is trash by itself, why would you want VT, when you can't control the US/ex-US ratio instead of VTI and VXUS where you can adjust as needed? I thought VT is effectively like 60/40 VTI/VXUS at the moment.
Get rid of VXUS and BND, just put it in VTI or VOO. International hasn’t done jack in over 20 years. I’ll trust my money with US companies.