Is there a rule of thumb for distributing funds across accounts in your AA? Should you attempt to recreate the entire AA in each of your accounts, or specialize accounts to a specific portion of your AA?
I ask because of the following situation I find myself in.
I've got roughly $600k to balance/rebalance across my much simplified AA (Thanks jlcollins!)
Target AA:
VTSAX 50%
VGSLX 25%
VBTLX 20%
VMMXX 5% (Note, this is just here as a placeholder for "cash". This could just as easily be my bank account. And probably will be unless someone wants to point out a reason not to do that. Especially given where interest rates are these days. ;-)
Funds distribution by company and account:
Fidelity 401k 45% - Current employer so no Vanguard until I leave in 5-6 years
Cash - To invest 34% - Was saving for a downpayment, now investing for FIRE!
Vanguard IRA#1 16%
Vanguard IRA#2 2%
TIAA-CREF 403b 2%
Vanguard Roth 1%
My understanding is that for my target AA I want to favor tax deferred/exempt accounts as follows.
VTSAX - Stocks Taxable
VGSLX - REIT Tax Deferred/Exempt
VBTLX - Bonds Tax Deferred/Exempt
VMMXX - Cash Taxable
Depending on the answer to my initial questions, I see two ways of distributing the funds in my accounts across this AA.
A) Replicate my AA within each account (401k, IRA, 403b, Brokerage, etc.).
B) Target accounts at specific parts of my AA (401k->VGSLX, IRA#1->VBTLX, etc.).
In the big scheme of things, either one seems reasonable to me. The problems arise because of 2 issues.
1) "Fairness" to the owners of the accounts.
2) Funds availability in each account.
For #1 the issue is that whichever account isn't in stocks will necessarily lag in growth, which puts the "owner" of the account at a distinct disadvantage. In this case, I own the 401k, and my wife owns IRA#1. If I put my 45% in stock and her 16% in bonds I feel like I need to explain why that's not "screwing her" since 100% of her account would be in bonds.
For #2 the issue is more acute. My 401k has only one fund worth investing in which is FUSVX a rough analog of VTSAX. Which means I'm now backwards on my AA tax plan with 45% of VTSAX in a Tax Deferred account leaving only taxable accounts available to pick up the majority of remaining AA in REITs and Bonds.
I'm tempted to just adjust my AA to accommodate my situation. My only concern is that a 100% or even 80/20 AA is too aggressive given that I want to FIRE in 5-6 years. I'm 37 so I get that I've got time, but not sure what to do when taking FIRE into consideration.
I'm not entirely sure I did a good job of communicating my situation/questions so please let me know if I need to clarify anything.
Addendum #1: 401k Funds by Expense Ratio
0.07% FUSVX Spartan® 500 Index Fund - Fidelity Advantage Class
0.26% FXIFX Fidelity Freedom® Index 2030 Fund - Class W
0.64% DODFX Dodge & Cox International Stock Fund
0.67% LCEYX Invesco Diversified Dividend Fund Class Y
0.77% FVIAX Fidelity Advisor® Government Income Fund - Class A
0.82% FDTOX Fidelity Advisor® Diversified Stock Fund - Class A
0.85% PTTAX PIMCO Total Return Fund Class A
0.98% ABYSX AllianceBernstein Discovery Value Fund Advisor Class
1.00% FIADX Fidelity Advisor® International Discovery Fund - Class I
1.01% Fidelity Advisor Stable Value Portfolio Class II
1.01% FNIAX Fidelity Advisor® New Insights Fund - Class A
1.11% JSRAX JPMorgan SmartRetirement® Income Fund Class A Shares
1.13% JSWAX JPMorgan SmartRetirement® 2010 Fund Class A Shares
1.15% FIIAX Fidelity Advisor® Mid Cap II Fund - Class A
1.16% JSFAX JPMorgan SmartRetirement® 2015 Fund Class A Shares
1.17% FHEAX Fidelity Advisor® Real Estate Fund - Class A
1.20% JTTAX JPMorgan SmartRetirement® 2020 Fund Class A Shares
1.22% JSCSX JPMorgan U.S. Small Company Fund Select Class
1.24% JNSAX JPMorgan SmartRetirement® 2025 Fund Class A Shares
1.28% JSMAX JPMorgan SmartRetirement® 2030 Fund Class A Shares
1.32% SRJAX JPMorgan SmartRetirement® 2035 Fund Class A Shares
1.35% SMTAX JPMorgan SmartRetirement® 2040 Fund Class A Shares
1.37% JSAAX JPMorgan SmartRetirement® 2045 Fund Class A Shares
1.41% JTSAX JPMorgan SmartRetirement® 2050 Fund Class A Shares
1.46% JFFAX JPMorgan SmartRetirement® 2055 Fund Class A Shares