Hello smart Mustachians!
I have started looking into my retirement accounts to see what I can do to simplify my investment strategy. I've read the old posts about VTSAX, VBTLX, and VGSLX and am wondering if I should just completely simplify to these funds or do something else. Each of the funds/accounts I currently have were opened at different times, under different conditions, so please try to refrain from face punching... I didn't know a lot in the past (and still don't). I look forward to your insights!
My 401k is employer sponsored and is through Wells Fargo. We do have some choice as to what our portfolio looks like, but I have mine simply set to "Moderate (Balanced Growth)" = mid cap stocks 14%, bonds 15%, balanced/lifestyle 42% (no idea what that is really), international stock 15%, large cap stock 14%. I've had the same allocation since I opened the account ~ 7 years ago. My 5-year personal rate of return is 9.5% (not bad I suppose). I'm not sure what I am paying in fees, but I guess I don't have much of a choice since I have to pick something that the company offers... I have $242,000 in my 401k.
In addition to the 401k I have several accounts open with Vanguard ($91,851 total), as follows:
Account Fund Symbol Fund Amount
Roth IRA VBIAX Vanguard Balanced Index Fund (0.07% cost basis) $21,031
Large cap stocks (60.45%) $12,713
medium duration bonds (39.55%) $8,318
VTIAX Vanguard Total International Stock Index Fund (0.11% cost basis) $20,102
foreign large blend (20% emerging/40% europe/30% pacific/7% North Am)
VTSAX Vanguard Total Stock Market Index Fund (0.04% cost basis) $29,014
Large cap stocks
Traditional IRA money market $5,500
Taxable investment acct VFIFX Vanguard Target Retirement 2050 Fund (0.16% cost basis) (89.95% stocks/10.05% bonds) $16,204
Vanguard Total Stock Market Index Fund Investor Shares (53.70%) $8,702
Vanguard Total International Stock Index Fund Investor Shares (36.20%) $5,866
Vanguard Total Bond Market II Index Fund Investor Shares* (7.10%) $1,150
Vanguard Total International Bond Index Fund Investor Shares (3.00%) $486
When I total them all up (not including the $5,500 in the money market account, still to be allocated), I get
total stocks total bonds total
$76,397 $9,954 $86,351
88.47% 11.53%
Given that I have admiral shares in my Roth IRA (nice cost basis for those) but not in VFIFX, should I get rid of VFIFX and put all of the taxable account stuff in 1 (or 2) accounts if I can manage enough $ to get admiral shares? (I don't recall the limit - maybe $10,000 for the index funds that I have?) I don't really remember why I picket a target fund for that account instead of just an index fund. Should I ditch one or more of the funds in the Roth IRA and invest in fewer funds? I obviously can't withdraw money from that account, but I could move it around.
I just opened the Traditional IRA this year for 2017 but haven't allocated the funds yet. Should I front load 2018 and try to get into an index fund at the admiral shares level there right off the bat too?
In addition, should I have more money in safer funds (more in bonds, in particular)? I am 42 yo but am thinking of either semi-retiring either very soon (job burnout, considering a lower paying career - I have a case study over in the case studies forum), or sticking with it for 3-5 years and then not looking for another job (at least not right away). All of my Vanguard funds are rated either 4 or 5 on their 1-5 risk scale, presumably because they are primarily stock (+ the international stocks), and I am wondering if that is a little too risky for me right now.
Thanks for reading this far, any advice would be welcome!!