Author Topic: Retirement and Investing decisions?  (Read 840 times)

loumar9168

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Retirement and Investing decisions?
« on: June 04, 2018, 11:51:17 AM »
I recently posted an inquiry in the general discussion section. I had some responses and made some moves but was hoping that there might be some more clarification here:

Below is a link to my original question concerning rolling over retirement funds from Nationwide into Vanguard.

https://forum.mrmoneymustache.com/welcome-to-the-forum/help-w-retirement-decision/msg2006011/#msg2006011

The rollover was completed several days ago and the funds were deposited into VMFXX Federal Money Mkt Fund.
While reading Boggleheads, I found that the best "core funds" for a three fund portfolio are VTSMX, VGTSX, and VBMFX.
Since I'm new to all this I'm open to more suggestions. I'll keep reading the other  posts.
Thanks in advance.


« Last Edit: June 04, 2018, 11:54:35 AM by loumar9168 »

nereo

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Re: Retirement and Investing decisions?
« Reply #1 on: June 04, 2018, 04:02:01 PM »
I recently posted an inquiry in the general discussion section. I had some responses and made some moves but was hoping that there might be some more clarification here:

Below is a link to my original question concerning rolling over retirement funds from Nationwide into Vanguard.

https://forum.mrmoneymustache.com/welcome-to-the-forum/help-w-retirement-decision/msg2006011/#msg2006011

The rollover was completed several days ago and the funds were deposited into VMFXX Federal Money Mkt Fund.
While reading Boggleheads, I found that the best "core funds" for a three fund portfolio are VTSMX, VGTSX, and VBMFX.
Since I'm new to all this I'm open to more suggestions. I'll keep reading the other  posts.
Thanks in advance.

Its important to understand that the bolded portion is just an opinion shared by many on the Boggleheads forum.  Its not a bad opinion to have (IMO), but it's just an opinion.  Your asset allocation ("where you invest your money") is a personal decision that factors in your age, goals, risk tolerance and other factors.  I personally find Boggleheads' typical bond allocation (VBMFX) to be higher than I like, and the small-cap portion of the total US market index (VTSMX) is so small that I don't bother.  How much to invest internationally (VGTSX) is another philisphophical question, particularly when one considers that much of the profits from large US companies already comes from overseas.

FWIW, I'm in teh accumulation phase, and I'm very heavy in VFIAX (SP500 fund) with a light sprinkling of VGTSX and VBMFX. 
Many carry just one fund (often VTSMX or VFIAX) and that's not a bad strategy either - compared to decades past holding that one fund leaves you pretty broadly diversified (just no bonds).
Your mileage may vary.

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SeattleCPA

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Re: Retirement and Investing decisions?
« Reply #2 on: June 05, 2018, 07:31:15 PM »
I think the Bogleheads approach is pretty good. But I think it also has some flaws if you're not careful:

Bogleheads investment philosophy flaws


BTW, that link in my sig lets you download a few e-book about a simple retirement plan...
My blog Evergreen Small Business
My free downloadable ebook: Thirteen Word Retirement Plan

L.A.S.

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Re: Retirement and Investing decisions?
« Reply #3 on: June 05, 2018, 07:53:45 PM »

L.A.S.

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Re: Retirement and Investing decisions?
« Reply #4 on: June 05, 2018, 07:55:43 PM »
Also, don't know if it came up in the other forum or not.  But perhaps its time for your daughter to buy you out of the second house? Or move out and allow you to sell it? 

loumar9168

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Re: Retirement and Investing decisions?
« Reply #5 on: June 05, 2018, 10:19:01 PM »
Once again I am grateful for all the comments / suggestions provided to me. I'll continue to read and learn. I'm 70 years old and of course I don't want to make a mistake and loose it all.
As for my daughter... as they say"it's work in progress". Thanks

phred

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Re: Retirement and Investing decisions?
« Reply #6 on: June 07, 2018, 12:31:47 PM »
Money market funds seem safe, but don't always keep up with inflation -- so, you lose that way also

At age 70 you probably don't want to be much in stocks.  The market may go down, and you may not have enough time for it to recover.  So, are people long-lived in your family?

There is no such thing as set it and forget it investing.  Buy and hold kinda blew up in 2002 and 2008.  You have to follow the business news, and read and ponder an investment book every quarter.

nereo

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Re: Retirement and Investing decisions?
« Reply #7 on: June 07, 2018, 12:36:49 PM »
Money market funds seem safe, but don't always keep up with inflation -- so, you lose that way also

At age 70 you probably don't want to be much in stocks.  The market may go down, and you may not have enough time for it to recover.  So, are people long-lived in your family?

There is no such thing as set it and forget it investing.  Buy and hold kinda blew up in 2002 and 2008.  You have to follow the business news, and read and ponder an investment book every quarter.
I don't agree with the bolded sentiment at all. Buy-and-hold is not dead, and 'following the business news' typically triggers decisions which result in worse outcomes, not better. As has been shown over and over, those that 'stayed the course' and ignored their investments did just fine over the last two decades.
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toganet

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Re: Retirement and Investing decisions?
« Reply #8 on: June 08, 2018, 11:14:09 AM »
Money market funds seem safe, but don't always keep up with inflation -- so, you lose that way also

At age 70 you probably don't want to be much in stocks.  The market may go down, and you may not have enough time for it to recover.  So, are people long-lived in your family?

There is no such thing as set it and forget it investing.  Buy and hold kinda blew up in 2002 and 2008.  You have to follow the business news, and read and ponder an investment book every quarter.
I don't agree with the bolded sentiment at all. Buy-and-hold is not dead, and 'following the business news' typically triggers decisions which result in worse outcomes, not better. As has been shown over and over, those that 'stayed the course' and ignored their investments did just fine over the last two decades.

For index investors, sure -- but if you bought Compu-Global-Hyper-Mega-Net at the peak of the first dotcom bubble, you'd be holding nothing now.

If you are worried that your portfolio would not be able to recover from a major downturn, that's could be a signal that you may want to reduce your equity allocation.

nereo

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Re: Retirement and Investing decisions?
« Reply #9 on: June 08, 2018, 11:49:44 AM »
Money market funds seem safe, but don't always keep up with inflation -- so, you lose that way also

At age 70 you probably don't want to be much in stocks.  The market may go down, and you may not have enough time for it to recover.  So, are people long-lived in your family?

There is no such thing as set it and forget it investing.  Buy and hold kinda blew up in 2002 and 2008.  You have to follow the business news, and read and ponder an investment book every quarter.
I don't agree with the bolded sentiment at all. Buy-and-hold is not dead, and 'following the business news' typically triggers decisions which result in worse outcomes, not better. As has been shown over and over, those that 'stayed the course' and ignored their investments did just fine over the last two decades.

For index investors, sure -- but if you bought Compu-Global-Hyper-Mega-Net at the peak of the first dotcom bubble, you'd be holding nothing now.

If you are worried that your portfolio would not be able to recover from a major downturn, that's could be a signal that you may want to reduce your equity allocation.
I don't think anyone is recommending single-stock investing here.

Another time-tested strategy to buttress against a major downturn is to set up a 3 to 7 year bond latter that you draw when markets drop substantially. Its one way of doing what toganet is talking about; holding more bonds and fewer equities *if* you want to smooth out the ride somewhat at the expense of potential gains.  Lots of threads on Boggleheads and a few here about setting up a CD/Bond ladder.
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MustacheAndaHalf

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Re: Retirement and Investing decisions?
« Reply #10 on: June 08, 2018, 09:05:43 PM »
Quote
Buy and hold kinda blew up in 2002 and 2008.  You have to follow the business news, and read and ponder an investment book every quarter.
...
For index investors, sure -- but if you bought Compu-Global-Hyper-Mega-Net at the peak of the first dotcom bubble, you'd be holding nothing now.
QQQ is up 90% for those who bought in Jan 2000 (from $91.38/sh then to $174.44/sh now, ignoring dividends).  Picking on the year 2002 in particular, Apple and Amazon rose 100x in price since then.
« Last Edit: June 08, 2018, 09:09:17 PM by MustacheAndaHalf »