Author Topic: Fidelity FUSVX & Contributions  (Read 2481 times)

Beach_Stache

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Fidelity FUSVX & Contributions
« on: June 25, 2016, 08:39:19 AM »
Hi MMMers,
I have done a pretty good job saving and I think a somewhat good job investing passively since I started working about 15 years ago or so, however over the years I have gotten a bit mixed up and am trying to organize my portfolio.  I have a TSP that I just keep everything in the 2050 fund.  Even though I plan to retire in about 20 years or so I leave it there b/c I want the most aggressive and figure I probably don't plan to tap my TSP until then if possible.  I have about 85k in a Roth IRA in Fidelity and another 35k in post-tax income in Fidelity as well.  The Fidelity acocunts are mixed around 4 low cost mutual funds but are not balanced at all.  I just have picked a few that have performed reasonably well and stable over the 10 year to life, so I think relatively safe.  I do not pretent to know a lot about investing other than you should and save as much as possible.  I have been thinking recently about changing over all of my Fidelity money to the FUSVX fund (Fidelity 500 Index Fund), which shows an expense ratio of 0.07%.  Then all future investments would continue to be put in that fund as well (around $600 or so/month).

I'm basically looking to invest passively on a low cost Fidelity fund(s) that will go up and down w/the market.  I can weather the storms over the years and don't have a problem w/that, but looking for something to invest in and forget and not worry that I have the right balance over time.  Even through retirement (still 20 years or so away) I would like to keep my investments somewhat aggressive as I don't plan to need to withdrawl 4% per year, probably 2-3% or so.

Any help would be much appreciated!

JetBlast

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Re: Fidelity FUSVX & Contributions
« Reply #1 on: June 25, 2016, 10:51:39 AM »
Most here would recommend a total stock market fund as it will include mid and small cap stocks, creating greater diversification. FSTVX is the symbol for the premium class of that fund. Personally, I think an S&P 500 fund has more than enough diversification, and either fund is a perfectly fine choice for what you describe.

 

Beach_Stache

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Re: Fidelity FUSVX & Contributions
« Reply #2 on: June 25, 2016, 12:30:43 PM »
Perfect, thanks so much, that's what I was looking for! 

Frankies Girl

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Re: Fidelity FUSVX & Contributions
« Reply #3 on: June 25, 2016, 01:13:17 PM »
Sounds like you are definitely on the right track, but a few things that might help you get organized better:

You need to figure out an investment policy statement and your actual asset allocation so you know when to rebalance.

You'll also need to consider tax efficiency of funds so you know what to put in which account. Like I hold a total market real estate fund, but only inside a tax sheltered account like an IRA, TSP or 401k/403b... because that type of fund (bonds as well) tends to have high turnover and produce lots of dividends - taxable events - so you want it doing that in an account that won't make you have to pay taxes on each little dividend.

I like what is called a couch potato or lazy portfolio. That means once I figured out my ISP, then what I wanted to hold as far as mutual funds and asset allocation and settled on 3 funds (plus cash) to make a total couch potato/lazy portfolio of 4 funds/categories (counting the cash category). I basically set it up, rebalanced everything between those 4 categories and set up automatic investing in the main one I wanted to grow, and pretty much forgot about the whole thing for 6 months/a year. I'd pull up everything then and check the balances, but wouldn't change anything unless it was out of wack by more than 5%. Which means mostly I don't do anything other than some basic math and typing about 20 minutes a year - that is the "lazy" part.



https://www.bogleheads.org/wiki/Fidelity

Word of note that you may already be aware of: they are in process of removing the "Spartan" name on their low cost index fund series to be just "Fidelity" index funds so some things might have a name difference in any Bogleheads stuff (or in general) that you come across when discussing Fidelity stuff. But check the tickers to confirm they're the same funds if possible.

I hold all my investments at Fido because I prefer their overall customer service and functionality (but Vanguard is the gold standard so that's why I linked to the Bogleheads for Fido users like us). I hold only low cost (used to be Spartan) index funds (per the Bogleheads link above).

So as an example, I hold three mutual funds, across 5+ accounts (taxable, 2 Roth IRAs, rollovers...) and use an excel from SquawkFox (but is really easy to make your own) to figure out when to rebalance. I just figured out what I want my asset allocation to be, then figured out what lazy portfolio I wanted (and I'm doing a 3 fund portfolio + a percentage in cash, so I needed 4 categories total). I plug the numbers in about every 6 months to a year, and decide if anything is more than 5% out of bounds, I'll rebalance.

The funds I hold are:

Fidelity Total Market Index Fund - Premium Class (FSTVX)
Used to be called Fidelity Spartan Total Market Index Fund
Hold this in IRA, taxable, Roth IRA and rollover.

Fidelity U.S. Bond Index Fund - Premium Class (FSITX)
Used to be called Fidelity Spartan U.S. Bond Index Fund
Only in an IRA.

FidelityŽ Real Estate Index Fund - Premium Class (FSRVX)
Used to be called Fidelity Spartan Real Estate Index Fund
Only in an IRA.


And as far as the FUSVX fund... I agree with Jetblast that it is a very decent fund, but if you have the ability to get the FSTVX then that is slightly superior for the same expense ratio.



For further reading:

https://www.bogleheads.org/wiki/Lazy_portfolios
http://jlcollinsnh.com/stock-series/
« Last Edit: June 26, 2016, 01:04:32 PM by Frankies Girl »

Beach_Stache

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Re: Fidelity FUSVX & Contributions
« Reply #4 on: June 26, 2016, 06:00:04 AM »
Thanks for much for the detailed response, much appreciated info!

MustacheAndaHalf

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Re: Fidelity FUSVX & Contributions
« Reply #5 on: June 26, 2016, 12:28:32 PM »
There are other approaches, but if you want to keep simplicity, I'd suggest a Target Date fund that's closer to your retirement date.

Your target retirement fund should aim at when you need your investments to stabilize.  You are counting on your TSP some time in retirement.  The problem comes if you're 90% stocks in your TSP, then retire, and the market crashes.  You may wind up retiring, but risking too much in the stock market.  That's the problem with having a target date a decade or so past your actual retirement date - it's too aggressive.  I'd favor a target retirement fund that matches when you'll retire, even if you won't touch the account at that time.  You want your risk level to reduce when you have to depend on the money to be there, and already have enough growth to let you retire.  When you have enough to retire, doubling your money doesn't change much... but having it drop in half may call off retirement.

Frankies Girl

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Re: Fidelity FUSVX & Contributions
« Reply #6 on: June 26, 2016, 01:05:54 PM »
Fixed the messed up Squawkfox link in my post above. Sorry about that!