Newbie in training- Please help with asset allocation

[Alittlehelpgoesalongway]

Hey everyone,

I'm still a newbie at everything on this site so please be semi kind-

My finances (no debt)-

Cash-$66,000 cash in the bank (life changes, and I was going to use this as a down payment for a 200k home)

9 years tax deferred into a penision at 10 %- Mandatory ( Probably $55 k if i cashed out now-I need to find more specifics-otherwise it is around 18k a year when I turn 60, which is over 30 years from now with a 3% COLA increase each year)

Need help here- 14K in Roth ( Through Fidelity 70% bio 30% consumer staple (every quarter I look there is less money than what I put in), but I am curious if I should just wait it out (risk aversion) since both are now ranked 3 stars out of 5 through Morning star.

So- 1)Should I move my retirement to another roth fund or wait it out?
      2) Should I move some cash into a non retirement index fund to the Fidelity Spartan Total Market Index Fund (FSTvX) or reallocate elsewhere?

My fiance has hair on fire student debt, but she loves her job and will hopefully be doing 20 years in a full time public sector position once she finishes school come October of this year.  I know more specifics are needed but it will be around 65k starting for her(she does not want to do private practice anytime soon which would increase her income by a lot), and I will need to look elsewhere as we live off of her income for awhile.  We will more than likely have to move around every few years, so the house purchase is probably out of the question for at least four years.

Please offer a little help to make sure I'm putting money in the right place.  My Roth IRA will be 100% done for the year by the end of this month for contributions.  I can also do a 457 maxed out at my job until the fiance starts working full time.

My fiance wants to work 20 years regardless of what is saved, but I just want to make sure I'm doing things correctly financially for the near future. (yes, her student loans are bad for her I get it, and I hope to save the cash for the increase in taxes for the year her loans may be forgiven. )

Thank you in advance for the responses.

[Heckler]

By selling bio and staples (assuming they are US equity) and buying US total market, you are diversifying by selling a small number of US companies, then rebuying the same companies in a smaller percentage, plus a whole lot of other companies.  You are not changing today's value of your account, regardless of what yesterday's value was. 

So, do you want to hold a small number of companies as you do today, or a large diversified number?   also most important, what does it cost you to hold either of these funds?

[Travis]

also most important, what does it cost you to hold either of these funds?

Probably the key bit of info needed. Please post the ticker names of where your money is sitting and we can tell you everything you need to know about your funds.

[NoStacheOhio]

My fiance has hair on fire student debt, but she loves her job and will hopefully be doing 20 years in a full time public sector position once she finishes school come October of this year.  I know more specifics are needed but it will be around 65k starting for her(she does not want to do private practice anytime soon which would increase her income by a lot), and I will need to look elsewhere as we live off of her income for awhile.  We will more than likely have to move around every few years, so the house purchase is probably out of the question for at least four years.

Depending on the amounts, if they're federal student loans, look into public service loan forgiveness.

[Alittlehelpgoesalongway]

Hey guys/gals, thanks for your responses

Heckler-  I don’t know if it is better for me to hold a small number today, or a large diversified number…To keep the Roth at Fidelity, the exp ratio gross and net is $7.70 per $1000 according to the website for the consumer staples (if I'm reading it correctly, sorry still learning), and $7.40 per $1000 for the Fidelity Select Bio Tech. I hope my responses answered your questions.

Travis- I believe the ticker names are 1)FBIOX and 2) FDFAX

NoStacheOhio- Ya we are looking into public service loan forgiveness and will deal with the future tax issue. 

So should I do a separate non retirement index fund as well if I don’t need all this cash for a few years sitting in the bank?

[MustacheAndaHalf]

Fidelity's fund has 0.77% expense ratio
http://financials.morningstar.com/fund/expense.html?t=FDFAX&region=usa&culture=en_US

Vanguard's fund has a 0.10% expense ratio
http://financials.morningstar.com/etfund/operations.html?t=VDC&region=usa&culture=en_US

I'm a little confused by your claim that this loses money every quarter.  According to morningstar data on Fidelity Consumer Staples, it did lose money in 2015 Q2 and Q3 as you said, but it gained +8.17% in 2015 Q4 and another 4.96% in just finished 2016 Q1.  Actually 2015 Q4 offset the losses, and it was up for each of the last several years.  Take a look at the performance tab on morningstar for that fund:
http://performance.morningstar.com/fund/performance-return.action?t=FDFAX&region=usa&culture=en-US

[Alittlehelpgoesalongway]

Thanks MustacheAndaHalf-

I'm still a pretty big newb at this.  Would you recommend I stay with money in these accounts then?

Should I move some cash from the bank into an Index Fund?

Thanks again for all the help

[MustacheAndaHalf]

Two messages for you, depending how much you want to change.  If you want to keep your sector bets, consider Vanguard ETFs instead of Fidelity.  How much do you pay to sell one ETF and buy another?  If the price is cheap enough, you can reduce your expense ratio from 0.77% to 0.10% by doing so.  If you move your assets to Vanguard, I know Vanguard ETFs are commission free at Vanguard (not a spokesperson, I just like the expense ratios at Vanguard).

If you're willing to change some more, I'd suggest a US Total Stock market fund.  Fidelity has "Fidelity Spartan" funds with low expense ratios, and there's ETFs (SCHB, ITOT) that charge very little each run for running those ETFs.  I again like the low expenses at Vanguard, but almost every fund has an S&P 500 fund or US Broad Market fund.  Essentially after Vanguard attracted too much of investor's assets, other fund companies had to offer the same thing.

[NoStacheOhio]

NoStacheOhio- Ya we are looking into public service loan forgiveness and will deal with the future tax issue. 

PSLF doesn't have tax implications. The forgiveness is non-taxable. If your loans are forgiven under non-PSLF (the 20/25 year program), then that does have tax implications.

[Alittlehelpgoesalongway]

Thanks Moustacheandahalf and NoStacheOhio-

Sorry for the delay in response. 
Instead of holding all this cash I'm going to to open a Fidelity Spartan Fund for the Index Funds with an opening balance of $10k.  I will just hold out with my current ROTH IRA's distribution.  I'm about 4 years out from buying a house, but I want to thank everyone for their responses as well.