Author Topic: SCHB or SCHD  (Read 7890 times)

dalekeener

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SCHB or SCHD
« on: October 15, 2015, 10:24:09 AM »
In a Schwab account that is taxable I want to invest in an ETF that I can add $200-300 to each month, starting with around 5-10k. I was looking at SCHB or SCHD coupled with a total bond fund split 50/50. Which equity ETF would anyone recommend to add to over the next 10-15 years and not sell. Or if there is a better option for me at 54. Personally I like the 50/50 split but am open to ideas for this account.

Thanks,

Dale

Scandium

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Re: SCHB or SCHD
« Reply #1 on: October 15, 2015, 10:32:44 AM »
I'm biased to total market (and against dividends) so I'd choose SCHB. SCHD is basically a large cap value fund, with higher dividend which are bad from a tax perspective. There is ~3x as much mid- and small cap in *HB as in HD. Arguably more diversified and historically higher growth.
http://portfolios.morningstar.com/fund/summary?t=SCHd&region=usa&culture=en_US

Unfortunately I don't like Schwabs international ETF (SCHF) as it doesn't have small cap or emerging market. One of the reasons I moved to vanguard. They do have a separate ETFs for this though.

Bonds in taxable is also bad from a tax standpoint, much better to put this in a tax-sheltered account if you can. Do you have a 401k/Roth or similar?

NorCal

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Re: SCHB or SCHD
« Reply #2 on: October 15, 2015, 10:42:41 AM »
I'm a fan of SCHB.  For that level of assets, I would invest in SCHB and SCHZ based on your preferred allocation.  50/50 seems to be a decent split for your age based on normal metrics.

My personal belief is that everyone who has not invested through a downturn should take the allocation they're comfortable with and add 5-10 percentage points to the bond portion.  Once you've invested through a downturn and are comfortable with the associated losses, then you can move it back up.  This is just my personal opinion, and not a widely shared one.

As your portfolio gets larger (maybe north of $20Kish), I would add a few other Schwab funds such as SCHA (small-cap), SCHF (international) and SCHH (REIT's).  The added complexity to your portfolio isn't worth it at this stage, but it's something to think about as it grows.

Most importantly, once you've decided what you're going to do, write it down in an investment policy and stick to it.

ShoulderThingThatGoesUp

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Re: SCHB or SCHD
« Reply #3 on: October 15, 2015, 10:46:24 AM »
SCHB. Since there's no commission I'm not sure what is difficult about putting some in SCHF and some in SCHE, but when you're just starting out SCHB is the way to go.

gimp

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Re: SCHB or SCHD
« Reply #4 on: October 15, 2015, 05:36:45 PM »
I have the bulk of my 401k (everything but a few left-over pennies) in SCHB.

aspiringnomad

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Re: SCHB or SCHD
« Reply #5 on: October 15, 2015, 07:03:44 PM »
Also a big SCHB fan. 2,500 companies and can't beat that ER!

Radagast

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Re: SCHB or SCHD
« Reply #6 on: October 15, 2015, 07:06:02 PM »
SCHB has a lower expense ratio and will result in lower taxes (lower dividends and less turnover), so it is the choice.

Though it looks like SCHD has been selling at very roughly 0.12% less than it is worth for the last year (I use Schwab through my employer so I have been tracking these things for several of their funds).

rayt168

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Re: SCHB or SCHD
« Reply #7 on: October 16, 2015, 04:32:02 AM »
I have both SCHB & SCHD.  In comparing the ratings that is on the schwab website, SCHB is the winner.  I plan on selling my SCHD shares and buying the SCHB.

dalekeener

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Re: SCHB or SCHD
« Reply #8 on: October 16, 2015, 01:04:22 PM »
Well...thanks to everyone...I have sold what shares in SCHD and have went with SCHB....appreciate all of the advice. 

Dale