Author Topic: Vanguard Asset Allocation  (Read 3479 times)


  • 5 O'Clock Shadow
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Vanguard Asset Allocation
« on: September 09, 2014, 09:55:23 PM »
My question is simple. What is my portfolio missing...

I am currently in the wealth building stage and 15 years from retirement.

I currently max out my 401k into the Vanguard Target 2050 Retirement Fund I. I do plan to retire well before then but this was the highest stock to bond ratio and I want my money to grow faster.

Any leftover money I funnel into my Vanguard brokerage account and attempt to balance my portfolio through purchases, not selling each month. I just passed the $10k mark on this account. I attempt to keep the asset allocation listed below.

60% VTI, 20% VEU, 10% BND, 10% VNQ. These are the Total Market (US), World Market ex- US, Bonds, and REIT ETFs.

Are there any holes in my portfolio?


  • Handlebar Stache
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Re: Vanguard Asset Allocation
« Reply #1 on: September 09, 2014, 09:59:56 PM »
Not really enough info to provide any useful commentary. How much do you spend per year and how much do you currently have invested?


  • 5 O'Clock Shadow
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Re: Vanguard Asset Allocation
« Reply #2 on: September 09, 2014, 11:54:31 PM »

It sounds as though it is missing IRAs ?


  • Stubble
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Re: Vanguard Asset Allocation
« Reply #3 on: September 10, 2014, 01:52:35 PM »
My question is simple. What is my portfolio missing...

Simple question. Hard to answer.

As someone else said, get what you can into a simple or Roth IRAs. What you already have is a very typical, solid balance. Do nothing and you're very likely to do just fine.

Everyone here has a different balance for diff. timelines, goals, risks, etc. and most of us are doing real well despite doing some very different things.

To me, the Total US Market Index is a foolproof, starting point. And you have a large chunk of that. Anything else IMO is just a way of trying to 'tilt' your risks/goals/timelines/predictions. That's what your Europe/World-ex.US, Bonds and REITs are doing.

If we call those 'holes' that you've filled, there's also stuff like Gold, Emerging Markets, the high flying Oil/Tech/Health Care sectors, etc. that could fall into that same-ish realm of 'guessing game'.

You might want to think about dividing your 40% that's not in VTI into some of those other risks, but then I'd suggest just focusing on VTI instead to make life simpler.

Personally, I like VO -the Mid Cap Index instead of VTI. I think it's a safer/better guess at tilting your investments up over VTI alone. So then I don't bother with much of those other things I listed. VO consistently follows, but beats, VTI and is only a touch more volatile.

The research on Bonds seems to be that long term, they just make you feel safer while you earn less money. They don't really 'counteract' the market like people seem to act like they do. REITs follow the market, but have lagged. Gold is a total guessing game, but doesn't correlate with the market. Europe follows the US market and used to better it, but now it lags, so might as well go with US Mid Caps which have always been better. I think Europe still has long term problems getting over the 2008 crash. I've gotten burned on trying to get in/get out of Em. Markets, but looooooooooong term, they should be winners.

Also -the point of your dated retirement 'fund of funds' is that it's suppose to be the only thing you own. Anything else messes up the point of having that pre-made balanced investment portfolio. Much of the other stuff you have is pretty much what that 2050 funds contains, though, so there's no real 'damage' in your case.

But, if you can, I'd suggest you get rid of it. If you can't right now, you could just try to re-adjust the rest of your portfolio so that it all acts like one total 2050 fund (if you like it that much). Since you have REITs, it shows you actually don't think the 2050 fund is the perfect total portfolio for you.

With all the pieces separate, you have full control to re-balance all of it.


  • 5 O'Clock Shadow
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Re: Vanguard Asset Allocation
« Reply #4 on: September 12, 2014, 06:05:19 PM »
AZRyan, I appreciate the thoughtful response. I agree with a lot of what you're saying about tilting the account one way or the other with non-VTI positions in my brokerage account.

I chose the 2050 retirement fund because only 10% or so of it was in bonds which is where I wanted to be. My 401k only offered these target retirement funds as choices otherwise I would have chosen the same balance in as my brokerage account.

I hope that I don't have to do much selling to rebalance as it's a lot more fun to buy!