Thanks guys! So currently 100% of my VG IRA is invested in Total Stock Market Index. I'm happy with that because I am not afraid of the risk and don't think I plan on introducing any hedges like bonds or REITs for a while (open to your opinions on this!) so basically I should just also open a brokerage (?) account with Vanguard to keep my money invested?
My super will have maybe $7k when I head back home and I will take it out when I depart and invest it back home. I see the Total Stock Market index as a good proxy for international exposure seeing as Fortune 500 companies operate all over the world. I am very interested in what kind of asset allocation I'd be shooting for? ...and if people have strong thoughts about getting into REIT/bonds why would that be?
Obligatory Japan 1989-2013 (25 years) chart:
How would stocks having a negative return for 25 years affect your plans? Suddenly you're 50 and have significantly less money than expected.
Also, bonds are at their best during a distribution phase, when you're withdrawing from the portfolio. While you may think this won't happen for many years, after all you're young, there are many scenarios where you might end up needing your portfolio before then. Generally, 100% of anything is not recommended. Here's an insightful post from the Bogleheads forum on this topic:
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Listen, there are two HUGE reasons other than psychology (itself not to be underestimated) to have some bonds:
1) you might need the money during a crash. As in, you get fired or get ill, both for the long term. The forced sale will be devastating and may well be the difference between the poor house and some degree of comfort. Do you really want to trade that in exchange for "more money if stocks do well", a situation in which you're already in good shape?
2) there are no guarantees that stocks rebound after any amount of time. Compare a stock certificate with a Treasury bond, no guarantees in sight for the former. If someone tells you that it's a certainty because of history blah blah, ask them for a written, notarized guarantee backed by THEIR personal fortune. Only then can you rightfully sleep well.
So don't do 100%. Add 20 or 30 percent bonds, which won't hurt your returns too badly and will be there for you when times generous. Unlike others above, I won't qualify this to depend on your worldview or vitamin levels. Just don't.
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http://www.bogleheads.org/forum/viewtopic.php?f=1&t=142825&newpost=2123372#p2120756