I am currently planning to increase my equity allocation to +/- 90% with the intention of holding that aggressive allocation through retirement and have narrowed my preferred options for doing (in my tax advantaged accounts) down to 2 portfolios.
The first portfolio I am considering is a simulated 90:10 LifeStrategy "Aggressive" Growth fund that just uses 100% Vanguard Target 2070. This fund is 90% equity with an underlying fund split that is effectively 54% VTSAX, 27% VTMGX, 9% VEMAX, 7% VBTLX & 3% VTABX. I have no intention to use the glide path. Vanguard Target 2070 will hold it's 90% equity allocation for the next 21 years until it hits TD-25 in 2045. Without going the TDF route emulating an LS "Aggressive" Growth fund would require at least 3 or 4 separate funds (ie. 50% VASGX, 30% VTSAX & 20% VTIAX or 54% VTSAX, 36% VTIAX, 7% VBTLX & 3% VTABX). The low 0.08% ER you get from Vanguard's TDFs and the internal rebalancing / reduced behavioral risk form all-in-one funds is also nice. The simplicity of going with a Vanguard Target Date fund then converting it to a farther out one anytime I hit TD-25 makes this first option very appealing.
The second option I am considering is to move to a 3-fund portfolio, which would allow me to address some of the concerns I have with Vanguard's LifeStrategy / TDF allocations. Ideally I'd like to (1) increase my international exposure by shifting from Vanguard's fixed 60:40 US:INT allocation to a fixed 50:50 US:INT allocation and (2) reduce emerging market exposure. The exactly portfolio I'm considering as an alternative to Vanguard Target 2070 is below:
45% VTSAX / US
45% VTMGX / Developed International
10% VASIX / Income (20:80 LifeStrategy)
Thoughts on TDF all-in-one convenience vs the custom portfolio?
The first portfolio I am considering is a simulated 90:10 LifeStrategy "Aggressive" Growth fund that just uses 100% Vanguard Target 2070. This fund is 90% equity with an underlying fund split that is effectively 54% VTSAX, 27% VTMGX, 9% VEMAX, 7% VBTLX & 3% VTABX. I have no intention to use the glide path. Vanguard Target 2070 will hold it's 90% equity allocation for the next 21 years until it hits TD-25 in 2045. Without going the TDF route emulating an LS "Aggressive" Growth fund would require at least 3 or 4 separate funds (ie. 50% VASGX, 30% VTSAX & 20% VTIAX or 54% VTSAX, 36% VTIAX, 7% VBTLX & 3% VTABX). The low 0.08% ER you get from Vanguard's TDFs and the internal rebalancing / reduced behavioral risk form all-in-one funds is also nice. The simplicity of going with a Vanguard Target Date fund then converting it to a farther out one anytime I hit TD-25 makes this first option very appealing.
The second option I am considering is to move to a 3-fund portfolio, which would allow me to address some of the concerns I have with Vanguard's LifeStrategy / TDF allocations. Ideally I'd like to (1) increase my international exposure by shifting from Vanguard's fixed 60:40 US:INT allocation to a fixed 50:50 US:INT allocation and (2) reduce emerging market exposure. The exactly portfolio I'm considering as an alternative to Vanguard Target 2070 is below:
45% VTSAX / US
45% VTMGX / Developed International
10% VASIX / Income (20:80 LifeStrategy)
Thoughts on TDF all-in-one convenience vs the custom portfolio?
Statistics: Posted by msterrr — Thu Apr 04, 2024 11:44 am — Replies 3 — Views 154