I have $150K that I would like to throw into a new Vanguard account, split into two mutual funds, and largely forget about (i.e., not trade or continue to watch daily, concern myself with volatility, etc.). Barring multiple catastrophes in my life, I can't really foresee the need to access the funds for at least 10 but more likely 20 years. Any recs as to which specific funds to purchase? I am pretty well balanced in terms of real estate, retirement funds, and a Schwab account which has an advisor, but I'd just like to put something into another basket. Thanks for any advice

VUG

Split equally?

leoj said:

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Split equally?

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Probably. Could go with just one fund. Key is growth. Don't need dividends. If one fund is best, I could go with that as well.

VTSAX

If you want two mutual funds, one Large Cap Growth, one Large Cap Value.

JVAXX + JGASX

When you say diversified are you including some more conservative positions?

YouBet said:

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When you say diversified are you including some more conservative positions?

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Not sure who you are asking, but if me:

Schwab guy has me in two separate Scharf Investment accounts (one for my old company's retirement account rollover when I left, the other in a taxable account. Mostly value investing).
The other money I have with him is in a Schwab Intelligent Portfolio, a separate Zack's account and another with Winslow Capital Growth. The last one has kicked butt this past couple of years.

The reason I want to put it into a separate Vanguard fund, other than what I related as above, are that:

I used to invest in Vanguard before I married and had a good experience with them.
My wife's family lost a sizable fortune when she was a kid, and as such she is always wanting to be super conservative with investments. They went from living in a house that they sold to Howard Hughes (Bob Toll of Toll Brothers Construction currently lives there) to bankruptcy. For her, the sky is always about to fall. Having some money in an account that she doesn't have access to benefits me in ways other than money.
The $150 K is mine, not ours, so I can do with it whatever I want. Again, there is value in having it in another account, rather than Schwab.

I want as pure of a stock play as possible with the money, I want to "set it and forget it", so all I really want is long term growth.

Obviously a Sock said:

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YouBet said:

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When you say diversified are you including some more conservative positions?

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Not sure who you are asking, but if me:

Schwab guy has me in two separate Scharf Investment accounts (one for my old company's retirement account rollover when I left, the other in a taxable account. Mostly value investing).
The other money I have with him is in a Schwab Intelligent Portfolio, a separate Zack's account and another with Winslow Capital Growth. The last one has kicked butt this past couple of years.

The reason I want to put it into a separate Vanguard fund, other than what I related as above, are that:

I used to invest in Vanguard before I married and had a good experience with them.
My wife's family lost a sizable fortune when she was a kid, and as such she is always wanting to be super conservative with investments. They went from living in a house that they sold to Howard Hughes (Bob Toll of Toll Brothers Construction currently lives there) to bankruptcy. For her, the sky is always about to fall. Having some money in an account that she doesn't have access to benefits me in ways other than money.
The $150 K is mine, not ours, so I can do with it whatever I want. Again, there is value in having it in another account, rather than Schwab.

I want as pure of a stock play as possible with the money, I want to "set it and forget it", so all I really want is long term growth.

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Then ignore my question. It sounds like you are equity heavy and thus in a high risk portfolio which is totally fine depending on your horizon.

Vanguard total stock market up 24.88% ytd. 13.63% over 10 years.
I also have van primecap but I don't believe they are taking new accounts. Up15% over 10 years

b0ridi said:

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Huell Babineaux said:

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If you want two mutual funds, one Large Cap Growth, one Large Cap Value.

JVAXX + JGASX

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SP500 funds do the same thing with a lower expense ratio and no load.

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Okay

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Again, there is value in having it in another account, rather than Schwab.

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No, there's not.

He can say it's valuable and why, but he's wrong.
Having money spread out amongst multiple firms is almost never beneficial

aggiebq03+ said:

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Huell Babineaux said:

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Again, there is value in having it in another account, rather than Schwab.

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No, there's not.

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Yes, there is.


He even said what it was.
Not all value is measured in $.

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Also, his wife can't get to his IRA and Individual brokerage accounts at Schwab, even if she has accounts there too under the same household.

Moving the 150k to vanguard for the reason of "making sure my wife can't get to it" doesn't make sense.

If it's because he thinks he's gonna get a higher return at vanguard, he won't.

It does nothing but complicate things, and brings no value .

Putting it elsewhere means wife doesn't see it and feel the need to conserve cash. It also means I can put something outside Schwab and look back at performance without my advisor asking me any questions. So, while there may not be purely financial reasons that moving the money from checking to Vanguard makes sense, there are other reasons.

I would say as long as your advisor knows about it, it's 6 of one half dozen of the other.

You want to make sure they can use those funds to assess your entire picture and 6 figures is important for them to at least be aware of.

I have been told before though that they're diversified by having funds spread across firms...definitely not the case.

https://texags.com/forums/57/topics/3068825/1

5 pages of advice

Edit to add, I thought that this was a pretty cool article that someone posted in the link above.

https://novelinvestor.com/asset-class-returns/

Obviously a Sock said:

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Putting it elsewhere means wife doesn't see it and feel the need to conserve cash. It also means I can put something outside Schwab and look back at performance without my advisor asking me any questions. So, while there may not be purely financial reasons that moving the money from checking to Vanguard makes sense, there are other reasons.

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If allocated and treated the same, the returns or "performance" at Schwab vs Vanguard is completely random. You'll never see a pattern.

But go ahead and try it

Open a fidelity account and buy the contrafund. Bet on William Danoff continuing to be the best in the business.

Ragoo said:

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Open a fidelity account and buy the contrafund. Bet on William Danoff continuing to be the best in the business.

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maybe i'm looking at this wrong, but it looks like that fund over the last 10 years is currently about 3.56% ahead of the s&p 500. but once you factor in the expense ratios, a passively managed s&p 500 index fund takes the lead by 2.35%. am i looking at this wrong, or is there another reason to take this suggestion i am missing?

BlackGoldAg2011 said:

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Ragoo said:

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Open a fidelity account and buy the contrafund. Bet on William Danoff continuing to be the best in the business.

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maybe i'm looking at this wrong, but it looks like that fund over the last 10 years is currently about 3.56% ahead of the s&p 500. but once you factor in the expense ratios, a passively managed s&p 500 index fund takes the lead by 2.35%. am i looking at this wrong, or is there another reason to take this suggestion i am missing?

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where are you looking. FCNTX has an expense ratio of 0.82%

dirkjones said:

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Vanguard total stock market up 24.88% ytd. 13.63% over 10 years.
I also have van primecap but I don't believe they are taking new accounts. Up15% over 10 years

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I agree with this guy except I would split it between the total stock market fund 80% and their total international stock fund 20%. In addition, I would dollar cost average into the funds over a 15 months in case we get a big downturn in the market. Look to double down in those months with big downturns.

Then at the 2 year point, I would look to diversify some of these holding into their 3 specialty funds - energy, health care and real estate index funds. So that at the 5 year point you might be somewhere like this:

Total Stock Market Fund 60%
Total International Stock Fund 10%
Energy Fund 10%
Real Estate Fund 10%

That would be a pretty sweet portfolio could be at $500K in 10 years.

Now the real me would put it in a IBKR account and buys some fun growth stocks and use margin to double my investment. But it appears you might want some money at the end of 10 to 20 years so that might not be your best option.

If you're gonna do comparisons, use 15 years instead of 10

george1992 said:

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dirkjones said:

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Vanguard total stock market up 24.88% ytd. 13.63% over 10 years.
I also have van primecap but I don't believe they are taking new accounts. Up15% over 10 years

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I agree with this guy except I would split it between the total stock market fund 80% and their total international stock fund 20%. In addition, I would dollar cost average into the funds over a 15 months in case we get a big downturn in the market. Look to double down in those months with big downturns.

Then at the 2 year point, I would look to diversify some of these holding into their 3 specialty funds - energy, health care and real estate index funds. So that at the 5 year point you might be somewhere like this:

Total Stock Market Fund 60%
Total International Stock Fund 10%
Energy Fund 10%
Real Estate Fund 10%

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I like this approach. I don't know if I want to dollar cost average over that long of a period of time, though. I hate to put money into the market when it is at or near all-time highs, just the same.

Great article that Tumble Weed linked, as well, which meshes nicely with this advice. That article is why I dislike, for myself, the idea of holding bonds or cash when I know my horizon for withdrawing the money is more than 10 years out.

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I hate to put money into the market when it is at or near all-time highs

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That article is why I dislike, for myself, the idea of holding bonds or cash when I know my horizon for withdrawing the money is more than 10 years out.

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These two statements completely contradict one another.

If you don't want bonds because you're confident that the stock market will continue to grow like it always has, then why doesn't it matter if you're investing at "all time highs"?

You stated yourself that your horizon is probably 20 years (2039). What difference does it make if you invest your money at the "high" of the market in 2019?

I don't mind holding bonds as a short term bridge to be able to dollar cost average from cash into stocks. I just don't want to have my current portfolio set up in such a way as to consider bonds as an investment strategy. My wife values cash and bonds. Given her history, I get it, but I disagree.

I understand your point about the ups and downs of the market being minimized as the horizon gets longer. However, we ARE at all time market high numbers and we are about to impeach a President (not to take this into the Politics Forum). So the previous advice from George 1992 about dollar cost averaging is appreciated.

Obviously a Sock said:

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I don't mind holding bonds as a short term bridge to be able to dollar cost average from cash into stocks. I just don't want to have my current portfolio set up in such a way as to consider bonds as an investment strategy. My wife values cash and bonds. Given her history, I get it, but I disagree.

I understand your point about the ups and downs of the market being minimized as the horizon gets longer. However, we ARE at all time market high numbers and we are about to impeach a President (not to take this into the Politics Forum). So the previous advice about dollar cost averaging is appreciated.

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I understand what you're saying, but I'm telling you it doesn't matter if your horizon is really 20 years.

Today, the Dow closed at 27,600

20 years ago, it was at 11,500

20 years before that, it was 838.


Don't complicate things. The ups and downs of the market aren't "minimized" with a 20 year horizon. They mean absolutely nothing.

Do you see my point?

Obviously a Sock said:

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However, we ARE at all time market high numbers[...]

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The S&P has spent 32% of its life within 5% of ATH.