Blog

What’s In Our Portfolio (2024 Update)

In December 2011, we switched our portfolio from a DIY allocation to the Vanguard LifeStrategy Growth Fund. And that fund was the entirety of our portfolio for about 12 years. Because people would often ask, I gave periodic updates, explaining that we still liked the fund. For example:

Are We Still Using the LifeStrategy Growth Fund?
10 Years with a One-Fund Portfolio

We recently made a change, which I’ll discuss in a moment, but it had nothing to do with a change in how much we liked that fund. I still think the LifeStrategy Funds (and similar products) are fantastic (tax-inefficiency aside). They’re easy to understand, reasonably low-cost, and very low-maintenance.

It was something in our life that changed, rather than our evaluation of the LifeStrategy fund. Specifically, we bought a house last fall. And with interest rates being what they are, it made sense to use a portion of the bond holdings to minimize the mortgage balance. (As Allan Roth often notes, it does not generally make sense to hold bonds that pay a certain interest rate while simultaneously having a mortgage balance with a significantly higher interest rate.)

But, with an “all in one” fund like a LifeStrategy fund, there’s no way to directly spend just the bond part of the fund. Instead, you have to sell the whole thing and then re-buy the stock part of the holdings. And that’s essentially what we did.

So for the stock part of our portfolio, we’re now just using Vanguard Total World Stock ETF. And for the bonds (because we do still have some bonds), we just bought individual long-term TIPS in one of our traditional IRAs — essentially a 5-year ladder of TIPS maturing from 2049-2053 (which would be our ages 65-69).

So again, we’re keeping things super simple. There’s still no need to rebalance. (The TIPS aren’t there to rebalance with the stocks. They’re there to just collect ~2% above inflation for 2-3 decades and then eventually be spent.) We’ll continue to buy more shares of Vanguard Total World Stock ETF. And we’ll slowly add to our TIPS ladder as well, buying both nearer-term and longer-term rungs.

Given how not-that-exciting this portfolio switcheroo is, it feels a bit silly to write about it. But given how public I’ve been about our use of the LifeStrategy fund, I felt that I should give an update and explain the recent change.

I suppose it’s still a single-fund portfolio. But now it’s a different single fund. Plus some TIPS.

What is the Best Age to Claim Social Security?

Read the answers to this question and several other Social Security questions in my latest book:


Social Security Made Simple: Social Security Retirement Benefits and Related Planning Topics Explained in 100 Pages or Less

Click here to see it on Amazon.

Disclaimer:Your subscription to this blog does not create a CPA-client or other professional services relationship between you and Michael Piper or between you and Simple Subjects, LLC. By subscribing, you explicitly agree not to hold Michael Piper or Simple Subjects, LLC liable in any way for damages arising from decisions you make based on the information available herein. Neither Michael Piper nor Simple Subjects, LLC makes any warranty as to the accuracy of any information contained in this communication. The information contained herein is for informational and entertainment purposes only and does not constitute financial advice. On financial matters for which assistance is needed, I strongly urge you to meet with a professional advisor who (unlike me) has a professional relationship with you and who (again, unlike me) knows the relevant details of your situation.

You may unsubscribe at any time by clicking the link at the bottom of this email (or by removing this RSS feed from your feed reader if you have subscribed via a feed reader).

What's your reaction?

Excited
0
Happy
0
In Love
0
Not Sure
0
Silly
0

You may also like

Leave a reply

Your email address will not be published. Required fields are marked *

More in:Blog

Blog

Best Robo Advisor In Singapore 2024

Sponsor: Webull (exclusive rewards ✅) https://kvli.link/webull Free Spreadsheet https://ko-fi.com/s/3d811360a6 ROBOADVISORS ► Endowus (free $20) https://kvli.link/endowus ...