How Many Investments Should You Own?

[@stevec.7017]

I like what Rob had done before in the past; VOO, SCHD, VXUS, and BND. Done!

[@davidbrooks8809]

SCHG..FTEC and SPLG 😊DONE

[@dougbratman5398]

I would just skip the BND and put that into SCHD with some VIG mixed in.

[@patrickbailey1249]

How does schd complement those and at what%?

[@beachbum77762]

100% Stocks is the best way to go. You'll have more money in the long run. You have to lower your spending some down years, but overall you'll be able to increase your spending most years and end up with more money overall!!!

[@davidfolts5893]

I like the Couch Potato Portfolio; it's no fuss, no muss, and easy for my wife to follow should I pass away first.Simplicity can be sophisticated.

[@yhckelly]

VFORX for the win. I love target retirement stuff. It's like the Crock-Pot of the investment world. Set that rascal and forget it. When dinner time comes, it's ready. And all you had to do was push one button. Perfect.

[@dougbratman5398]

Not much better, maybe not as good, as a basic S&P 500 fund. Also hasn't been around long. Certainly not a bad choice though. Low expenses!

[@prkeene]

The higher expense ratio of target date funds and their unalterable stock-bond allocation is why I switched my 401k to an effective 3-fund using available Fidelity core funds.

[@geoffgordon9569]

Agree, I like rebalancing every month with more capital.

[@g.t.richardson6311]

Target date funds blow My wife works at target PT for her fun money. They match 5% even for part timers, which is good deal. But only options are target date funds from what I remember when opened few years ago. She is retiring from real job next year but likely continue at target for the discount and something to do When she finally packs it in… that will go to her fidelity IRA from older jobs in a week

[@MC-gj8fg]

I've generally been a fan of avoiding bonds unless closing in on retirement, and I don't mess around much with investment outside of the US. Target date funds, meanwhile, never have a mix I like and typically have higher expense ratios that I simply don't see paying for themselves. I DCA monthly and maintain about a 50% S&P, and 15% small cap mix. With the remainder, I periodically buy into a few S&P sector tilts towards sectors that have outperformed the market for the past 25 years, such as the nasdaq, consumer discretionary, and healthcare. The first two are volatile, and I tend to add to the positions during a significant dip, while healthcare has marginally outperformed the S&P, but with less volatility. I've been increasing my cash position as of late. You can't beat getting over 5% on your money risk free and staying nimble for any opportunities that may present themselves.

[@ianwhitehead7247]

You have a way of laying out material that makes this less daunting for people - demystifying the process. Folks like you helped me to have the guts to stop using a 1.5% manager. I appreciate it.

[@ericlaukonen9911]

There is something to be said for diversifying for counterparty risk and national financial repression risk. A small percentage of the portfolio should seek some hedging in this area. If vanguard implodes it may be some waiting period to get access to your funds.

[@J-2024-v8i]

Another reason to have more than one single diversified fund is, for when you need to start withdrawing from your portfolio, to give you optionality on where to pull funds from. For example, if stocks are down and bonds are stable or up, you would like to pull the funds from the bond fund. With only one fund, the withdrawal is pro-rata to the funds that make the one diversified fund.

[@NurseJake]

When young, 1 fund works great, but you are right. Some would argue cash as well. However, i will be only doing stocks, bonds, and an emergency fund

[@neeferpd]

This was my exact question. I was fully expecting Rob to bring this up. How would the single life strategy fund work for someone actually in retirement with respect to withdrawals? I'm a bit of a newbie and thought maybe I'm missing something big.

[@terrycoye3373]

Regular rebalancing moots that problem, so it’s not something an investor would have to contend with in the combined fund.

[@neeferpd]

@@terrycoye3373 I'm the newbie commenter above. So hoping you can help me understand. Suppose you're in retirement and you've chosen 60/40 life strategy fund. Say stock market dives for a couple of years. I realize bond market might be up a bit most likely, but doesn't this mean that your entire life strategy fund value could be down a good bit in its value? Wouldn't you want to have a separate bond fund or some fixed income account to withdraw from during those times?

[@J-2024-v8i]

@@terrycoye3373 You can’t rebalance a single fund. It rebalances itself. However, you will still book a loss if you withdraw from it when stocks are down, since that will bring down the nav of the fund. If you had two separate funds, one with stocks and one with bonds, withdrawing from the bond fund would not book a lose in this example. One diversified fund may work when you are in the accumulation phase only, as you can set it and forget it, as long as you don’t have to withdraw from it and, if you young, probably all stocks is best as long as you can stomach the ups and downs.

[@gabrielenicolini5988]

Hi Rob - thank you so much for the clarity. Here in Italy Lifestrategy & similar from other providers are offered at 0.30% therefore people prefer to stay on single etf and rebalance strategy. As always a great pleasure to listen to your thought process!

[@rgarri6396]

I started lifestradigy growth fund 25 years ago and never regretted it.

[@tammimilewski2788]

Bond Funds don’t do well in an increasing interest rate environment. I prefer treasury bonds for my fixed portion. Plus state tax free in a brokerage taxable account.

[@davlogic]

Excellent investment advice Rob. For anyone interested in having control over their investments this is a great roadmap. Tax strategies are my main concern with less than 3 years before retirement. Keep these easy to understand videos coming.

[@johnbeeck2540]

Congrats on 200K Subs Rob!

[@noreenn6976]

I have a life strategy fund, I prefer that to switching to the ETF funds because I want to put a set amount in automatically each week, easy peasy.

[@knighteffsix6351]

I would think that one additional reason to opt for multiple funds is the ability to liquidate only bonds or only stocks as needed when one needs cash. If the stock market is down, for example, I might sell some bonds for my cash needs. And if stocks are up, I might take some profits there for cash. Now I realize if you’re just going to rebalance anyway, then that doesn’t matter so much. But if, like Jack Bogle, one rarely rebalances, then that could make a huge difference. Your thoughts Rob?

[@howardfriedman7077]

knight: Congrats!!! That is the right answer.

[@howardfriedman7077]

@@knighteffsix6351 I'm saying your theory is the right one. You need to have separate funds in order to pick and choose from where you will withdraw your money. A blended fund or a target date fund does not allow you to do that.

[@g.t.richardson6311]

Another option … my bond funds (only about 20%) throw off decent monthly income….as of now I’ve been reinvesting all monthly dividends and buying more shares, which of course then provides more dividends, but I could simply put the dividends into my SPAXX (fidelity) and use that cash flow if withdrawals needed down the road and not touch principal … same with preferred stock etf that pays monthly.

[@mikederucki]

I saw a family trust holding 50 tickers. Complexity is job security for these guys

[@terrybass5872]

Jack Bogel would say just use.... Vanguard Balance Index Fund

[@benjaminjohnson1693]

I have just 2 ETFS in my ROTH IRA - VTI (90%) and VEA (10%). My time horizon is several years. I am due a modest pension, so I currently do not have any bonds. I may add some short-term bonds once I am in retirement.

[@gregdean8720]

Thanks for covering this important topic material. You mentioned that you used to allocate to small cap value, which is something that I didn't realize. Even though you don't currently follow small cap value allocations, I'd be interested on your take on what investments you should own for those of us who are making those allocations. I have EFTs for two of the major small cap value indices, my rationale being that there perhaps the definition of small cap value has more subjectivity. Future video suggestion?

[@BoBear79]

AVUV is all you need here.

[@gregdean8720]

@@BoBear79 Yeah, I've been curious if a Russell 2000 index is enough or if getting a S&P Small-Cap 600 Value index EFT might provide more diversification.

[@BoBear79]

@@gregdean8720 Size and value are two of the most effective factors over time. And small cap value has the best risk/reward but must be held for long periods to be effective. IMO, if you're going to allocate to small cap, AVUV is the best way. A simple small cap blend fund of any issuer doesn't do much, if anything, over VOO/VTI.

[@anothername2730]

More good advice from Rob!

[@Wawalsh1234]

I truly appreciate your videos, thank you.

[@christopherbilkey5237]

90% of my investments are Roth. That makes me keep a good amount of bonds in Roth.

[@brianh6680]

Recently came across an interesting Roth conversion strategy. The idea was to make a Roth conversion and also make an investment in an oil and gas limited partnership in the same year. Special incentives for the LP (intangible drilling costs) allow for an immediate tax deduction in the range of 60-80% of the investment, offsetting or negating the Roth conversion taxes. The catch is, only "accredited" investors can join these LPs and then there's finding one you trust.

[@AutomationMaestro]

Can you please make a video or discuss position size of an investment? Because you can all the great investments you want, if they aren't large enough over 20 -30 years they won't do you much good.

[@bobbydazzler8051]

Rob, Gifting your book “Retire Before Mom & Dad” to my two daughters. Great principles that are timeless, thoughtfully explained, and gratefully not gimmicky- as most others seem to be. I can safely hand this to my kids and not worry about them being pulled into a seminar to drain them of their future savings! Question: Curious as to why you were once big on small caps but no longer are. I ask because I have been long on small caps (admittedly lost out to S&P previous few years) but am questioning my strategy. In 401K I’m about 60% SC, 15% LC, rest divided into MC & cash. My strategy was based on playing catchup to starting retirement savings late in life. Looking at 15 years to retirement and cannot afford too many more opportunity losses. This is why I’m gifting your book to my kids! I want them to know that their parent’s situation can be avoided with good investment decisions. My parents didn’t teach me anything about money. Thanks again!

[@scott1441]

One IRA- 95 % of total retirement savings- with 3 mutual funds - actively managed - 55/40 /5- equity, bonds, money market. The other 5 % in a taxable brokerage account with 6-10 individual stocks in various sectors.

[@derekmarlowe522]

In VTI, once you get past the first 12 stocks you are under 1% each. The next 40 puts each stock less than 1/2% each. This seems to greatly water down any high growth holdings since they will never be at a meaningful size to move the portfolio total value. In the SP500 the top 50 were the only group of 50 to beat the index average return, according to a study I recently read. VTI is loaded with lots of mediocre positions that further water down the fund return. Also I dont think that one gets any more protection in a bear market from owning VTI over funds with far less holdings. I enjoy your videos!

[@bribradt3450]

I agree with you and I had the same thought. I realize that past performance doesn't say anything about the future, but voo and vti are pretty much neck and neck over the past several years

[@afridgetoofar1818]

I think you’re missing the point of Index investing. It’s not about picking winners and losers, which is hard to do over the long haul.

[@michaelsd284]

Thanks for the video Rob. I use a ladder approach using these types of funds to get the asset allocations I want for the desired investment period within my retirement lifespan (first 5yrs, 10yr in, 20yr in, and 30yr in or legacy)

[@markwalters7498]

Yeah Vanguard keeps overweighting international stocks because there is supposedly more potential for growth. Been saying that for years with consistent underperformance of international stocks vs US.

[@hanwagu9967]

if you have the bulk of retirement savings in a 401k, it also benefits to keep things simple if the plan has a pro rata distribution rather than allowing you to pick and choose which investments to withdraw.

[@howardfriedman7077]

If you are in the withdrawal stage, you should have that money transferred to an IRA.

[@hanwagu9967]

@@howardfriedman7077 there are pros and cons for rolling into an IRA, so it's not a generalized you should roll into an IRA.

[@venchenzo4493]

4 fund portfolio of s and p 500, schd, vgt, and bnd. 25 percent in each has a lower standard deviation, lower max drawdown and 3.5 to 4 percent higher CAGR than VASGX.

[@MillennialRescueOrg]

Hi Mr. Rob Berger , Thank you for sharing your insights to the world - I’m sure many more than the few appreciate your knowledgeable sharing and caring ! Riddle me this Batman, You have 3 Million in Retirement savings, 2 Million in no taxable Roth IRA’s and 1 Million in a taxable 401k. Also 2 Million in Realestate property… How would you go about planning a retirement portfolio?

[@afridgetoofar1818]

At 45, I just VTSAX & Chill.

[@nlmytube]

Putting a mutual fund in your taxable account will result in forced income (capital gains distributions) that increases your taxable income. ETFs are a better choice for taxable accounts for this reason. I could see putting a Life Strategy fund in a traditional IRA or 401k, however.

[@briandarnell1809]

Does anybody remember the old drinking game where you had to do a shot everytime somebody said "Hey Bob" on the original Bob Newhart Show. I want a new game where you do a shot everytime Rob says "TIPS". LOL 🙂

[@thefixer742]

I would like to have some extra exposure into commodities like oil, gold, silver, lithium, uranium, cocoa. What ETF would you suggest? (Energy transition/renewable energy). Is there also any AI tech fund?

[@sovrappensiero1]

Thanks. Your videos are very helpful. I am not sure if you have already addressed this in another video, but if not, I’d love to hear why it’s not necessarily as good to keep bonds in a Roth IRA or taxable accounts. Also, what are taxable accounts? Like regular brokerage accounts?

[@dougbratman5398]

Rob, I don't like bonds. I just don't. I prefer dividend funds or ETFs, some of which you reviewed, like SCHD. In bad times, like 2022, it lost less than bonds. A lot less. In good years it made more than bonds. A lot more. I do like blended funds like VBIAX and Wellington. This breaks the rules a bit. Love S&P and Total Stock market index funds and some specialty finds line Vanguard information technology (VGT).

[@iLuvpizza418]

Rob, regarding your Plan Vision comment, is it duplicative or worth the additional expense for Plan Vision if already subscribed to New Retirement? Are they similar? Thanks, and great video.

[@alan30189]

I found when I pulled my money out of mutual funds in 2008 and invested in stocks on my own, I did infinitely better than these fund manager goobers. The only mutual fund I’m still in, is an international fund.

[@tomm.3994]

Love your videos, however in one of them you suggest M1 Fianace. They charge a significant fee!

[@ramonyll]

Why would you want to hold different types of investments for different accounts? Around minute 10 of the video you mentioned that you prefer having: * Taxable Accounts - No bonds. Stocks and Cash * Roth Accounts - No bonds. Only stocks * Traditional IRA/401K - Bonds ok What is the reasoning behing this? Also, do you also change the type of fund (large/small/mid-cap and/or value/blend/growth) for each type of account?

[@JTStembler]

I have VFIAX for Vangaurd IRAs and FXAIX for Fidelity 401K.

[@BB-cs3kk]

Prefer to have BND or Treasuries ETF to draw from only during recession years.

[@abrint2018]

Vanguard is the market leader in the U.S. funds business, though its ultracheap index funds no longer stand out among its peers.

[@droops63]

I don't think that VASGX has tax-exempt bonds in it (at least, a quick search doesn't show any). If the bonds are all taxable, then would it be okay to use in a Roth?

[@BarbHurley-s6m]

Excellent!

[@cwneppl]

Why not keep bonds in Roth? If not, not as diversified.

[@davidbrooks8809]

5 funds..1. SPLG 2. FTEC 3. SCHG 4. Amazon 5. Berkshire Hathaway

[@ferchanguitoable]

4 funds = 70% Fskax, 20% Ftihx, 5% Fuamx and 5% Fipdx

[@jeffultra2007]

So, it's 14 basis points for VASGX. If you add up the expense ratios for setting up each fund on its own (the 4 funds within VASGX), you come up with a figure that's higher than the single expense ratio for VASGX alone. Does that really make the total fees come out LOWER for setting up the individual funds separately? I'm not sure just how the math works, but just wondering.

[@everlastingarms3065]

You don't add up the ratios. You average them (weighted by amt).

[@DavidDLee]

Why not have bond funds in taxable / Roth accounts?

[@hm51008]

The theory is bonds are better suited for tax-advantaged accounts like a traditional IRA, so no taxes are paid on the interest until you withdrawal the assets.

[@mrb552]

Bonds pay out dividends every month that are taxable at "ordinary income rates" just like paycheck income rather than lower long term capital gains rates.

[@jeffreymartinson2545]

I also don't understand the Roth reasoning.

[@mrb552]

@@jeffreymartinson2545 Roth accounts are growing tax free and should have investments with the highest potential return due to that benefit. Therefore equities belong in Roth accounts. The most aggressive equities in a person's portfolio should be in the Roth account when possible.

[@mrb552]

@@jeffreymartinson2545 Roth accounts are growing tax free and should have investments with the highest potential return due to that benefit. Therefore equities belong in Roth accounts. The most aggressive equities in a person's portfolio should be in the Roth account when possible.

[@hemasvatik2845]

Super!

[@obifox6356]

Not VASGX ! Too much International. Too much bonds. You need 2 years cash or relatively safe funds. Rest should be Total (US) Stock Market. It includes enough international investment via the companies’ investments.

[@jamesphillips2961]

Rob, could you comment on why you should not have bonds in a taxable account? Thanks.

[@erickarnell]

Can't speak for our illustrious host, but I'd prefer to keep bonds out of a taxable account because bonds have payouts that would become taxable events whether I wanted them or not.

[@jamesphillips2961]

@@erickarnell OK, got it. I have a Vanguard LS fund and have experienced this.

[@okgreat2573]

Interest is taxed as regular income as opposed to capital gains. But I believe Treasuries have no Federal income tax.

[@g.t.richardson6311]

@@okgreat2573 treasury’s and ibonds, no state or local tax if your state has them Interest is taxable federally

[@BW-kv9wj]

VOO, VTI, VGT, SCHD, DGRO, QQQM, COWZ. You’re welcome.

[@blackgrandpa7652]

I hold voo in my personal brokerage account and i dollar cost averaging weekly set it and forget it and live my life😂

[@Sperinator]

Why no bonds in Roth IRA?

[@stuartlob2854]

Here for same question.

[@alexk729]

Over time stocks will outperform bonds by quite a large margin. You want your Roth to grow in value as much as possible. Why hold it back with low growth bonds? Thats the reasoning.

[@Sperinator]

@@alexk729 TIL -- cool, that makes sense. Thanks for the reply. Just did a reallocation of my bonds to be fully in my 401k, no more in Roth IRA nor HSA.

[@rakeshguptagupta8834]

I honestly don't understand why you're discussing these dubious schemes. There are plenty of options like Eledator and similar ones that are fast and profitable.

[@OffGridandOutdoors]

Great info. But is it just me or has bond ETFs been crappy for everyone lately? I've been replacing bond ETFs with an SCHD like thing.

[@kyletomerick]

You’re solely looking at price return. The income they generate is part of its return but you don’t see it increase the NAV price

[@afridgetoofar1818]

Once the Fed starts cutting rates, bond fund performance will improve.

[@wsurfn]

love this

[@EatLeadPal]

I'm 63, retired, and I've had my money in S&P 500 funds (100% stock) since I started investing. I have made a great deal of money and I see no reason to change. The S&P 500 has made an average of 9.8% returns over the past 100 years. International and Bond funds are losers in my opinion because they don't make much money. This is just my amateur opinion which may not work for everyone. I noticed you didn't show the performance of the funds you are showing in this video.

[@terrycoye3373]

What is your strategy for withdrawal? 4% rule?

[@EatLeadPal]

@@terrycoye3373 My plan is to never use my investments. I'm living off several pensions and don't need it. It will be a legacy for my kids and grandkids. However, I would still use the same investment strategy because S&P 500 Index funds are the way to go. Just make sure you have money set aside during a market downturn. Like I said in my first comment, I'm an amateur and others situations may be different. My plan has worked great for me so far. I have a friend who was overly conservative in his investing and when he retired, he had made very little money and ended with only what he put in. He regrets it.

[@FrankBatistaElJibaro]

FSELX all the way.

[@stevesharma4901]

❤

[@pauld9653]

interesting how some accept just one bond fund like BND or AGG.. which over the last 10 years has returned a big fat ZERO ! Like a multi strategy bond portfolio including: individual bonds, corp and high yield, Baby bonds.. preferreds with a maturity date, individual TIPS, MYGA's.. higher than CD's and tax deferred, Short term treasury, BDC's, ...

[@kyletomerick]

The price return may have been zero but its real returns aren’t. The losses in share price are offset to the extent of the income it has earned since then

[@bartz4439]

thats amazing how Vanguard US founded by Jack who wanted to minimize costs for customers is making fund at the cost over 2x more expensive than buying 4 seperate funds... disgusting we got same in UK, im closing my vanguard account - they are sooooo greedy and lifestrategy is extremely overweight with UK stocks... home bias over 20%?? and costing over 0.2%

[@JoeS97756]

Give me a break, Vanguard is the best deal out there.

[@bartz4439]

@@JoeS97756 nope

[@harism2001]

VOO, VTI, QQQ

[@davidbrooks8809]

Overlap!!!😊

[@JoeS97756]

Boring, take some risk!

[@cryengine_x]

lol you didnt remove reit's and emerging markets because you wanted simplify, you did it because theyve performed relatively poorly the last 15 yrs. pretty sure if emerging markets was outperforming the sp500 the last 15 yrs you def would not have removed them. in fact you would have increased their weighting, lets be honest.

[@tonycrabtree3416]

Mutual funds? 1 because they are all so broad. 😂😂. The rest should be single stocks.

[@rolandosouffrain7957]

Lol made me lol😂 when u said some financial advisors put u 8nto 30 funds. Imagine u go to them and all they do is put ur money 💰 in VOO. I can do that myself. I wouldn't need a financial advisor. Lol. 😂😂 hmmm🤔🤔🤔

[@ccrider8483]

Most brokerages try to put people in managed accounts and charge a 1-1.5% fee annually. That really makes no sense to me.

[@rolandosouffrain7957]

@ccrider8483 yeah that's why I do it myself. Too many E.T.F.s and inform on you tube to pay someone

[@janitoronfire]

One. VTSAX.

[@afridgetoofar1818]

Buy & Hold.