As of Fall 2017:
One of the hidden benefits of blogging about ones finances is that one actually has to blog about it. Our allocation is entirely passive (and automated) at the moment. I’ve traded only once in the last three years and I have no intention of trading in the future (exceptional reason notwithstanding, and even then I’m not sure if I’ll actually have any disposable cash).
That said – here’s what our current portfolio looks like:
Taxable vs. Tax Advantaged
We only recently increased our 401(k) contribution from 10% to 20% of our gross pay. And while we can still fully fund our 401(k) accounts, we need the cash for some impending expenses (a trip to LA, parents visiting, and a washing machine). We are determined not to let this pass next year and all years going forward. We’ll actually have the option to contribute an additional $500 next year, for a total of $18,500 or $37,000 for the two of us.
Currently, we use my income to pay our expenses (including our mortgage – see budget), and save my wife’s income. We will continue doing this – including pouring all future raises (if and when they come) into our savings. In other words, we will keep our expenses fixed for as long as possible.
WellsFargo (TDF 2040) and Fidelity (TDF 2045) hold our 401(k) accounts that we currently fund.
I did not get 401(k) benefits in my last job so I opened a ROTH account with Merrill Lynch and later with Betterment. We also moved my wife’s 401(k) to a traditional IRA with Betterment when we moved to Denver.
Our investments are spread across these accounts. We currently fund our tax-advantaged accounts (Wells Fargo and Fidelity) and our taxable account in Betterment (80% stock) every other week. Our Merrill Lynch account has been dormant for a while now. All leftover funds, if and when they are available, go to our Vanguard account (VTSAX, VTHRX).
All that has us perennially low on cash. We set up a $50 weekly cash goal to build a cash cushion in our Betterment account. But we started looking at that as part of our savings instead of a cash stash. Virtue or vice, I’m unable to see cash (anything over $1500) sit idle in my checking account. As a remedy, I now transfer all leftover fund to my wife’s checking account. She’s the more sober of us.
We also want to be able to pay for a down-payment on a rental property should housing prices fall (drastically).
In all, our current Taxable and Tax Advantaged allocation is aggressive. There is a need to need to allocate more in bonds. We will explore this further in the coming months.
I was able to put these charts together rather quickly because we track our financials on Personal Capital (even though the numbers lag by a day). I intend to update our portfolio on a quarterly basis. Any feedback on our portfolio will be highly appreciated.