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Started By
Message
Vanguard target retirement fund vs SP500
Posted on 1/11/23 at 8:17 am
Posted on 1/11/23 at 8:17 am
I am currently 29 and I plan to retire around 2050 with a full salary pension. I try my best to max out my Roth IRA and invest those funds into risky single company stocks in that such as AMZN, META, SHOP, ABB, etc.
I am conservative with my workplace Roth acount.
I am currently contributing my workplace Roth investments all into Vanguard 2050 Target Date retirement fund at the moment, which looks like it has me at around 20% bonds.
Would I be better off just buying SP500 (VOO) at my age and then switching the allocation over to the Target date in about 10 years so that I am a bit more aggressive with this acount or should I be ultra conservative with it given my investment strategy stated above.
I am conservative with my workplace Roth acount.
I am currently contributing my workplace Roth investments all into Vanguard 2050 Target Date retirement fund at the moment, which looks like it has me at around 20% bonds.
Would I be better off just buying SP500 (VOO) at my age and then switching the allocation over to the Target date in about 10 years so that I am a bit more aggressive with this acount or should I be ultra conservative with it given my investment strategy stated above.
This post was edited on 1/11/23 at 8:25 am
15
Posted on 1/11/23 at 8:22 am to tigersint
quote:
which looks like it has me at around 20% bonds.
avoid
Posted on 1/11/23 at 8:25 am to tigersint
At 29 I'd prefer going aggressive and do less bonds. Could you change the target date?
Posted on 1/11/23 at 8:30 am to tigersint
My understanding is that target date funds have higher expenses.
You can do this yourself.
At 29, most would suggest a high % of stocks like 90% or more.
You can do this yourself.
At 29, most would suggest a high % of stocks like 90% or more.
Posted on 1/11/23 at 9:01 am to tigersint
If you have a sizeable pension and are very certain about it, you might consider that as the stable/conservative portion of your portfolio.
I'm retired and have no bonds because I have a federal pension and dont need the added security of a conservative bond allocation. Worst case, I scale back spending so I dont dip into investments while market is down.
I'm retired and have no bonds because I have a federal pension and dont need the added security of a conservative bond allocation. Worst case, I scale back spending so I dont dip into investments while market is down.
Posted on 1/11/23 at 9:01 am to tigersint
VOO. In 30 years, you will have so much cash that you can just divert the dividends to your account and never touch principal.
Posted on 1/11/23 at 9:10 am to tigersint
Few years older than you. You're not touching this for 30 years.
Get out of the Target Date and dump it all in VOO.
Get out of the Target Date and dump it all in VOO.
Posted on 1/11/23 at 9:45 am to tigersint
Just FYI, the passive bond funds are most concentrated in securities with the most issues and the highest prices. If you want exposure to bonds, buy bonds not bond funds. Stay away from target date but your ROTH and SPY are basically the same trade.
Posted on 1/11/23 at 9:59 am to tigersint
I’m 33 and have it all in a SP500 index
Posted on 1/11/23 at 10:31 am to tigersint
SP500 low cost fund and don’t look back.
The target funds were more expensive - have not checked lately.
At your age, no bonds needed. If you do it right, you will never need bonds….as the previous poster stated, sit back and collect dividends.
The target funds were more expensive - have not checked lately.
At your age, no bonds needed. If you do it right, you will never need bonds….as the previous poster stated, sit back and collect dividends.
Posted on 1/11/23 at 11:37 am to tigersint
quote:
full salary pension
Seriously, I wouldn't do a target date fund until around 10 years out (if at all). I think VOO or whatever broad stock market vehicle you prefer is going to be (while volatile) a much better performer.
Good luck!
This post was edited on 1/11/23 at 11:39 am
Posted on 1/11/23 at 12:52 pm to tigersint
The problem with all target retirement funds is over time they move more and more of your money into low performing bonds as capital preservation basically. Pretty old school thought these days to move to a lot of bonds as you get close to retirement because the S&P and stock market as a whole have made bonds look silly for decades now.
It's hard to go against the S&P, if you want to diversify a little more can go with a total stock market index or get some small and mid cap ETFs as well for more exposure across the landscape.
You can do some international but the returns there the last few decades overall have been pretty poor compared to US stock returns.
It's hard to go against the S&P, if you want to diversify a little more can go with a total stock market index or get some small and mid cap ETFs as well for more exposure across the landscape.
You can do some international but the returns there the last few decades overall have been pretty poor compared to US stock returns.
Posted on 1/11/23 at 3:09 pm to tigersint
I use VFIAX and VWUSX, both Vanguard. VFIAX is S&P 500 and the other is US Growth. The US growth one has suffered the past year - a lot - but long term I expect both to be very good for me. Hell, until the past year they’ve been very good. I’m just gonna keep maxing out each month and let it ride. I also have SWPPX in my 401k, which is also an S&P fund. I really like S&P 500 funds .
My wife, however, has their Target Date 2045 fund so we can get a bit more diversification to sort of compliment mine. Between all that and her pension, I am 100% confident in our retirement.
. My wife, however, has their Target Date 2045 fund so we can get a bit more diversification to sort of compliment mine. Between all that and her pension, I am 100% confident in our retirement.
This post was edited on 1/11/23 at 3:11 pm
Posted on 1/11/23 at 4:54 pm to tigersint
I'm 38 with a work 401K that has me invested into a 2050 target date. Make sure i match into it.
Rest is my own portfolio of maxing roth in
70% VOO
15% each of SCHD & QQQ
You do you, but I like getting more bang for my buck while I'm young. Compare lifetime returns on Target date vs VOO and you should get your answer.
Rest is my own portfolio of maxing roth in
70% VOO
15% each of SCHD & QQQ
You do you, but I like getting more bang for my buck while I'm young. Compare lifetime returns on Target date vs VOO and you should get your answer.
Posted on 1/11/23 at 8:41 pm to tigersint
quote:
Vanguard 2050 Target Date retirement fund at the moment,
I’m in the same and looks like it is around 9% fixed income.
Posted on 1/11/23 at 9:56 pm to tigersint
I’m 34
I won’t own a bond until about 3-5 years before retirement. And I probably won’t own a whole lot of them 5 years after, either.
I won’t own a bond until about 3-5 years before retirement. And I probably won’t own a whole lot of them 5 years after, either.
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