I am needing some guidance as to how to structure my portfolio . It would be good to tell me what mutual funds / indexes / stocks / bonds you have in your 401K portfolio and what % of portfolio each comprises , what your age , and how many years until retirement .

What is the makeup of your portfolio ?

( I am 55 , 12 years until retirement (i hope ) , NW of approx 4 million , but most of this is invested in real estate )

I would appreciate you sharing this with me .

**Marcopolo

My thinking is along these lines :

FNMIX Fidelity New Markets Income 10 %
LSBRX Loomis Sayles Bond 10 %
MWTRX Metropolitan West Bond 10 %
SCHH Schwab Reit 8 %
SCHA Schwab Small Cap 10 %
SWPPX Schwab SP500 12 %
SCHD Schwab Dividend ETF 12 %
GLD Gold 13 %
Cash 15 %


Any thoughts ? ( I realize that I am missing intl equities at this point ... )

**Marcopolo

I think that is a less than mediocre portfolio. Perhaps, your 401k offers less than mediocre options.

My 401k has no bearing on yours. But, since you asked, my 401k is 100% OGEAX.

What are you trying to accomplish? You said your NW is $4MM, how much do you need?

"There's no need to continue playing the game if you've already won." -Bill Bernstein

Until recently mine was 70% VTI and 30% EFA. I started putting new contributions in Pimco Total Return Bond fund about a year ago. I recently sold all the VTI and have that in cash until I decide where to put it. The ETFs I can buy are very limited.

I am targeting a higher bond proportion because I am closer to retirement. At retirement I intend to have an overall allocation of 60% stocks and 40% bonds at retirement so part of my recent sales were driven by gradually shifting toward that goal.

I am trying to put together a 401K portfolio that grows with returns and with my continued contributions . The platform that I have for the 401K is Schwab , so I am trying to use no-load Schwab mutual funds to emulate other funds that I like that come with fees.

So, you put your entire 401K portfolio in the SP500 index , huh ? How old are you ? I guess your point of that strategy is pure growth - correct ?

My net worth is mostly in real estate - trees and squirrels where there is more risk than I would like in converting that to assets you can derive your retirement income from .
In fact it is a drain , and I am trying to sell it intelligently . Mostly commercial real estate in North Carolina / Durham / Chapel Hill area .

**Marcopolo

I have 100% of my 401(k) invested in in Schwab Managed Retirement Trust Fund 2040. (I have a separate Roth IRA and separate taxable investment accounts, which are in different funds.) I suppose I am guestimating retirement around 2040.

No on all questions except OGEAX being an SP500 index.

Your real question is asking what our asset allocation is, not what we have in our 401k. My 401k represents maybe 2-3% of my overall assets. My 401k offers piss poor investment options. I choose the "least bad" of them and use the rest of my portfolio to make up the rest of my AA.

Since you will probably ask, I use Bernstein's "coward's" portfolio. I have a slightly heavier tilt towards international funds. I also have some longer duration bond funds as well.

Again, this has no bearing on what you should do. If you have $4MM (I assume to be value if liquidated today), how much more do you need? Have you calculated what your income needs will be in retirement? It's fine if you want to continue working, but if your current stock pile can offer you security through retirement, why put it at risk? Unless you want to be like Scrooge McDuck and swim in your money. But, taking too much risk may leave you "loosing" the game when you may have already "won".

I think you're just fishing for information.

On March 4, 2012

On September 22, 2012

On November 4, 2012


So tell me, is your current real estate currently held in a solo 401(k)? If not, you're going to have a hard time transferring the value of your assets to a 401(k). After all, the gains from the sale of assets not held in a 401(k) would be considered capital gains, not income. So that money, if not already held in a 401(k), would not be transferable to one.

I know the following from your past posts:

• You manage 5 houses in your Dad's estate.
• You're based on the Monterey Peninsula, in California
• But you own $4M in commercial real estate in NC
• You're an MBA in Finance from NYU
• You make $134K, saving 40-50% of your gross with 6% matching,with about another $12K in business income that is likely to grow to $60K in the next couple of years
• The reason you can do this is because your living in the "family homestead " relatively rent free , paying for property taxes and upkeep on an old property
• You've lost too much of your net worth in a Ponzi scheme
• You have a consultant assigned to your account at Schwab named Joe
• On your ETF index stocks and mutual funds , you made a return of 8%-10 %; on your stocks you lost money. You lost the gains that I had in the index and mutual funds. This 401K has a value of about $25K
• You're considered rolling part of your 401(K) to Lending Club
• You're 55 years old, with a projected 12 years left to grow your portfolio

Well, I know that your 401(k) isn't where your real estate holdings are, since you have an employer with matching. You must be a wizard with time, since you manage your Dad's houses, have a job with a 401(k), your own growing business and yet have also managed to amass $4M in NC commercial real estate.

You have a fascinating story but it's very hard to keep track of it. Would you like to summarize your financial picture so we know what we're dealing with?

So you have a net worth more than most of us and you have an MBA, but for some reason you think our asset allocations, which bear no relation to your own situation, would be applicable to you. I just don't buy it.

Wow, that's very impressive that you've been able to amass a NW of $4MM. I'm impressed.

Vintek ,

Very impressive assembling of my posts . The "commercial real estate" in NC is one improved commercial property but the rest is in raw land filled with trees and squirrels that just requires property taxes every year . I also manage another shopping center in Arizona for our family company . We have been lucky with that center and have maintained a relatively high occupancy during this recessionary time .

In my Dad's estate , the 5 houses has now turned into 3 , as I have short-sold 2 of them .

85 % of my net worth is not with income producing assets and obviously don't hold any real estate in a 401K - it is all in partnerships with the family . Therefore ,
I am just like most regular guys - trying to have my 401K/IRA/529 investments in the Big Gorilla - stock , bond and mutual fund world - produce a decent return .

The ponzi scheme wiped out most of my retirement funds , and I am rebuilding . At this point , my 401K is $37K , Roth IRA $17K , 529 $9K , Edu $4K -- I have been able to save/invest about $60K this year . (Might get to the average retirement fund of the nation at $70K if I play my cards right )

I am only fishing for ideas on what others have done with their 401K portfolios as I am reviewing my portfolios . I have historically made more money in deeds of trust in real estate which earned a 12 % return month in month out . I find that is not the easiest thing to do with a stock market based portfolio . Over the long haul , my expectations are more in-line with the market at 7-10 % . What I find to be the most difficult situation is having the whole portfolio produce an average return in that 7-10 % range . We have all had that mutual fund that comprises 20 % of our portfolio that earns a 25 % return , but what happens with the rest of the portfolio ? I have found it very difficult to produce that 7-10%
return for the whole portfolio .

Therefore , I was looking for getting some data points as to what others are doing .

I was reviewing my Vangard 529 and found that in the last year I had produced a 12 % return . The way 529's work is they are invested all the time , you specify in which funds and in what proportion each investment will be placed and it automatically buys those funds. Great idea , really .

The 529 was invested in :
26 % Vanguard 500 index
25 % Vanguard Growth index
25.3 % Vanguard Small Cap index
13.39 % Vanguard Total Intl Stock
1.38 % Vanguard Total Bond


Seeing the Vanguard portfolio and some of your posts has made me realize that is fruitful to simplify the portfolio .

Seeing the Schwab Managed 2040 Fund mentioned , I started looking at these and this one looked like a great portfolio , actually . I started looking into target funds more seriously , but my investigation at Schwab today and talking to my broker led to the discussion about balanced funds vs target funds . She likes balanced funds and particularly mentioned Janus Balanced , Vanguard Wellington and said those are great funds for 529's where that is the only fund present . Interesting .

I really do think the balanced fund idea is worthy of some thought .

Anyway , if are others that could share their 401K portfolios , I would appreciate it .


**Marcopolo

LeRainDrop ,

I found that the Schwab Managed Retirement Trust Fund is offered by Schwab Bank , rather than Schwab the broker . Where do you hold this fund ? And what minimums are there , do you know ?

Please advise.

**Marcopolo

me too and when you crack that egg, be sure to report back here.

otherwise, i've found my wants to be very different than reality.

Marcopolo, I hold this fund since the only options in my employer's 401(k) plan are the different target date funds with Schwab ending 2020, 2030, 2040, etc. You are correct that the trustee is Charles Schwab Bank. I log in through schwabplan.com. I do not believe there are any minimums, as I deposit evenly throughout the year in order to hit the max. Here's the fund detail: https://www.schwabplan.com/FundDetail/SM340.pdf. Outside of 401(k), I stick to Vanguard.

Okay. We know more, and that's better.

But what are your objective? Yes, I know how much you want to earn, but that's only a means to an end. Do you enjoy your work and want to do it beyond the 12 years projected? Do you want to live off your retirement savings? Or do you want to leave something behind for the kid(s)?

In short, if you want gains, you have to take risks. That whole reward/risk ratio is really hard to get around.

And as mentioned earlier in my post, liquidation of your real estate assets aren't going to work for a 401(k) because your gains are not considered income. As such, the bulk of your portfolio will have to lie outside of the tax-deferred accounts.

Anyway, figure out your endgame and we can make some suggestions to help you get there.

As for my own asset allocation, it's almost entirely in equities, both US and international, with a slight weighting toward small cap, mid-cap and value in US funds, and a weighting toward emerging markets and value in international funds. My asset allocation is considered high risk by most standards, but I'm fortunate enough to have an income that makes such risk tolerable. I have a few individual stocks, but they're mostly for fun. I win on some; I lose on some. I'm ahead overall on them but I consider that as much luck as anything else. Aside from the house we live in, we also have 2 houses which are rental properties.

Vintek ,

I feel like I will be working for a long time . The problem with most of my assets is that I don't have control of them , and can't just sell the land . There are restrictions on selling some of those parcels , as we sell a parcel like we are doing now to a multi-family developer and there is a provision that we can't sell any other of our land until he has a co on the 75th percentile unit for 18 months . Well , to give you an example , it may take another 3 months to close the transaction , and then he will get started with his plans, his investors . Who knows when he will break ground , and 18 months after probably at least a year , then we can look at selling some more land . We need to get a majority vote at the Board level and then go out to the stockholders and have a majority of shares of the managing partner to vote to sell the land . So, I have other Board members who like to think about developing property wo actually doing it , which is a difficult situation . And then there are 3 generations involved , 2 generations active , 1 generation limited .

So, I understand risk/reward . And my retirement income will come from my deferred accounts, my share of the income from these commercial properties , other income producing properties I put together by the time I retire , social security , inherited estate income . And yes, I enjoy what I do , but it is a real challenge working with family .

So, come off the pocket , pls give me a nugget of one of your tax deferred account portfolios with fund names . Just one representative portfolio of the vintek portfolios .

What do you say ?

I like the fact that you have two investment properties , BTW .

**Marcopolo