Hi everyone, after a fair amount of reading and research, I have finally decided to invest some money in the stock market. A little background: I’m 39, a farmer (so land is my primary investment), looking to save for retirement (hopefully in about 20-25 years). I have started with $15,000 and plan to invest an additional $1,000/month going forward. Trying to make up for lost time. I’m hoping some of you with more experience can give me some feedback on my choices. I have decided to go with a mix of mutual funds, etf’s and bonds. Because of some of the minimum purchase costs I don’t have my money distributed amongst these as I would like to yet, but plan to change that in the coming months. Here is where I’ve put my money so far and what percentage of my total investment I want to have in each: VOO - 30% FBGRX - 30% YAFFX - 15% VFIIX - 10% VIMAX -7.5% VDC - 7.5% Again, I’m new at this, so I’d really appreciate any feedback or advice. Thanks!
So.....you have a SP500 Index, 30%, a blue chip growth fund, 30%, a large cap fund, 15%, and a consumer staples fund, 7.5%. I would guess that all the stocks in the funds above are also in the SP500. So you have quadrupled up on many stocks with what appears to be emphasis on the big cap, blue chip, consumer, side of the market. Lots of duplication but probably a pretty safe plan, if that is what you intended. These represent 82.5% of your money. Than you have a mortgage fund, 10% of your money, and a mid cap fund, 7.5% of your money. A reasonable and probably pretty safe plan if your duplication across the four funds is intentional. I would guess that you will probably achieve about the same return, perhaps a bit worse, than the SP500 over time combining the four funds that have duplicate holdings. The MAIN THING is that you are now investing and that is a good thing. I would follow your plan and see how you do for "total return" over the next year and adjust at that time if needed. For simplicity after the first year you might find that simply holding the SP500 Index OR a Total Stock Market Index, plus the mortgage fund, plus the mid cap fund, would get you about the same or a somewhat better return, with more simplicity and less record keeping. So, looks ok to me if the above is your goal. As I said, I would calculate a TOTAL RETURN for your four funds in the first paragraph of my post a year from now and compare your total return to that of the SP500 and the Total Stock Market and see what you think. Your plan should generate a nice return as a long term retirement vehicle. With your plan it will be critical to NOT jump in and out of the market. DO NOT let a correction or even a recession shake you out of the market. Just ride things out for the LONG TERM.
The plan looks good to me. I also share the view that you would probably do a touch better with just VOO but my advice would be to not change your well researched strategy. See what happens. Perhaps that portfolio will prove us wrong. I also have a comment on your investment horizon. 20 years is a long time for saving as aggressive as you are. With a strong investment plan, you should get to a pretty good place in 10 years, or so. One day, you will be extremely happy you started this investment program. Congratulations. You're on the road to success.
Thanks for the replies fellas! I really appreciate it. I like the idea of giving this mix a year to see how it performs before changing things up too much. I’m hoping I didn’t get in the market at a bad time, but I definitely plan on being in for the long haul. Thanks again!
MAIN THING........keep contributing and posting on the threads on this board so we can make it more active. There are a lot of trading threads and boards on this site and that is a good thing. We need to extend that "good thing" to general investing threads to expand the diversity of investing talk on this site. This will benefit ALL.
