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Personal Investments • Portfolio check and advice request.

I will have to give the proposed allocation some study and figure out how to achieve something like that by exchanging or selling some holdings to reallocate the money. The 457 does appear to have an S&P fund: Nationwide S & P 500 Index Fund - Institutional Service Class with .44 expense ratio.
Wow, you were not kidding when you said your 457 has ZERO low-cost funds! Image may be NSFW.
Clik here to view.
:(
I'm not sure I would switch to the Nationwide S&P-500 (0.44%) since it's more expensive than Fidelity Contrafund (0.39%), which is absolutely criminal for a passive index to be more costly than an actively managed fund. Perhaps just scan your 457 fund offerings and find the lowest cost large-cap stock fund (with no bonds and little-to-no int'l stock). So sorry your 457 is so costly... Not sure how long you will be with this employer, but if it will be for 10+ years or more, it might be worth trying to explain the cumulative cost of a 0.5% ER difference to the 457 plan admin and the higher ups, who would all benefit from keeping more of their money for retirement. See How to Campaign for a Better 401k and share with the 457 admin Why Costs Matter So Much! If you're only there for 3 more years, you could transfer the 457 into your existing Rollover Trad IRA after you separate (unless you need to make withdrawals from it before age 59.5).

If one has a $100K current balance and contributes $23K/yr for another 15 years, then an average 6% return with an ER of 0.10% vs 0.60% (just a mere 0.5%) difference is a whopping $36K in added costs! It only gets worse if you: have a higher return (more stocks than bonds), a longer contribution period (worse for young employees), or a bigger balance/contributions (worse for established execs).

FV(6% - 0.10%, 15 years, -$23K, -$100K) = $767.6K
FV(6% - 0.60%, 15 years, -$23K, -$100K) = $731.6K
Delta = $36.0K... that 0.5% ER difference turned into a 4.9% difference in balance after 15 years!
My 457 is also tax deferred as the money contributed is pretax income. So, bond funds should be held in both it and the rollover IRA?
If there's enough room (big enough balance) you could hold all the bonds in the 457 instead of the rollover Trad IRA. The idea of simplifying is to hold all the bonds and international stocks in one account, so that all other accounts can just be a single fund (US stocks). To be tax-efficient, the bonds should only be held in Tax-Deferred (so either the Rollover IRA or the 457, but holding in both if not required adds clutter).
The professionals I've looked into here seem to be more focused on selling products and/or totally managing your investments, neither of which I want.
If you keep reading and asking questions here, you may be able to sort out the salesman posing as advisors from the fiduciaries that will truly act in your best interests. Financial advisors that are compensated by commission or assets under management have a conflict of interest to upsell you on products that generate the biggest commission/fees for themselves. However, by the time you have the knowledge to clearly sort the wolf in sheep's clothing from a trusted advisor, you likely can manage things yourself. If you must pick an advisor, find an advice-only one that charges an hourly rate or flat fee. See the links below.

Jason Zweig's 19 Questions for your Advisor
Rick Ferri
Mark Zoril (of Plan Vision)

Rick's site also has this link: https://adviceonlynetwork.com/#advisors
Recommended by @Sandi_K, a client of Plan Vision: https://www.garrettplanningnetwork.com/ ... n-advisor/

The three-year projection is a dose of reality. Even if we have to retire in 2027, I am hoping to not then have to dip into the retirement funds. For now, I can save more. One option is a Roth for my husband. Since I have fully funded my Roth this year, I have just been socking away extra savings in the HYSA, which is where I have the emergency fund money. Some of that can be invested either in his Roth or a brokerage account. Or should we buy TIPS?
If it's in a new Roth IRA for him, then you'd prefer to hold stock there. If you want to invest it in a Taxable brokerage account that should also be stocks. If you want TIPS, you should buy those in the Rollover Trad IRA, since TIPS are not tax-efficient to hold in a Taxable account. The questions of a stock index fund (probably VTI or VTSAX depending on ETF or mutual fund) should be answered by your AA plan; if you buy stocks, you may need to shift from stocks to bonds in either the Trad IRA or the 457, but if you buy TIPS in Tax-Deferred, you might want to increase stocks in any of your accounts to keep your AA on track.

Statistics: Posted by bonesly — Sun Jul 28, 2024 12:48 pm — Replies 7 — Views 778



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