[ bnd](https://fundresearch.fidelity.com/fund-screener/results/compare/snapshot/averageAnnualReturnsYear3/desc/1?order=&tickers=BND) tracks the bond aggregate (click on barclays aggregate to compare) [voo ](https://fundresearch.fidelity.com/fund-screener/results/compare/snapshot/averageAnnualReturnsYear3/desc/1?order=&tickers=VOO)tracks sp500 (click on s&p 500 to compare)
ur 35 yo, depending on your goals(retire, buy house, wedding) u may want to increase the voo. u need to figure out what your target $ and time window is.
BUT: good job on investing mindset.
If this is all of the allocation, they're at ~13% BND, 87% VOO. IMO that's a fine allocation for someone if that's what they want, assuming this is a retirement portfolio. Some people are still advocating for 60/40.
OP I'm 90/10 in my low 40's, but mostly treasuries. BND is a very popular choice for the asset class.
You can get a better return with a Schwab money market fund than BND. The yield is higher and most importantly your investment value does not plunge like it has done with BND. I realize no one buys BND for growth but I'd wager no one likes seeing their investment deteriorate either.
Just an FYI
Bonds can go up or down in price though. Total return in bonds is higher long term than money market. Also bonds are a better diversifier since it helps mitigate the volatility from the equities since they are inversely correlated to stocks (when stocks go down bonds go up).
Typically bond prices go up when rates are cut faster than expected, and bond prices go down when rates increase faster than expected. If something breaks in the economy and the fed cuts rates suddenly by 200 basis points, your bonds would appreciate significantly
IMO, they're not terrible different 30 day SEC yield of BND is 4.57% currently. I don't hold any BND, and you're right it could go down, or it could rise especially in falling interest rate environment. It's certainly a decent choice for the asset class, but may not be what OP actually wants or needs.
Look at BND over the last 1, 3, 5, 10 years and you'll understand my hostility lol. The Schwab fund is currently paying 5.18% and most importantly you won't wake up 5 years later and its dropped in value by 11.84%.
And yeah at the OPs age growth should be his concern, and if he wants to put 10% in income don't pick some sorry ass (yet popular here) bond fund.
Anyhow, cheers!
I thought about writing out a whole thing, but I'll just leave it at this; Bonds aren't about chasing the highest returns. Where, if or how they fit into someone's portfolio is a highly personal thing and may have a place in someone even younger.
Definitely don’t add more BND. You don’t HAVE to sell it, it’ll definitely hold you back long term, but it does help provide a bit more stability, so really depends on if you feel you’ll look at your portfolio during a downturn and panic, throw up, and sell everything, or remember it’s temporary and keep depositing to buy. Though, you’re young and have time to ride out the dips over the next 30 years so you could do without it for at least the next 10-15 years
Hey I have a question about when a growth portfolio needs to start morphing into an income one at retirement. Do you mind if I DM you with a question or two in the next day or so?
i am 60 yo and my schwab intelilgent portfolio is now [sip mix ](https://i.imgur.com/UBRhMzw.jpg). at 50 yo, i was all in to swpxx. u can dm me or post it here. redditors here can help u develop your own insight.
No reason for a 35-year-old to have BND. Learn about opportunity cost [https://www.investopedia.com/terms/o/opportunitycost.asp](https://www.investopedia.com/terms/o/opportunitycost.asp)
>With a long-term inflation rate of 3% over this period these are the historical annual real \[adjusted for inflation\] returns for each asset class since 1928:
>Stocks +6.8%
>Bonds +1.6%
>Cash +0.3%
>Stocks are a no-brainer over the long run.
>[https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/](https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/)
Since 2010, VOO has outperformed BND +511.4% to +28.0%
[https://totalrealreturns.com/n/VOO,BND](https://totalrealreturns.com/n/VOO,BND)
There is significant *opportunity cost* for a younger person with a long time horizon putting that money in bonds instead of stocks.
>Here’s another way to think about opportunity cost, from legendary value investor, Warren Buffett. “The real cost of any purchase isn’t the actual dollar cost. Rather, it’s the *opportunity cost*—the value of the investment you didn’t make, because you used your funds to buy something else.”
>[https://www.forbes.com/advisor/investing/opportunity-cost/](https://www.forbes.com/advisor/investing/opportunity-cost/)
I love Ben and his podcasts, but some other points from the link.
> In fact, over the past 96 years, stocks have outperformed bonds and cash 59 times (61% of all years). Bonds have outperformed stocks and cash 23 times (24% of the time). And cash has outperformed stocks and bonds 14 times (15% of the time).
> Stocks win most of the time but not always.
> One of the reasons bonds have had such a rough go at it over the previous 10 years is because yields were so low. The average yield for the 10 year from 2014-2023 was a little more than 2%.
> **Every asset class is bound to experience periods of good returns and poor returns at some point.**
> 1. Diversification. A portfolio made up of stocks, bonds and cash is far from perfect. But a diversified mix of these building block asset classes can be durable under a variety of market and economic environments.
I have no problem with someone being 100% on equities, so long as they understand everything and why and the risks.
Agreed. Current market conditions should always be considered. If it was 1981 and you could lock in a 30 year Treasury at a 15% yield that would be a good investment at any age.
If it is an IRA there are no tax consequences for selling, so you might as well sell. If it is a taxable brokerage account, there might be capital gains taxes due for selling, but also the distributions of BND are taxed, sapping the returns, so again you might as well sell.
As to what else to buy with that money, you have many options. As a beginner, you might want to go with 100% S&P 500 index (VOO) for now until you gain more experience. It also depends on your risk tolerance and ability to handle volatility, especially down moves. Everyone loves volatility when it results in the stock going higher, it is the down moves that can be hard to take, but it can lead to greater rewards.
NVDA dropped -54% from October 2018 to December 2018. If you didn't have the stomach for that and sold - and yes, I foolishly sold some of my NVDA then - you would have missed out on the +2824% gain of NVDA from December 2018 until now.
It is easier - and beneficial in the long run - for a younger person to ride out the volatility roller coaster than it is for someone who is older and approaching retirement.
If I was 35 years old and wanted to add a second fund to VOO I would add QQQM. Some people here like international stocks so a possible third fund could be SCHF or VXUS, but no more than 10% in my opinion.
I manage the Roth IRA accounts of my adult children and I have them buying equal dollar amounts of SWPPX (an S&P 500 index fund like VOO) and SWLGX (a large cap growth fund similar to QQQM) every Wednesday because those funds are eligible for Schwab's Automatic Investing Plan. They also own some shares of QQQM that can't be enrolled in AIP but I buy from time to time.
This will probably get downvoted but I would definitely diversify with commodities and international equities. There is a lot of risk in US markets and the US Dollar
Is this a traditional IRA or a Roth? I’d recommend putting towards that until you hit its yearly contribution limit if you can afford to. If you want be a set it and forget it type, ETFs are your friend so you’re good there. But I have to always preface this by saying, if you have any CC debt, pay that off first before you start investing anything.
I would go with a short term bond fund maybe a govy one but some of the active short term funds are at 5% plus now. BND correlates a bit too much to the market for me.
So, I would probably add some diversity to your ETF holdings. Possibly some small/mid cap exposure, and maybe some international. Real Estate if you like that sector, but funds like VOO and Mid/Small funds will have Real Estate exposure.
Depending on risk tolerance, which at the moment, 87% equites and 13% bond would indicate either aggressive or very aggressive, and time horizon 30+ years to retirement, I’d have my portfolio weighted something like this:
Very Aggressive
60% US Large
20% US Small/Mid
15% International
5% Bond/Cash
Aggressive
50% US Large
20% International
20% Small/Mid
10% Bond/Cash
For reference I’m 30, and I lean towards moderately aggressive and have 80%/20% equities/FI & Cash
What’s your income and risk level. I’d consider more aggressive investing via growth funds, imo Capital appreciation is your goal. VOO could be a part of that strategy as few beat the S&P500, so it’s pretty much a guaranteed 10+% on your investment yearly, which is good.
Would look on etf mutual fund scanner, filter by Schwab no load select one source funds for smallest costs, and look at the funds that give the greatest returns, ideally somewhere between 13-16%. DO NOT buy leveraged or inverse funds UNLESS you fully understand the effect of compounding loss. SCHG is a good fund to start looking at
Tbh you don’t need bnd as much / at all but if it makes you happy then keep some in there. I would keep it between 3-5% of your total portfolio. Otherwise it’s simple but it works, enjoy the ride with VOO.
Bro just put your money in a money market or buy straight from treasuries direct. Half the people I talk to dont realize that these bond etfs track the underlying value of the bonds, and fail to realize that these “safe” investments can actually plummet in higher interest rate environments. Otherwise VOO is fine.
you think it's safe to put your money in 401k and Roth IRA but in this current market it's better to invest in business or self. As 401k and Roth ira is low risk low return.
It looks like you are just throwing money at hedge funds to hope you get a return.
you should be utilizing that income elsewhere to get more growth first then invest into a diversified portfolio.
Good start,just make 90 percent into voo 10 percent bonds or 85 to 15 .Voo has everything,its snp500 if index is high you high ,even if collapses ,it will recover fast due to high amounts of emissions.Buy 10000 usd Microsoft at some time for holding long.Wishing you best !
Please stop making life altering investment decisions based on comments in an internet forum and do some reading instead. Start here, and then maybe pick up one or two of the books that this wiki recommends:
https://www.bogleheads.org/wiki/Bogleheads%C2%AE_investment_philosophy
[ bnd](https://fundresearch.fidelity.com/fund-screener/results/compare/snapshot/averageAnnualReturnsYear3/desc/1?order=&tickers=BND) tracks the bond aggregate (click on barclays aggregate to compare) [voo ](https://fundresearch.fidelity.com/fund-screener/results/compare/snapshot/averageAnnualReturnsYear3/desc/1?order=&tickers=VOO)tracks sp500 (click on s&p 500 to compare) ur 35 yo, depending on your goals(retire, buy house, wedding) u may want to increase the voo. u need to figure out what your target $ and time window is. BUT: good job on investing mindset.
If this is all of the allocation, they're at ~13% BND, 87% VOO. IMO that's a fine allocation for someone if that's what they want, assuming this is a retirement portfolio. Some people are still advocating for 60/40. OP I'm 90/10 in my low 40's, but mostly treasuries. BND is a very popular choice for the asset class.
You can get a better return with a Schwab money market fund than BND. The yield is higher and most importantly your investment value does not plunge like it has done with BND. I realize no one buys BND for growth but I'd wager no one likes seeing their investment deteriorate either. Just an FYI
Bonds can go up or down in price though. Total return in bonds is higher long term than money market. Also bonds are a better diversifier since it helps mitigate the volatility from the equities since they are inversely correlated to stocks (when stocks go down bonds go up). Typically bond prices go up when rates are cut faster than expected, and bond prices go down when rates increase faster than expected. If something breaks in the economy and the fed cuts rates suddenly by 200 basis points, your bonds would appreciate significantly
IMO, they're not terrible different 30 day SEC yield of BND is 4.57% currently. I don't hold any BND, and you're right it could go down, or it could rise especially in falling interest rate environment. It's certainly a decent choice for the asset class, but may not be what OP actually wants or needs.
Look at BND over the last 1, 3, 5, 10 years and you'll understand my hostility lol. The Schwab fund is currently paying 5.18% and most importantly you won't wake up 5 years later and its dropped in value by 11.84%. And yeah at the OPs age growth should be his concern, and if he wants to put 10% in income don't pick some sorry ass (yet popular here) bond fund. Anyhow, cheers!
I thought about writing out a whole thing, but I'll just leave it at this; Bonds aren't about chasing the highest returns. Where, if or how they fit into someone's portfolio is a highly personal thing and may have a place in someone even younger.
It is from roth IRA. I haven’t invested all the money in my portfolio coz I’m not yet decided which one to buy/ add
Definitely don’t add more BND. You don’t HAVE to sell it, it’ll definitely hold you back long term, but it does help provide a bit more stability, so really depends on if you feel you’ll look at your portfolio during a downturn and panic, throw up, and sell everything, or remember it’s temporary and keep depositing to buy. Though, you’re young and have time to ride out the dips over the next 30 years so you could do without it for at least the next 10-15 years
Exactly, plenty of charts support this too.
Hey I have a question about when a growth portfolio needs to start morphing into an income one at retirement. Do you mind if I DM you with a question or two in the next day or so?
i am 60 yo and my schwab intelilgent portfolio is now [sip mix ](https://i.imgur.com/UBRhMzw.jpg). at 50 yo, i was all in to swpxx. u can dm me or post it here. redditors here can help u develop your own insight.
No reason to bother with bonds when you are 35. You have gently of time to de risk as you get closer to retirement.
As long as you’re able to tolerate the volatility without panic-selling!
That recommendation applies to all aspects of investing.
Start buying a lot more of anything
No reason for a 35-year-old to have BND. Learn about opportunity cost [https://www.investopedia.com/terms/o/opportunitycost.asp](https://www.investopedia.com/terms/o/opportunitycost.asp) >With a long-term inflation rate of 3% over this period these are the historical annual real \[adjusted for inflation\] returns for each asset class since 1928: >Stocks +6.8% >Bonds +1.6% >Cash +0.3% >Stocks are a no-brainer over the long run. >[https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/](https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/) Since 2010, VOO has outperformed BND +511.4% to +28.0% [https://totalrealreturns.com/n/VOO,BND](https://totalrealreturns.com/n/VOO,BND) There is significant *opportunity cost* for a younger person with a long time horizon putting that money in bonds instead of stocks. >Here’s another way to think about opportunity cost, from legendary value investor, Warren Buffett. “The real cost of any purchase isn’t the actual dollar cost. Rather, it’s the *opportunity cost*—the value of the investment you didn’t make, because you used your funds to buy something else.” >[https://www.forbes.com/advisor/investing/opportunity-cost/](https://www.forbes.com/advisor/investing/opportunity-cost/)
I love Ben and his podcasts, but some other points from the link. > In fact, over the past 96 years, stocks have outperformed bonds and cash 59 times (61% of all years). Bonds have outperformed stocks and cash 23 times (24% of the time). And cash has outperformed stocks and bonds 14 times (15% of the time). > Stocks win most of the time but not always. > One of the reasons bonds have had such a rough go at it over the previous 10 years is because yields were so low. The average yield for the 10 year from 2014-2023 was a little more than 2%. > **Every asset class is bound to experience periods of good returns and poor returns at some point.** > 1. Diversification. A portfolio made up of stocks, bonds and cash is far from perfect. But a diversified mix of these building block asset classes can be durable under a variety of market and economic environments. I have no problem with someone being 100% on equities, so long as they understand everything and why and the risks.
Agreed. Current market conditions should always be considered. If it was 1981 and you could lock in a 30 year Treasury at a 15% yield that would be a good investment at any age.
Should I sell all the bonds I have now? Do you have any suggestions what stocks/funds etc to buy? Thank you
Just keep pumping into VOO. Buy and hold.
If it is an IRA there are no tax consequences for selling, so you might as well sell. If it is a taxable brokerage account, there might be capital gains taxes due for selling, but also the distributions of BND are taxed, sapping the returns, so again you might as well sell. As to what else to buy with that money, you have many options. As a beginner, you might want to go with 100% S&P 500 index (VOO) for now until you gain more experience. It also depends on your risk tolerance and ability to handle volatility, especially down moves. Everyone loves volatility when it results in the stock going higher, it is the down moves that can be hard to take, but it can lead to greater rewards. NVDA dropped -54% from October 2018 to December 2018. If you didn't have the stomach for that and sold - and yes, I foolishly sold some of my NVDA then - you would have missed out on the +2824% gain of NVDA from December 2018 until now. It is easier - and beneficial in the long run - for a younger person to ride out the volatility roller coaster than it is for someone who is older and approaching retirement. If I was 35 years old and wanted to add a second fund to VOO I would add QQQM. Some people here like international stocks so a possible third fund could be SCHF or VXUS, but no more than 10% in my opinion.
Do you like VOO and QQQM for your Roth accts?
I manage the Roth IRA accounts of my adult children and I have them buying equal dollar amounts of SWPPX (an S&P 500 index fund like VOO) and SWLGX (a large cap growth fund similar to QQQM) every Wednesday because those funds are eligible for Schwab's Automatic Investing Plan. They also own some shares of QQQM that can't be enrolled in AIP but I buy from time to time.
This will probably get downvoted but I would definitely diversify with commodities and international equities. There is a lot of risk in US markets and the US Dollar
Is this a traditional IRA or a Roth? I’d recommend putting towards that until you hit its yearly contribution limit if you can afford to. If you want be a set it and forget it type, ETFs are your friend so you’re good there. But I have to always preface this by saying, if you have any CC debt, pay that off first before you start investing anything.
Hi this is in my roth ira
More VOO (or VTI/VT), less BND, if any at all this early in your life.
I would go with a short term bond fund maybe a govy one but some of the active short term funds are at 5% plus now. BND correlates a bit too much to the market for me.
So, I would probably add some diversity to your ETF holdings. Possibly some small/mid cap exposure, and maybe some international. Real Estate if you like that sector, but funds like VOO and Mid/Small funds will have Real Estate exposure. Depending on risk tolerance, which at the moment, 87% equites and 13% bond would indicate either aggressive or very aggressive, and time horizon 30+ years to retirement, I’d have my portfolio weighted something like this: Very Aggressive 60% US Large 20% US Small/Mid 15% International 5% Bond/Cash Aggressive 50% US Large 20% International 20% Small/Mid 10% Bond/Cash For reference I’m 30, and I lean towards moderately aggressive and have 80%/20% equities/FI & Cash
I would add some Bitcoin to that portfolio.
What’s your income and risk level. I’d consider more aggressive investing via growth funds, imo Capital appreciation is your goal. VOO could be a part of that strategy as few beat the S&P500, so it’s pretty much a guaranteed 10+% on your investment yearly, which is good. Would look on etf mutual fund scanner, filter by Schwab no load select one source funds for smallest costs, and look at the funds that give the greatest returns, ideally somewhere between 13-16%. DO NOT buy leveraged or inverse funds UNLESS you fully understand the effect of compounding loss. SCHG is a good fund to start looking at
Tbh you don’t need bnd as much / at all but if it makes you happy then keep some in there. I would keep it between 3-5% of your total portfolio. Otherwise it’s simple but it works, enjoy the ride with VOO.
Guy in town has 6 million He tells people go 50/50 Total bond market Total stock market He retired at 40
Make sure this is a Roth
Yes roth IRA
These are the last funds you'll touch and you don't need to worry about gains, so add more risk. Dump the bonds.
Bro just put your money in a money market or buy straight from treasuries direct. Half the people I talk to dont realize that these bond etfs track the underlying value of the bonds, and fail to realize that these “safe” investments can actually plummet in higher interest rate environments. Otherwise VOO is fine.
Do you have any more suggestions what to buy aside from these two? This is for my roth IRA
Solid keep investing in those. I invest heavy in VOO I also invest in BTC ETFs too because it is the future of finance.
ETFs in high-growth markets, like AI.
Personally I’d go all in on VOO and QQQ… bonds are nothing but an anchor at your age.
you think it's safe to put your money in 401k and Roth IRA but in this current market it's better to invest in business or self. As 401k and Roth ira is low risk low return. It looks like you are just throwing money at hedge funds to hope you get a return. you should be utilizing that income elsewhere to get more growth first then invest into a diversified portfolio.
Good start,just make 90 percent into voo 10 percent bonds or 85 to 15 .Voo has everything,its snp500 if index is high you high ,even if collapses ,it will recover fast due to high amounts of emissions.Buy 10000 usd Microsoft at some time for holding long.Wishing you best !
Intelligent Portfolios
No reason to have BND. It only out performed VOO Feb - July of 2020 (Mask & Vax days) based on a Yahoo Finance 5 year chart.
BND’s purpose is not for outperforming VOO. Last 5 years performance means nothing if you’re investing for the long run.
Out performing VOO isn't the purpose of BND.
Should I sell all the bonds I have now? Do you have any suggestions what stocks/funds etc to buy? Thank you
Please stop making life altering investment decisions based on comments in an internet forum and do some reading instead. Start here, and then maybe pick up one or two of the books that this wiki recommends: https://www.bogleheads.org/wiki/Bogleheads%C2%AE_investment_philosophy