Why Aren’t You Doing What You Recommend?

[Editor’s Note: Just a reminder that the CityVest deal discussed on the blog last Friday only lasts through the end of the year. If you missed that post, this is basically a chance to get into a private multi-family real estate fund with only a $25K minimum. More details at the blog post link above or this affiliate link. Remember how affiliate links work- if you invest after going through my link I get paid, although it doesn’t cost you any more to go through that link.]

A few months ago Jonathan Clements asked this question on Twitter:

It’s a good question, and one I had previously spent a lot of time thinking about, particularly once a year when I rebalance my parents’ portfolio, which is markedly simpler than my own, especially prior to the simplifications we made in our portfolio a year or two ago.  To give you an idea what I’m talking about, here’s what my parents’ portfolio looks like:

Total Stock Market 30% Total International Stock Market 10% Small Value 5% REIT Index 5% TIPS 20% Intermediate Bond Index 20% Corporate Short Term Bond Index 5% Prime MMF 5%

Eight asset classes, four equity, and four fixed income. It used to be seven until Prime MMF went to a yield of basically 0% for years and we split a 10% allocation to it and put some of it into short-term bonds to chase yield a little.

Meanwhile, ours looks like this:

US Stocks 40% International Stocks 20% Real Estate 20% Bonds 20%

Just kidding. Kind

Keep reading this article on The White Coat Investor.

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