I am having 401K, HSA, Roth IRA and a brokerage account. Currently I am investing only on individual stocks on my HSA and the brokerage accounts. I have just opened my Roth IRA account. On my 401K, I am investing my money on VITAX, FSKAX and SWPPX.

I have recently been learning about ETFs and I am planning to invest in ETFs going forward, specifically Vanguard S&P500 ETF and Totals bonds ETF in 90%, 10% ratio. Should I follow this approach across all my retirement accounts and the brokerage account? Need some suggestions.

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AutoModerator t1_jebhbc0 wrote on March 30, 2023 at 8:17 PM

#2,499,002

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InteriorAttack t1_jebhm14 wrote on March 30, 2023 at 8:19 PM

#2,499,076

How far are you from retirement? Why are you investing in a brokerage account before maxing your hsa, 401k and roth?

Cruian t1_jebib8w wrote on March 30, 2023 at 8:23 PM

#2,499,273

>On my 401K, I am investing my money on VITAX, FSKAX and SWPPX

Why? FSKAX already fully includes the others.

>specifically Vanguard S&P500 ETF and Totals bonds ETF in 90%, 10% ratio.

Why ignore the US extended market?
Why ignore ex-US?
What made you decide ETFs over mutual funds?

>Should I follow this approach across all my retirement accounts and the brokerage account?

I wouldn't follow it in any account to be honest. Personally, I consider the S&P 500 obsolete for any account where you don't have a short list to pick from (because of bullets 1 & 2).

DharaniA OP t1_jebl246 wrote on March 30, 2023 at 8:41 PM

#2,499,939

Replying to InteriorAttack (#2,499,076)

I am 33 now. I didn't have much idea on the investing when I started initially. I started with a brokerage account. This is what my plan is going to be 1. Match the employer contribution of 401K 2. max out HSA 3. max out Roth IRA.

[deleted] t1_jebpf7y wrote on March 30, 2023 at 9:08 PM

#2,500,944

Replying to DharaniA (#2,499,939)

[deleted]

Powerful-Glove6563 t1_jebs03i wrote on March 30, 2023 at 9:25 PM

#2,501,576

Replying to DharaniA (#2,499,939)

I would make following changes

Max out Roth IRA before hsa ( you can only contribute till you don’t reach limit ) .
Check out investment option in your hsa . Lot of employee hsa don’t have good options and higher fees . Incase of change in insurance plan or employer move it over to company like fidelity
Start increasing your 401k contributions as you save more

Keep in mind this are long term retirement money . It can’t be used for immediate need . Good luck

DharaniA OP t1_jec4qcf wrote on March 30, 2023 at 10:52 PM

#2,504,566

Replying to Powerful-Glove6563 (#2,501,576)

Thank you! Are you referring to the maximum income limit until I can contribute to Roth IRA?

My HSA is with Fidelity.

DharaniA OP t1_jec79wl wrote on March 30, 2023 at 11:11 PM

#2,505,182

Replying to Cruian (#2,499,273)

My 401k fund options are very limited. So I chose the funds I mentioned. I wanted to move to ETFs because of their low expense ratio.

Cruian t1_jecekz9 wrote on March 31, 2023 at 12:04 AM

#2,507,041

Replying to DharaniA (#2,505,182)

>I wanted to move to ETFs because of their low expense ratio.

Low ERs is not exclusive to ETFs. In fact, several Fidelity mutual funds beat the ER of any comparable ETF.

Low ERs is usually far more of an issue of index based vs actively managed. Index mutual funds exist, actively managed ETFs exist.

>My 401k fund options are very limited.

That's usually the case.

>So I chose the funds I mentioned.

You only need FSKAX of those 3.

You should also look into adding at least an ex-US fund somewhere.

DharaniA OP t1_jeclk02 wrote on March 31, 2023 at 12:56 AM

#2,508,892

Replying to Cruian (#2,507,041)

Thank you. Will there be any difference between how ETFs are taxed vs Mutual funds are taxed?

Powerful-Glove6563 t1_jecrwwo wrote on March 31, 2023 at 1:44 AM

#2,510,732

Replying to DharaniA (#2,504,566)

Yes I am

Cruian t1_jecvpp9 wrote on March 31, 2023 at 2:14 AM

#2,511,778

Replying to DharaniA (#2,508,892)

Within tax advantaged accounts, no.

DharaniA OP t1_jecwxui wrote on March 31, 2023 at 2:23 AM

#2,512,135

Replying to Cruian (#2,511,778)

Thanks. I see your point. It makes sense. What is your take on sticking to the same list of index funds (when the expense ratio is zero) across all my retirement accounts?