Disclosure: This post contains affiliate links and we may receive a referral fee (at no extra cost to you) if you sign up or purchase products or services mentioned.
Ah, how time flies! In February 2019, I wrote a post called The Breakdown of Our Net Worth Savings & Investments that detailed our investment portfolio at the time.
As you’d expect, it broke down all our assets and liabilities and gave a good snapshot of our financial picture. This was just a couple of months after I had retired from the corporate world so it gave us a pretty good baseline to start our retirement.
But holy schnikes – that was almost four years ago!
Even though everyone’s situation and financial goals are usually vastly different, many readers still want to see numbers on personal finance sites. It helps them to get ideas and provides some motivation if they’re looking to do something similar to what others have done.
That’s also the case here. Readers routinely ask me questions about our numbers and I end up pointing them to that post from way too long ago!
So I thought that I’d take the time today to give you an updated look at our investment portfolio. I also like that the stock market’s really cooled off over the past year so this should give a more “realistic” picture of where we stand.
Disclaimer: I’m not a financial planner. I don’t have a background at all in finance. I’m just some random guy who figured out what works well for himself and his family and I post the stuff on the internet. Don’t consider anything here as advice and consult a professional before getting yourself into something you don’t understand.
There are also so many different ways to invest – all with pros and cons. For instance, my friend Mr. Tako has built his massive investment portfolio based on dividend stocks. It’s really incredible and something cool to realize. You can check out his site at Mr. Tako Escapes.
Just because something works well for one person, doesn’t mean it’ll work best for the next. Your job is to learn and figure out the ideal strategy for yourself. And if this isn’t something you want to learn, then you should focus on hiring a fee-only fiduciary planner to help guide you along the way. NAPFA, Garrett Planning Network, and XY Planning Network are great places to start.
Personal Capital is Still Rocking It!
I want to start by saying that all the numbers you see here are being pulled from my Personal Capital account. If you’re not familiar, Personal Capital is a free online service that lets you link all your financial accounts to it. It then lets you see your complete financial picture so you know exactly how you’re doing.
Not only can you see how your accounts balance each other out (i.e. savings/investments vs debt) but you can drill down to detailed transactions within each account, too. You also get to see the totals for each category as well (cash, investments, credit cards, etc.). I love being able to easily view the asset allocations of my investment portfolio with just a click.
The biggest keys to moving ahead financially are knowing where you stand currently and to also realize where you need to be. Knowing where you are now is a cakewalk after your accounts are all linked.
The real magic though is due to the tools within Personal Capital. These include the Retirement Planner, Withdrawal Planner, Retirement Fee Analyzer, and Investment Checkup – and they’re all great at helping you position yourself where you want to be down the line.
Of all the retirement calculators I’ve tried over the years, I think the Retirement Planner in Personal Capital is my favorite. One reason is that it’s easy since you don’t need to enter much on things to get started with because it already knows where you currently stand financially. The other reason I like it is its flexibility in making a lot of “what if” spinoff scenarios. And, like many good calculators, it runs Monte Carlo simulations (5,000 in Personal Capital!) to give you your projection and success likelihood.
And I’ve talked repeatedly about how Personal Capital’s Retirement Fee Analyzer helped me save over $50,000 in fees over a ten-year period with just a couple of hours’ worth of time. I would have never known about this otherwise… absolutely incredible.
Anyway, if you’re not using Personal Capital for your finances, it’s worth giving it a shot. Considering it’s a free service, it’s hard to go wrong.
You can check our Personal Capital here.
The Balance Sheet Breakdown
I’m going to round some of these numbers in our investment portfolio slightly just for security reasons. What can go wrong with sharing all your personal finance details on the internet, right? 😂 These numbers are current as of December 2022.
First, is the overall balance sheet…
Here’s a breakdown of our investments and cash…
|Investment||Symbol||Total Value||Expense Ratio||% of Account||% of Portfolio|
|Taxable Brokerage Account|
|Allegheny Technologies Inc||ATI||$700.00||0.40%||0.05%|
|Invesco BulletShares 2022 Corp Bond ETF||BSCM||$60,000.00||0.10%||32.98%||4.02%|
|Invesco BulletShares 2023 Corp Bond ETF||BSCN||$30,000.00||0.10%||18.95%||2.31%|
|Invesco BulletShares 2026 Corp Bond ETF||BSCQ||$50,000.00||0.10%||31.54%||3.84%|
|Teledyne Technologies Inc||TDY||$1,000.00||0.74%||0.09%|
|Vanguard Total Stock Market ETF||VTI||$30,000.00||0.03%||14.95%||1.82%|
|Vanguard Federal Money Market Fund||VMFXX||$90.00||0.05%||0.01%|
|Rollover IRA #1|
|Invesco BulletShares 2024 Corp Bond ETF||BSCO||$50,000.00||0.10%||5.39%||3.59%|
|Vanguard REIT ETF||VNQ||$20,000.00||0.12%||2.51%||1.68%|
|Vanguard Total Stock Market ETF||VTI||$900,000.00||0.03%||92.10%||61.42%|
|Rollover IRA #2|
|Invesco BulletShares 2023 Corp Bond ETF||BSCN||$20,000.00||0.10%||100.00%||1.73%|
|Health Savings Account (HSA)|
|Fidelity ZERO Total Market Index Fund||FZROX||$40,000.00||0.00%||100.00%||2.73%|
|Roth IRA #1|
|Invesco BulletShares 2025 Corp Bond ETF||BSCP||$50,000.00||0.10%||27.24%||3.53%|
|Alphabet Inc Class C||GOOG||$4,000.00||2.18%||0.28%|
|Alphabet Inc Class A||GOOGL||$4,000.00||2.17%||0.28%|
|SPDR S&P Dividend ETF||SDY||$4,000.00||0.35%||2.35%||0.30%|
|Vanguard REIT ETF||VNQ||$50,000.00||0.12%||26.91%||3.48%|
|Vanguard Total Stock Market ETF||VTI||$50,000.00||0.03%||28.94%||3.75%|
|Vanguard Federal Money Market Fund||VMFXX||$60.00||0.03%||0.00%|
|Roth IRA #2|
|Walt Disney Co||DIS||$3,000.00||13.90%||0.19%|
|SPDR S&P 500 ETF||SPY||$4,000.00||0.09%||22.95%||0.31%|
|Vanguard REIT ETF||VNQ||$6,000.00||0.12%||30.03%||0.41%|
|Vanguard Total Stock Market ETF||VTI||$6,000.00||0.03%||32.69%||0.44%|
|Vanguard Federal Money Market Fund||VMFXX||$80.00||0.43%||0.01%|
|Roth IRA #3|
|Vanguard Total Stock Market ETF||VTI||$3,000.00||0.03%||99.13%||0.20%|
|Vanguard Federal Money Market Fund||VMFXX||$30.00||0.87%||0.00%|
|Series I Savings Bonds||$20,000.00||100.00%||1.40%|
|Charles Schwab Investor Checking||$3,000.00||27.40%||0.21%|
|Business Checking Accounts||$3,000.00||27.36%||0.21%|
|Cash on Hand||$1,000.00||9.19%||0.07%|
I didn’t list any accounts where Faith is the beneficiary either. The UGMA bank account we have at Ally and the 529 plan we have in place are hers even though they’re still in our name right now. If she wants to do an investment portfolio review of her own, let her run with that one! 😉
The only other asset not included in the above breakdown is our 2012 Honda Pilot. Yes, I consider the car to be an asset on the balance sheet – it’s a depreciating asset but an asset nonetheless. I could sell it tomorrow for cash if I needed to just like anything else. That’s the $13k you saw in the screenshot of our net worth.
And to round out things, we have our liabilities. Because we don’t own a home, we don’t have a mortgage to worry about. We also don’t have any loans. So the only liabilities in our financial picture are our credit card balances… about $3,100 worth as I type this.
Credit cards??? Come on, Jim – you know better than that! Those things have a 16.65% interest rate on ’em!
Easy, tiger – we don’t keep a balance. All of our credit cards are paid off in full every month.
So why use ’em? First of all, since we don’t have a mortgage or any loans, credit card usage is something important to keep our credit scores up. Here are a couple of my current scores shown through Credit Karma (another fantastic free service):
And the second reason we focus on credit card usage is for the travel rewards. Credit cards have paid for us to regularly travel around the world for free or at a very low cost – something we likely couldn’t afford otherwise. If that interests you (it should), check out some of my travel rewards posts:
- The #1 Best Way To Track Credit Card Rewards
- The #1 Easy Way We’re Getting the Southwest Companion Pass
- Our Travel Perks Are Drying Up and That’s Big $$$!
- Free Nights – We’ve Had 5 at Hilton Hotels Recently
- We Got Turned Down for a Credit Card… Ok, Four!
- Travel Rewards – 12 Free Flights Earned in 9 Months!
I’d also recommend using the free service, Travel Freely, to track your credit cards and rewards. The alerts about annual fees coming up, upgrading/downgrading advice, and when it’s time to apply for a new card (and suggestions on which ones) are extremely helpful. For the low cost of $0, this site/app can make taking advantage of credit card travel rewards simple.
The Bucket Strategy
I don’t want to go into this too much because I’ve already laid things out previously in a couple of posts that I’ll link to momentarily. The gist though is that we maintain 3 “buckets” of money in our portfolio:
1) Cash bucket – This is our money for spending over the very short term. In our case, it amounts to one year of expenses that we keep in our online savings account and transfer a monthly “paycheck” to our checking account for our living expenses every month.
2) Income bucket – This is money that earns a little more than the cash bucket, but not as much as the growth bucket. We have a bond ladder of 5 years (soon to be 4 years) invested in BulletShares fixed-income ETFs. The income bucket enables us to not need to sell our equities during a bear market for several years if needed.
3) Growth bucket – The rest of our money is in our growth bucket. This money is invested in equities (mostly VTI) to grow over the long haul. There will be ups and downs over a shorter duration but over the long run, it should continue to grow solidly.
Every year (or staggered throughout each year), money is moved from the growth bucket to refill the income bucket. And money is moved from the income bucket to refill the cash bucket.
There are many ways to implement a bucket strategy. You can read more about our structure in my original post on the subject, The Drawdown on Investments – Our Game Plan, and more recently in Is This Down Stock Market Problematic as an Early Retiree?
But the credit has to go to my friend Fritz for making me even aware of this strategy. His post, How to Build A Retirement Paycheck From Your Investments, is an excellent synopsis of how this works and why you might want to consider utilizing it. Nice job, Fritz!
The reason I wanted to touch on this is so you can understand why you see the various Invesco BulletShares Corporate Bond ETFs in my portfolio. Each of these represents a year’s worth of our expenses to be moved over when they mature to become our spending money for the year. This ladder helps me sleep better at night knowing I don’t need to sell equities to pay for our expenses during a bear market.
I’ve recently decided that 5 years might be a little much on this and with the stock market still not fully recovered, it’s a good time to skip buying any BulletShares this year. That means I won’t have to sell any equities to make it happen. In the future, I’m going to keep this at a rolling 4-year period.
Details on Our Investments
I’m a firm believer in keeping things simple and our portfolio is no different. The majority of our investment portfolio is invested in VTI (the ETF version of VTSAX). VTI/VTSAX are index funds that provide exposure to the entire U.S. stock market.
I’ve found JL Collins’ Stock Series to be a fantastic understanding of how to invest more simply. He took all that information and turned it into a much more polished read in the book, The Simple Path to Wealth, which I recommend to anyone looking to understand a simple and effective way to invest in the stock market.
In a nutshell, we buy the whole U.S. stock market through VTI – we’re looking forward to that providing growth for us for decades to come. You might also notice that we own the Fidelity ZERO Total Market Index Fund (FZROX). That’s because our HSA is held at Fidelity and that gives me another low-cost total stock market fund.
Outside of that, we invest in some bonds (BulletShares Bond ETFs) to help smooth the ride and to be part of our bucket strategy.
Then we have VNQ. When we sold our last rental property in early 2021, I took the proceeds and invested in the Vanguard Real Estate ETF (VNQ). Although owning this doesn’t provide all the benefits of actually owning a physical property, it allows me to continue to have a piece of the real estate market. It does provide more diversification than owning a rental or two and without the headaches that come with being a landlord.
We also bought some Series I Savings Bonds last November and this past January. It was hard to pass up the nice returns being offered. Once the rate becomes less interesting, I’ll keep an eye out for where to move this money next… and keep you in the loop, of course!
And finally, we have a handful of individual stocks in our investment portfolio. These were stocks that we decided to hang onto once we liquidated and moved to index funds. Most of these are our “fun stocks” so to speak… Google (Alphabet), Amazon, and Disney.
I bought 2 shares of Google at about $664/share back in 2007 (it was all I could afford). That’s since split into Class A and Class C shares and then did a 20:1 split this past summer. I’ve had about a 201% return, which is pretty cool.
Amazon was my real win though. I bought 12 shares of Amazon stock in 2008 at $49/share for a total of $588. I sold 2 shares in 2020 before the split at $3,025/share for a total of $6,050! My remaining 200 shares (after the split) are currently worth a crazy $20,000 right now!
But here’s the deal – even though that’s a little fun, I was thinking the other day about VTI being a cap-weighted index fund. That means that the index fund holds percentages based on the stock’s total market capitalization.
In essence, I already own a ridiculous amount of both Google and Amazon within VTI since they’re such powerhouses. According to Katie Donegan’s chart showing the VTSAX breakdown (which is identical to VTI), Amazon makes up 2.46% and Google (Alphabet) makes up 3.31%.
So outside of the individual stocks I own of these, I’m carrying a lot of ownership of these companies through VTI. Why??? It’s not like they’re dividend stocks giving me something different to think about. So, I’m going to be selling these shortly and rolling the money right into VTI. I’ll likely do the same with the straggling few shares of ATI, FE, and TDY, too, just to clean up the portfolio.
Asset Allocations and Sectors
As I mentioned earlier, it’s nice that Personal Capital does the hard work for you to let you instantly see where you stand on asset allocation. Here’s where we’re at on that…
Something very important to do for your portfolio is to rebalance it periodically (maybe once or twice a year). This can help minimize risk.
I discuss rebalancing, why it’s important, and how I do it in my post, Portfolio Rebalancing: Get Your Asset Allocation in Line. If you’d like a copy of the spreadsheet I created and use for my own rebalancing, sign up for my email list and I’ll send you a copy (you can unsubscribe at any time):
My comfort level of risk is to be around 70% invested in equities. You can see by the chart above that I’m at 70.74% (U.S. plus international stocks)… that’s close enough to perfect for me!
Here is what the breakout on our market caps looks like for our U.S. stocks:
And here are the sectors contained within our investment portfolio:
Here’s the thing though… I don’t really care much about tracking the sectors I’m invested in. The reason goes back to VTI being a cap-weighted index. The strongest sectors are going to carry the most weight and be the largest portion of my portfolio automatically. As time goes on and other sectors become stronger, the index fund will adjust accordingly.
So right now, technology is over 23% of my portfolio, but at one point, the energy sector would have been at the top. Things change and VTI will automatically adjust with no intervention needed.
There you have it, folks – this is how our investment portfolio is looking lately. I’m sure it’s not the perfect portfolio but it does the job well for us. As time changes, I’m sure there will be some adjustments (like the couple that I mentioned throughout), but I do feel good about the current structure overall.
Plan well, take action, and live your best life!
Thanks for reading!!