WiscDocParticipantStatus: PhysicianPosts: 11Joined: 07/04/2019
Our group switched to a High Deductible HSA this year and I have $4500 to invest within it. I have switched to managing my own finances in the last year and have my 401k and Roth IRA’s split on an 80:20 stock bond ratio. I recently switched my 401k to Vanguard accounts and also have our Roth IRA’s in Vanguard. In those accounts I have it all in vanguard total stock, total international stock and total bond funds (About 220K total). I like the simplicity of a 3 fund portfolio and feel like I am less likely to make mistakes if I keep things simple and not try to tilt to a more elaborate portfolio.
My issue as a newbie is that the HSA (Health Equity) doesn’t offer any of these 3 funds. They all, however, are Vanguard index funds. I realize this is a very small percentage of my portfolio, but I’m a little lost as to how to allocate that portion within the HSA. I don’t really have a small or value tilt in mind, and we already own some real estate near our home that I consider to be an investment. From what I’ve read you want your most aggressive funds to be in the HSA because of the tax breaks so I could pick a small value fund I suppose but then wouldn’t I be tilting my portfolio to small funds? If I wanted to mimic my above 3 fund portfolio should I pick small/medium/large funds and split into thirds? Maybe I am overthinking this but I would love some advice from you more sophisticated investors.
I listed the available stock funds below and excluded the bond and real estate funds. (I’m also getting used to the acronyms so if it is easier for me to just list out the names I can do that also)
VSIAX, VTTSX, VTWNX, VWIAX, VFORX, VTINX, VEMPX, VTAPX, VIIX, VEMIX, VTHRX, VMIAX, VMVAX, VIVFX, VVIAX
WiscDocJuly 21, 2019 at 4:11 pm MST #232427ENT DocParticipantStatus: PhysicianPosts: 3500Joined: 01/14/2017
These are the only ones I’d mess with:
VTTSX – Target 2060
VWIAX – Wellesley Income
VEMPX – Extended market
VEMIX – Emerging Market
VMVAX – Mid Cap Value
VVIAX – Value Index
Specifically, you could do 80% in an international index elsewhere and fill the remainder of the total international with the VEMIX in your HSA. Same with the extended market and large cap elsewhere. Target 2060 might fit your needs too and have the glide path you’re looking for.GParticipantStatus: Physician, Small Business OwnerPosts: 1799Joined: 01/08/2016
The target date would be simple option if you want to stay balanced.
I am 100% vtsax since I want to use it decades from now and have the luxury of cash flowing current expenses.triadParticipantStatus: Dentist, Small Business OwnerPosts: 272Joined: 04/29/2016
Vanguard Institutional Index Fund Institutional Plus Shares (VIIIX) – this is SP500
Vanguard Total Bond Market Index Fund Institutional Plus Shares (VBMPX) – this is bnd
Vanguard Total International Stock Index Fund Institutional Plus Shares (VTPSX) – this is vxus
edit:these are all great choices. they have lower expense ratios then the admiral funds you use currently. I might have to looking into swtiching to this HSA…July 21, 2019 at 6:35 pm MST #232455