The EASY 3 Fund Portfolio... Do you have or are working on building a 3 fund portfolio? - Enjoy! 🏆 M1 Finance (Get $100 when you deposit $5,000): m1.finance/QWPVWLf7Gmc7 📊 3 Fund Portfolio Guide: docs.google.com/spreadsheets/d/1itHvZD0-OSwORTK7KDC4HOxwtGuf9s6uJtfkon4D8A8/edit?usp=sharing 🌐 Money Talk Hub: discord.gg/gNyNW6fKUm 🔑 Join The Patreon Community: www.patreon.com/dannysully Any requested videos, please let me know in the comments below!
I've been investing for 30 years, and EVERY time I veered away from index funds, I regretted it. Every time I think I'm picking a winner stock, it turns into a loser. I have now learned my lesson the hard way. I stick to low-cost, low-fee index funds. John Bogle was a saint.
I’ve been binge watching dozens of videos like this one the last few days. I just turned 30 and I have never even thought about retirement until now. No one in my family has ever paid into retirement either. For some reason I always thought investing was just a game of luck that most people lose. I can’t believe how ignorant I’ve been. This morning I opened a Roth IRA with Fidelity and put $100 in it. Tonight I bought $100 worth of FXAIX. It’s just one tiny step of many to come. Content creators like you and many others are teaching me so many things I never knew. I appreciate all the informative videos.
Thank you for your insight and kind words. I also at one point did not believe in the long term index fund investing approach because I preferred to be aggressive and outbeat the market. Truth is, for 99% of people that is unlikely to ever happen the way you'd think. I'm glad you benefit from this content and many others out there and will do my best to continue making content I believe can truly help! Definitely in the right direction and I love to see that! Thanks again!
The key is to actually invest. So many know they should but don’t. Great channel and easy to understand information. Maybe more vlogs showing people tips and trips on how to use Fidelity. Will have the most views long term as people enjoy tutorials when they’re getting started on something.
That is a great point, many know but don’t take action. Action and discipline toward investing is key to building the success. Thank you for your input and kind words!💪 and I agree, definitely working for the long term highest quality content that impact people.
Doing 50:30:20 based on your 3 ETF portfolio. VOO50%, (Soxq, Schg, qqqm each 10%), and lastly (schd, dgro each 10%) Also have a separate account that just has Schd for 50K and the final account that only holds AI and Cybersecurity including VGT Etfs for 50K Tradional IRA follows my regular brokerage account allocations.
All solid options, thank you for your insight on this! The only thing I am curious about is your Traditional IRA decision over a Roth. I'll leave a video to the research I have done on this if you are interested! Traditional vs Roth IRA: czcams.com/video/zCTHuIwKEO4/video.htmlsi=3tDrC5WbpC5dphti
A couple of things to add here: 1. Do not buy Fidelity Zero funds in a taxable account (they are proprietary so are not portable), and 2. Many Vanguard index mutual funds (such as VTSAX, VTIAX, VBTLX) that are used in a 3-fund portfolio are just as tax-efficient as the corresponding ETF (VTI, VXUS, BND).
hi danny, i’ve been watching all ur videos and was wondering if you had any resources for how to tell if an investment is tax efficient or inefficient, or if you could make a video on it in the future? for example, i recall you said that you invest in ETFs in your taxable accounts, and i’d like to know how you determine that ETFs are tax efficient (and how other investments are tax efficient or inefficient). thanks!
Hey Amelia, so the reason is the structure behind each. Any ETF is structured to be more tax efficient. I believe I’ve covered this in a previous video but I can look for other resources to send you as well when I get the chance!
Hey! Thank you so much for your kind words! And of course, below is the link and I'll also place it in the description of this video. www.etfrc.com/funds/overlap.php
There definitely is overlap between them but the main constraint is how much small and mid cap exposure you want. My other portfolios have separate funds for each segment because I want to track and allocate how I want for them.
Rather than sell out of the higher positions, if you will make more contributions, just only contribute to the presently underrepresented funds until you restore your desired distribution. That being said, these are way too bond heavy
Correct that is another approach to take, thank you for your input. And the scenarios discussed were just examples to show the performance they would have achieved historically. It also depends on peoples own positions in life. Someone retired would be more bonds than someone in their 20s.
This is a simple portfolio that historically has proven to achieve great results. It is does not guarantee future results but is very easy. Personally, I also have a select share of stocks and other investments as well since I spend time researching and developing portfolios.
If you purchase index stocks like Fidelity500, when you contribute after the initial contribution does the money just automatically go towards those investments, when you pay into your Roth account? Considering a Roth IRA account, not sure how it works.
Money would only auto invest if you set that up specifically. I have made a video that includes that if you are interested I can direct you to it. But with Fidelity you can do auto investments and recurring transfers from your bank account that could do everything automatically for you!
Fidelity displays percentages to you for how much you own of each. If you take this approach I would recommend planning out ahead of any purchasing since you will have to manually set it up and rebalance. Does that cover your question?
Also there is a free 3 fund portfolio guide I have linked in the description of this video that you may also find valuable. Let me know if I can help you with anything! :)
2:47 - am I misunderstanding this? You say "you can match the market returns" and then contrast this with most "pros" who lose to the S&P500, then conclude that therefore you will be beating most of those pros. But the market you're matching isn't the S&P500 - as the source in the video states, you're matching the OVERALL market (domestic, international, and bond), which doesn't necessarily match the S&P500 - and in years when the S&P500 fund is performing better than the total market, you, too, would lose compared to the S&P500. And I think that's okay - I use a 3 fund portfolio because the diversification reduces my risk at the cost of lower returns compared with the S&P500. But I think the claim you're making is a little misleading - if you want to match the S&P500's returns, you would probably want to use a 1 fund portfolio! But curious what your thoughts are about this.
Hey there, you mention a great point here and thanks for pointing it out. The overall market returns can be referred to as many different things so it can misleading. For example, it could be just the total us stock market, sp500, or domestic international and bonds combined, etc. For this video, a 3 fund portfolio is not the same as just a 1 fund portfolio (sp500 that i compared to with at that time), so you are correct with that. The purpose was to demonstrate how simple index fund investing can beat majority of the pros. So yes you are correct, saying a 3 fund portfolio is not the same to compare to an sp500 that I used as my source at 2:47. I will say, this portfolio still came out to show a great historical performance and I would still bet on it beating pros, active investors, etc. Not a financial advisor, do your own research, but thank you for pointing this out. I appreciate you paying close attention to the details, I will improve on this going forward!
The EASY 3 Fund Portfolio... Do you have or are working on building a 3 fund portfolio? - Enjoy!
🏆 M1 Finance (Get $100 when you deposit $5,000): m1.finance/QWPVWLf7Gmc7
📊 3 Fund Portfolio Guide: docs.google.com/spreadsheets/d/1itHvZD0-OSwORTK7KDC4HOxwtGuf9s6uJtfkon4D8A8/edit?usp=sharing
🌐 Money Talk Hub: discord.gg/gNyNW6fKUm
🔑 Join The Patreon Community: www.patreon.com/dannysully
Any requested videos, please let me know in the comments below!
I've been investing for 30 years, and EVERY time I veered away from index funds, I regretted it. Every time I think I'm picking a winner stock, it turns into a loser. I have now learned my lesson the hard way. I stick to low-cost, low-fee index funds. John Bogle was a saint.
Thank you for your input on this. I completely agree based off of my experiences as well. I hope many unaware see your comment and learn from this!
I’ve been binge watching dozens of videos like this one the last few days. I just turned 30 and I have never even thought about retirement until now. No one in my family has ever paid into retirement either. For some reason I always thought investing was just a game of luck that most people lose. I can’t believe how ignorant I’ve been. This morning I opened a Roth IRA with Fidelity and put $100 in it. Tonight I bought $100 worth of FXAIX. It’s just one tiny step of many to come. Content creators like you and many others are teaching me so many things I never knew. I appreciate all the informative videos.
Thank you for your insight and kind words. I also at one point did not believe in the long term index fund investing approach because I preferred to be aggressive and outbeat the market. Truth is, for 99% of people that is unlikely to ever happen the way you'd think. I'm glad you benefit from this content and many others out there and will do my best to continue making content I believe can truly help! Definitely in the right direction and I love to see that! Thanks again!
The amount that the "small" fees cost you over time is crazy! Great video!
Right! And thank you!👌
The key is to actually invest. So many know they should but don’t. Great channel and easy to understand information. Maybe more vlogs showing people tips and trips on how to use Fidelity. Will have the most views long term as people enjoy tutorials when they’re getting started on something.
That is a great point, many know but don’t take action. Action and discipline toward investing is key to building the success. Thank you for your input and kind words!💪 and I agree, definitely working for the long term highest quality content that impact people.
Doing 50:30:20 based on your 3 ETF portfolio. VOO50%, (Soxq, Schg, qqqm each 10%), and lastly (schd, dgro each 10%)
Also have a separate account that just has Schd for 50K and the final account that only holds AI and Cybersecurity including VGT Etfs for 50K
Tradional IRA follows my regular brokerage account allocations.
All solid options, thank you for your insight on this! The only thing I am curious about is your Traditional IRA decision over a Roth. I'll leave a video to the research I have done on this if you are interested!
Traditional vs Roth IRA: czcams.com/video/zCTHuIwKEO4/video.htmlsi=3tDrC5WbpC5dphti
I was watching some of your videos earlier and now im back for more. Ive opened a Roth IRA account. I think I love you.
That’s awesome!! I’m happy to hear you’re learning and getting started! And I appreciate your kind words :)
Total USA = growth = qqqm,vgt,xlk
Total international = foundation = spmo,dgrw,vig
Total bond = dividend/income = svol,Schd,jepq,fdvv,dgro,divo,vym
A couple of things to add here: 1. Do not buy Fidelity Zero funds in a taxable account (they are proprietary so are not portable), and 2. Many Vanguard index mutual funds (such as VTSAX, VTIAX, VBTLX) that are used in a 3-fund portfolio are just as tax-efficient as the corresponding ETF (VTI, VXUS, BND).
Correct, I have covered that in my other videos but good input. Thank you.
Great video, sir
Thank you!
Si, Senior! I real clicked! 😄👍
Thank you :)
Wow wish Fidelity offered similar tools as Vanguard seems more simplified to balance your portfolio.
Right! It’s amazing how easy M1 finance makes it. I initially didn’t want to join but I’m happy with the platform.
hi danny, i’ve been watching all ur videos and was wondering if you had any resources for how to tell if an investment is tax efficient or inefficient, or if you could make a video on it in the future? for example, i recall you said that you invest in ETFs in your taxable accounts, and i’d like to know how you determine that ETFs are tax efficient (and how other investments are tax efficient or inefficient). thanks!
Hey Amelia, so the reason is the structure behind each. Any ETF is structured to be more tax efficient. I believe I’ve covered this in a previous video but I can look for other resources to send you as well when I get the chance!
Hi there Danny! Love your videos! Can you please provide the link to the overlapping tool you used in this video? Thanks!
Hey! Thank you so much for your kind words! And of course, below is the link and I'll also place it in the description of this video.
www.etfrc.com/funds/overlap.php
Thanks!
@@DannySully
Can you also do a 2 fund portfolio vid?
Yes I can work on that!
Great video! Can you do a review of a two-fund portfolio??
Yes! Great idea I will start working on this soon, thank you!
I'm using Vanguard for this tax year, portfolio is down atm but I'm not concerned.
Cheers, new subscriber.👍
Vanguard is a great option, stay disciplined to your plan! And thank you for subscribing! :)
What's your net worth?
Does owing FXAIX and FSKAX create overlap one wouldn’t benefit much from?
There definitely is overlap between them but the main constraint is how much small and mid cap exposure you want. My other portfolios have separate funds for each segment because I want to track and allocate how I want for them.
Rather than sell out of the higher positions, if you will make more contributions, just only contribute to the presently underrepresented funds until you restore your desired distribution.
That being said, these are way too bond heavy
Correct that is another approach to take, thank you for your input. And the scenarios discussed were just examples to show the performance they would have achieved historically. It also depends on peoples own positions in life. Someone retired would be more bonds than someone in their 20s.
So is it okay to just have S&P, international fund, and bond fund and that be the only three funds you invest in for life?
This is a simple portfolio that historically has proven to achieve great results. It is does not guarantee future results but is very easy. Personally, I also have a select share of stocks and other investments as well since I spend time researching and developing portfolios.
If you purchase index stocks like Fidelity500, when you contribute after the initial contribution does the money just automatically go towards those investments, when you pay into your Roth account? Considering a Roth IRA account, not sure how it works.
Money would only auto invest if you set that up specifically. I have made a video that includes that if you are interested I can direct you to it. But with Fidelity you can do auto investments and recurring transfers from your bank account that could do everything automatically for you!
Any idea how to allocate a % on fidelity? For a 3 fund
Fidelity displays percentages to you for how much you own of each. If you take this approach I would recommend planning out ahead of any purchasing since you will have to manually set it up and rebalance. Does that cover your question?
@DannysMoneyTalk Still confused haha. I only have fxaix so far. Just opened up. Roth ira. Wanted to add international and bonds for it.
Also there is a free 3 fund portfolio guide I have linked in the description of this video that you may also find valuable. Let me know if I can help you with anything! :)
Hey! What are you confused on? Let me know any questions and I'll do my best to help.
Hi Danny! Great video, thanks for sharing. I wanted to mention, I don't think your link for the free template is accessible.
Hey Angel, thank you for pointing this out, apparently it was not directed exactly to it. I have fixed it now!
Thanks again :)
beacons.ai/dannysully/freedownloads
2:47 - am I misunderstanding this? You say "you can match the market returns" and then contrast this with most "pros" who lose to the S&P500, then conclude that therefore you will be beating most of those pros. But the market you're matching isn't the S&P500 - as the source in the video states, you're matching the OVERALL market (domestic, international, and bond), which doesn't necessarily match the S&P500 - and in years when the S&P500 fund is performing better than the total market, you, too, would lose compared to the S&P500. And I think that's okay - I use a 3 fund portfolio because the diversification reduces my risk at the cost of lower returns compared with the S&P500. But I think the claim you're making is a little misleading - if you want to match the S&P500's returns, you would probably want to use a 1 fund portfolio! But curious what your thoughts are about this.
Hey there, you mention a great point here and thanks for pointing it out. The overall market returns can be referred to as many different things so it can misleading. For example, it could be just the total us stock market, sp500, or domestic international and bonds combined, etc. For this video, a 3 fund portfolio is not the same as just a 1 fund portfolio (sp500 that i compared to with at that time), so you are correct with that. The purpose was to demonstrate how simple index fund investing can beat majority of the pros. So yes you are correct, saying a 3 fund portfolio is not the same to compare to an sp500 that I used as my source at 2:47. I will say, this portfolio still came out to show a great historical performance and I would still bet on it beating pros, active investors, etc. Not a financial advisor, do your own research, but thank you for pointing this out. I appreciate you paying close attention to the details, I will improve on this going forward!