Probably most people would say 44/54 is within their rebalancing bands given a 50/50 target, so they'd do nothing.When I retired, Vanguard prepared a financial plan for me and we decided on a 50/50 asset allocation. We took a total portfolio approach. My taxable account and Roth IRA were mostly in stocks and my traditional IRA was mostly bonds.
In May I bought a new home and paid for it from my taxable accounts so now my asset allocation is 44% stocks, 54% bonds and 2% cash. My portfolio needs to be rebalanced. I would like my new allocation to be 60% stocks and 40% bonds. My bond holdings are VBTLX (57%) and VFIDX (17%).
I'm reluctant to rebalance now since the stock market is near an all time high and after years of meager returns, bond funds are finally paying a decent dividend.
So how should I proceed? Should I wait for a stock market correction or do it now? How much should I allocate to VTSAX and VTIAX?
Rebalancing has nothing to do with creating a "new allocation."
Statistics: Posted by tibbitts — Sat Jul 06, 2024 12:48 pm