In situations where you these might result in opposing choices, which would take precedence?
I currently have a 75/25 asset allocation, and I am working to bring it to 70/30 or 65/35 through new contributions in my 457b. My plan allows for both pretax and Roth contributions, So I have contributed to both in a manner to remain in the 12% bracket.
My breakdown is as follows
Taxable Broakerage 31% of total portfolio
Fidelity s&P fund 21.3%
Fidelity zero total stock market 3.9%
Fidelity Treasury MM fund 6.4% (about a year's worth of expenses)
Fidelity Roth IRA 38% of total portfolio
Fidelity S&P fund (same as above) 20.3%
Fidelity Extended market index 8.25%
Fidelity International index 4.0%
Fidelity US Bond Index 4.25%
Individual TIPS (bought small amount just to see how it works without any tax consequences) 1%
I Bonds- 7 % of total portfolio
Fidelity Traditional IRA 2% of total portfolio
Fidelity US Bond Index 1.3%
TIPS 0.7%
The remaining 22% of the portfolio is in the 457 accounts- which started in 2020 (prior to that, my school district's 457 options had over 3% in fees and no match so I didn't contribute.
457 Pre Tax Contributions about 15% of total portfolio.
Ishares Total US Stock 10%
*****Ishares US Aggregate Bond 3.75 ****
Ishares Total International 1.25%
457 Roth Contributions about 7% of total portfolio
Ishares Total US stock 4.1%
Ishares US Aggregate Bond 2%
Ishares Total International 0.7%
The simplest method to get to the desired 70/30 or 65/35 would be to exchange some of the Pretax ishares total US Stock with some of the Ishares us aggregate Bond. However, my particularly plan doesn't work that way. Exchanges or sales etc are done across both Pretax and Roth- meaning that if I do the exchange, while I reduce my equity holding and increase my bond holding in the tax efficient Pre Tax portion, I ALSO reduce my equity holding (and increase my bond holdings) in the Roth portion which is not really what I want to do.
What I am currently doing is making PreTax contributions and then only buying the Ishares US Aggregate Bond fund with 100% of the contribution. However, to go from 75/25 to 70/30 It would take the entire year of maxed out contributions. I only need about 6 months of pretax contributions to put myself at the top of the 12% bracket for the end of the year.
To make matters even a bit murkier, my rough draft tax return shows that I can contribute the full $7.000 to my Roth IRA- which would optimally be used to purchase an equity index fund- taking me further from the desired Asset
Any thoughts on this rambling, thinking out loud while composing post and situation?
I currently have a 75/25 asset allocation, and I am working to bring it to 70/30 or 65/35 through new contributions in my 457b. My plan allows for both pretax and Roth contributions, So I have contributed to both in a manner to remain in the 12% bracket.
My breakdown is as follows
Taxable Broakerage 31% of total portfolio
Fidelity s&P fund 21.3%
Fidelity zero total stock market 3.9%
Fidelity Treasury MM fund 6.4% (about a year's worth of expenses)
Fidelity Roth IRA 38% of total portfolio
Fidelity S&P fund (same as above) 20.3%
Fidelity Extended market index 8.25%
Fidelity International index 4.0%
Fidelity US Bond Index 4.25%
Individual TIPS (bought small amount just to see how it works without any tax consequences) 1%
I Bonds- 7 % of total portfolio
Fidelity Traditional IRA 2% of total portfolio
Fidelity US Bond Index 1.3%
TIPS 0.7%
The remaining 22% of the portfolio is in the 457 accounts- which started in 2020 (prior to that, my school district's 457 options had over 3% in fees and no match so I didn't contribute.
457 Pre Tax Contributions about 15% of total portfolio.
Ishares Total US Stock 10%
*****Ishares US Aggregate Bond 3.75 ****
Ishares Total International 1.25%
457 Roth Contributions about 7% of total portfolio
Ishares Total US stock 4.1%
Ishares US Aggregate Bond 2%
Ishares Total International 0.7%
The simplest method to get to the desired 70/30 or 65/35 would be to exchange some of the Pretax ishares total US Stock with some of the Ishares us aggregate Bond. However, my particularly plan doesn't work that way. Exchanges or sales etc are done across both Pretax and Roth- meaning that if I do the exchange, while I reduce my equity holding and increase my bond holding in the tax efficient Pre Tax portion, I ALSO reduce my equity holding (and increase my bond holdings) in the Roth portion which is not really what I want to do.
What I am currently doing is making PreTax contributions and then only buying the Ishares US Aggregate Bond fund with 100% of the contribution. However, to go from 75/25 to 70/30 It would take the entire year of maxed out contributions. I only need about 6 months of pretax contributions to put myself at the top of the 12% bracket for the end of the year.
To make matters even a bit murkier, my rough draft tax return shows that I can contribute the full $7.000 to my Roth IRA- which would optimally be used to purchase an equity index fund- taking me further from the desired Asset
Any thoughts on this rambling, thinking out loud while composing post and situation?
Statistics: Posted by coachd50 — Mon Feb 03, 2025 7:35 pm — Replies 2 — Views 155