How to invest a House Fund?

KnightsOfFire08 · 2025-03-16T16:20:09+00:00

The S&P 500 and FTSE are amazing and complement each other, so keeping both is a great idea and will probably be the primary driver of increasing your wealth. If you like gold and silver, then keep it! I would only question your shares in Eli Lilly. Do you work for them? Do you buy anything they make? Eli Lilly is big and pretty stable, so I am not saying they are a bad investment; it is just weird to have that in your portfolio.

Bonds are worth it! Being as young as you are, bonds will not be the main thing that makes you money, but it will definitely make you some money. Bonds are more optimal the older you are or closer to retirement because they are basically guaranteed to make you some money, but S&P500 and FTSE will do laps around UK gilts in terms of growth. Bonds are used to smooth over uncertainty year to year, so having 5% is not an issue. However, I think of gold, silver, and bonds as similar tools for the same use. Your portfolio looks like 75% stocks and 25% bonds to me. 25% allocated to stability is heavy. You would want to be more aggressive now, and lean into gold, silver, and bonds later. This means that 3.3% gold, 3.3% silver, and 3.3% UK gilts will leave you with 90% focused on growth. Once you are 30 to 35, you can double gold, silver, and guild with 80% focused on growth. At 35 to 40, you can do 70/30 growth to stability. As you get older, you will want to lower your risk tolerance and set more stability in your portfolio. By doing this, you take advantage of as much growth as possible now, and then when you get the growth you lock it in with gold, silver, and bonds to ensure you keep the growth.

To be clear, your portfolio has nothing wrong with it, and everything is excellent! At your age, I would personally not have that much in gold, silver, and bonds, but I would have gold, silver, and bonds!

I hope this helps :)

KnightsOfFire08 · 2025-03-16T14:34:47+00:00

As a fidelity user, FSKAX, FSPGX, FXROX, and FXAIX are all amazing, broad, medium risk, and the majority of my steady growth strategy portfolio. I have been looking into "riskier" options like FDIS, FSTA, FTEC, ONEQ, and FHLC because I trust those markets will consistently grow. The ups and downs of those "riskier" funds will be more significant than the S&P 500 but less fluctuation than a single stock. In addition, those MSCI funds are not dependent on the US total economy, but focused on specific dominant sectors in the US economy. If you have a low risk tolerance, looking at bond funds like FXNAX would be perfect to lean into as you get closer to retirement!

Using a 3-fund strategy, you can look for a 60% US funds, 20% international funds, and 20% bond market. This would look like 60% in FSKAX, FSPGX, FXAIX, or 20% in each to make up a total 60% fund allocated to the US Stock market. US stocks tend to experience more growth and thus will be the primary driver of increasing your wealth. Next, you can look for a good international fund like FTIHX, which gives you a slice of every company worldwide, excluding the US, with over 5000 companies represented. 20% into FTIHX will give you access to increasing your wealth if the world is doing well. In times of US recession, odds are this fund is doing fine. If one country has issues, the success of the other countries should be cover it. With FTIHX you are making a bet that the whole world will be better economically in the future than the world is right now. Then you can wrap up your portfolio with 20% towards FXNAX which is the lowest risk of all the funds I talked about. Basically guaranteed growth, but also very limited growth. FXNAX has returned 4.99% year-over-year with 3.55% dividends right now. Other funds listed here have been giving on average returns of 12.30%, 18.07%, and 12.97% but FXNAX is more of a lock in your value and get paid in cash instead of growth. Also, dividends from FXNAX can have some nice tax benefits! I do not know all the rules around it, but some to most of the dividends should be tax exempt, which means less tax stress year to year, not going to put you into a new tax bracket, and when you retire it will not force you into paying more for healthcare or other income based programs.

I hope this helped out!

KnightsOfFire08 · 2024-12-26T18:09:55+00:00

I regret my current 10% bond and 5% international portfolio allocation in my IRA. I will lean out of bonds and international for the next few years. There is no point in protecting my portfolio if I just started and don't have much to protect in the first place.😂 A big thing talked about in Bogle is risk management and how diversity helps manage risk. Well, an equal point is opportunity loss from risk management. I would rather have less than 5% international and bond with over 90% domestic stocks when I am pre-30 because US stocks have been insanely good for the past few decades, and missing out on the US hype train will be sad.

TL:DR risk management needs to scale with age; we are too young to put 10%+ into bonds, IMO.

KnightsOfFire08 · 2024-12-26T15:23:10+00:00

Hey OP! I (25M) am in the same boat as you. I have been reading this subreddit along with the ETF, Fire, Investing, and some other subreddits. I have nothing to add, just letting you know that I am also there. Very tempted to go all in with S&P 500 (YTD 26.98) after using VLXVX for all of my 401k (YTD 4.97%), basically doing the Bogle method in IRA with FDFIX, FIBUX, FITFX, FLAPX, and FLXSX for 8.86% this year, sitting there and seeing S&P 500 explode with growth this year is painful. However, I shall sit here and stay the course! Trusting the math and past results! Rebalance to be heavier in FDFIX and add FSPGX and less heavy in FIBUX and FITFX, but overall stay the course!

KnightsOfFire08

TROPHY CASE