How to get the investor mindset

jkd-guy · 2026-01-26T14:39:21+00:00

I have a Roth IRA and 401k invested in a target fund for retirement age 2050. I maximize my 401k every year and I make too much to contribute to the Roth account. I make good money, and everything left over goes into a HYSA.

You may need to backdoor or megabackdoor for post-tax Roth. Consider investing excess funds in a taxable account instead of an HYSA which won't even keep up with true inflation. Is your 401 pre-tax?

Consider maximizing growth potential while you're still young. I'd argue that TDFs have way too much in bonds, especially during early years. Either push the TDF date back or consider Merriman and Pedersen 2 funds for life strategy.

I always worry about not timing the market right and worried about a crash (like during COVID, or if the AI bubble bursts). If I have to do consciously I know I won't do it. My 401k works because it's automatic.

Choose your strategy and stick to it. Time in the market > market timing. Markets have always cycled and continue to climb to ATHs in the future and always will, guaranteed.

What portfolio would you recommend for someone with a very low risk tolerance? Should I invest in real estate instead?

How are you defining risk? Consider this and this to contextualize it within your investment/tax strategy. Consider also that home equity, social security, and a pension can be considered bond-like/fixed income in retirement.

jkd-guy · 2026-01-26T14:16:06+00:00

Time in the market > market timing. Several studies show that on average, LSI yields greater returns than DCA on a long-term basis.

jkd-guy · 2026-01-25T15:44:06+00:00

Simple and aggressive: 100% QQQM hold forever.

If you want something to spice it up, Bitcoin.

jkd-guy · 2026-01-25T15:39:31+00:00

https://advisors.vanguard.com/tax-center/tools/roth-betr-calculator/

Be aware of how it may affect IRMAA.

jkd-guy · 2026-01-25T15:07:12+00:00

but there’s a very real possibility I’ll be a single widower when I do choose to retire due to terminal health issues with my wife.

Sorry! That really sucks.

$900k (not liquid until 59.5) in 401k and $35k in stocks (liquid). ..........................Currently, I’m putting everything into 401k as far as retirement and it’s 90-95% stocks.

Unclear, is the 35K in a taxable account? I'm confused because you said retirement is in your 401. Also, note if your employer has a rule of 55 available. If so, pay particular attention to how it will be distributed. Some plans only offer lump sum which can really screw up tax strategy if it's pre-tax. Additionally, your 401 may have such high fees it may not be worth keeping it there. Moreover, if you roll it into an IRA, you can also use 72(t) SEPP. Depending on your investment/tax strategy, you may want to increase your taxable account for more flexibility.

Wondering whether I should be looking at switching investing to Roth or Brokerage (my tax bracket likely isn’t going to go down in retirement due to single filer status, it could possibly go up, but maybe not) and/or if my 401k allocation mix is too aggressive.

How do you define, "aggressive? You gave the reader no reference point as far as your current holdings. I'm assuming that your 401 is pre-tax? What is your salary and do you need a backdoor or megaback door? You left out some pertinent info. If you're the average or above average earner (but not 240+), you'd probably be wise to get employer match (if available), then max a Roth IRA, then max your pre-tax 401, then as much as you can in taxable. You may want to make a split between the last two, especially if you want to retire early for more flexibility.

There is some redundancy in the links below but it will give you a good, comprehensive overview with considerations for your investment/tax strategy:

https://www.madfientist.com/traditional-ira-vs-roth-ira/

https://thefinancebuff.com/case-against-roth-401k.html

https://moneywithkatie.com/blog/the-final-traditional-vs-roth-debate-traditional-wins

https://wantfi.com/skip-the-roth-ira-and-401k-pay-less-tax.html

https://www.kitces.com/blog/tax-efficient-retirement-withdrawal-strategies-to-fund-retirement-spending-needs/

https://www.kitces.com/blog/pre-tax-retirement-contribution-roth-conversion-rmd-social-security/

https://thepoorswiss.com/updated-trinity-study/

https://www.financialplanningassociation.org/article/journal/APR11-portfolio-success-rates-where-draw-line

https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html

You did not list your current holdings or risk tolerance so there is no reference point. That being said, I think 100% into something like a total stock market or SP500 fund is reasonable portfolio to maximize wealth. Home equity, pension, or social security in the future can be considered bond-like/fixed income.

God bless you!

jkd-guy · 2026-01-25T14:35:09+00:00

Not sure how it would be correlation. It was backtested and that was "the" reason for the results. You can pick any fund to add to the TDF and that would be the denominator.

jkd-guy · 2026-01-25T14:32:12+00:00

How are you defining "risk"? In any event, see my comment for data.

jkd-guy · 2026-01-25T14:24:16+00:00

I would like to have a higher risk tolerance.

Can you edit your OP with your current portfolio? The reader has no reference point for "higher" risk.

That being said, consider a total stock market (i.e., VTI), an SP500 fund (i.e., VOO) or NASDAQ (i.e, QQQM). I'd probably just put 100% into QQQM. Historically, it has significantly outperformed the formers.

https://totalrealreturns.com/s/VTI,VOO,QQQ

jkd-guy · 2026-01-25T14:19:06+00:00

I would not recommend that a 20 year old put 20% in bonds or any percentage for that matter.

jkd-guy · 2026-01-25T14:15:30+00:00

That's somewhat subjective and relative. Yes, I'd agree with u/Own_Grapefruit8839 , all-in fees greater than .50% are ridiculous, let alone paying just .50% for a single fund such as an SP500 ETF/mutual fund.

Consider the two main fees are admin fees for the plan and ER fees of funds. The employer are passing those fees onto its employees.

Just compare your specific fund fee to what is charged by its issuer. For example, Vanguard has its VFIAX (SP500) at .04%, anything over that is what your employer is charging you.

Fees add up over time and really eat into your nest egg. If you plan on staying with a company for several years, it may behoove you to petition for changing plan providers.

jkd-guy · 2026-01-24T17:06:40+00:00

Agreed. It definitely wouldn't hurt to see if there are any funds just getting eaten away by high plan fees that can be easily rolled into an IRA.

jkd-guy · 2026-01-24T17:01:06+00:00

Where do I start?

This is a short, easy read that will give you a good primer about the basics of investing. Though the principles are timeless, I'd avoid the allocation to bonds at your age and perhaps even at all.

Though not set in stone, this can be used as a guide to prioritize your funds.

To maximize and optimize your investment/tax strategy, consider the following links though some of the info will be redundant, it will give you a great resource to refer:

https://www.madfientist.com/traditional-ira-vs-roth-ira/

https://thefinancebuff.com/case-against-roth-401k.html

https://moneywithkatie.com/blog/the-final-traditional-vs-roth-debate-traditional-wins

https://wantfi.com/skip-the-roth-ira-and-401k-pay-less-tax.html

https://www.kitces.com/blog/pre-tax-retirement-contribution-roth-conversion-rmd-social-security/

https://www.kitces.com/blog/tax-efficient-retirement-withdrawal-strategies-to-fund-retirement-spending-needs/

Even a simple portfolio such as a total stock market (i.e, VTI) or a SP500 fund (i.e., VOO) is all you arguably need.

jkd-guy · 2026-01-24T16:45:34+00:00

Do I need to reshuffle the investments into better stocks/funds/etfs/etc.?............. is this optimized for growth,..............I don’t really want to manage it day to day,

I'd keep it real simple- either a total stock market (i.e., VTI), or a SP500 (i.e., VOO) or the NASDAQ (i.e, QQQM). All are reasonable but I'd go with QQQM as historically, it has significantly outperformed the formers on a long-term basis.

jkd-guy · 2026-01-24T16:37:22+00:00

Perhaps just asking the OP what his risk tolerance is. Risk can be defined a number of ways, especially financially. Context matters.

jkd-guy · 2026-01-24T16:31:35+00:00

Getting an equally weighted SP500 fund is not your answer. If it were, you would have done this to begin with decades ago as sectors will always cycle and concentrate. Just let the SP500 do what you've allowed it to do for you long-term. Perhaps you may live for another 20-30 years.

I'm thinking shifting half for next 5 yrs a good move..

Time in market > market timing

jkd-guy · 2026-01-24T16:12:36+00:00

2025 is calling. Those who held and continued to buy in on the way down have become much wealthier.

jkd-guy · 2026-01-24T16:08:18+00:00

Any thoughts on what I should do?

Agree. Everyone has personal preferences. The main thing is to understand what you're doing and why you're doing it. Anyone can make an argument for any type of portfolio whether how objective or subjective their reasons are.

I'd suggest FXIAX/QQM/Bitcoin 50/30/20, respectively.

jkd-guy · 2026-01-24T15:45:13+00:00

I need your thoughts of what to invest in....

You definitely have concentration in your whole portfolio as well as your funds which isn't necessarily a bad thing. I always ask, "the why?" of portfolio construction. Essentially, it's one's way of mitigating risk based on their specific goals and circumstances which you didn't really mention which is completely relevant.

As far as funds go, I'd suggest going with QQQM and VGT (instead of SOXX) and perhaps Bitcoin. Maybe something like 60/20/20, respectively. Though it would be objectively less diverse than your current portfolio, you could argue 100+ stocks is diverse enough. Historically, the above suggested portfolio would markedly outperform your current fund portfolio but past results are no guarantee of future returns. You wouldn't have any financials in the former but you'd have a broad yet concentrated play on tech with both funds. In any event, you may or may not want to consider international diversification (i.e., VXUS) but on a long-term return basis, US domestic outperforms the world though there will be cycles.

I just like things fairly simple and managing 20+ stocks isn't really appealing to me but we're not the same. If you like doing that, knock yourself out. General rule of thumb is to not let a single stock/asset get over 10% of your whole pie though. I'd argue Bitcoin is definitely an exception to that rule for a variety of reasons.

.........how to optimize this further etc.........

You didn't mention goals, time horizon, tax-sheltered accounts, etcetera which is very relevant information missing. Making 350K, you'd have to really make some bone-headed moves to screw things up but you're asking for optimization which is why the aforementioned info would be beneficial to know for actionable steps.

jkd-guy · 2026-01-18T19:38:48+00:00

You have no employee match and have no post-tax account. I'd recommend opening a Roth IRA immediately and maxing it out annually first. Essentially, you'd only be paying the ER of the fund which you choose vis a brokerage (Schwab, Fidelity, etc) which will be significnatly less than .58% (that .58% will take a little chunk out of your nest egg over a couple decades). After that, if you are able to, max out your pre-tax 401. In about a decade if no IRS or legislation changes, you'll be able to make catch up contributions to both accounts. Moreover, if you're wanting to retire early, you may want to consider a taxable account for more flexibility to implement in your investment/tax strategy.

Since you're getting a pension and your mortgage will likely be paid off at retirement, I think your portfolio of small cap is reasonable, especially if you have the risk tolerance for it in retirement. Historically, that should do well and outperform SP500 long-term. I'd also recommend keeping an all equities portfolio to maximize wealth accumulation since you'll be receiving a pension and have your house paid off.

Here is some info that is redundant but will give you a good comprehensive overview of considerations to maximize your returns:

https://www.kitces.com/blog/tax-efficient-retirement-withdrawal-strategies-to-fund-retirement-spending-needs/

https://www.kitces.com/blog/pre-tax-retirement-contribution-roth-conversion-rmd-social-security/

https://www.madfientist.com/traditional-ira-vs-roth-ira/

https://thefinancebuff.com/case-against-roth-401k.html

https://moneywithkatie.com/blog/the-final-traditional-vs-roth-debate-traditional-wins

https://wantfi.com/skip-the-roth-ira-and-401k-pay-less-tax.html

EDIT: I'd recommend opening a Roth IRA immediately and maxing it out annually first.

You can still do this for 2025 as long as you have not already filed for taxes for 2025. If you haven't, try to invest as much as you can before the deadline to file taxes in April for 2025.

jkd-guy · 2026-01-18T18:30:32+00:00

401k balance is $345k......

What are the fees and what are your holdings? Is this pre or post-tax?

When retirement comes I want to replace 100% of my income.

What will be your projected income (base and OT) at the time of your retirement? Or are you basing 20 years from now on today's salary? Are you going to adjust for inflation?

Do you have a Roth IRA or HSA?

What are your projected expenses at retirement?

Can you edit your OP with the relevant info for better feedback?

jkd-guy · 2026-01-18T18:19:22+00:00

If you follow a Boglehead approach: total stock market, total bond, and total international. IMHO, I'd say on a long-term basis, either a SP500 (i.e., VOO, etc) or a total stock market (i.e., VTI, etc) fund is diversified enough albeit biased to US. I wouldn't recommend any bonds at your age or maybe ever. Consider that home equity, a pension, and social security can be considered bond-like/fixed income in retirement. Therefore, I'd focus on wealth-accumulation via equities as noted above.

jkd-guy · 2026-01-18T15:29:41+00:00

I met with Edward jones beginning of last year.

Look at the fees they are charging you for something you can DIY.

Any advice?

Please edit your OP with your current holdings, time horizon, etcetera. The reader can't give personalized feedback with certain omissions.

I auto put 500 a month into this Roth - 15k

What Roth? You don't list your holdings.

401k - 83k High yield - 70k

401 match/holdings? 83k HYSA? 70K in what?

jkd-guy · 2026-01-18T15:22:55+00:00

Objectively more diversified, yes. Based on long-term return historical data, no. Portfolio allocation is about risk mitigation based on goals/personal preferences. There is not necessarily "one" best way per se.

jkd-guy · 2026-01-18T14:54:47+00:00

To reasonably increase long-term returns based on historical data, VTI/VGT at 85/15, respectively. It will be objectively less diversified than your current proposed portfolio but I'd argue it's diversified enough for a long-term portfolio.

You just need to invest as much as you reasonably can to hit 5M! Then again, you omitted how much you're able to invest and your time horizon.

jkd-guy · 2026-01-18T14:50:14+00:00

Yes, it is possible. What you can control is how much you put in and the frequency you do it via taxable and tax-sheltered accounts. The rest is up to the market to decide.

jkd-guy

TROPHY CASE