Three-Fund Portfolio: The Lazy Strategy That Really Works
When you have a three-fund portfolio, your asset classes will typically contain the following: – U.S. Stocks – International Stocks – U.S. Bonds
What Is The Three-Fund Portfolio?
Advantages of the Three-Fund Portfolio
2. Low cost of investing
3. Tax efficiency
4. Simple rebalancing and management
Over at PortfolioCharts.com, they went back to 1970 and found the average return for a three-fund Portfolio right around 6%, after accounting for inflation.
Three-Fund Portfolio Performance
1. The 80/20
Three-Fund Portfolio Asset Allocation
2. The 60/40
3. The Equal Weight
2. Pick your financial institution
Building Your Three-Fund Portfolio
1. Figure out your asset allocation
3. Matching funds of a three balanced portfolio
Here is a breakdown of the recommend funds
Build a three-fund portfolio with Vanguard – U.S. Stocks: Vanguard Total Stock Market Index Fund (VTSAX) – International Stocks: Vanguard Total International Index Fund (VTIAX) – Bonds: Vanguard Total Bond Market Index Fund (VBTLX)
I think for all new investors, it’s the best place to start with Three-Fund Portfolio. It’s easy, simple, and completely effective.
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