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Investment Plan

Investment Plan - A Simple 15 Step Process

Mission Statements of The Plan:

1. The Purpose of The Plan is to accumulate Assets during the employment years, which will be used later in Retirement as a supplement to Social Security.

2. The Strategy will be primarily a "Buy And Hold Through Thick And Thin".

3. The two primary investment vehicles will be Roth IRA's and a Company 401k. Taxable Accounts may also be utilized, but after Tax Deferred Accounts have been fulfilled.

4. The order of preference should start first with the 401k, and contribute enough to secure the Company Match. Then, max out the Annual Roth IRA Contributions. Finally, return and max out the 401k Contributions. Hopefully, this will be accomplished every year, and by the end of each year

5. The Investments will include Equity and Fixed Income Mutual Funds, ETF's, and Individual Stocks in a globally diversified manner.

6. Allocations will have a minimum of Two Thirds of Assets in Low Cost, Core Mutual Funds to provide a portfolio foundation. The remaining One Third can be in Supporting Role, Sector, and Miscellaneous Assets.

7. Allocations will follow a 60:40 ratio of Equity to Fixed Income Assets.

8. Equity Allocations will be 40% in Domestic Equity and 20% in International Equity.

9. Domestic Allocations will be 20% Large-Cap, 15% Mid-Cap, and 5% Small-Cap Equities.

10. International Allocations will be 50:50 Developed to Emerging Markets.

11. Re-balancing will be performed when allocations exceed their designated levels by about 5%.

12. Some Tactical Asset Allocations are permitted, but at a minimum.

13. Do not take on undue and uncompensated market risk. And no day trading!

14. Up to 10% of Assets may be used as "Play Money" to invest outside of the above parameters of The Plan.

15. If I do not completely understand a particular investment vehicle after doing sufficient Due Diligence, I will abstain from endangering any assets in said vehicle.

RETIREMENT PORTFOLIO

Core Mutual Funds

40.9% - Cash in a 401k Stable Value Fund and 2 IRA Money Market Funds
7.7% - S&P 500 Index Trust
8.5% - PRWCX - T. Rowe Price Capital Appreciation
5.2% - FSEMX - Fidelity Extended Market Index
4.1% - VTIAX - Vanguard Total International Stock Index
= 66.4% Core Assets

Supporting Role

5.5% - STSVX - Dreyfus/The Boston Co. Small Cap Value
4.1% - RNWFX - American Funds New World R4
4.3% - MAPIX - Matthews Asia Dividend
4.6% - PRIDX - T. Rowe Price International Discovery
= 18.5% Supporting Role Assets

Sector & Miscellaneous

4.4% - TAREX - Third Avenue Real Estate Value
4.0% - PRNEX - T. Rowe Price New Era
4.6% - Real Assets in various Precious Metals, Energy, Agriculture, and other Commodity Stocks, ETF's, and Mutual Funds

2.1% - Individual Stocks
= 15.1% Sector & Misc. Assets


As Of 03-31-2017


The below is a Work In Progress.
It is my current thinking on transitioning all of my Cash, Bonds, Roth IRA's, and 401k accounts into a bucket approach to retirement allocation.

Bucket #1
Short Term: Cash to cover 1 to 3 years of living expenses (10 to 20%???).
Local and Online Savings and Checking Accounts, CD's, MMA's, etc.

Bucket #2
Intermediate Term: Holdings to cover 3 to 12 years of expenses (30 to 55%???).
Rebalanced occasionally into Bucket #1 as it gets depleted.
All interest and dividends are used to replenish Bucket #1.

Taxable Accounts: Short Term and Intermediate Term Municipal Bond Funds, Inflation Protected Savings Bonds(I Bonds).

Roth IRA Accounts: Bank Loan Bond Funds, Short and Intermediate Bond Funds, Real Return Bond Funds, TIPS Bond Funds, Conservative Allocation Mutual Funds, Dividend Paying Stocks.

401k: Stable Value Fund.

Bucket #3
Long Term: Holdings to cover past 12 years of expenses (25 to 60%???).
Rebalanced occasionally into Bucket #2 as Bucket #2 gets depleted from replenishing Bucket #1.
All interest and dividends are re-invested.

Roth IRA Accounts: Moderate Allocation Mutual Funds, High Yield Bond Funds, Emerging Markets Debt Funds, Commodity Funds.

401k: Domestic and International Stock Mutual Funds.