My comment had nothing to do with the difference in performance (growth) between US and foreign.
The suggested placement of VTI and VT fails to result in 80:20 US:foreign as soon as the taxable account and the Roth IRA are different sizes. That is most likely to happen with contributions.
Granted it might be a couple of years before the ratio is far enough off to worry about. But it could happen very quickly....say if the investor only invests in Roth IRA this year, with nothing going to taxable. That would throw it off from the desired ratio much quicker (assuming the portfolio is still small).
Also, I personally find the math of VTI + VXUS to be simpler than VTI + VT. But maybe some people don't.
Either plan will work. I presented my idea because I think it is easier than using a fund that contains two separate asset classes.
The suggested placement of VTI and VT fails to result in 80:20 US:foreign as soon as the taxable account and the Roth IRA are different sizes. That is most likely to happen with contributions.
Granted it might be a couple of years before the ratio is far enough off to worry about. But it could happen very quickly....say if the investor only invests in Roth IRA this year, with nothing going to taxable. That would throw it off from the desired ratio much quicker (assuming the portfolio is still small).
Also, I personally find the math of VTI + VXUS to be simpler than VTI + VT. But maybe some people don't.
Either plan will work. I presented my idea because I think it is easier than using a fund that contains two separate asset classes.
Statistics: Posted by retiredjg — Thu Jan 23, 2025 4:15 pm