Its unbelievable that these valuable pieces of information are shared for free every week... Keep up the great work, I found your chsnnel recently and will definitely subscribe to get all those nerdy spreadsheets and emotes...thanks Jeff!!!
Thank you for the positive feedback. It's great to have you here in the community. I want to help as many people as possible reach financial freedom. That is the mission here. I appreciate your support.
Hey @JeffTeeples, we're also working towards financial independence and have been inspired by your strategy! We're following a similar approach with SCHD and VGT, as we believe in the power of tech and have always been fans of SCHD. After watching your videos and doing some analysis, we've decided to keep it simple with VGT, SCHD, and VOO (which we already held and didn't want to let go of due to FOMO!). Our plan is to increase our SCHD holdings in retirement by selling either VOO or VGT. Thanks for sharing your expertise and being transparent - it's made a big impact on our investment journey!
Thank you for the kind words & the support of the channel. I love hearing about these things because it is fun to grow together. I would love to say I have all the answers, but that would be BS (: I learn a lot from this community as well. The benefit flows both ways.
Happy late birthday Jeff. Thanks for the update. I am at 5.25 mil. Biggest positions VOO, VTI, SCHD, VYM, and now looking to build up dgro. I got $48,800 divs last year in taxable divs. Q2 taxable divs this year was $17,388 this year.
Man Richard, that portfolio is impressive! I bet you'll smash your dividends from last year with SCHD going crazy in quarter 2 this year (: DGRO is a nice addition for a dividend grower. Not that you need me to tell you that (: You're waaaaay down the path already.
Hi Richard, quick question if you don't mind, my goals are similar in the sense I want more dividends by the time I retire as well. At what age did you start investing and how much per month?
@@VanillaCherryBread Hi. I never really kept track of how much. I started investing after my first deployment to the Middle East in the army in 1998. I always tried to max my 457 and or 401k. I was a cop for 13 years and I worked 60 hr a week and put all my savings into investments. Now I max my 401k and my employer puts in almost 10k on top of that.
Hey Larry. Thank you for watching and thanks for the question. I would not recommend buying any individual stocks if you do not put the time in to do in depth research. I think SCHD & DGRO are great dividend ETFs to invest in for solid long-term performance. DGRO specializes in growth its dividend (even though SCHD ironically has a higher 10 year dividend growth rate). SCHD will give you a nice balance between dividend yield, growth, and total returns. It is a nice counterbalance for VGT, QQQM, or SCHG if you have money invested in growth ETFs. Very low overlap.
I concur with Jeff's recommendations of SCHD and DGRO. @JeffTeeples - How about adding XMHQ and VIG? These four ETFs offer diverse strategies, similar returns, with minimal overlap.
Hey Gurinder. Thanks for watching and for leaving this reply I think VIG is a great way to go. It is similar to DGRO. I am not familiar with XMHQ. After seeing CRAZY dividend CAGRs, I looked at the distribution history. I noticed the recent dividend was $4.5773 per share. The previous all-time high quarter was $0.3533. Would love to know where that came from. The total returns are VERY impressive on XMHQ compared to the other 3 dividend ETFs as well. I'll be watching this one.
Staying the course. When the market appears to go up, i buy, keeping my allocations in check. When the market drops, I buy, maintaining my allocation percentages. In short, buy less when prices go up and buy more as the prices drop. Yay! Keep those videos coming and thanks.
Exactly Roy. You nailed it! Staying the course long-term will help us build stable wealth. This market will eventually fall, and we will stick to the battle plan and benefit from the discounted prices when everyone else is running (:
Hi Jeff, I really want to thank you for introducing me to M1. It made the DCA very easy, on top it automatically allocates more money to the fund that is under my allocation %, which buys even more shares at the lower price. Also I definitely see the benefit to have SCHD in my portfolio these days. Thanks again for this!
Hey Cindy. No problem. I think M1 Finance is the best platform for long-term investing with a passive strategy. I love the target allocation DCA framework. I do the same thing in E*Trade, but it requires math haha SCHD was incredible today. I know the reversion to the mean is inevitable. Then all of the people telling me I'm wasting money in SCHD instead of going 100% VGT will disappear (: Once growth is in the tank, I'll be all about buying QQQM and VGT. The rest of the world will say I'm crazy for not going all in on SCHD (:
I think a well put together 3 fund portfolio will do great. It is 'basically' what I have. Well, I have 3 core categories that are a bit different that the traditional 3-fund portfolio. I have growth, value, and market. I like to keep it simple. Most my money will go into VOO (market fund), SCHD (value ETF) and VGT or QQQM (favorite growth ETFs). That is 4 positions. I would say the other positions are 'other'. For example, JEPQ is strictly for cash-flow because I quit my job and we need cash to get by right now. IBIT is bitcoin, which is another play altogether and only 2 to 3% of my portfolio. VUG is a growth ETF that we have to buy because it is the only good option in our HSA. Then there are my individual stocks I maintain on the side (1% of total).
Thanks Kent! I am definitely a tech bull to be sure. It comes with some serious down trends at times. I'm betting on the long-term future with tech, but I realize it comes with high volatility.
Today I've got the following question: for instance, you can deversify VGT with QQQM, and SCHD with DGRO, but what about JEPQ? Is there any recommended tool to have more than one dividend cow, just in case to be more secured from income generation perspective (mabye DIVO, or anything that you personally would prefer)? Thank you for the approaches and materials you're sharing!
Thanks for watching and for a great question. I like JEPI to put alongside JEPQ. JEPI picks stocks from the S&P 500 index, and JEPQ selects them from the Nasdaq-100. Two of my favorite indexes. You can mix it REITS, my favorite being ticker O, and many other covered call ETFs as well.
Hey Ivan. Thank you for watching & for the question. Also, I see that shiny member badge, it is much appreciated (: I am a huge proponent of holding ETFs instead of individual stocks. I think that over time it will provide better returns because we humans are proven to be terrible market timers. Our emotions kick in and it is dangerous. We end up buying high (greed + bandwagon) and selling low (panic). It's funny because it 'feels' more diversified to own 20 or 25 different stocks. But in reality, holding VOO gives us ownership in 500 of the largest companies in the US. It is WAY more diversified, even though it feels like our 'eggs are all in one basket'.
Question for you Jeff.. I mainly contribute to two accounts. My Sep Ira and taxable. Thoughts on doing something like Voo/vgt in one account and vti/qqqm in the other. Something like a 70/30 split into both. Don’t really have interest in dividends at the moment.
Thanks for the question. I think you have a great plan with those combos. All 4 ETFs pay (basically 100%) qualified dividends. So you could put either combo in the SEP vs the taxable and be fine. I would definitely concentrate on maxing the SEP IRA before putting too much into the taxable each year. My wife and I try to max her traditional 401k and HSA before our taxable (for the most part, you can always do a comfortable mix that works for you). I think you got this. Dollar cost average into your 4 ETFs for years and you'll be looking very good. Make sure not to panic sell when things get ugly and don't get too high when things are green. Stay the course and do your thing. I am confident in all of those holdings over the long haul. It's a great hands off way to approach it. I love ETFs.
Thank you Jeff for the transparency, I have a doubt that in these months you have not invested in VOO or VGT, what you are doing is investing in SCHD until the portfolio is balanced, or there is something that I am not understanding, big hug
Hey Juan. I have been investing in SCHD lately due to its underperformance. I like to keep VOO, VGT+QQQM, and SCHD about even. When the market crashes, I will be buying a lot of VGT and QQQM. I let me winners run in general. I'm not interested in selling shares to produce long-term capital gains. However, new dollars always 'auto-buy the dip' because they go into the ETF that is underweight (biggest proportional discount). Target allocations never feel right during big booms (like VGT lately), but it is proven that buying low wins long-term.
Could you make a video explaining how to make a spreadsheet like yours I wanna start tracking my investments but I’m not sure how to start making spreadsheets
Hey Braiden. Thank you for watching and dropping a comment. That is a great idea! I need to take the time to throw together a more advanced portfolio tracker. I think a video describing the process will be a great idea when I get there.
I love the transparency, I had some reservations and you’ve made me feel more comfortable about investing by displaying your journey. Thank you Jeff! ❤
I appreciate you sticking with these videos. I really do make them to help others towards financial freedom. I wasn't wild about *full* transparency at first because I didn't want it to be dripping with 'look at me' vibes. But *showing* that I practice what I preach outweighed that concern by a mile. It is a simple long-term game that we can win together. Am I perfect? Absolutely not. But I can help get people pointed in the right direction. Specific systems will vary, and there are a lot of ways to go about it. But some things, like buy and hold long-term, don't panic sell, stay the course, stick to target allocations regardless of the news, and many others are universally correct (:
I’ve been trying to get in at a discount with VGT and QQQM by selling CSP on it. However they keep going up! Should I continue this or just buy them where they are currently
Hey Tony. I don't play around with options myself. I'm a fan of buying and holding all positions. I'm a bit biased, but I would say buy them and hold for years. However, to your point, they are high right now, so I guess 'it depends' is the real answer. I haven't purchased growth (not counting converting some VGT to QQQM) with new dollars in over a year. It has been all SCHD to bring it up to its target allocation. I guess I don't have a buy or sell recommendation in a vacuum. I do everything by my target allocation system. I love it because it is mathematically impossible to not buy the 'comparative dip' within my portfolio this way. I do the same thing (well, M1 Finance does it for me) with my 25 individual stocks. Buy the one that is beat up the most with new dollars to get it back to its spot. The real question is, how much VGT and QQQM do you want in the portfolio? Once you know that %, you can buy them all at once or put it on a DCA system over time to get them to weight.
Thanks for watching and for the kind words. I don't love DIVO, personally, because it misses on a lot of the things I care about. The expense ratio is too high at 0.56%. The dividend does not reliably grow. And the total returns are lacking. I don't invest in cash-flow plays for total return or to beat the market, but it does matter. I will say DIVO has impressive, although sporadic, dividend payments. Something like SCHD is more of a reliable grower. I think DIVO is a fine play for a dividend portfolio in general, just not for me.
Jeff, I am trying to use the Portfolio Visualizer to backtest some investments. It won't let me enter VMFXX which is a larger portion of my investments. What do you recommend I substitute so that I can see the return % as part of my overall investments?
Hey Chazac. I don't back test my cash equivalents with my portfolios. Emergency cash, checking, savings, high yield savings, and money markets are all 'cash' to me. I will have it no matter what, so I don't want it to skew the results of 'this' vs 'that' for *investing* results. After looking around a little, I don't know what you can use to replace it if you do want to see your total performance on portfolio visualizer. I need to create a spreadsheet for situations like this. Noted (: Thank you for being a channel member. Your extra level of support has been awesome.
haha, thanks Rafael. I have given up on making them shorter. But I'm still trying to streamline the process. I appreciate you watching and for dropping a comment.
Thanks for the kind words Ron. I am mostly large cap. I do invest in HWKN and AGM for small cap exposure. I also have MLI for mid cap. My ETF mix of 33% VOO / 33% SCHD / 17% VGT / 17% QQQM is 76.9% large, 19.5% mid, and 3.61% small cap.
I use Seeking Alpha to track my live portfolio. It has my shares and everything so it updates real-time. It is easily the best aggregator I've used (and I've tried a lot of them). It's great because I can do my research and tracking all in one place.
If I knew the answer to this I would be a billionaire (: I have no clue. The market 'feels high', but earnings have also been solid. I will stay balanced to my target allocations in all markets just in case.
Hey Billy. That is a tough one because there are so many ways to go about it. There is the traditional approach of having X amount of stocks (index funds usually) and X amount of bonds (bond ETF usually). That is not a bad way to go, but I don't personally like it. I'm biased towards your method of 100% dividend paying ETFs and stocks. I like it because you will have reliable cash-flow growth, even in a down market. If your portfolio value drops in a crash you will still be collecting those (usually) growing dividends. I prefer the way you are doing it to the traditional approach. A lot of portfolio strategies are balanced as long as the investor stays the course and doesn't emotionally jump on bandwagons while watching the news.
I wonder how much your portfolio might have lost in the past few weeks since you uploaded this video. I was hoping you were going to create some content addressing the big dip we've been experiencing as of recent, especially in the tech sector, and show us the new value of your portfolio as a consequence. That would have been a tremendous help and motivation for us, subscribers as well as new viewers, to keep going and to keep investing among this market volatility.
Thank you for watching and for the comment. I have some videos queued up for the coming weeks. Not tomorrow but next week will be my portfolio update. I was out of town for a while and had to record ahead. But you're right, keep on buying to the target allocations and do not panic sell. Staying the course is the theme of my update video.
Thanks for the video and all the informational replies. Since you're not working this year, are you taking advantage of a spousal Roth IRA contribution? Or is the UA-cam money a negative factor?
Hey Charlie. Great questions. I am maximizing everything possible. I put $7k into a Roth IRA. Business expenses are written off in joint return, and (I haven't done it yet) I'll be starting a solo 401k to stash all the money I make on UA-cam (which isn't much so far). I should be able to make my income $0 on paper for a while.
Hey Oldrin. It is honestly wild. I said I was going to get rid of it to focus on QQQM long-term. But it is going to be soooooo hard to pull the trigger, haha. I've toyed with the idea of keeping JEPQ around, and offloading cash (VMFXX) instead. Keeping JEPQ + VMFXX at 10% of the portfolio. This gives a cash position and a 'greedy cash-flow' position within the mix. Still leaves 90% of my portfolio for my 'normal long-term investments'.
@@JeffTeeples I hear you sir! Well you are in such a great position + your discipline you will certainly be fine either way! Question I recently found about SCHG, am I right to think that it seems to be kind of a little more specialized version of voo ? Would you say they are fairly close to interchangeable in terms of being a corner stone holding or am I way off?
SCHG is more akin to QQQM. It focuses on growth companies. It has a PE ratio of 34.49. QQQM is at 32.62 while VOO is 25.7. SCHG and QQQM both have about a 50% overlap with VOO, which is natural, since VOO is 'about half' growth over its history (it is a bit higher at the moment). The other half of VOO is full of value companies, though, making it different than SCHG. They are not interchangeable, however, I think SCHG makes for a great addition to the growth section. I was very torn between it and QQQM for my portfolio.
ThanX Jeff..... GREAT video... Love the overview and your success on your portfolio..... Congrats.. Keep up the great work.... Question for you.... Do you auto DRIP every month/quarter or do you manually do it and lastly, do you adjust/balance your percentages of holdings each quarter or half or annually...???? Thanks again - appreciate your hard work and efforts each week for us.... Wishing you and your family well..... Peace...!!!
Hey Lance. Thanks for watching and dropping a comment as always. I appreciate you support as a member as well! I auto drip in M1 Finance with my individual stocks (The HODL Factory) because it buys to the target allocation. In E*Trade, I have DRIP off for all accounts. I take the dividends and apply them to my underweight positions (for example, VGT and QQQM dividends were reinvested into SCHD this quarter). I basically do what M1 automates over in E*Trade with my ETFs. The rebalance thing is tricky. Historically I didn't have to rebalance... Ever, actually. This is because I made good money before quitting to start this channel. I would invest in the underweight position and it would naturally balance itself out over time. I think I may have to start doing official rebalances beyond my new contributions moving forward. The portfolio is getting bigger *and* I don't make a lot of money now (wife has great job, covers the bills and 401k, but we don't have extra. Definitely my fault haha). I aim to make it an annual event. I'm okay with letting my winners run a little bit. Especially because I'm diligent about buying the others with new money. In 'most' markets, it will balance itself. Not in this market, though.
@@JeffTeeples Thanks so much Jeff.... Very interesting..... Yes, I am trying to work thru that "balancing act" as we speak... With all the gains - things get thrown off. I am using a taxable brokerage account to help balance things out as I can contribute to that fund anytime vs IRA's or ROTHS which are governed by many contribution rules. Appreciate your overview and I am sure due to your excellent skills and education in the accounting field it will make your task quite easy. I guess I should have studied harder in school. LOL Be well and have a great week.. Looking forward to Sundays video.
Haha, Lance, you always give me a good chuckle. I'm sure you did just fine in school / life / your career (: I've been thinking about rebalancing as well. I used to bring in a solid salary, and now I'm close to zero. I have a brand new game plan to follow that I will share in a monthly update. A lot of changes (because of my specific situation, not in 'general investing strategies'). More to come.
Channel idea: 1)Merits of DRIP vs cash dividend. 2)Turning the volume up or down on dollar cost averaging with correction concerns vs rock solid unwavering DCA. And 3) strategies on what types of assets to hold in taxable vs IRA type accounts with examples. I’ve only been a channel member a short time so apologies if this info is contained in your previous videos.
Hey Chris. Thank you for the great ideas for the channel. I am throwing them on my list. I’ve touched some of those things in past videos, but nothing detailed. I appreciate you being a channel member! The extra level of support means a lot.
I don't like making individual stock calls based on my gut. I am biased towards TSLA in a way because I bought it at under $50 per share and sold for $372. I think a lot of that was dumb luck. It is a wild card company that I think has a decent chance of doing well long-term. I don't have it in my stock portfolio because it doesn't pass my screeners. I took my gut out of investing. So far it's working well, but we never know what the future holds.
Hey Bruno. Not for me personally. SMH has been fantastic for a long time, but I don't like concentrating money into one sub-sector of tech. I feel good owning a lot of the semiconductor stocks in VGT, as well as my individual stock picks.
Thank you for watching. You are exactly right! I should add that it is easy to stay the course when we are hitting all time highs. Not that I wish this... But... I can't wait for the next rough market because that is when remaining a buyer and not panic selling *really* pays off. I was down ~$200k in 2022 (heavy in VGT). Didn't sell a single share because that would have been selling low. I'm a bit of a robot, but for some that is not an easy task. We need to stick to the system when things get tough.
Thanks for the kind words Eric! I likely will not open 529 accounts for the kids, but I’m not 100% sure. The perks vary state to state in the US. Actually, I really need to make a video on this. Great reminder (: Thanks for your support of the channel!
I’m pretty inspired by your portfolio setup! I work in the tech sector and am still in the accumulation phase - I was wondering what you think of this breakdown? 50% growth - 15% SMH, 15% IWY, 30% QQQM 50% value - 10% AVUV, 10% AVDV, 10% COWZ, 20% SCHD Monitoring COWZ to see if I want that to take over SCHD still. I’m roughly 30, so still a very long time horizon! I’m also still very personally bullish on semis, though willing to rotate out back into a general growth (QQQM) or even VOO if necessary.
Hey Ian. I think that is a solid mix for being 30. It has a bit of a high standard deviation at 19.1%. But the PE isn't outrageous because you mix in some nice value holdings. It is 25.87. For reference, my mix is 16.78% and 25.30, respectively. You have CRUSHED my returns in the past 4 years (that is all I could look back because of age of a holding), and your risk adjusted return is better as well. I think you'll do well as long as you stay the course when times get tough, and buy to your target allocations (buy the ones that are beat up at a discount with your new dollars). The most common way that retain investors lose with any system is when they abandon the game plan when times get tough.
I appreciate that Oldrin. I will throw that on the list. It can get a little spicy, and there are a lot of different opinions. I'm a believer in paying down anything over 8% right away. Never pay an extra penny on anything 4% or less. It is that 4%-8% range that varies.
It is what I call my collection of individual stocks (I want to start an ETF someday, but for now it is my account name in my brokerage). It is the HODL Factory. A mix of the meme of misspelled word of 'hold' (crypto related) and the acronym of hold on for dear life.
Jeff, I know this is off-topic,however I value your opinion and need you to remove my guilt …. Feel free to delete if needed. I love Roth’s. I load up $14000 individual Roth’s , 7,000 each for me and the wife. 401k Roth while working =6.2% fica, 1.4%,and 4.95% state tax (IL). This will cost me an additional 12.65% now before federal. IL does not tax 401k in retirement and fica, Medicare are not paid as well in retirement. I’m not sure the 401k Roth is worth it right now. I’m already saving 38% per year and really need the $$ now for the 2 kid (12 & 16). This is across 401k, Roth’s, HSA. 403b, brokerage, Coverdale and custodials. Trying to reduce my taxes now, not increase. I am aware of federal tax credits I get right with 2 kids as well. Still need the cash and not more tax right now.
Hey Daman. Short answer: Making traditional 401k contributions is likely more valuable than making Roth 401k contributions. And the bonus is that it saves you money now for kids and lifestyle. I love Roth IRAs in general. But I think traditional 401k contributions are better for most people. It lowers your taxes this year, and it actually grows 'more tax free' than most people realize. Believe it or not, the only thing that matters for long-term dollars is the tax % now vs the tax % when you withdraw the money from the traditional 401k or IRA in retirement. The secret is they both grow tax free. Or, you could say they both *don't* grow tax free (traditional is paid when you take it out, Roth was lost the year it was contributed). Either way, they are identical and most people only think 'Roth's grow tax free'. If you're in the 22% tax bracket now, and you plan to be in the 12% (or 15% by then) tax bracket in retirement, which is most people because you control how much you take each year at that time, you are losing future purchasing power by going with a Roth 401k contribution instead of a traditional contribution. If you will be in the same tax bracket you will come out exactly even overall. To the dollar. For example: Let's compare putting $23,000 into a Roth 401k vs a traditional 401k this year. If you are in the 22% tax bracket, you will contribute the following: Traditional: $23,000, no tax bill in current year Roth: $23,000, DIRECT cost of $5,060. Remember, your life is one big account. This money is gone forever. You have effectively contributed a net $17,940 to your portfolio. In 30 years growing at 10%, you grow to this: $23,000 = $456,260 $17,940 = $355,883 To pull the $456,260 out at 22%, you would be left with... *exactly* $355,883. The only question with 401ks that 'really' matters (besides some random little things if you take it out early and stuff like that) is your marginal tax rate now vs marginal tax rate in retirement. In the majority of cases, it will be lower in retirement, *or*, it won't matter anyway (: (meaning you have so much money you're good).
Nice results! I've been rebalancing my portfolio to take advantage of falling interest rates - bond funds and sectors that benefit from low interest. I'm very close to retirement so getting more conservative.
Interest rates have held steady since July 2023. The Federal Reserve has decided to hold interest rates steady after its meeting on June 11 and 12, 2024. The federal funds target rate has remained at 5.25% to 5.5% since July 2023. To combat inflation, the rate was raised 11 times between March 2022 and July 2023.Jun So what interest rates falling ?
Very nice! It is a great move to get all of our ducks in a row *before* the events happen. I love that you are positioning for the (hopefully inevitable) changes that will come late this year and early next. I'm a stickler for my target allocations. I've done nothing but load up on SCHD lately as VGT and QQQM have shot to the moon. It always feels backwards to our human emotion, but we want to have systems in place to buy low and sell high over time.
I viewed it more like 'rebalancing some VGT to SCHD as I get closer to retirement' (because VGT is full of gains lately, and SCHD is a great stable income builder). I'm just using these tickers as an example. I do agree the interest implications where confusing when getting technical. I took it at a 'high level approach' value (:
I appreciate it! We should both get a referral bonus in 60 days. Although I've had 11 referrals and I've never gotten a credit there (I emailed this week to see what is going on). We are supposed to get $75 each if you fund the account with $10,000 or more in 60 days. If you don't, no big deal at all. I'm excited for you to get going there either way regardless of the bonus situation.
@@JeffTeeplesI have checked with M1 on this, they say you need to have $10,000 in the brokerage account within 30 days of open. I have $10,000+ in the M1 high yield cash account which does not count, and I am doing the DCA $100 daily, not get $10,000 into brokerage within 30 days, so no bonus for us 😢. So far I really love M1, with the target allocation, I just put a fixed amount in daily, no matter the market is up or down.
It's all good Cindy! I'm glad you're using and loving M1 Finance. I think it has the best automated investing system by a country mile compared to other online brokers. A part of me has been tempted to move everything over there for a while now. I love E*Trade as well, though. I'll likely open a Roth IRA at M1 Finance, and continue piling money into the portfolio there. I love how it buys to the target allocations without us doing anything. Just put money in and enjoy buying the dip automatically (:
The semiconductors have been amazing over the past decade. SMH is probably my favorite. I get a lot of exposure to semis in VGT. Something like SMH (which has been amazing) is too concentrated for my taste. I believe in technology moving forward without a doubt. But I like to own the basket of tech with VGT so I automatically get the 'next big thing' in tech. SMH has dominated VOO and VGT, no doubt, over the past decade and then some. I'm happy with my slice of it within the indexes because we don't *know* if semiconductors will continue to dominate. They may.
Good advice. I've been loading up on somewhat "boring" assets like SCHD, VIG, and a few staple stocks. I'm leaving my long term growth stocks and ETFs alone with a few targeted buys to build out positions over multiple years.
Hey Nick. It's great that you're diversifying your portfolio with those "boring" assets. It's nice holding the growth ETFs and seeing them sky in value. Makes buying SCHD feel better because 'eventually' it will pay off compared to the growth side. Once that happens, we'll be loading up on the growth ETFs again (:
It will be a fun battle (: Of course, we will both win long-term if we stay the course. I made ~$50k per year more than my wife. She had the better benefits (and still covers the family now). I miss the mega extra investing each month! But the purpose of this channel is worth it 100x over. Wife still makes enough to cover bills AND max the 401k with a crazy generous company match. I got a few promotions late in the career, so I didn't take full advantage of making great money. We got a couple nice years of it though. I figure this UA-cam channel will eventually chip in some extra cash-flow each month (again, not the purpose, but it will be nice to get investing more beyond the 401k again each month).
Hey Anthony. It is a tough one because 'technically' "value" has outperformed "growth" by definition (which is murky) over the past 100 years. *But*, this means nothing because a company can bounce back and forth between 'growth' and 'value' depending on the financials at the time (PE ratio being a major one). I look at it like this. *Actual* ticker growths, such as QQQ, have dominated the market (VOO) and value over the past 40 years. So I would say yes to your initial assumption, but I still think a nice mix of growth and value is the best. Growth is so volatile and value (like SCHD) will be more 'bond like' in the down markets. For a young person, tilting growth isn't a bad idea as long as they commit to never selling in a down market.
I've been seeing from others that nearly all the growth in the last few months of the S&P 500 has been attributed to Nvidia, so you take that out and VOO has been pretty flat. So don't worry about VOO beating your mix so far this year, I think that's going to change very soon
Thanks for watching and for dropping a comment. Nvidia has been wild lately. That is the beauty of VOO, it will always benefit from the 'next company blowing up' and hedge against the ones falling (as they weigh down and eventually get replaced). No 'market timing' and 'auto rotations' make it a tough thing to beat. It is no wonder over 98% of actively managed funds fall short in 20 year windows. All of that said, we got this! (: I really do think the mix will compete well. May not win every single year, but I've outperformed the market by a lot when zooming out. All with zero decisions being made. Target allocation contributions and chill.
Hey Idan. I typed out a long reply and UA-cam errored out. Sigh. Anyway, I'm more of a fan of the S&P 500 index. I like the higher floor and lower ceiling, personally. But for the small cap fans, the S&P 600 is superior to the R2000 over the years and decades. They track small cap, but different methodology. Check out VIOO vs IWM. IWM is ahead YTD, but the 3-5-10 favor VIOO. I learned this when I read a book about factor investing (title slips my mind).
Got it. My main investing strategy is long term with similar ETF's like you use. I just wanted to put a chunk of money temporarily (6-12 months) and then get it out just so it might get more then the intresest I can get in the HYSA before I find real estate to invest in so I thought about that IWM just not sure if it's a right move.
@@Investmiz a lot of people love investing in small cap value. I think it could be a nice move. The most important thing is to determine what you want to invest in and why, build your target allocations to support the system, and stay the course. I wouldn’t jump in and jump out of any ETF based on timing market events. Us humans are bad at timing and predicting.
❤ Hi Jeff, Huge fan of the channel and frequent commenter. 🤔Burning question: What should we do with the dividends from the high yielding ETFs a.k.a. income, ETFs? Should we drip or use that income every month to put into The other safe building block ETFs
Thank you for the consistent support of the channel & great question. I personally turn dividend reinvestments (DRIP) *off* in E*trade. This is because I don't want JEPQ to automatically reinvest in JEPQ. Same with SCHD to SCHD, etc. I do use DRIP in M1 Finance because it automatically reinvests to the target allocations (instead of the company that paid the dividend). I take the juicy dividends and reinvest them to my target allocations. I'm buying whatever holding is the most beat up to get it back to its target weight (at a comparative discount to my other holdings). This is my way to auto-time the market without screwing things up with my gut calls (:
@@JeffTeeples thank you Jeff for taking the time to reply to me. that’s what I was thinking would be best to do with those dividends, but I didn’t know if you being a math wizard had any testing research that says we should do otherwise with our dividends from income ETFs.
For those in peri-retirement, we may be more concerned about a 2008 repeat where you would probably lose about 1/3 and maybe sorry that you didn’t have at least 10% in BND
Not at all. If I had a $1,000,000 portfolio, it would drop to $670,000. A $900,000 portfolio would drop to $603,000 + 10% bonds = ~$703,000. The lost performance in any long stretch, even with cherry picking, simply isn't worth it. But, this is assuming the investor will NOT panic sell during the crash (otherwise bonds or cash are GREAT for them) and stay the course long-term. People don't realize the cost of floor stabilization over time. Plus, SCHD is a better floor by %, and comes with (most) of the S&P 500 total return upside over 13 years since inception, and has never failed to grow its dividend. Will it drop more than bonds? Yes. Will it drop more than VOO or QQQ? Nope.
Started with negative $75,000 at 28 (school debt and bad life decisions pre-career). And trust me, if I can do this then *anyone* can (: Build a nice system based on your risk tolerance and goals, ignore the noise, and stay the course.
Its unbelievable that these valuable pieces of information are shared for free every week... Keep up the great work, I found your chsnnel recently and will definitely subscribe to get all those nerdy spreadsheets and emotes...thanks Jeff!!!
Thank you for the positive feedback. It's great to have you here in the community. I want to help as many people as possible reach financial freedom. That is the mission here. I appreciate your support.
Hey @JeffTeeples, we're also working towards financial independence and have been inspired by your strategy! We're following a similar approach with SCHD and VGT, as we believe in the power of tech and have always been fans of SCHD. After watching your videos and doing some analysis, we've decided to keep it simple with VGT, SCHD, and VOO (which we already held and didn't want to let go of due to FOMO!). Our plan is to increase our SCHD holdings in retirement by selling either VOO or VGT. Thanks for sharing your expertise and being transparent - it's made a big impact on our investment journey!
Thank you for the kind words & the support of the channel. I love hearing about these things because it is fun to grow together. I would love to say I have all the answers, but that would be BS (: I learn a lot from this community as well. The benefit flows both ways.
Happy late birthday Jeff. Thanks for the update. I am at 5.25 mil. Biggest positions VOO, VTI, SCHD, VYM, and now looking to build up dgro. I got $48,800 divs last year in taxable divs. Q2 taxable divs this year was $17,388 this year.
Man Richard, that portfolio is impressive! I bet you'll smash your dividends from last year with SCHD going crazy in quarter 2 this year (: DGRO is a nice addition for a dividend grower. Not that you need me to tell you that (: You're waaaaay down the path already.
Hi Richard, quick question if you don't mind, my goals are similar in the sense I want more dividends by the time I retire as well. At what age did you start investing and how much per month?
@@VanillaCherryBread Hi. I never really kept track of how much. I started investing after my first deployment to the Middle East in the army in 1998. I always tried to max my 457 and or 401k. I was a cop for 13 years and I worked 60 hr a week and put all my savings into investments. Now I max my 401k and my employer puts in almost 10k on top of that.
which companies would you recommend or where should I invest a hundred K to get the best dividend return right off the bat?
Hey Larry. Thank you for watching and thanks for the question. I would not recommend buying any individual stocks if you do not put the time in to do in depth research. I think SCHD & DGRO are great dividend ETFs to invest in for solid long-term performance.
DGRO specializes in growth its dividend (even though SCHD ironically has a higher 10 year dividend growth rate). SCHD will give you a nice balance between dividend yield, growth, and total returns. It is a nice counterbalance for VGT, QQQM, or SCHG if you have money invested in growth ETFs. Very low overlap.
I concur with Jeff's recommendations of SCHD and DGRO.
@JeffTeeples - How about adding XMHQ and VIG? These four ETFs offer diverse strategies, similar returns, with minimal overlap.
Hey Gurinder. Thanks for watching and for leaving this reply I think VIG is a great way to go. It is similar to DGRO. I am not familiar with XMHQ. After seeing CRAZY dividend CAGRs, I looked at the distribution history. I noticed the recent dividend was $4.5773 per share. The previous all-time high quarter was $0.3533. Would love to know where that came from.
The total returns are VERY impressive on XMHQ compared to the other 3 dividend ETFs as well. I'll be watching this one.
Always appreciate your portfolio updates. 👍💰💰💰💰💰💰💰
Thanks Jed. I appreciate you taking the time to watch & drop a comment. The support helps a lot.
Staying the course. When the market appears to go up, i buy, keeping my allocations in check. When the market drops, I buy, maintaining my allocation percentages. In short, buy less when prices go up and buy more as the prices drop. Yay! Keep those videos coming and thanks.
Exactly Roy. You nailed it! Staying the course long-term will help us build stable wealth. This market will eventually fall, and we will stick to the battle plan and benefit from the discounted prices when everyone else is running (:
Hi Jeff, I really want to thank you for introducing me to M1. It made the DCA very easy, on top it automatically allocates more money to the fund that is under my allocation %, which buys even more shares at the lower price.
Also I definitely see the benefit to have SCHD in my portfolio these days. Thanks again for this!
Hey Cindy. No problem. I think M1 Finance is the best platform for long-term investing with a passive strategy. I love the target allocation DCA framework. I do the same thing in E*Trade, but it requires math haha
SCHD was incredible today. I know the reversion to the mean is inevitable. Then all of the people telling me I'm wasting money in SCHD instead of going 100% VGT will disappear (:
Once growth is in the tank, I'll be all about buying QQQM and VGT. The rest of the world will say I'm crazy for not going all in on SCHD (:
Thanks for sharing. But aren't 8 positions a lot compared to something like the 3-index fund play?
I think a well put together 3 fund portfolio will do great. It is 'basically' what I have. Well, I have 3 core categories that are a bit different that the traditional 3-fund portfolio.
I have growth, value, and market. I like to keep it simple. Most my money will go into VOO (market fund), SCHD (value ETF) and VGT or QQQM (favorite growth ETFs). That is 4 positions.
I would say the other positions are 'other'. For example, JEPQ is strictly for cash-flow because I quit my job and we need cash to get by right now. IBIT is bitcoin, which is another play altogether and only 2 to 3% of my portfolio. VUG is a growth ETF that we have to buy because it is the only good option in our HSA. Then there are my individual stocks I maintain on the side (1% of total).
Way to go Jeff - happy for you and your family. 40% tech - deep exhale - but you are keeping it real.
Thanks Kent! I am definitely a tech bull to be sure. It comes with some serious down trends at times. I'm betting on the long-term future with tech, but I realize it comes with high volatility.
Today I've got the following question: for instance, you can deversify VGT with QQQM, and SCHD with DGRO, but what about JEPQ? Is there any recommended tool to have more than one dividend cow, just in case to be more secured from income generation perspective (mabye DIVO, or anything that you personally would prefer)? Thank you for the approaches and materials you're sharing!
Thanks for watching and for a great question. I like JEPI to put alongside JEPQ. JEPI picks stocks from the S&P 500 index, and JEPQ selects them from the Nasdaq-100. Two of my favorite indexes. You can mix it REITS, my favorite being ticker O, and many other covered call ETFs as well.
Top content. Everything explained so well for the starting investors. Thank you Sir
Hey Mervyn. I appreciate the kind words. Thanks for watching the video and for dropping a comment.
Thank you for the video. Do you think that just holding a few ETF we are good instead of picking individual holdings? All the best for you
Hey Ivan. Thank you for watching & for the question. Also, I see that shiny member badge, it is much appreciated (:
I am a huge proponent of holding ETFs instead of individual stocks. I think that over time it will provide better returns because we humans are proven to be terrible market timers. Our emotions kick in and it is dangerous. We end up buying high (greed + bandwagon) and selling low (panic).
It's funny because it 'feels' more diversified to own 20 or 25 different stocks. But in reality, holding VOO gives us ownership in 500 of the largest companies in the US. It is WAY more diversified, even though it feels like our 'eggs are all in one basket'.
Thank you so much for your quick response, It is really helpful and I appreciate it!!
Question for you Jeff.. I mainly contribute to two accounts. My Sep Ira and taxable. Thoughts on doing something like Voo/vgt in one account and vti/qqqm in the other. Something like a 70/30 split into both. Don’t really have interest in dividends at the moment.
Thanks for the question. I think you have a great plan with those combos. All 4 ETFs pay (basically 100%) qualified dividends. So you could put either combo in the SEP vs the taxable and be fine.
I would definitely concentrate on maxing the SEP IRA before putting too much into the taxable each year. My wife and I try to max her traditional 401k and HSA before our taxable (for the most part, you can always do a comfortable mix that works for you).
I think you got this. Dollar cost average into your 4 ETFs for years and you'll be looking very good. Make sure not to panic sell when things get ugly and don't get too high when things are green. Stay the course and do your thing. I am confident in all of those holdings over the long haul. It's a great hands off way to approach it. I love ETFs.
Thank you Jeff for the transparency, I have a doubt that in these months you have not invested in VOO or VGT, what you are doing is investing in SCHD until the portfolio is balanced, or there is something that I am not understanding, big hug
Hey Juan. I have been investing in SCHD lately due to its underperformance. I like to keep VOO, VGT+QQQM, and SCHD about even. When the market crashes, I will be buying a lot of VGT and QQQM.
I let me winners run in general. I'm not interested in selling shares to produce long-term capital gains. However, new dollars always 'auto-buy the dip' because they go into the ETF that is underweight (biggest proportional discount).
Target allocations never feel right during big booms (like VGT lately), but it is proven that buying low wins long-term.
Could you make a video explaining how to make a spreadsheet like yours I wanna start tracking my investments but I’m not sure how to start making spreadsheets
Hey Braiden. Thank you for watching and dropping a comment. That is a great idea! I need to take the time to throw together a more advanced portfolio tracker. I think a video describing the process will be a great idea when I get there.
I’m starting Voo, vgt, schg, schd
That is a killer combo. I almost went with SCHG over QQQM. Maybe I should have (: SCHG is having a great year!
I love the transparency, I had some reservations and you’ve made me feel more comfortable about investing by displaying your journey. Thank you Jeff! ❤
I appreciate you sticking with these videos. I really do make them to help others towards financial freedom. I wasn't wild about *full* transparency at first because I didn't want it to be dripping with 'look at me' vibes. But *showing* that I practice what I preach outweighed that concern by a mile. It is a simple long-term game that we can win together.
Am I perfect? Absolutely not. But I can help get people pointed in the right direction. Specific systems will vary, and there are a lot of ways to go about it. But some things, like buy and hold long-term, don't panic sell, stay the course, stick to target allocations regardless of the news, and many others are universally correct (:
Thanks!
Hey Brianna. Thank you as always! Your support of the channel has been outrageous... In a good way!
I’ve been trying to get in at a discount with VGT and QQQM by selling CSP on it. However they keep going up! Should I continue this or just buy them where they are currently
Hey Tony. I don't play around with options myself. I'm a fan of buying and holding all positions. I'm a bit biased, but I would say buy them and hold for years.
However, to your point, they are high right now, so I guess 'it depends' is the real answer. I haven't purchased growth (not counting converting some VGT to QQQM) with new dollars in over a year. It has been all SCHD to bring it up to its target allocation.
I guess I don't have a buy or sell recommendation in a vacuum. I do everything by my target allocation system. I love it because it is mathematically impossible to not buy the 'comparative dip' within my portfolio this way. I do the same thing (well, M1 Finance does it for me) with my 25 individual stocks. Buy the one that is beat up the most with new dollars to get it back to its spot.
The real question is, how much VGT and QQQM do you want in the portfolio? Once you know that %, you can buy them all at once or put it on a DCA system over time to get them to weight.
Awesome portfolio, any thoughts on DIVO for a lil growth & income?
Thanks for watching and for the kind words. I don't love DIVO, personally, because it misses on a lot of the things I care about. The expense ratio is too high at 0.56%. The dividend does not reliably grow. And the total returns are lacking.
I don't invest in cash-flow plays for total return or to beat the market, but it does matter.
I will say DIVO has impressive, although sporadic, dividend payments. Something like SCHD is more of a reliable grower.
I think DIVO is a fine play for a dividend portfolio in general, just not for me.
Jeff, I am trying to use the Portfolio Visualizer to backtest some investments. It won't let me enter VMFXX which is a larger portion of my investments. What do you recommend I substitute so that I can see the return % as part of my overall investments?
Hey Chazac. I don't back test my cash equivalents with my portfolios. Emergency cash, checking, savings, high yield savings, and money markets are all 'cash' to me. I will have it no matter what, so I don't want it to skew the results of 'this' vs 'that' for *investing* results.
After looking around a little, I don't know what you can use to replace it if you do want to see your total performance on portfolio visualizer. I need to create a spreadsheet for situations like this. Noted (:
Thank you for being a channel member. Your extra level of support has been awesome.
Congratulations Temples!!!
Thank you! I appreciate you watching and leaving a comment. It was a great week in the market.
SHORTER? NO!!! Make these videos longer please 😊
haha, thanks Rafael. I have given up on making them shorter. But I'm still trying to streamline the process. I appreciate you watching and for dropping a comment.
We all know how much valuable information you give us and more would be better! 😂
We all enjoyed the market gains
Market gains are like a rollercoaster ride, thrilling when going up! We'll take it (:
Very nice! 🎉
I have a question: do you invest in any small cap stocks or etf?
🙏
Thanks for the kind words Ron. I am mostly large cap. I do invest in HWKN and AGM for small cap exposure. I also have MLI for mid cap.
My ETF mix of 33% VOO / 33% SCHD / 17% VGT / 17% QQQM is 76.9% large, 19.5% mid, and 3.61% small cap.
How long did it take to reach that number???
I’m about 14 years into the journey.
Do you have a live portfolio tracker??
I use Seeking Alpha to track my live portfolio. It has my shares and everything so it updates real-time.
It is easily the best aggregator I've used (and I've tried a lot of them). It's great because I can do my research and tracking all in one place.
Are we in a stock market bubble?
If I knew the answer to this I would be a billionaire (: I have no clue. The market 'feels high', but earnings have also been solid. I will stay balanced to my target allocations in all markets just in case.
I have a question what would you consider a balanced portfolio being retired? I'm 100% dividend stocks and dividend ETFs
Hey Billy. That is a tough one because there are so many ways to go about it.
There is the traditional approach of having X amount of stocks (index funds usually) and X amount of bonds (bond ETF usually). That is not a bad way to go, but I don't personally like it.
I'm biased towards your method of 100% dividend paying ETFs and stocks. I like it because you will have reliable cash-flow growth, even in a down market. If your portfolio value drops in a crash you will still be collecting those (usually) growing dividends. I prefer the way you are doing it to the traditional approach.
A lot of portfolio strategies are balanced as long as the investor stays the course and doesn't emotionally jump on bandwagons while watching the news.
@JeffTeeples thanks Jeff I'm not into bonds either. Also if value drops I'm getting paid to wait. I'm also reinvesting 65% of dividends.
I wonder how much your portfolio might have lost in the past few weeks since you uploaded this video. I was hoping you were going to create some content addressing the big dip we've been experiencing as of recent, especially in the tech sector, and show us the new value of your portfolio as a consequence. That would have been a tremendous help and motivation for us, subscribers as well as new viewers, to keep going and to keep investing among this market volatility.
Thank you for watching and for the comment. I have some videos queued up for the coming weeks. Not tomorrow but next week will be my portfolio update. I was out of town for a while and had to record ahead. But you're right, keep on buying to the target allocations and do not panic sell. Staying the course is the theme of my update video.
Thanks for the video and all the informational replies.
Since you're not working this year, are you taking advantage of a spousal Roth IRA contribution?
Or is the UA-cam money a negative factor?
Hey Charlie. Great questions.
I am maximizing everything possible. I put $7k into a Roth IRA. Business expenses are written off in joint return, and (I haven't done it yet) I'll be starting a solo 401k to stash all the money I make on UA-cam (which isn't much so far).
I should be able to make my income $0 on paper for a while.
@@JeffTeeples - that's awesome!
How great is it that JEPQ is up almost 16% for you, while paying that sweet sweet yield haha, great job Jeff!
Hey Oldrin. It is honestly wild. I said I was going to get rid of it to focus on QQQM long-term. But it is going to be soooooo hard to pull the trigger, haha.
I've toyed with the idea of keeping JEPQ around, and offloading cash (VMFXX) instead. Keeping JEPQ + VMFXX at 10% of the portfolio. This gives a cash position and a 'greedy cash-flow' position within the mix. Still leaves 90% of my portfolio for my 'normal long-term investments'.
@@JeffTeeples I hear you sir! Well you are in such a great position + your discipline you will certainly be fine either way! Question I recently found about SCHG, am I right to think that it seems to be kind of a little more specialized version of voo ? Would you say they are fairly close to interchangeable in terms of being a corner stone holding or am I way off?
SCHG is more akin to QQQM. It focuses on growth companies. It has a PE ratio of 34.49. QQQM is at 32.62 while VOO is 25.7.
SCHG and QQQM both have about a 50% overlap with VOO, which is natural, since VOO is 'about half' growth over its history (it is a bit higher at the moment).
The other half of VOO is full of value companies, though, making it different than SCHG. They are not interchangeable, however, I think SCHG makes for a great addition to the growth section. I was very torn between it and QQQM for my portfolio.
@@JeffTeeples Thank you so much for thoughts! I appreciate you taking the time to answer my questions!
@@JeffTeeples Why are you planning on getting out of JEPQ?
ThanX Jeff..... GREAT video... Love the overview and your success on your portfolio..... Congrats.. Keep up the great work.... Question for you.... Do you auto DRIP every month/quarter or do you manually do it and lastly, do you adjust/balance your percentages of holdings each quarter or half or annually...???? Thanks again - appreciate your hard work and efforts each week for us.... Wishing you and your family well..... Peace...!!!
Hey Lance. Thanks for watching and dropping a comment as always. I appreciate you support as a member as well!
I auto drip in M1 Finance with my individual stocks (The HODL Factory) because it buys to the target allocation.
In E*Trade, I have DRIP off for all accounts. I take the dividends and apply them to my underweight positions (for example, VGT and QQQM dividends were reinvested into SCHD this quarter). I basically do what M1 automates over in E*Trade with my ETFs.
The rebalance thing is tricky. Historically I didn't have to rebalance... Ever, actually. This is because I made good money before quitting to start this channel. I would invest in the underweight position and it would naturally balance itself out over time.
I think I may have to start doing official rebalances beyond my new contributions moving forward. The portfolio is getting bigger *and* I don't make a lot of money now (wife has great job, covers the bills and 401k, but we don't have extra. Definitely my fault haha).
I aim to make it an annual event. I'm okay with letting my winners run a little bit. Especially because I'm diligent about buying the others with new money. In 'most' markets, it will balance itself. Not in this market, though.
@@JeffTeeples Thanks so much Jeff.... Very interesting..... Yes, I am trying to work thru that "balancing act" as we speak... With all the gains - things get thrown off. I am using a taxable brokerage account to help balance things out as I can contribute to that fund anytime vs IRA's or ROTHS which are governed by many contribution rules. Appreciate your overview and I am sure due to your excellent skills and education in the accounting field it will make your task quite easy. I guess I should have studied harder in school. LOL Be well and have a great week.. Looking forward to Sundays video.
Haha, Lance, you always give me a good chuckle. I'm sure you did just fine in school / life / your career (:
I've been thinking about rebalancing as well. I used to bring in a solid salary, and now I'm close to zero. I have a brand new game plan to follow that I will share in a monthly update. A lot of changes (because of my specific situation, not in 'general investing strategies'). More to come.
Channel idea: 1)Merits of DRIP vs cash dividend. 2)Turning the volume up or down on dollar cost averaging with correction concerns vs rock solid unwavering DCA. And 3) strategies on what types of assets to hold in taxable vs IRA type accounts with examples. I’ve only been a channel member a short time so apologies if this info is contained in your previous videos.
Hey Chris. Thank you for the great ideas for the channel. I am throwing them on my list. I’ve touched some of those things in past videos, but nothing detailed.
I appreciate you being a channel member! The extra level of support means a lot.
Hey Jeff what you think about Tesla? Good buy?
I don't like making individual stock calls based on my gut. I am biased towards TSLA in a way because I bought it at under $50 per share and sold for $372. I think a lot of that was dumb luck.
It is a wild card company that I think has a decent chance of doing well long-term. I don't have it in my stock portfolio because it doesn't pass my screeners. I took my gut out of investing. So far it's working well, but we never know what the future holds.
@@JeffTeeplesHi Jeff, what specifically are your screeners that you use? Thanks
Thanks for your transparency.
You're welcome, Sherry. Thank *you* for watching and dropping a comment.
No semi ETFs (e.g., SMH)? :)
Hey Bruno. Not for me personally. SMH has been fantastic for a long time, but I don't like concentrating money into one sub-sector of tech. I feel good owning a lot of the semiconductor stocks in VGT, as well as my individual stock picks.
Thanks for the video. These videos remind me to don't over think it. Stay the course that is been mapped out. It does work. Have a great week.
Thank you for watching. You are exactly right! I should add that it is easy to stay the course when we are hitting all time highs.
Not that I wish this... But... I can't wait for the next rough market because that is when remaining a buyer and not panic selling *really* pays off. I was down ~$200k in 2022 (heavy in VGT). Didn't sell a single share because that would have been selling low.
I'm a bit of a robot, but for some that is not an easy task. We need to stick to the system when things get tough.
Nice job with the ATH Jeff, congratulations!! Are you planning on opening 529 accounts for the kids?
Thanks for the kind words Eric! I likely will not open 529 accounts for the kids, but I’m not 100% sure. The perks vary state to state in the US. Actually, I really need to make a video on this. Great reminder (:
Thanks for your support of the channel!
keep pumping out those financial informational videos Jeff!!!!
Will do Kevin. Your encouragement means a lot, thanks for watching!
I’m pretty inspired by your portfolio setup! I work in the tech sector and am still in the accumulation phase - I was wondering what you think of this breakdown?
50% growth - 15% SMH, 15% IWY, 30% QQQM
50% value - 10% AVUV, 10% AVDV, 10% COWZ, 20% SCHD
Monitoring COWZ to see if I want that to take over SCHD still.
I’m roughly 30, so still a very long time horizon! I’m also still very personally bullish on semis, though willing to rotate out back into a general growth (QQQM) or even VOO if necessary.
Hey Ian. I think that is a solid mix for being 30. It has a bit of a high standard deviation at 19.1%. But the PE isn't outrageous because you mix in some nice value holdings. It is 25.87.
For reference, my mix is 16.78% and 25.30, respectively.
You have CRUSHED my returns in the past 4 years (that is all I could look back because of age of a holding), and your risk adjusted return is better as well.
I think you'll do well as long as you stay the course when times get tough, and buy to your target allocations (buy the ones that are beat up at a discount with your new dollars).
The most common way that retain investors lose with any system is when they abandon the game plan when times get tough.
62k growth and yet dollar shave club still too expensive
Give me the magic of compound over a clean shave all day every day!
Jeff had a video idea, should you pay off a 6% mortgage earlier as opposed to investing comparison.
I appreciate that Oldrin. I will throw that on the list. It can get a little spicy, and there are a lot of different opinions. I'm a believer in paying down anything over 8% right away. Never pay an extra penny on anything 4% or less. It is that 4%-8% range that varies.
@@JeffTeeples I completely agree.
What is HODL ?
It is what I call my collection of individual stocks (I want to start an ETF someday, but for now it is my account name in my brokerage).
It is the HODL Factory. A mix of the meme of misspelled word of 'hold' (crypto related) and the acronym of hold on for dear life.
@@JeffTeeples I would buy it !!! 💪😅
Jeff, I know this is off-topic,however I value your opinion and need you to remove my guilt …. Feel free to delete if needed.
I love Roth’s. I load up $14000 individual Roth’s , 7,000 each for me and the wife. 401k Roth while working =6.2% fica, 1.4%,and 4.95% state tax (IL). This will cost me an additional 12.65% now before federal. IL does not tax 401k in retirement and fica, Medicare are not paid as well in retirement. I’m not sure the 401k Roth is worth it right now. I’m already saving 38% per year and really need the $$ now for the 2 kid (12 & 16). This is across 401k, Roth’s, HSA. 403b, brokerage, Coverdale and custodials. Trying to reduce my taxes now, not increase.
I am aware of federal tax credits I get right with 2 kids as well. Still need the cash and not more tax right now.
Hey Daman.
Short answer: Making traditional 401k contributions is likely more valuable than making Roth 401k contributions. And the bonus is that it saves you money now for kids and lifestyle.
I love Roth IRAs in general. But I think traditional 401k contributions are better for most people. It lowers your taxes this year, and it actually grows 'more tax free' than most people realize. Believe it or not, the only thing that matters for long-term dollars is the tax % now vs the tax % when you withdraw the money from the traditional 401k or IRA in retirement. The secret is they both grow tax free. Or, you could say they both *don't* grow tax free (traditional is paid when you take it out, Roth was lost the year it was contributed). Either way, they are identical and most people only think 'Roth's grow tax free'.
If you're in the 22% tax bracket now, and you plan to be in the 12% (or 15% by then) tax bracket in retirement, which is most people because you control how much you take each year at that time, you are losing future purchasing power by going with a Roth 401k contribution instead of a traditional contribution.
If you will be in the same tax bracket you will come out exactly even overall. To the dollar.
For example:
Let's compare putting $23,000 into a Roth 401k vs a traditional 401k this year.
If you are in the 22% tax bracket, you will contribute the following:
Traditional: $23,000, no tax bill in current year
Roth: $23,000, DIRECT cost of $5,060. Remember, your life is one big account. This money is gone forever. You have effectively contributed a net $17,940 to your portfolio.
In 30 years growing at 10%, you grow to this:
$23,000 = $456,260
$17,940 = $355,883
To pull the $456,260 out at 22%, you would be left with... *exactly* $355,883.
The only question with 401ks that 'really' matters (besides some random little things if you take it out early and stuff like that) is your marginal tax rate now vs marginal tax rate in retirement. In the majority of cases, it will be lower in retirement, *or*, it won't matter anyway (: (meaning you have so much money you're good).
I appreciate the response. I’m gonna stick with my method. I value my kids experiences as they are getting older.
Nice results! I've been rebalancing my portfolio to take advantage of falling interest rates - bond funds and sectors that benefit from low interest. I'm very close to retirement so getting more conservative.
Interest rates have held steady since July 2023.
The Federal Reserve has decided to hold interest rates steady after its meeting on June 11 and 12, 2024. The federal funds target rate has remained at 5.25% to 5.5% since July 2023. To combat inflation, the rate was raised 11 times between March 2022 and July 2023.Jun
So what interest rates falling ?
Very nice! It is a great move to get all of our ducks in a row *before* the events happen. I love that you are positioning for the (hopefully inevitable) changes that will come late this year and early next.
I'm a stickler for my target allocations. I've done nothing but load up on SCHD lately as VGT and QQQM have shot to the moon. It always feels backwards to our human emotion, but we want to have systems in place to buy low and sell high over time.
I read it as a positioning play to take advantage of the *coming* interest rates. I could be wrong on this, as it wasn't explicitly stated that way.
@@JeffTeeples Ok so buying bonds now at todays lower prices to position for interest drops?
I viewed it more like 'rebalancing some VGT to SCHD as I get closer to retirement' (because VGT is full of gains lately, and SCHD is a great stable income builder). I'm just using these tickers as an example. I do agree the interest implications where confusing when getting technical. I took it at a 'high level approach' value (:
Sunday is now started! 🎉 just signed up for M1 with your link!
I literally watch your videos as I fill out my personal sheets weekly, its a ritual
I appreciate it! We should both get a referral bonus in 60 days. Although I've had 11 referrals and I've never gotten a credit there (I emailed this week to see what is going on). We are supposed to get $75 each if you fund the account with $10,000 or more in 60 days. If you don't, no big deal at all.
I'm excited for you to get going there either way regardless of the bonus situation.
This is what I was hoping for. These videos are to help others get going. I know weekly is a lot (many do monthly), but I *love* the Friday ritual.
@@JeffTeeplesI have checked with M1 on this, they say you need to have $10,000 in the brokerage account within 30 days of open. I have $10,000+ in the M1 high yield cash account which does not count, and I am doing the DCA $100 daily, not get $10,000 into brokerage within 30 days, so no bonus for us 😢. So far I really love M1, with the target allocation, I just put a fixed amount in daily, no matter the market is up or down.
It's all good Cindy! I'm glad you're using and loving M1 Finance. I think it has the best automated investing system by a country mile compared to other online brokers. A part of me has been tempted to move everything over there for a while now. I love E*Trade as well, though.
I'll likely open a Roth IRA at M1 Finance, and continue piling money into the portfolio there. I love how it buys to the target allocations without us doing anything. Just put money in and enjoy buying the dip automatically (:
any thoughts on semicondoctor etf's? i feel like ur missing out abit
The semiconductors have been amazing over the past decade. SMH is probably my favorite.
I get a lot of exposure to semis in VGT. Something like SMH (which has been amazing) is too concentrated for my taste. I believe in technology moving forward without a doubt. But I like to own the basket of tech with VGT so I automatically get the 'next big thing' in tech.
SMH has dominated VOO and VGT, no doubt, over the past decade and then some. I'm happy with my slice of it within the indexes because we don't *know* if semiconductors will continue to dominate. They may.
@@JeffTeeples i too have them also SOXQ, been great this year. Any plans on adding them?
I'll never say never, but no plans as of right now. I'm happy with a more broad approach regarding technology.
Good advice. I've been loading up on somewhat "boring" assets like SCHD, VIG, and a few staple stocks. I'm leaving my long term growth stocks and ETFs alone with a few targeted buys to build out positions over multiple years.
Hey Nick. It's great that you're diversifying your portfolio with those "boring" assets. It's nice holding the growth ETFs and seeing them sky in value. Makes buying SCHD feel better because 'eventually' it will pay off compared to the growth side.
Once that happens, we'll be loading up on the growth ETFs again (:
I am a little ahead, but since I am retired and not adding new money that won't last long. Lol. Keep up the good work.
It will be a fun battle (: Of course, we will both win long-term if we stay the course.
I made ~$50k per year more than my wife. She had the better benefits (and still covers the family now). I miss the mega extra investing each month! But the purpose of this channel is worth it 100x over. Wife still makes enough to cover bills AND max the 401k with a crazy generous company match. I got a few promotions late in the career, so I didn't take full advantage of making great money. We got a couple nice years of it though.
I figure this UA-cam channel will eventually chip in some extra cash-flow each month (again, not the purpose, but it will be nice to get investing more beyond the 401k again each month).
Thanks for sharing. My understanding is that growth long term makes more $ than value. Please advise.....
Hey Anthony. It is a tough one because 'technically' "value" has outperformed "growth" by definition (which is murky) over the past 100 years. *But*, this means nothing because a company can bounce back and forth between 'growth' and 'value' depending on the financials at the time (PE ratio being a major one).
I look at it like this. *Actual* ticker growths, such as QQQ, have dominated the market (VOO) and value over the past 40 years. So I would say yes to your initial assumption, but I still think a nice mix of growth and value is the best. Growth is so volatile and value (like SCHD) will be more 'bond like' in the down markets.
For a young person, tilting growth isn't a bad idea as long as they commit to never selling in a down market.
I've been seeing from others that nearly all the growth in the last few months of the S&P 500 has been attributed to Nvidia, so you take that out and VOO has been pretty flat. So don't worry about VOO beating your mix so far this year, I think that's going to change very soon
Thanks for watching and for dropping a comment. Nvidia has been wild lately. That is the beauty of VOO, it will always benefit from the 'next company blowing up' and hedge against the ones falling (as they weigh down and eventually get replaced). No 'market timing' and 'auto rotations' make it a tough thing to beat. It is no wonder over 98% of actively managed funds fall short in 20 year windows.
All of that said, we got this! (: I really do think the mix will compete well. May not win every single year, but I've outperformed the market by a lot when zooming out. All with zero decisions being made. Target allocation contributions and chill.
Hi Jeff! What are your thoughts about IWM? Russell 2000
Hey Idan. I typed out a long reply and UA-cam errored out. Sigh.
Anyway, I'm more of a fan of the S&P 500 index. I like the higher floor and lower ceiling, personally.
But for the small cap fans, the S&P 600 is superior to the R2000 over the years and decades. They track small cap, but different methodology. Check out VIOO vs IWM. IWM is ahead YTD, but the 3-5-10 favor VIOO.
I learned this when I read a book about factor investing (title slips my mind).
Got it. My main investing strategy is long term with similar ETF's like you use. I just wanted to put a chunk of money temporarily (6-12 months) and then get it out just so it might get more then the intresest I can get in the HYSA before I find real estate to invest in so I thought about that IWM just not sure if it's a right move.
@@Investmiz a lot of people love investing in small cap value. I think it could be a nice move. The most important thing is to determine what you want to invest in and why, build your target allocations to support the system, and stay the course.
I wouldn’t jump in and jump out of any ETF based on timing market events. Us humans are bad at timing and predicting.
❤ Hi Jeff, Huge fan of the channel and frequent commenter. 🤔Burning question: What should we do with the dividends from the high yielding ETFs a.k.a. income, ETFs? Should we drip or use that income every month to put into The other safe building block ETFs
Thank you for the consistent support of the channel & great question.
I personally turn dividend reinvestments (DRIP) *off* in E*trade. This is because I don't want JEPQ to automatically reinvest in JEPQ. Same with SCHD to SCHD, etc. I do use DRIP in M1 Finance because it automatically reinvests to the target allocations (instead of the company that paid the dividend).
I take the juicy dividends and reinvest them to my target allocations. I'm buying whatever holding is the most beat up to get it back to its target weight (at a comparative discount to my other holdings). This is my way to auto-time the market without screwing things up with my gut calls (:
@@JeffTeeples thank you Jeff for taking the time to reply to me. that’s what I was thinking would be best to do with those dividends, but I didn’t know if you being a math wizard had any testing research that says we should do otherwise with our dividends from income ETFs.
Peace ✌️
Peace!! ✌️
For those in peri-retirement, we may be more concerned about a 2008 repeat where you would probably lose about 1/3 and maybe sorry that you didn’t have at least 10% in BND
Not at all. If I had a $1,000,000 portfolio, it would drop to $670,000. A $900,000 portfolio would drop to $603,000 + 10% bonds = ~$703,000.
The lost performance in any long stretch, even with cherry picking, simply isn't worth it. But, this is assuming the investor will NOT panic sell during the crash (otherwise bonds or cash are GREAT for them) and stay the course long-term.
People don't realize the cost of floor stabilization over time. Plus, SCHD is a better floor by %, and comes with (most) of the S&P 500 total return upside over 13 years since inception, and has never failed to grow its dividend. Will it drop more than bonds? Yes. Will it drop more than VOO or QQQ? Nope.
So, he started with about 700k more or less...maybe more.
Started with negative $75,000 at 28 (school debt and bad life decisions pre-career). And trust me, if I can do this then *anyone* can (:
Build a nice system based on your risk tolerance and goals, ignore the noise, and stay the course.