2017 Q2 PoF Portfolio Update
I’ve described my portfolio and some rationale for what I own previously. The image below is a snapshot of the spreadsheet I use to track everything. About once a month or so, I log in to Personal Capital which gathers the balances from every account for me, and I enter them into the spreadsheet.
Personal Capital does a good (and in some ways better) job of tracking your balances and allocation, but I prefer to supplement with a spreadsheet, which aids in rebalancing and makes for easy sharing online with you all. If you sign up for the free service, this site may benefit, enhancing my charitable mission.
Although I just sold over $100,000 from the taxable account to pay for some property (to be detailed in a post next week), the account still has more than half of our retirement assets.
I like US and foreign stocks in the taxable account. While I could have only two funds there, I have tax-loss harvested, and I have trading partners now. I also own a little bit of Berkshire Hathaway. With no dividend come no tax drag, which is a beautiful thing.
I have a similar potential issue with the HSA. There’s a good chance that when I leave my employer, I’ll transfer that money to a different provider like HSA bank, which offers lower cost funds than Wells Fargo.
In the Roth accounts, I have some of the more volatile investments, including emerging markets and REIT. One could make an argument for emerging markets in taxable (TLH opportunities, foreign tax credit), but it’s not the most tax-efficient class, either.
2017 Q2 POF Asset Allocation
My targets have been adjusted slightly since I last gave you an update. I realized I was actually overweight on REIT based on Personal Capital’s analysis, which takes into account the amount of REIT exposure in the US Stock mutual funds I own. I have also acquired additional physical real estate, so I feel comfortable reducing my REIT exposure.
My spreadsheet indicates I’m at 8.4% with REIT, but my non-REIT index funds apparently contribute another 2.5% in REIT to my overall portfolio. To account for this, I’ve lowered my goal (based on my spreadsheet) to 7.5% and have made a slight increase from 20% to 22.5% for my international stock allocation.
Let’s see how accurate my spreadsheet calculates my small cap and mid cap exposure. I don’t expect it to be all that accuarate, since there are some stocks considered mid caps in Vanguard’s small cap index. Here’s what personal capital says in the 3×3 style box format:
As I suspected, I have more mid caps and fewer small caps than the spreadsheet predicts. I could fine tune the spreadsheet to reflect the percentage of mid caps in Vanguard’s small cap indices to get a more accurate picture, but I’m not rebalancing within US stocks so it’s not particularly important to be accurate. It’s more for informational purposes only, and I may very well drop the mid cap indices in favor of all small cap indices for simplicity’s sake.
2017 Q2 PoF Portfolio Performance
The market hummed along in the second quarter. Volatility remained low, and gains were slow, but steady. The S&P 500 (Personal Capital’s standard benchmark) returned 2.57%, while my portfolio returned 2.78%.
Returns were boosted by the strong performance of international stocks. Developed markets outpaced emerging markets, making Vanguard’s Developed Markets Index my strongest performer at 6.38% for the quarter.
My bond fund did what bond funds tend to do. While they typically underperform in good times, they also can be expected to outperform when stocks are down. As JL Collins says, they “smooth the ride.” In the second quarter, Vanguard’s Total Bond Fund gained 0.84%.
2017 2Q Market Performance
Morningstar has a very complete list of market index performances, with returns in the last week, month, quarter, year-to-date, one-year, three-year, and five-year timeframes.
A number of sites offer quarterly market reviews, and my tardiness means many are available. If you’d like to read about the quarter in great detail, see these market summaries:
I have not read the reports in detail. I like to keep my investing relatively simple, and I don’t expect I’d learn anything particularly actionable in them. Still, if you’ve got the time, reviews such as these can give you some insight as to how the markets behave, or at least how the experts interpret their behavior.
Start receiving paid survey opportunities in your area of expertise to your email inbox by joining the Curizon community of Physicians and Healthcare Professionals.
Use our link to Join and you'll also be entered into a drawing for an additional $250 to be awarded to one new registrant referred by Physician on FIRE this month.
2017 Q2 Spending
In the first quarter, we spent just under $14,000, putting us well under last year’s $62,000 pace. In the second quarter, the lower spending trend continues with less than $12,000 out the door, a figure I find quite interesting, given the fact that we haven’t intentionally tried to spend less.
I think the biggest difference is the realization that early retirement is going to be a reality in the relatively near future, and acquiring anything new or making additional home improvements doesn’t make a lot of sense right now. I suppose there is some intentionality there, but it’s not like we’re trying to see how low we can go in the spending department. Perhaps we’re closer to that sweet spot where frugality and minimalism converge.
I’ll detail where the money went, but first, it’s only fair to tell you where it didn’t go. One way we keep our expenses relatively modest is by cheating. How do we cheat?
- No mortgage or rent payments. We own our homes.
- No loan payments. Student loans have been paid off.
- No term life or disability insurance. We dropped them once we were FI.
- Health Insurance provided by employer. We will bear this cost when RE.
- Travel Rewards. Credit card points and CME travel reduce our travel costs.
- School-aged children. Both are enrolled in a quality public school.
- Donations. We give to and from donor advised funds, and track that separately.
Food & Dining remains our biggest spending category. We didn’t take any big trips, although I did visit friends in Colorado in April. Our family vacation to Paris & Reykjavik took place in the first quarter, so those expenses were already reported.
With about $26,000 in annual expenses in six months, I expect we’ll be well within the $60,000 spending budget I had anticipated. I do expect to make some bigger purchases in the next 12 to 24 months, which will include a new (to us) vehicle capable of pulling an RV, and, of course, an RV. I’m still budgeting $80,000 a year as our typical annual spending in early retirement to account for health care and “one time” expenses.
2017 Q2 Blog Performance
E-mail subscribers have already seen the following figures from my 18-month e-mail update as of July 9th, 2017. They also saw the revenue data from this site, which I reserve only for e-mail subscribers. I am happy to report that the site brought in more money in the last quarter than it did in the entire first year.
If you’d like to join the
nearly 1,600 over 3,000 strong (that’s more than 1,400 new subscribers in 4 months!), you can subscribe right here:
Numbers! I heart numbers:
- 1,097,000 all-time pageviews with 358,000 in the last quarter
- Viewed from 190 countries. Still none from Greenland or Madagascar, and somehow the number shrank by 5 countries. Were there mergers that I didn’t hear about?
- 2,544 e-mail subscribers (984 new in the last quarter)
- 681 Feedly subscribers
- 197 RSS Feedburner subscribers
- 4,445 Twitter followers
- 580 Facebook Page Likes & 96 Friends.
As you may know, my site is “the other site” in the White Coat Investor Network. We partnered four months ago in a synergistic relationship that has proven to be mutually beneficial, as anticipated.
The biggest news from WCI recently is the announcement of the (now sold out) first ever WCI Physician Wellness & Financial Literacy conference slated for March 1-3, 2018 in Park City, Utah.
I like to write Top 5 posts, so it seems appropriate to share the top 5 viewed posts of all-time. They are:
- Stealth Wealth: I’m Just an Ordinary Average Guy(15,857 views)
- He Has Read Over 250 Investing Books. He Recommends These Three Funds. (12,604 views)
- A Tale of 4 Physicians: The Impact of Lifestyle (11,885 views)
- Vanguard Backdoor Roth: A Step by Step Guide (11,237 views)
- 20 Steps to Effective DIY investing (10,882 views)
The fourth and fifth posts are not new posts, but are new to the Top 5, benefitting from sharing on social media and on forums.
Where is my traffic coming from? Top 5 referring sites:
- White Coat Investor (42,039 sessions)
- Twitter (20,617 sessions)
- Rockstar Finance (11,603sessions)
- Retireby40 (7,577 sessions)
- Facebook (6,593 sessions)
1500days.com remains at number 6. This list has not changed in content or order in the last quarter.
I frequently send readers away to different sites. Unfortunately, not every site registers, so while I know the White Coat Investor would top this list, my current setup with JetPack doesn’t track links to that particular site.
- The Happy Philosopher (4,775 clicks)
- Bogleheads (4,212 clicks)
- ESI Money (3,923 clicks)
- Early Retirement Now (3,541 clicks)
- 1500 Days (3,225 clicks)
The Chase Sapphire Preferred is an excellent first (or only) card with an all-time high welcome bonus! New in 8/2021 is a $50 annual hotel credit for bookings via the Chase UR tavel portal & 5x points for all travel via the portal. 3x points on dining, 2x on other travel. Flexible rewards good for cash, travel, or transfer to travel partners, great travel protection & new Peloton, Lyft & DoorDash perks! $95 Annual Fee
The Chase Sapphire Reserve offers great travel perks including Priority Pass lounge access, a credit for Global Entry or TSA Pre✓ and a $300 annual travel credit. When using Chase Ultimate Rewards travel portal, get 10x points on hotels and car rental & 5x points on air travel. 3x points on other travel & dining. Elevated Peloton, Lyft and DoorDash benefits. $550 Annual Fee
I hope you all had a good quarter, both from an investing perspective and from a life perspective. Summer is a great time to be alive, and I hope you’ve been able to enjoy it.
Expect another quarterly update in another couple months. I’ll do my best to be more timely. I’m particularly excited to write this next one, because I’ll be doing it as a part-timer. It just so happens that my new schedule begins with the advent of the fourth quarter.