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No. of Recommendations: 1
Assuming that you can't, or don't want to, find a talented money manager, I think you would be better off with 50% in a low-cost S&P 500 index fund and 50% in a low-cost Wilshire 4500 index fund (i.e. the Wilshire 5000 without the S&P 500). This will give you a broad exposure to large, mid, and small cap stocks.

I wouldn't worry about cash or bonds. You are way too young. Equities provide a better probability of providing a positive real after-tax return over the long-run, so equities are actually less risky if your holding period is very long.

I also wouldn't worry about international funds. For one thing, there are too many games being played because of the time differences between when the stock markets are open in different countries. This causes mutual fund investors to have reduced performance. Also, it just isn't necessary. An international exposure might reduce annual volatility, but annual volatility is not important when you are talking about investing for decades.


I'd like to recthis one again. When I read the post, my first thought was, "He's 34. Why are they putting some much into bonds?"
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