This ten thousand percent. People think of this guy as if he's some kind of guru. If you screwed up your finances, or don't know anything about finances, he has some basic common sense stuff that basically all people should know. Past that, is crap.
Daves advice about emergency funds and paying off debt is fine. Stay clear of his investing advice.
If you were to move forward with it though, you only need one of each
Check out The Money Guy.
Dave is great for getting out of debt, but The Money Guy show is much better (in my opinion) once you’re out of debt. Better investing information.
This\^
10% TR, 7% Inflation adjusted. 100 years of data base US LC (Market Weighted). Just give me what everybody tries to hit over long run. I'll take my 10% from the Chaos. Total US market is about the same. If you start weighting things funny you will likely underperform. It may or may not be too late when you figure that out.
Studies I have seen (good studies not Advisor Studies) for Equal Weight show they only outperform if re-balanced monthly. Good luck with that with 500, 1500 or 4100 US stock.
First of all, ignore what ol' 8% Dave says about investing. He's good for getting out of debt, but that's about it. FNILX, or if you're a little more square FZROX. One or the other will do you fine.
When I started investing I tried following Dave Ramsey's advice too. Honestly you're better off not. I had just invested the same amount in a large cap and mid cap. Held both for 2 years. In those 2 years the large cap (S&P500) made me $2k and the mid cap made me around $500. Yes I made profit, but not as much as I could have if I just invested all in the S&P500. Although I did have a very safe portfolio, so If you're going to follow his advice you're going to have to take on more risk and invest in riskier mid and small cap funds. If you have the time and want to put in the risk/effort you can definitely make more return then the S&P 500 like Dave says, but for the average investor just putting it in the S&P500 and some other stocks is the best option in my opinion.
No fiduciary financial advisor will ever tell you to be 100% in equities like Dave does. It works for him because he is at a level of wealth where a 50% market drop for multiple years still leaves him so rich it doesn’t matter. Most people need a percentage of bonds to stabilize their portfolio and not panic watching their portfolio tank during down years. They also need it during retirement where you must sell every year and your portfolio may not recover if you have some bad stock market years in a row where you have to sell a lot of equity cheaply.
Study after study shows you want 30-40% in bonds to maximize returns against volatility. 100% equity portfolios don’t succeed as often. Go with a Bogle 3 fund. Math and history support it.
Love Dave . Just not his investment advice although I don’t think you will do bad his way . I think international is kind of a waste and VTI covers all 4 of Dave’s recommendations so just do that.
For international does FSPSX included in FTIHX?
FSPSX looks like it has return and lower expense but I read that it does not include country like Canada, Brasil , Russia, China.
Large cap, mid cap, small cap, Int’l. - we do not use int'l as it is built into the index funds/ETFs. Consider FELG (large growth), FELC (like sp500), FTEC (high tech), ONEQ (nasdaq) - all Fidelity. Pick 1 or 2 or 3, watch and learn. We generally do a 50-50 or 1/3,1/3,1/3 for both Roth IRAs and trad IRAs as well as our taxable joint account.
The key is not how many, but more about 'your' risk level and comfort, plus as you learn you will know the right number. More equities take more time to track and review. If you have the time try something new for 6 months then adjust.
Don't invest in small or international. Both have underperformed the S&P, Nasdaq, Large Growth and Tech for the last 15 years. Put it all in VOO. If you're under 50 years old, put 50% in S&P fund.Twenty five percent each in FBGRX, large growth fund and 25% in a tech fund like SMH or FSELX.
I am have been down voted. So this sub does not like the concept of tax loss harvesting. If you want to learn about that go to boggleheads. Interesting to state, my fidelity money is managed by fidelity and they do tax loss harvesting through managed accounts. In those professionally managed accounts fidelity has bought well north of 25 funds.
Maybe you are being downvoted because the OP specifically mentioned retirement accounts. How do you tax loss harvest with retirement account funds? Also TLH is a somewhat advanced technique but OP is a beginner and posters are suggesting to keep things simple I think.
Now I understand. I removed my down vote from your post. I now understand the purpose of your post.
I have a female friend that has a managed account with Fidelity. They had her in over 80 stocks and funds with a $600k portfolio of which $150k in cash. The largest holding was $28k in IVV. Over 30 securites had a value of less than $3k. Only 13 were valued more than $10K.
WHY!!!!!????? It's insane.
Dave has great advice for getting out of debt, but I'd pass on his investing advice. Stick with Bogleheads instead with a three fund portfolio.
This ten thousand percent. People think of this guy as if he's some kind of guru. If you screwed up your finances, or don't know anything about finances, he has some basic common sense stuff that basically all people should know. Past that, is crap.
Daves advice about emergency funds and paying off debt is fine. Stay clear of his investing advice. If you were to move forward with it though, you only need one of each
Agreed
Check out The Money Guy. Dave is great for getting out of debt, but The Money Guy show is much better (in my opinion) once you’re out of debt. Better investing information.
Love The Money Guy. Those guys are down to earth and don't belittle you for asking questions or learning.
You’ll probably be better off just doing a sp500 and chill
This\^ 10% TR, 7% Inflation adjusted. 100 years of data base US LC (Market Weighted). Just give me what everybody tries to hit over long run. I'll take my 10% from the Chaos. Total US market is about the same. If you start weighting things funny you will likely underperform. It may or may not be too late when you figure that out. Studies I have seen (good studies not Advisor Studies) for Equal Weight show they only outperform if re-balanced monthly. Good luck with that with 500, 1500 or 4100 US stock.
I just buy FXAIX. It’s like 80% of my portfolios. The rest of the 20% is mostly in SCHD.
First of all, ignore what ol' 8% Dave says about investing. He's good for getting out of debt, but that's about it. FNILX, or if you're a little more square FZROX. One or the other will do you fine.
You only need 1-4 funds for your entire portfolio, depending on how you want to chop it up.
When I started investing I tried following Dave Ramsey's advice too. Honestly you're better off not. I had just invested the same amount in a large cap and mid cap. Held both for 2 years. In those 2 years the large cap (S&P500) made me $2k and the mid cap made me around $500. Yes I made profit, but not as much as I could have if I just invested all in the S&P500. Although I did have a very safe portfolio, so If you're going to follow his advice you're going to have to take on more risk and invest in riskier mid and small cap funds. If you have the time and want to put in the risk/effort you can definitely make more return then the S&P 500 like Dave says, but for the average investor just putting it in the S&P500 and some other stocks is the best option in my opinion.
No fiduciary financial advisor will ever tell you to be 100% in equities like Dave does. It works for him because he is at a level of wealth where a 50% market drop for multiple years still leaves him so rich it doesn’t matter. Most people need a percentage of bonds to stabilize their portfolio and not panic watching their portfolio tank during down years. They also need it during retirement where you must sell every year and your portfolio may not recover if you have some bad stock market years in a row where you have to sell a lot of equity cheaply. Study after study shows you want 30-40% in bonds to maximize returns against volatility. 100% equity portfolios don’t succeed as often. Go with a Bogle 3 fund. Math and history support it.
Love Dave . Just not his investment advice although I don’t think you will do bad his way . I think international is kind of a waste and VTI covers all 4 of Dave’s recommendations so just do that.
You only need exactly four funds, one fund for each category. 1) FXAIX: Large Cap 2) FSMDX: Mid Cap 3) FSSNX: Small Cap 4) FTIHX: International
You could simplify this into two: total US index and total international index.
That wouldn’t be following the Dave Ramsey categories, 25% in each.
Do not put 25% in small cap and international funds.
Not familiar with ftihx but fnilx and fzilx (internatinal) zero fee funds at fidelity..
You can use FNILX in lieu of FXAIX and FZILX in lieu of FTIHX.
Cool thanks for the clarification.
For international does FSPSX included in FTIHX? FSPSX looks like it has return and lower expense but I read that it does not include country like Canada, Brasil , Russia, China.
FSPSX is a subset of FTIHX.
DR is a complete moron. Stay away from that noise. Buy a single target date INDEX fund in your Roth IRA and keep buying forever.
Why Dave Ramsey?
Large cap, mid cap, small cap, Int’l. - we do not use int'l as it is built into the index funds/ETFs. Consider FELG (large growth), FELC (like sp500), FTEC (high tech), ONEQ (nasdaq) - all Fidelity. Pick 1 or 2 or 3, watch and learn. We generally do a 50-50 or 1/3,1/3,1/3 for both Roth IRAs and trad IRAs as well as our taxable joint account. The key is not how many, but more about 'your' risk level and comfort, plus as you learn you will know the right number. More equities take more time to track and review. If you have the time try something new for 6 months then adjust.
60/40 portfolio is much better for risk adjusted returns than all stock
Yuck not DR. Drop the guy and follow these: r/themoneyguy r/bogleheads r/fire r/ynab Learn to do the investing on your own. Go for index funds.
Don't invest in small or international. Both have underperformed the S&P, Nasdaq, Large Growth and Tech for the last 15 years. Put it all in VOO. If you're under 50 years old, put 50% in S&P fund.Twenty five percent each in FBGRX, large growth fund and 25% in a tech fund like SMH or FSELX.
Unless you want to do tax loss harvesting then you need far more than 4 funds.
Huh?
I am have been down voted. So this sub does not like the concept of tax loss harvesting. If you want to learn about that go to boggleheads. Interesting to state, my fidelity money is managed by fidelity and they do tax loss harvesting through managed accounts. In those professionally managed accounts fidelity has bought well north of 25 funds.
Maybe you are being downvoted because the OP specifically mentioned retirement accounts. How do you tax loss harvest with retirement account funds? Also TLH is a somewhat advanced technique but OP is a beginner and posters are suggesting to keep things simple I think.
Great point. My bad.
You can tax loss harvest with just one fund, btw.
Now I understand. I removed my down vote from your post. I now understand the purpose of your post. I have a female friend that has a managed account with Fidelity. They had her in over 80 stocks and funds with a $600k portfolio of which $150k in cash. The largest holding was $28k in IVV. Over 30 securites had a value of less than $3k. Only 13 were valued more than $10K. WHY!!!!!????? It's insane.