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Old 12-24-2012, 12:15 PM   #2
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Join Date: Apr 2004
Location: Acworth, GA
Posts: 219
My Ride: 2010 Infiniti G37
I keep all of my retirement accounts with the same allocation style so that regardless of the tax situation (roth or traditional) they will still have the same type of returns and I don't have to worry about ensuring my risk level is balanced between multiple accounts and re-balancing to maintain my risk profile can be done in both types of accounts periodically with very little/no need for me to do anything other than sign up for automatic re-balancing in both types of accounts. If you attempt to establish a specific risk profile using multiple accounts then it can be much more difficult to maintain that risk profile in the future. For instance, say you wanted 60% domestic large cap, 20% domestic small/mid cap stocks, 10% foreign/emerging, and 10% bonds. If you put the 10% foreign/emerging and 10% bonds in your TSP and it grew faster than the others, then you would now have to shift your TSP to include some other type of investment and try to figure out exactly what % into each you needed to adjust all three accounts in order to re-establish your risk profile. If they are all balanced with the same risk profile, however, you can generally just have each set to automatically re-balance your portfolio to your desired risk profile at regular intervals.

That's how I prefer to do it for retirement accounts anyway. (insert legal disclaimer that this isn't professional advice etc etc here )
Wraisil is offline   Reply With Quote