Reviewing my asset allocation I've been maintaining since I began my 401k.
My allocation is 20% into each: 1) emerging markets; 2) small cap value; 3) large cap growth; 4) Mid Cap blend; 5) total bonds
Performance Stats:
| Investment | YTD | 3 yr | 5 yr | 10 yr |
|---|---|---|---|---|
| My Allocation | 5.84% | 3.71% | 8.79% | 4.59% |
| Target Date 2045 | 10.19% | 4.98% | 10.13% | 4.17% |
| S&P 500 | 9.34% | 9.61% | 14.63% | 7.18% |
My 401k (which sucks via John Hancock) doens't have any index or S&P 500 funds so I can kiss trying to match it goodbye. I'm thinking about just putting it all in to a Target 2045 fund and let it be. I think my asset allocation isn't working like it should. Historical (going back 20 years) data suggest that this should return just under 10% a year (obviously past performance isn't cause for future results).
Obviosuly I'm 20% bonds so my returns would be much lower than the S&P500 or 2045 Target date (which has 5% bonds), but I wasn't expecting it to be this low. Small cap value and emerging markets should have provided some more juice, but small cap value has been sub par this year so far.
The 10 year performance is what worries me. Granted it includes 2008-2009 so I may be fearing my own retirement for nothing. The 5 year performance is much better. But the YTD and 3 year performance isn't even in the same ballpark as my expectations.
Thoughts on your methods for maintaining your allocation in the face of it not turning out as expected.
For the record, my compound growth rate since August 2008 when the 401k began is 8.55% according to John Hancock's tools.
Submitted July 06, 2017 at 11:13AM by razeus http://ift.tt/2tub64T
