Retirement Nestegg Report – May 2012

Retirement Nestegg Report – May 2012

Well this was an exciting month and pretty good timing for me as with all of my recent contributions I have a good chunk of money to throw into individual stocks and went through most of the $10k I recently contributed this month.

I also made a pretty drastic strategy change with my 401k account. Doing these monthly reports have made me realize that my strategy of picking actively managed mutual funds trying to beat the SP500 just was not working over the longer term in my 401k and so I completely re-balanced my 401k where now the vast majority of my money is in a vanguard target retirement fund, another chunk is in a vanguard index fund, and I actually moved another chunk to a vanguard bond index fund since I thought we had been on a nice run up lately and wanted to have a more stable cash-like cushion should things turn south where I could then move it into the stock market if the opportunity presented itself. It’s not something I am contributing to on a regular basis and accounts for about 15% of my 401k right now.

Never invested in bonds before but should give me some stability in a downturn and allow me to do another re-balance to all stocks sometime in the future if we get another opportunity with a big downturn. Ironically this move allowed me to beat the SP500 this month in my 401k, but going forward it should track much closer to the SP500 in general. I will save my efforts for trying to beat the SP500 with my individual stock purchases in my IRA accounts where I have been much more successful over time.

Traditional Rollover IRA – $15,940.87 (-11.53%)
My Roth IRA – $53,396.64 (-7.77%)
Wife Roth IRA – $27,924.54 (-5.70%)
Traditional 401k – $103,675.68 (-4.95%)

Roth/Traditional % = 40.47% (tax free)

Total Retirement Nest Egg $200,937.73 (-5.95%)

Monthly Contributions $715.28 (401k)
SPY Performance -5.92%
My Monthly Investment Performance -6.28% (-0.36%)
My Monthly Individual Stocks Performance -6.99% (-1.07%)