Asset Allocatioin for multiple accounts?

[bUU]

Originally Posted by darrell2525

Is having one asset allocation (AA) across multiple accounts a must?
Me and the wife have 401Ks. Her accounts have index funds and mine as well. But her has the extended total stock market index and mine only the S&P500. Its just too much hassle every year having to re balance both accounts as 1 AA. Is there something wrong with just having our AA of 80/20 set in each account and call it a day??

It need not be that difficult. You're just talking about retirement accounts. If you have lots of excellent choices in both 401ks then there's no problem having that portion of your overall portfolio asset allocation reflected by coincidentally identical account-level asset allocations.

Having said that, it is difficult for us, because we both have 401ks with very limited choices. My spouse's 401k has absolutely no good bond fund or stable-value choices. None. [My 401k sucks in a completely different way - high ERs across the board (but since it is across the board, that doesn't really inject a bias into the appropriate account-level asset allocation).] So the right answer for us, since asset placement best practice dictates putting tax-inefficient investments, like bond funds, in retirement accounts, that my 401k be almost exclusively such investments. The reality is that the bulk of the conservative side of our overall portfolio is in my 401k (and in a tIRA I opened from a 401k rollover). My spouse's 401k is actually mostly equities, again: because all the decent choices there are equity investments.

So it sounds like perhaps you're much younger than we are, so having 80% equities in retirement accounts is appropriate for you (and perhaps you don't have significant taxable investments, like we do). If that's the case, then what you're doing sounds right for you, for now.

[darrell2525]

Originally Posted by mathjak107

there is no real trading . maybe 2 x a year we swap a fund or two.

thanks mathjak107

[mathjak107]

good luck