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Old 12-12-2016, 04:04 PM
 
Location: Haiku
4,056 posts, read 2,569,746 times
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Quote:
Originally Posted by saralvr View Post
Constantly going down.
One thing about investing, no matter what it is - stocks, bonds, blended funds, gold, real estate - there are times when they go down and times when they go up. There is always uncertainty as to what will happen in any given week, month, or year. If it were a certainty we would all be rich. Good investments over time will do fine. Don't worry about the ups and downs along the way. You learn to shrug it off.
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Old 12-12-2016, 04:09 PM
 
Location: Omaha, Nebraska
7,311 posts, read 4,151,370 times
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TwoByFour is making an excellent point. No investment goes up continuously without a hitch. Investing (as opposed to mere saving) is a long-term game. You have to be prepared for the downs as well as the ups. Wellsley's ups are not as high as Wellington's, but its downs aren't as low, either.
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Old 12-12-2016, 08:13 PM
 
593 posts, read 857,788 times
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The year end distributions for capital gains is happening this week or next so the price may have dropped
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Old 12-12-2016, 09:46 PM
 
Location: Wisconsin
21,536 posts, read 43,982,964 times
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Price won't drop because of the distributions until the day it happens - which for VWINX is 12/16 - and that drop is compensated for by additional shares bought with that distribution which will be reflected in the portfolio value on Monday, 12/19 - so, if one is reinvesting dividends/cap gains the net change, effectively, is zero.
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Old 12-12-2016, 10:10 PM
 
29,774 posts, read 34,856,103 times
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Quote:
Originally Posted by Ariadne22 View Post
Price won't drop because of the distributions until the day it happens - which for VWINX is 12/16 - and that drop is compensated for by additional shares bought with that distribution which will be reflected in the portfolio value on Monday, 12/19 - so, if one is reinvesting dividends/cap gains the net change, effectively, is zero.

A point that is always needed this time of year.
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Old 12-12-2016, 10:57 PM
 
6,615 posts, read 3,742,110 times
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Quote:
Originally Posted by saralvr View Post
I know this is a dividend fund. We had some extra money around and opened this up about 5 months ago. Constantly going down. It got such high reviews. With everything going up, why is this down? Any recommendations? I know it's just a very little bit we put into this, but it's obviously not the right tool. Thanks
Its total return YTD, including dividends, is 7.56% so far.

The last month total return has been only 0.43%. But it has gone down -.40% in the last 3 months.

So you must have bought it at a high price point.

VWINX is 60% bonds and 40% equities and cash.

It became clear recently that the interest rate is going to probably be raised and announced on Wednesday. This fund will probably go down on that news, although it's been expected and has already gone down a bit in anticipation of that. Some people are selling it, because it doesn't do as well in a rising interest environment as it does at other times because of the bond part.

Are you reinvesting the dividends? If so, that will tick up your earnings more quickly than you think. Are you planning on buying more of it? If so, wait for it to go down as much as possible after the interest rate increase, and buy then. You'll be glad about that in a couple of years, when the share price is higher because you bought low.

It's a good, stable fund that's intended to be held long term. It reduces volatility in a portfolio, while gradually climbing in value over the years. Notice that I said YEARS, not months.

It pays a decent dividend, but the divi isn't high enough for me to classify it as a dividend fund. But that's me.

As for recommendations, it depends on your goal and your time frame. Are you wanting dividends? Or a sleep-at-night fund that will gradually increase but not have the wild swings of the general stock market? Or a fund that will hold up under both bull and bear markets reasonably well (while understanding that such a fund won't do top notch under either...it's a steady-as-she-goes type of fund)?

What is VWINX for? In 2008, the S&P index fund VTSMX lost over 37%. VWINX lost 9.5%. AND continued paying its dividends. That's what VWINX is for. Is that what you want?

If it's the dividends you care most about, I wouldn't worry too much about the share price. Your dividends will keep coming, and the share price will gradually increase again. You can see by the returns I state above that VWINX has done pretty well for a moderate allocation fund this year. Be prepared for a dip in share price after the interest rate is raised, though. If you don't want to go through that, you might consider selling tomorrow, before the announcement. (But note that there's a dividend payment coming 12/16, and a capital gains return; I THINK but am not sure that you have to own it the day before in order to get the dividend.)

VWINX has a standard deviation (the swing in share price up or down) of about 4.5 over a 5 year period, compared to an over 10 standard deviation for VTSMX (the S&P index). What that means is that on a big crash day, VWINX will go down much less than pure stock funds...and you'll be very happy you have it. But that also means that on big UP days, VWINX will go up much less than pure stock funds. It helps keep volatility down.

So...what are you looking for? (I have a bit of VWINX, too. I'm not crazy about it, either. I just wanted something more steady that pays a bit of a dividend, but still gets me over 6% return on a long term basis. I have a bit of a profit in it, so I might sell it after the 1st of the year, unless the share price is too low. Not sure. I want a bigger dividend. But it's fine right now.)
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Old 12-13-2016, 06:24 AM
 
672 posts, read 837,744 times
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To answer the question about why we have the fund, yes, we wanted a dividend fund. The dividends are re-invested My husband and I have been in Mutual Funds for probably 25+ years, but we are not the type that check it daily. We are more of the long term lookout type and have done well over the course of the years. We are now semi retired and do not have a pension. Therefore, we feel the need for a bit more of a conservative portfolio. Having said that, we are 40/60 in our funds. We have both Fidelity and Vanguard. Fidelity is where we transferred his 401K when he was laid off. It's in a target retirement fund. Vanguard we've had, as I've said, for 25 years. It's an index fund that we are currently in and a municibal bond fund.

What are we looking for? To diversify and stay 40/60. Not sure if our choice of where we have our money in the funds is the right choice, but they have made money so we're happy. Yes, I do want to sleep at night. My worry is that we don't have a pension to rely on. It hasn't helped reading this week on the forum that SS might be slashed. We are planning on taking it when my husband turns FRA in a little over 2 years. But, a reduction that has been proposed will really hurt us.

Appreciate all the advice given so very much. Thank you.
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Old 12-13-2016, 07:09 AM
 
29,774 posts, read 34,856,103 times
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Quote:
Originally Posted by saralvr View Post
To answer the question about why we have the fund, yes, we wanted a dividend fund. The dividends are re-invested My husband and I have been in Mutual Funds for probably 25+ years, but we are not the type that check it daily. We are more of the long term lookout type and have done well over the course of the years. We are now semi retired and do not have a pension. Therefore, we feel the need for a bit more of a conservative portfolio. Having said that, we are 40/60 in our funds. We have both Fidelity and Vanguard. Fidelity is where we transferred his 401K when he was laid off. It's in a target retirement fund. Vanguard we've had, as I've said, for 25 years. It's an index fund that we are currently in and a municibal bond fund.

What are we looking for? To diversify and stay 40/60. Not sure if our choice of where we have our money in the funds is the right choice, but they have made money so we're happy. Yes, I do want to sleep at night. My worry is that we don't have a pension to rely on. It hasn't helped reading this week on the forum that SS might be slashed. We are planning on taking it when my husband turns FRA in a little over 2 years. But, a reduction that has been proposed will really hurt us.

Appreciate all the advice given so very much. Thank you.
You have provided some important information. I know you have read posts in forums before about investing and a number of us have mentioned Wellesley as a good fund. I would say you made a very good choice for where you are and your stated goal. Where did the money come from for the Wellesley fund and do you expect to have more money coming in to invest? If not new money what do you plan to do with RMD's or will that all be consumed by living expenses.

We often in this forum discuss investing before retiring and to a lesser extent but still often how to withdraw in retirement. We don't usually in here discuss how to structure our portfolio for withdrawal. Mathjak and others will bring that up but usually folks who do are doing so within the context of their situation.

What rarely gets discussed is what to do with excess money or money coming in not spent. For instance if your RMD rate is greater than what you need for living expenses, what do you do with the excess? If you have pensions and SS and they exceed your annual living needs how do you invest that amount? Would you do the same at 66, 71,76,80 etc?

I can tell you that we have changed our plans as we have evolved and have different expectations for down the road. So may you and others.
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Old 12-13-2016, 07:25 AM
 
672 posts, read 837,744 times
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Tuborg, Thank you. Great points to digest as well. We have money in CDs that are obviously earning nothing. As a small one came due we opened the Wellsley with it. We have a 5 year ladder with EverBank and that is our emergency fund. We also have 2 years liquid for living expenses until we start SS. My husband, though laid off almost 3 years ago, has been able to do contract work for about 3 months of the year. It pays a great part of our living expenses so we haven't had to dip yet into principal too much.

As far as RMDs, I've started to research this recently. I spoke to my accountant as well to get some more understanding of how it will affect us in the future. We have some time as we are 63 and 61. I want to meet with a fee based financial planner in the near future to help outline how we should go about withdrawals when the time comes.

Again, thank you so much. I've learned so much over the past few years here. Invaluable.
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Old 12-13-2016, 07:40 AM
 
210 posts, read 150,713 times
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Quote:
Originally Posted by TuborgP View Post
What rarely gets discussed is what to do with excess money or money coming in not spent. For instance if your RMD rate is greater than what you need for living expenses, what do you do with the excess?

I buy the best CD I can find at the time and/or put it in a taxable account at Vanguard if needed. My husband's deferred is all at Vanguard now.
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