My Current Asset Allocation and Net Worth Growth – January-March 2011

• Am maintaining a my target of 6-9 months of expenses in a cash reserve fund in my Dollar Savings Direct high yield online savings account.
• Have rebalanced my mutual fund portfolio to meet my asset allocation target %’s (75% equity, 25% fixed income overall) 
• Have donated $1,150 to Multiple Sclerosis Foundation in 2011 (5% of income).

For a detailed list of my short term, mid term, and long term financial goals, click on the link below:

My Personal Finance Journey – Financial Goals

• Overall Fixed Income / Equity Allocation
  • Currently, 24% of my net worth is invested in fixed income instruments (cash or bond funds), and 76% is invested in equity.
  • This is almost perfectly aligned with my targets for these categories of 25% (fixed income) and 75% (equity).

• Equity Allocation
  • In the equity portion of my portfolio, 74% is invested in US Domestic Equities with the remaining 26% being held in international equities. 
  • This is almost perfectly aligned with my equity breakdown targets of 71% and 29%, respectively, for US Domestic and international holdings.

While the overall percentages for these categories looks pretty good, a detailed look (table below) at the allocation breakdown reveals the real story and provides for better analysis of the current state.

Remember: a red flag goes off if your current % allocation in a category is greater than +/- 5% off of the target allocation. This is my trigger that I need to rebalance that aspect of my portfolio.

% Cash (money market target 5%) 7%
% non-inflat Bond Funds (target 15%) 14%
% TIPS Bonds (target 5%) 3%
% International Equity (Target 11%) 10%
% International Emerging Markets (Target 11%) 9%
% Domestic Large Cap (Target 8%) 9%
% Domestic Small Cap (Target 8%) 9%
% Domestic Small Cap Value (Target 14%) 15%
% Domestic Large Cap Value (Target 13%) 13%
% REIT (target 10%) 9%

Analyzing my current asset allocation percentages, it appears that I am lucky enough to be exactly on target with all of my asset classes (within +/- 5% banding) .Therefore, no rebalancing is required. Always a good thing!

My next moves for the April-May, 2011 time frame will be to do the following:

• Continue contributing to my Roth IRA for the 2011 year. I only need to contribute $2500 more to fully fund it for 2011.
• After fully funding my Roth IRA, any extra money I have will most likely go towards paying off my condo loan and obtaining even more equity in that investment. The only other option I would have is to invest in my individual mutual fund (taxable) account. But, I feel that it would be a more efficient use of my time to build up more equity in my condo. What do you all think?
• Continue investing $41.67 each month in microloans to help the working poor in Peru. This is part of my 2011 goal of having $500 in microloans.
• Try to reach my $5000 fundraising goal for the Multiple Sclerosis bike ride I am doing in June of this year. Currently, we have reached $3,800. If you are interested in making just a $10 donation, click here.

Wish List 

• At some point, purchase the Vanguard Total Stock Mkt Idx (MUTF:VTSMX) to replace S&P 500 index fund. This gives better, broader diversification to the US stock market.
• Install a stacked washer/dryer combination unit in to my condominium. This one will be a long shot, but it just may be possible!