In my free time I'm trying to decide what/how/where I'm going to diversify my Roth IRA portfolio. I'm saving right not but haven't actually opened the account. My question is, is it a bad idea to buy, say, VOO (S&P 500) ETF's as well as VTI ( Total Stock Market ETF's). I can see why someone would argue to just go with VTI. But, VTI tracks 3700 stocks whereas VOO is ~500. VTI could decline as VOO prices increase, and vice-versa. I'm trying to decide what ETF's I would like in my Vanguard Roth IRA.
Here's what I was thinking:
- 1) S&P 500 ETF (VOO) and/or
- 2) Total Stock Market ETF (VTI) and
- 3) Total World Stock ETF (VT) and/or
- 4) Vanguard total International World Stock ETF (VXUS)
-Vanguard suggested (Don't really trust an automated program giving advice on my asset allocation) to spend (assuming $10,000 invested) 60% VTI and 40% VXUS
I know this method covers a great deal of the market, but are two ETF's really enough? I thought it would be good to buy 3-4 ETF's but I'm not entirely sure.
This all comes down to budget too, and at the moment I cannot max mine out at $5,500/year. But I think I can invest 3-400/mo in my Roth IRA. So investing in two ETF's/mo is probably my best bet until I adjust my asset allocation. Looking for some advice.
In all honesty, I know what I think is the right thing to do in my mind, but no one in my family has planned for retirement, and have no idea what an IRA even is. With that being said, I believe I know what I need to do, but this is the only place I can go for advice to reaffirm/adjust my retirement planning.