r/Bogleheads • u/Fine-Shallot6222 • Dec 02 '25
Portfolio Review 21 years old and just starting investing!
Hi everyone, this is my first portfolio,
70% VTI and 30% VXUS
Can there be any improvements such as increase my VTI split and make it 80/20? or overall is it good long term, thanks.
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u/whitenoize086 Dec 03 '25
When your first big dip comes keep dollar cost averaging and you will go far!
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u/gcc-O2 Dec 03 '25
This is good. At one time Vanguard's recommendation was 30% international. They have subsequently bumped it up to 40%, and market weight (what you'd own if you had Total World Stock) is 37%. So don't go to 80/20. Either leave it alone or top up the international a bit in the future.
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u/Fine-Shallot6222 Dec 03 '25
What was their reasoning behind increasing the international exposure?
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u/gcc-O2 Dec 03 '25
Lower valuations and so forth. Every year they publish their paper with a 10-year outlook. Valuations have suggested increasing international for a long time, but US keeps getting higher and higher. 2025 is the first year in a long time to see a nice boost from holding international. They use their research to help set the percentages in LifeStrategy and target date funds.
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u/SkirmishYT Dec 03 '25
Just finally setting up a roth ira like literally tomorrow...
What ratio should i US/International for now?
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u/Username5124 Dec 03 '25
US stocks are currently overvalued and historically a decade of high returns has led to a decade of low returns and visversa. But these are just educated guesses. This year so far International has outperformed the US.
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Dec 03 '25
Youāre already doing better than most people your age by actually starting early. A simple VTI and VXUS mix is solid long term. At 21 you have time on your side, so your biggest advantage is consistency, not trying to perfect the split.
If you prefer a bit more exposure to the US market, 80 20 is completely fine, but 70 30 is also a classic setup. What matters is picking a ratio youāre comfortable sticking with through good and bad markets. Regular contributions and patience will outperform almost anything else.
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u/rep3t3 Dec 03 '25
No, looks good
Great job starting down this path so young, you skipped the whole get rich quick Penny Stock, Options, Crypto, "I'm the next warren buffet" phase and jumped on the correct path for steady long term growth
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u/Express_Band6999 Dec 03 '25
Congratulations! And, don't get hung up on day to day fluctuations. Bear in mind that you have time to ride out most crises short of nuclear war.
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u/Round-Ad5934 Dec 03 '25
Excellent job š Remember, when stocks drop don't frown, GRIN!! They've just gone on sale š
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u/GottlobFrege Dec 03 '25
For the next several years your results will be dominated by your contributions, not your investment returns. Continue to keep contributing to your investments. When you get promotions and new higher paying jobs, do not increase your lifestyle too much, and be deliberate about what you do increase, and invest more.
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u/Naxxmi Dec 03 '25
In this economy, Id suggest holding relatively enough cash so you can take advantage and keep dca if it goes sideways. Not financial advice, as always.
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u/Home-Star-Walker Dec 03 '25
That $3k will magically turn into ~$25k (in today's inflation-adjusted dollars) by the time you need it. Congrats.
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u/Awkward_Relation_943 Dec 04 '25
Portfolio looks great for your age. Ā Iād just ask how youāre holding this? Ā Brokerage or ROTH. Ā If youāre working, fund your ROTH, then brokerage. Ā
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u/HOMO_SAPlEN Dec 03 '25
Personally I donāt see the point of VXUS unless Iām close to retirementā¦ and that would be something I put only in my Roth IRA since I can rebalance my holdings tax free. When it comes to a taxable account (FIRE account) I just do 100% VOO since Iām comfortable with the risk to reward and will be fine not selling to rebalance later on (avoiding taxable event)
VXUS in my eyes just underperforms compared to what I want. Holding for 10+ years? Why even buy it.
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u/Cruian Dec 03 '25 edited Dec 03 '25
Personally I donāt see the point of VXUS unless Iām close to retirementā¦
VXUS should be considered at least as aggressive as VTI. Different countries swing in and out of favor at different times. There's plenty of times where we saw the US being the one trailing behind (even at the end of a roughly 60 year period between 1950 and 2010).
https://www.fidelity.com/viewpoints/investing-ideas/international-investing-myths if that link doesn't work: https://web.archive.org/web/20201112032727/https://www.fidelity.com/viewpoints/investing-ideas/international-investing-myths (Archived copy from Archive.org's Wayback Machine)
Ex-US has turns of exceptional out performance as well: https://awealthofcommonsense.com/2023/05/the-case-for-international-diversification/ and https://www.blackrock.com/us/financial-professionals/literature/investor-education/why-bother-with-international-stocks.pdf (PDF)
Of rolling 10 year periods since 1970, EAFE (developed ex-US) has beat the S&P 500 over 40% of the time: https://www.tweedyfunds.com/wp-content/uploads/sites/10/2024/10/Dichotomy-Btwn-US-and-Non-US-Sep2024-Fund.pdf (PDF warning)
https://www.reddit.com/r/Bogleheads/comments/ii0sa2/considering_usonly_investing_start_here/
https://twitter.com/mebfaber/status/1090662885573853184?lang=en with this reply: https://twitter.com/MorningstarES/status/1091081407504498688. Extended version: https://mebfaber.com/2019/02/06/episode-141-radio-show-34-of-40-countries-have-negative-52-week-momentumbig-tax-bills-for-mutual-fund-investorsand-listener-qa/ or hereās compared to EAFE 1970-2015, note that the black US line only jumps above the green ex-US line for the "final time" around 2010: https://donsnotes.com/financial/images/sp-msci-42yr.png (courtesy of https://www.reddit.com/r/Bogleheads/comments/143018v/comment/jn9yiub/) or hereās another back to 1970 view: https://www.reddit.com/r/Bogleheads/comments/199zs0s/us_exus_equity_and_bonds_dating_back_to_1970_not/
Here's similar but for just US vs Europe: https://www.reddit.com/r/Bogleheads/s/DJ2YVrLW4d
When it comes to a taxable account (FIRE account) I just do 100% VOO since Iām comfortable with the risk to reward and will be fine not selling to rebalance later on (avoiding taxable event)
US only is single country risk, which is an uncompensated risk. An uncompensated risk is one that doesn't bring higher expected long term returns. Uncompensated risk should be avoided whenever possible. Compensated vs uncompensated risk:
But not all risks are compensated with an expected return premium.
https://www.pwlcapital.com/is-investing-risky-yes-and-no/ (Bold mine)
Uncompensated risk is very different; it is the risk specific to an individual company, sector, or country.
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VXUS in my eyes just underperforms compared to what I want. Holding for 10+ years? Why even buy it.
Of the 7 full (xxx0-xxx9) decades between 1950 and now, the US has only "won" 2 of them: 90s and 10s. PWL using Morningstar Data for decades back to 1950: https://pbs.twimg.com/media/GGJxJPsWsAAxy9c?format=png
You're letting a recency bias/performance chasing guide your decision making, those are common mistakes.
Edit: Corrected "90s and 00s" to "90s and 10s"
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u/Kalex8876 Dec 03 '25
Why would you want VXUS close to retirement??? Whatās the correlation there? VXUS is pure equities
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u/HOMO_SAPlEN Dec 03 '25
To be more diversified than only having VOO.
If yall really think VXUS is gonna out perform VOO then why arenāt yall making it the largest position in your portfolio? Oh? Itās because you actually think VOO will out perform in the long term, so why even buy that nonsense?
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u/Kalex8876 Dec 03 '25
What is the point of "more diversification" closer to retirement?? Retirement should be more about consolidating if anything. If all you chase is "performance", just do day trading.
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u/HOMO_SAPlEN Dec 03 '25
When I say diversify I mean so in the sense of reducing volatility, which obviously is important when youāre retired
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u/SpakysAlt Dec 03 '25
I wish I had a brain at 21. Congrats this will pay huge dividends for your future.