For after tax after 401k salaries, do you think spending about 50% on living expenses, investing about 25% in Vanguard Retirement fund, saving 20%, and keeping 5% for fluidity a good allocation ratio? Renter, no home, no loan.
Yes that's good. When you say "saving 20%" that could also be investments at Vanguard. If in a taxable account I would avoid target retirement funds because of the interest. Just use stock index funds and put the bonds in tax deferred
Could you explain the interest? Newbie in investment. Does it charge fees besides the fund management fee?
Target Retirement funds contains bonds which pay interest every months. You don't want this in a taxable account as you would have to pay taxes on it. So the target retirement funds are better in tax sheltered accounts
Wtf is an "expense investment savings ratio". Your budget sounds reasonable but living expenses is on the high side. TC or gtfo. For real, percentages differ depending on your TC.
Basically you’re saving 50% after tax plus max 401k If you can do a max ESPP in there too that would be incredibly awesome. That, and consider bonds for “savings” instead of banks/CDs Edit: And don’t join the sheeple to post TC/YoE. It has no bearing on your question.
How do you compare discover 2% savings vs bond? I’m an investment newbie. For bond, should I buy bonds directly or buy Vanguard bond fund?
You do a 4-6% high yield bond nearing expiration. 2% barely beats inflation. Bond funds differ from bonds. I imagine OP needs near time liquidity. I wouldn’t put that money in a bond fund.
Sure, that's awesome.