The NEW And Improved 3 Fund Portfolio

In a recent lecture to my Patreon Academy members, I spoke about the three-fund portfolio strategy. An investment methodology that provides diversification and balance within a portfolio, with little time and effort. The idea is simply to allocate your portfolio (in part or in whole) across three asset classes: U.S. stocks ETF, international stocks ETF (excluding U.S.) and U.S. bonds. This strategy provides investors with proven results, simplicity, low costs, and zero anxiety.

Today we will explore an upgraded approach to the three fund portfolio that offers better returns, without taking on more risk.

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Nothing in this video constitutes tax, legal, financial and/or investment advice, nor does any information in this video constitute an invitation and/or solicitation to invest in a particular security. This video merely expresses the author’s opinion and should be viewed as such. Before proceeding with any investments, you should do your own research and seek advice from an independent licensed professional.

The author of this video does NOT accept liability for any investment decisions, as this video is provided only for educational and entertainment purposes. Although the author has endeavored for the information in this video to be correct and accurate, he does NOT assume liability nor does he guarantee that the data will be updated, correct and/or accurate at all times.

[danselman]

Thank you Tom and thank you Toms Academy members for your generosity in deciding to share this.

[aaronthompson]

Great info I’m in my 30’s and currently hold VOO 50% QQQ 35% and VYM 15%

[bmurphy]

Totally agree with Tom here except I would personally change a couple things. First I would get rid of bonds. They are good for someone who is less risk adverse & to keep the portfolio more stable but they have shown to underperformed over long periods. I would get rid of them & be 100% stocks till your at least 60. Then it might make sense to add some bonds but I would still argue that from 60 most people still have at least 20 years to live & in some cases up to 40+ which is a huge period to invest so I would just keep it 100% stocks for life. 50% s&p 500 & 50% Nasdaq & over 40-80 years, saving 50% of every $ you earn, the amount of money you'll have in your portfolio will blow your mind.

[GetSchanked]

"Michael Bury out there predicting 17 recessions out of the last three..." 😂💀

[echoeversky]

For bonkers loadout: 50/50 TSLA and JEPI and reballance yearly for the luls.

[AmitDangerPatel]

Thanks as always for sharing Tom. Go Blue. Just to push back on this a bit, from a first principles standpoint, i think the true value of a 3 asset portfolio like this is to choose 3 UNcorrelated assets which is why non-us stocks is a common choice. I’m with you, they’re not sexy, but Qqqm and SPY are highly positively correlated to each other. If you really want to sub out non-us stocks and keep it USA all the way, I think I would chose IWM, or DIA instead of QQQ (or SPY). Just my two cents. Curious what your community thinks of that.

[yetivanmarshall]

I'm 62 and listen to you, Amit and Jeremy, And about 25 others 😊

[gaiusho]

What about fund overlap between qqqm and VOO? largely overlapped. i also considered this setup.

[ehickert]

Tom, thanks for sharing such valuable content! For the S&P part of the 3 fund portfolio, what do you think about using a dividend ETF like SCHD? Or some kind of combo with not too much overlap? This would have the benefit of a reliable dividend stream, plus the growth.

[austinAandres]

VOO, QQQM, BND.

Weight by age. Look good Tom?

[WolfgangMartinViernheim]

Oops, I'm almost 60 and 100% invested in Tesla and Palantir. Am I doing something wrong? That's not a real question - I take responsibility!

[davidlisovtsev]

personal experience:
I'm under 30 non American, and from the current job the investment [government mandated investment] is 75% S&P and 25% bonds, this is the maximum ration allowed in the law, my private investment is 100% NASDAQ, no S&P whatsoever, so in total my bonds are around 10% of total, funny that I'm that close to Tom's numbers lol

[dominichoward]

Look at investing simplied 3 fund... its pretty good

[justina]

Not Tom working in giving the finger 😂

[mcgche]

What about high yield ETF's and Reits paying 8-10% dividends?

[milentodorov]

Hey Tom, what do you think, if in this portfolio, we replace QQQ with TSLY (TESLA is volatile tech stock with high potential of growth like QQQ, and on top of that with TSLY we get high monthly pay out) and instead of S&P500 we get APLY (big company with steady cash flow and moderate growth and we get additional monthly dividents)?

[garyschmelzer]

What are some ideal bonds for somebody that’s over 50

[TeslaEVolution]

Over time : DCA NASDAQ will beat everything!!! DCA +30% when it goes down seems especially good.

[brianburton]

I don’t invest in any bonds nor international stocks.

[andrewdopaco]

What ETF do you recommend buying for the bond exposure?