The Simple Story About 2 Funds for Life
Channel: Paul Merriman
Date: 2023-05-10

This week Chris Pedersen is joined by Paul and Daryl in a video review and update of how he created his "2 Funds for Life” and how it can be used to build a successful lifetime portfolio with just a target date fund and a small cap value fund.   

For the accompanying podcast Paul decided to discusses ways a parent or grandparent might explain 2 Funds for Life to a young adult.  In the discussion Paul suggests using the following tables to make a handful of important decisions.

Tables 1-4 from his Follow the Math comments-
Table 1- https://paulmerriman.com/wp-content/uploads/2023/03/Table1.pdf
Table 2- https://paulmerriman.com/wp-content/uploads/2023/03/Table2.pdf
Table 3- https://paulmerriman.com/wp-content/uploads/2023/03/Table3.pdf
Table 4- https://paulmerriman.com/wp-content/uploads/2023/03/Table4.pdf

Equity Index Returns (1928-2022) to compare the returns of major equity asset classes- https://paulmerriman.com/wp-content/uploads/2023/05/1-15-40-Year-Equity-Returns-1928-2022-2.pdf
Table B13 to show what happens when you combine a small amount of small cap value with a mostly bond portfolio - https://paulmerriman.com/wp-content/uploads/2023/04/2-Fine-Tuning-Tables-50-50-2022-B13.pdf
Table B14A to show the impact of combining a small amount small cap value with a large cap blend fund - https://paulmerriman.com/wp-content/uploads/2023/04/SCV-vs-SP500-Tables-2022B14A.pdf

The goal is to help a young investor understand a target date fund as a good way to build a long term investment portfolio that will allow them to retire with enough for life.

The second goal is to show a young investor how a small amount of a small cap value fund, along with a target date fund, will likely help build an investment portfolio that will allow them to retire with almost twice as much annual income and leave much more to their heirs.

For the parent or grandparent it will be helpful to watch the videos on Fixed and Flexible Distributions.

This information is intended to be used and must be used for information purposes only.

We are not investment or tax advisors, and this should not be considered advice. It is very important to do your own analysis before making any investment or employing any tax strategy. You should consider your own personal circumstances and speak with professional advisors before making any investment.

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