retirement

Don't double down on retirement

Don Taylorq_v2.gifDear Dr. Don,
My wife and I have always combined our finances. When it comes to our retirement investments -- 401(k), 457 plan and Roth IRA -- we treat them as if they were one portfolio. Throughout the accounts, we have foreign, bond and U.S. exposure (small caps, mid caps, large caps and a REIT). I believe we are well-diversified and we monitor our allocation with quarterly rebalancing. Is there anything wrong with this approach?
-- Dave Diversity

a_v2.gifDear Dave,
I'm with you. I only pay for two things on the Internet: my subscription to The Wall Street Journal online and a premium subscription to Morningstar.com. On Morningstar, I'm able to combine my retirement portfolio with my wife's retirement portfolio and run portfolio analytics using Morningstar's Portfolio X-Ray.

Some couples keep their monies separate -- and there's nothing wrong with that -- but if you're a couple, it's all your money and you don't want to double down on your exposures to different investments.

I'd actually go a step further and say that you shouldn't separate retirement accounts from other nonretirement accounts. It's all your money; take a holistic approach to how it's invested. Diversification doesn't just mean to diversify your retirement assets.

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Read more Dr. Don columns for additional personal finance advice. To ask a question of Dr. Don, go to the "Ask the Experts" page, and select one of these topics: "Financing a home," "Saving & Investing" or "Money."

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