Pecan

I've been trying to follow the Express Advisor's monthly newsletter, and think I'm not timing things correctly.

According to my Vanguard transaction history, contributions were paid from FDX to my Money Market acct on 4 & 7 Feb, and then 22 Feb. That seems to be up to a week after we actually get paid.

Can someone with more knowledge in this area enlighten me? Does anyone else find Vanguard's site a bit user-unfriendly?

Thanks.

Flyinhigh

Check the Pilot Benefit Book (PBB) on page R-50. It says that contributions will be deposited about 5 business days after the 15th and last day of the month. This covers both the Pilots' Retirement Savings Plan (401K) and the Pilots' Money Purchase Plan (B Fund).

Popeye

Why are the 401K contribution numbers different between the Vanguard site and the FDX monthly Earnings Statement? Are there fees or some other charge that reduce our actual Vanguard contribution from the deductions FDX takes out of our check?

Overnitefr8

At the beginning of the year you have the $500 match by the company. This number is not reflected in your monthly earnings statement. Also, the first January deposit is from earnings in December of last year (assuming it took the whole year to max out).

MD11Fr8Dog

When the company puts money into your Vanguard acct shouldn't impact how you follow the Express Advisor. What I do is have contributions go to the Money Market and then once each month, after the first newsletter of the month, I rebalance my Vanguard accts., if needed.

Example, if your starting out, just balance your accounts based on the percentages that the newsletter recommends. I follow the Aggressive model, and it currently suggests 19% in the money market, and 27% in each of three other funds. Since all my money is going into the money market each month I only have to rebalance if the percentages get out of wack. If the funds stayed flat, the money market would grow from the inputs and would eventually require rebalancing. But generally, the funds the newsletter suggests are growing, so that somewhat offsets the money market increase. If the model doesn't have you in the money market, then that would probably require more rebalancing.

Don't get all wrapped up in when your contributions are deposited. Just check your percentages after the first newsletter each month, since that is the one that will suggest any changes to the models, rebalance if needed. Anything less than a 1% from suggested I just leave it. You might want something tighter or looser.

Its really pretty easy, much easier than before the model changed 2 years ago. I used to make changes twice a month then! And you used to have to monitor fund prices as compared to a set Stop/Loss number that told you move to the money market if a price fell below a specific Stop/Loss.

Also, I find Vanguard mostly to be user friendly and they keep improving it. Rebalancing used to be a chore on Vanguard and you had to calculate your own percentages, now they have it set up to do on one page automatically,

I'm the worst personal finance guy, but if I find it easy, it has to be!

TheBaron

The short answer is no.
Are you looking at your February 28th pay stub? Those contributions haven't been credited to your Vanguard account yet. If you look at the bottom of the transactions page on Vanguard you should see "Year-to-date contributions"; "Federal Express Corporation Pilots' Retirement Savings Plan"; and "Pre-Tax/401(K) Contributions."
That number should equal what shows on your February 15th stub (1st three 401 (K) contributions of the year.) That same number does not include the company match (up to $500/yr.) You can see the company match by totaling all the transactions and comparing their total to your pay stub or the 401(K) year-to-date contributions addressed earlier.

Pecan

OK. Based on what you've said, I think I'm doing it correctly. I had just been rebalancing after the newsletter, but then thought that I should wait until after the contributions are made each month. I guess it doesn't really matter. Unfortunately, I didn't learn of USPFA until two years ago. I'm almost back up to the break even point!!

O'DarkThirty

For those who follow the USPFA news letter, does anyone think it odd for the aggressive model to have 19% in the money market. For me, this is too conservative. For the last year, I've decided to put my money into the other three funds and disregard the money market recommendation. My total return should be better than he shows knowing I'm putting my money more at risk....but that's why it's called aggressive.

Pecan

I suspect you're correct, but Dave stresses that he's not trying to squeeze every ounce of earnings out of an upswing because there's always the downside. Preservation of capital seems to be a major factor in keeping 19% in the money market.