53-Year-Old With $1.5M Hesitates On $200K Move – 'Anxious To Pull The Trigger!' Reddit Explodes: Will International Funds Ruin Retirement?

Investing in international funds is a move that divides the financial community nationwide.

Although global diversification is a good way to reduce risk and seize opportunities outside the U.S., some investors consider currency volatility and lower returns potential downsides. And for Americans approaching retirement, whether foreign funds are a sound investment or a risky gamble is a looming question.

One such investor struggling with this predicament is a 53-year-old finance enthusiast with a $1.5 million 401(k) self-managed, strategic portfolio. He shared his thoughts and concerns on Reddit, detailing how his passion for investing and saving has carried him toward his goal of retiring at 60.

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However, as he approaches retirement, he’s faced with a $200K dilemma: should he take a part of his 401(k) from a high-performing small/mid-cap fund and put it into a less volatile international fund?

According to the 53-year-old, this change would likely bring his portfolio closer to his goal allocation, lowering the small/mid-cap exposure from 25% to 11% and raising international exposure from 8% to 21%.

The move aligns with his strategy, but he’s hesitant and considers investing the money in two separate transactions, months apart.

“For our complete portfolio (across all accounts) to be allocated “correctly,” I would need to adjust this to an 11% Small/Mid and 21% International split or move roughly $200K out of Small/Mid (Vanguard Instl Extended Market fund) and into International (Vanguard Instl Total Intl Stock),” he says.

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Let’s analyze the advice he received from the r/financialindependence community on Reddit.

Are International Funds a Good Move? Reddit Advises

Proceed with the Reallocation

Just a few commenters in the thread suggested the 53-year-old investor pull the trigger. One, in particular, advised him to make the move because, as he mentioned in his post, he will know he made the right choice when his portfolio is allocated “correctly.”

“Just do it and get it over with. You will feel better after when your portfolio aligns with what your target is, I promise,” a comment reads.

Another Reddit member wonders why the investor is overthinking the allocation so much and feels he doesn't need to make two transactions.

“If you were shifting $200k from a 2040 TDF to a 2050 TDF, would you be afraid to pull the trigger all at once? (I wouldn't). Why is this logically any different?” says a Redditor.

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One of the r/financialindependence community mentioned taxes and suggested that international funds have a foreign tax credit policy that would benefit him more than a 401(k).

“Don’t you want to hold more international in taxable versus 401(k) because of the foreign tax credit?” the comment reads.

Caution about International Investments

While a few commenters agreed that moving the $200K into international funds is a good idea, more were vehemently against it. One Redditor left a comment that clearly described his opposition to investing in international funds.

“I wouldn’t dream of putting nearly 15% of my nest egg outside the protections of U.S. law,” the comment reads.

Another Redditor expressed concern about the weakening economies of certain European and Asian countries, which, according to him, will possibly worsen soon.

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“International looks weak and potentially getting worse. Germany and France are facing struggles. China’s economy isn't that strong. Looming tariffs. Not an area that I'd broadly invest in via ETFs. Maybe some specific stocks but not a broad index,” he said.

Yet another Redditor is against investing in international funds because he believes they will underperform U.S. funds in the next few years.

“No. I have a pretty good idea that international is going to underperform the U.S. due to multiple factors over the next 2-4 years,” the Redditor wrote.

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