Lucky 21-Year-Old With $70K Portfolio From META And ETFs Asks: 'Am I Playing It Too Safe?' Reddit Offers Polarized Advice

Investing in the stock market requires skill and strategy, but some can also get lucky. Some investors win big by betting on individual stocks very early, like META, while others are more cautious and prefer to spread their money in index funds like ETFs.

This brings us to the story of a 21-year-old college student who inherited a $70K portfolio from his dad. His father bought META stocks at $29 per share and held them until the investment was worth $30K.

“My dad invested a few grand into Facebook when it was $29 a share,” the college student wrote.

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When the portfolio became his at 21, he sold the META stocks to avoid capital gains taxes and because of his low income, he paid 0%.

“META accounted for about 40% of my portfolio weight, which I didn't necessarily like. Because I'm a college student and my income is less than $48,350 this year, I'll pay 0% on capital gains. Therefore, I figured I'd rebalance my portfolio and completely sell META, using that liquidity to invest in ETFs,” the young investor said.

Now, he’s restructured his entire portfolio into ETFs. His current allocation includes 52% or $36,500 in VOO, 17% or $12,000 in AVUV, 17% or $12,000 in AVDV and 14% or $10,000 in SWVXX, his emergency fund.

Because he plans to start a job at a Fortune 500 company after graduation, he’s considering DCA for these investments.

“After I graduate, I'll be working in sales at a pretty large Fortune 500 firm, so once I have consistent income, I will continuously DCA into these,” the 21-year-old investor wrote.

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However, he’s unsure of this strategy and wonders if he can follow a better plan, so he’s turned to Reddit for advice. And Reddit has delivered.

Let’s analyze what the commenters have suggested the 21-year-old do.

Redditors’ Advice for the 21-Year-Old Investor

Stick With the Core ETF Strategy and Keep Diversifying

Many Reddit members of the r/ETFs community have suggested that young investors stick with a balanced ETF portfolio but adjust the allocations for better diversification and long-term yield.

“A better split if you want, would be: VOO: 50%, AVUV: 16%, DFIV: 10%, AVDV: 10%. This gives you better international diversification as well as improves your risk-adjusted returns,” a Redditor suggested.

According to this Redditor, this strategy capitalizes on the stability of the U.S. market while including international exposure to protect against domestic downturns.

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Automate and Focus on Long-Term Growth

A few Reddit members have stressed the importance of automation and discipline in building a stable portfolio to create wealth over time, avoiding high-risk moves like options trading.

“My advice: Time is the most valuable asset when it comes to stock asset maturation. You are on the right path. Also, don't play options,” a comment says.

A Redditor suggested the 21-year-old automate investing every paycheck into the final allocation to create discipline and ensure the money goes into his portfolio.

“That’s a decent portfolio. Make sure you automate investing every paycheck, like your 401(k). Set and forget it,” the Reddit member wrote.

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