My $100K Model Growth Portfolio for 2025 📈 | Stocks, ETFs & Strategy

Hey, what's up everyone and welcome to the School of Personal Finance. One of the biggest mistakes that I see people making is that they don't invest aggressively enough inside of their retirement accounts. Maybe they have bad memories of 2009 during the great financial crisis or 2001 dot com bubble bursting, 2022 was a pretty crappy year and people see their account values dropping like a rock and it scares them from investing aggressively and they move to a more conservative portfolio and then never do anything from that point on. The difference that you end up with in retirement when you earn a 10% rate of return compared to a 7% rate of return can be hundreds and hundreds of thousands of dollars. So in this video, I'm going to walk you through an example of a model growth portfolio that I use. This way you can kind of use it as a benchmark to see are you investing aggressively enough. Now obviously when you invest aggressively, it's more like a roller coaster ride. You're going to have some very bad years mixed in with those good years and you have to be able to sit through that and not panic during that time. I hope that you find this one helpful. All right, let's get to it. All right, let's jump right in. A couple of things to get out of the way first. Number one, none of this is investment advice. All right. I don't know anything about you. I'm not recommending any of the funds or the fund families that I'm about to show you. These are just for educational purposes. These are just examples of what a model growth portfolio would look like. And then I also just wanted to touch on asset location. And what I mean by that is that you want to be invested differently in tax free types of accounts like Roth accounts compared to a traditional type of account where that money is tax deferred and it's going to be taxed as ordinary income when you take it out. You want to invest more for growth in those tax free accounts. You want to go for it. You want that money to grow as much as possible so that when it comes out, it's a bigger amount and it's going to be tax free. You could have some more of your secure dividend paying or bond types of investments inside of a traditional account because you're not paying taxes, right? It's tax deferred as is paying income and dividends. And then when you take it out, you're going to have to pay ordinary income tax on that. So asset location is a very important piece in your overall asset allocation and the way that you invest for your retirement. All right, so here we go. So what I call a core holding, the anchor of the portfolio, and you've probably heard this from me and from everybody else a million times, and that is a broad based index fund like the S&P 500. Now I am a fan of Vanguard. I'm not recommending Vanguard, but I typically end up using a lot of Vanguard ETFs inside of portfolios that I manage just because they're so liquid, they're so widely held, the expense ratios are so low that I've just become accustomed to using them and I'm familiar with them. So the most popular S&P 500 index fund in the world is VOO. Another equivalent of that would be the SPDR ETF where the ticker symbol is SPY. Those are really the two most popular S&P 500 funds. Now some people might use a broader index fund as their core holding like the Vanguard Total Stock Market Index Fund or the Fidelity Total Stock Market Index Fund. And instead of having 500 holdings, that has closer to, you know, 5,000 holdings. So it encompasses the whole U.S. stock market. I typically do not play it that way where I'll have the S&P 500 fund and then I'll also add a mid cap and a small cap fund as well for 5% each. So let's slow down and back up a little bit. So the S&P 500 fund, typically 40% of my model growth portfolio is what I have in there. And then for a mid cap and a small cap fund, again, just using Vanguard as an example, the VO is the Vanguard Mid Cap Index Fund, and I typically allocate around 5% in my growth portfolio. And then the VB is the ticker symbol for the Vanguard Small Cap Blend, Small Cap ETF, and I typically allocate 5% to that as well. So right there, we have 50% of the portfolio made up of large cap, mid cap, and small cap U.S. companies. Now, if you're looking at your 401k or your 457 plan, then you most likely do not have these funds available. They are going to be mutual funds that you have available with different ticker symbols. And usually the name is going to be pretty similar. It might not be Vanguard. It might be a different fund family, but you get the idea. If you have, you know, a 401k that's managed by Fidelity, then you want to look for the Fidelity S&P 500 fund, the Fidelity Mid Cap Blend fund, the Fidelity Small Cap Blend fund. The most important thing when looking at your 401k or your 457 are the expense ratios. You want to make sure that they have very low costs available to you in these broad-based index funds. All right. And now we're going to go outside of the United States. So what I'll typically use next is a developed markets ETF like the iShares. The ticker symbol is EFA. Vanguard has its own version as well. And I will typically start with a 10% allocation to developed markets. And then staying on the international theme, I will go with about 5% in emerging market ETFs. And for that one, iShares, EEM is a typical one that I will use in the portfolio. But again, Vanguard, Schwab, they all have their own version, spider ETFs of an emerging market ETF. So 15% between developed markets and emerging markets. So now we're at 65% overall of the entire portfolio. And again, in your retirement accounts, you are not going to have these ETFs available. So you have to look for a developed markets index fund, an emerging markets index fund. And again, make sure that the expenses are low. All right. Now circling back around to the US. Now this is my growth model, right? So this is for people who have 10 plus years before retirement, before they're going to be touching this money. Like if you're young, if you're in your twenties or your thirties, you should be pushing growth, right? You should really want to be investing for growth and be okay with the roller coasters of the market. For this next 20%, I allocate it towards large cap technology. And that might be a few different funds that I will use for that. So some very popular ones are like the QQQ, the triple Q's, which basically follows the NASDAQ 100. Another one is the Vanguard growth ETF. The ticker symbol is VUG. Both of those very low expense ratios. They're going to be investing in large cap technology companies that you are very well aware of and looking for growth. Another one that I find myself using is the XLK. This is a spider technology driven ETF also. So I typically find myself using a combination of those funds, maybe two of those funds in my growth portfolio. Now, if you do really have a high risk tolerance, you can even increase that allocation of 20% to a higher number and reduce the allocation in the S&P 500, for example. And hindsight is 20-20 and past performance does not mean anything for future performance. But those growth ETFs, they've done amazing over the last 10 years. They've really outperformed every other aspect of the market. And that's really because of the Magnificent 7 has just outperformed everything else over the last decade. All right. So moving on to alternative types of investments, I will typically allocate around 5% to a Bitcoin ETF. Now, in retirement accounts, this really is not available yet. It's coming soon, I believe. I think that you will have options where you could invest in the Bitcoin ETF in your 401k or 457 plan, but it might be a little bit further down the road. And then also with gold, I've been the gold bug for years. I'm always talking about it. I'm still bullish on gold. I still think that gold is a good place to have a small allocation of your overall portfolio. So my growth portfolio, I have 3% allocated towards gold. So 5% Bitcoin, 3% gold. Now, those are both much more volatile than the S&P 500, for example, right? Bitcoin, it could be all over the place. It's gone numerous cycles where it's lost 80% of its value. So you really have to look at that like a long term investment and just set it and forget it and not worry about it and just hold it for the long term. Gold is not nearly as volatile, but it does go through pretty big cycles. It's had decades where it's gone nowhere. And then all of a sudden, you know, this year it's up 30%. Right? The last few years, it's just outperformed basically everything else. So it's been doing very well over the last couple of years. All right. And then the last 7% I allocate towards specific sectors or individual stocks that I believe have the potential to outperform. Now, you know that I'm a big believer in the fact that nobody could predict what's going to happen in the future. And I am not a stock picker. I think it's a very hard game to play. But with that said, sometimes there are companies out there where you just feel like they have the potential to really run. You want to be an owner of those companies and you place a bet on those companies doing well over the long term. If there aren't individual companies that you would like to invest in, then investing in sectors. For example, you could buy a sector of financials. So like the XLF is a ticker symbol for the financial sector or the industrial sector. And then you are just focusing that 7%. You could even divvy it up between a couple of different sectors. Healthcare, for example, biotech. Every sector is available to buy in an exchange traded fund where you own the basket of those companies. A popular one now is quantum computing. There's a quantum ETF that you could purchase as well. Uranium is another ETF. Gold miners is another ETF that you could purchase. If you think that a specific sector is going to do well and you want to try to take a little bit more risk and try to play a sector, you could allocate a small portion of your portfolio. I'm not a fan of allocating a large portion because you just don't know what's going to happen and you don't want to take on that much risk where you could blow yourself up. So in this type of growth portfolio, it's not like you're going to have ups and downs of 30% up, 30% down. It's going to be all over the place, but you will have volatility. It's invested in stocks and alternatives that are volatile. But over the long term, what you're really hoping for is to get an average rate of return that's going to beat the S&P 500 by a few percentage points. So if you could get 10, 11, 12% over the long term by investing in a portfolio like this, it might be worth the additional risk that you are taking on, especially if you have a very long time horizon. All right, everyone. That is it for this one. I hope that you found it helpful. Again, these are just examples. I'm just showing you under the hood a little bit of how I manage portfolios for people and what I'm looking at as I'm putting together these growth portfolios and where my mindset is at. I never want to pretend that I could outsmart the market. And anybody who tells you that they know what's going to happen next or where the market is going, you have to take it with a grain of salt. Everybody has opinions, and nobody really knows what's going to happen in the future. So we try to use history as our guide. We try to reduce risk while also reaching for growth. And over the long term, hope that the United States, that the overall stock market, that these growth companies, that they keep performing the way that they have in the past. All right. I will see you in the next video. Thanks.