Portfolio balancing - Belgium

For investors outside the US. Personal investments, personal finance, investing news and theory.
Sister forums: Canada, Spain (en español)
---------------
Post Reply
Topic Author
NLX_
Posts: 4
Joined: Fri Dec 02, 2022 9:14 am

Portfolio balancing - Belgium

Post by NLX_ »

Country of Residence: Belgium

International Lifestyle: None

Currency: EUR

Emergency funds: At least six months of expenses will remain on a savings accounts, uninvested

Debt: Mortgage at 0.97% interest rate, 24 years to pay off at 1000 EUR per month (included in expenses for emergency fund)

Age: 35

Desired Asset allocation: 100% stocks/ETFs (bonds aren't attractive in Belgium due to taxation)

Desired allocation to stocks outside your of country of residence: Not sure

Current investing portfolio is basically none.

With respect to the Belgian "pension pillars":
- First pillar (Legal pension): Maxed out (salary is higher than the max. contribution to this pillar))
- Second pillar (Group pension saving offered by employer): Relatively high as my employer operates in the life insurance industry
- Third pillar (Pension savings with tax deduction): Maxed out because of "woonbonus" (deducting mortgage costs)

I have 17000 EUR available in a (low interest) savings account besides my emergency fund. I currently put about 1000 EUR per month on my savings account. Instead of doing that I am considering investing this DCA-style.

I am looking for advise on how to balance my portfolio.

I have 2 different targets.
- Mid term target (12 to 17 years from now) --> I would likely want to sell my house and opt for something that will be more expensive and located elsewhere (though still in the same country). For this purpose I'd like to liquidate about 80k to 100k (at present value, so to be adjusted for inflation).
- Long term (25 years from now) --> I would like to retire at 60. Legal retirement is at 65 (or even higher by then) in Belgium.

I am considering the following ETF's:
- First World (as alternative to IWDA with better tracking difference): HSBC MSCI WORLD UCITS ETF
- Emerging Markets: Xtrackers MSCI Emerging Markets UCITS ETF 1C

I would like to put some more weight on Information Tech (although covered through MSCI WORLD) perhaps through iShares S&P 500 Inf Tech Sector UCITS ETF USD Acc

I am wondering if I should also allocate some funds towards Small Cap Value ETF's such as ZPRX (EU) or ZPRV (USA).

I also see a lot of growth potential in Clean Energy, but not sure how much I would allocate to this "niche".

Dividends are taxed heavily in Belgium so Accumulating is preferred.

I read about re-balancing the portfolio from higher risk to lower risk as you age (or: as I start getting closer to my 2 targets) but I am not sure how to approach this.

All advice very welcome. Thank you very much in advance.
Post Reply