DIY Retirement Portfolio Rebalancing: When, How, Tools

Thanks to everyone who responded to the recent book giveaway. Your encouragement and kind words were uplifting. The responses gave me lots of topics to focus on in 2025. I received 104 responses. Congrats to the winners. 

Also, a few weeks back, I asked for your help in getting me over the 1,000 subscriber mark on YouTube. The response was incredible, taking me over the top that day! Thank you. I’ve already surpassed 1,200, and I’m looking forward to the next milestones. 

Every January for the past 20+ years, I’ve analyzed my investment portfolios and adjusted when necessary.

Why January?

December is too busy for me. January is the calm after the holiday storm, and many of us used the time to rethink our finances.

DIY investors should consider rebalancing their portfolios once a year — but no more frequently than once a year.

Less frequently is OK. However, rebalancing should be systematic and unattached to emotional triggers like market fluctuations or personal events.

Your rebalance date could be every 18 or 24 months. Pick your rebalance frequency, set a reminder, and follow through systematically. Every twelve months is a good rule of thumb, but it doesn’t have to be near the new year. 

Annual portfolio scrutiny is more than just rebalancing. My portfolio is not quite where I want it to be yet. So, I use the annual rebalance process to streamline.

I streamline by:

• Reducing fund redundancy and overlap, consolidating into core portfolio holdings.
• Selling individual stocks no longer serving my investment objectives, moving money into core index holdings.

Multiple Accounts

A common problem with portfolio rebalancing is determining your current asset allocation if you have multiple accounts and brokers. 

One way around this is to rebalance each account individually. This method is cumbersome when some accounts are much smaller than others. I prefer to rebalance by looking at all my holdings together.

But without knowing your current asset allocation, you can’t rebalance to the target asset allocation.

Streamlining to fewer accounts and fewer holdings makes the rebalancing process easier. 

Between Mrs. RBD and I, we have:

• Two taxable accounts
• Two traditional IRAs
• Two Roth IRAs
• Two former employer-sponsored accounts
• One SEP IRA

We have some room to consolidate accounts here and will do so when the time is right.

To keep things easier to manage, I invest in just one fund in the smaller accounts (a total market fund), then use the larger accounts to adjust to reach our target asset allocation. 

I use a few different tools to get a consolidated view of all of our holdings and use this data to make adjustments to our portfolio.  

Finding Your Current Asset Allocation

The first step in rebalancing is to determine your current asset allocation. 

This might be an easy task if all your money is in one place. Some brokers are very good at this. But if you have money in multiple accounts from multiple account providers, it is more challenging.

For example, I’ve spoken to folks with a portion of their retirement money in an IRA with a financial advisor but another portion self-managed through an employer-sponsored account or individual investment account.

I have six accounts with Fidelity, and it does a surprisingly lousy job of giving me portfolio insights across my various accounts. If you have accounts outside the umbrella of a primary broker, it becomes more difficult. 

I’ve turned to tools over the years to figure it out. DIY planning tools like Boldin and ProjectionLab do not offer this functionality yet, so we have to look elsewhere.

The three tools I use are the focus of the companion video I made for this post. Check it out on YouTube or below.

Spreadsheets

I use the spreadsheet method to create the charts on my Portfolio page but I’ve slowed in updating it regularly because it is a rather painstaking process to make charts like this:

The process entails (see video):

1. Downloading spreadsheet files from the holdings view of your multiple brokerage accounts
2. Combining all the holdings and market values into a table
3. Inserting columns and categorizing each holding (manually)
4. Then, pivot tables to calculate the current allocation percentages.

Spreadsheets are free, customizable, and familiar to most, so they are a suitable option. But the more complicated your financial situation, the more manual this process becomes. 

I’m more frequently opting for tools to help analyze my financials because they work better than most spreadsheets I can build.

Morningstar Investor (paid) is a new tool that I’m experimenting with and like so far. It does an excellent job of consolidating data and providing portfolio insights. 

Empower (free, with a caveat) does a good job of aggregating account data, among its other analytical capabilities. 

Morningstar Investor

Morningstar Investor is the flagship portfolio tracking on the Morningstar website. Known for its fund ratings and retirement insights, Morningstar imports your portfolio data (via third-party connectivity) from multiple sources and provides comprehensive analysis.

For example, I’ve connected my six Fidelity accounts, my wife’s two, and my M1 Finance account. Then, I combine them all into one portfolio view (demonstrated in the video).

It automatically categorizes each fund and ETF and provides your current asset allocation. It can also look at each mutual fund or ETF you own, and extract individual stock insights, then show you the overlap between holdings.

It also provides benchmark portfolios to compare against. I prefer a more personalized target asset allocation:

• 75% U.S. stocks
• 15% International stocks
• 10% Bonds

The tool quickly tells me that my portfolio is overweight U.S. stocks and underweight international stocks and bonds.

Now, I can adjust my retirement accounts.

As a bonus, the Stock Intersection tool shows what funds hold stocks and how much, based on the amount you’ve invested in the fund.

For example, I own Apple stock, plus a few funds that hold Apple as their top holdings. The tool shows me my total exposure to Apple across all my holdings.

This is the first tool I’ve seen that is capable of this:

Subscribers can click into any individual holding to find fund and stock reports, proprietary ratings, charts, and key statistics.

New users can get a 14-day free trial. After that, it’s $199 for the first year. 

Empower

Empower is a free tool that I’ve been using for about 10 years. Formerly known as Personal Capital, Empower is a portfolio aggregator and net worth tracking that analyzes all your financial accounts into visualizations. 

This tool also automatically categorizes your investment but doesn’t give you the granularity that Morningstar does within the funds (there’s no Stock Intersection equivalent). 

Here’s the view I demonstrate in the video:

Empower struggles a bit with investment categorization, but users can modify categorizations to their liking and select which accounts to include in this view. 

In this case, I can see where my portfolio is not aligned with my targets, and I can adjust my holdings.

Empower is free to use. It supports third-party data connectivity, so you can bring in all your accounts for comprehensive analysis. Connectivity has improved recently.

It has a decent retirement calculator, too, similar but not as customizable or robust as Boldin or ProjectionLab.

The main drawback of Empower is that it is a lead generation tool for the company, offering wealth management services.

So, if you sign up and connect your accounts, a wealth advisor may reach out to you. Saying no is fine, but some people find this to be intrusive. Most people are OK with that tradeoff because it is a powerful free tool.

Determine Your Target Asset Allocation

Your ideal target asset allocation is the percentage of portfolio assets invested in stocks, bonds, and cash. 

We can determine our asset allocation using a simple rule of thumb I call “minus your age“, which looks at age and risk tolerance. 

To find your ideal asset allocation, subtract your age from one of the following numbers associated with your risk tolerance:

• Conservative – 120
• Moderate – 130
• Aggressive – 140

The result is the amount to allocate toward stocks. The balance is then invested in bonds or other fixed assets. 

For example, my risk tolerance is aggressive, and I am 49 years old. 

=140 - 49 = 91

So, I would target approximately 91% stocks and 9 % bonds. See above. 

Rebalance to Your Target Allocation

Once you have your current asset allocation and your target, calculate the difference between the two. Then, go into your brokerage account and make the adjustments. 

In the video example, I use the following example where I break it out to include U.S. stocks, international stocks, bonds, and cash:

With the difference calculated, the final step is to go into the brokerage account and:

• Sell $56,000 of domestic stock funds
• Sell/transfer $49,400 of cash held in a money market account
• Buy $53,600 worth of bond funds
• Buy $52,800 in international stocks

As I pointed out a few times in the video, this does not have to be a precise exercise. The market fluctuates daily. But you want to get close to your target asset allocation once a year to maintain your retirement plan. 

Why Should We Rebalance?