rebalancing for a Boglehead stock/bond Asset Allocation?

[cabronjames]

I'm advising a friend on asset allocation (AA).  The friend is a young accumulator, "just starting out".  His job 401k fund choices are limited in order to implement a Permanent Port AA, with no brokerage window choice.  There is no fund choice available to him in the 30 yr T-Bond, or gold asset classes.  He is fortunate to have the typical stock & bond index asset classes available via ridiculously low exp ratio Institutional versions of Vanguard mutual funds in his 401k.

In the future if my friend were able to start & accumulate Roth IRA with Vanguard VBS as custodian, it would be possible to hold 30 yr T-Bond & gold asset classes in the Roth, & stock (& possibly cash) in the job 401k.  He is not able to do a Roth IRA yet.  I advised him that since his employer doesn't match, he'd be better off putting each year's dollar #1 through dollar #5000 in a Roth IRA.  He acknowledged this point, but for now prefers with funding his job 401k exclusively.

Until that future time, as a "workaround AA", I suggested he use a Bogleheadish AA which is completely implementable within his job 401k:

50% stock
-25% US S&P500 - VIIIX (0.02% exp ratio, diff share class of VOO)
-25% ex-US - MSCI All Country World ex USA Investable Market - VTPSX (0.12%er, cousin of VXUS)
50% US intermediate-term bond - Barclays Capital U.S. Aggregate Float Adjusted - VBTIX (0.07%er, cousin of BND)

He is interested in implementing this Boglehead AA.

My question is on rebalancing policy. 

Would the PP-style 40% rebalancing bands work for the Boglehead approach? Eg only rebalance if
VIIIX drops to 15% or rises to 35%
VTPSX drops to 15% or rises to 35%
VBTIX drops to 30% or rises to 70% (more unlikely for the less-volatile-than-stock bond asset to drift to the rebalance band anyways).

My initial thought on a rebalancing scheme
1. monitor his port once each quarter, such as Jan 1, Apr 1, Jul 1, Oct 1, via a private Google Docs spreadsheet I'll make him, that he can "kick me off" once he uses it with his "live" data.

2. update the nbr of shares of each of the 3 funds in the spreadsheet to account for his contributions & div-reinvest which have occurred since his last monitor 90 days ago

3. check the cell in the spreadsheet which determines if a rebalance is needed.  If a rebalance is needed, rebalance the whole port back to the target: 50% VBTIX, 25% VIIIX, 25% VTPSX

4. direct all new pay contributions towards the LOW asset.  If a rebalance was just done in #3, direct the contributions to what was the low asset prior to the rebalance.

NOTE: I imagine rebalancing events in practice would be rare, given the policy of adding to the low asset for a quarter at a time.

from the "behavioral economics" perspective on my friend: He is a very diligent about following a plan.  He is very good with info tech & is the type that will schedule a reminder to himself on his smartphone to do the rebalancings, which can be done via his job's 401k website or via calling his company's HR Retirement person.  He's not very interested in this investing topic, & wants to follow a simple sound plan.

Any feedback on this rebalancing plan?  My experience with rebalancing is in the context of the Perm Port; I have no experience with other AAs like this Boglehead AA.  Thx in advance.

[FarmerD]

IMO since your friend is just starting out, he may just want to do option 4.  If he's starting at a low base, new contributions to the low asset would easily rebalance him out.  Of course once he builds up a sizable 401, new contribution may not be able to rebalance the 401 out so at that point he may need to rebalance existing assets. 

Really any of your ideas are fine.  It may just come down to just how much time & effort your friend is willing to put into it.  BTW Bogleheads differ on the right stock/bond ratio for a young person.  Most say either 50/50 or 66/33 or 60/40 so as long as your friend is in that ballpark he'd be in line with Boglehead orthodoxy.     

[Ad Orientem]

I am a fan of simplicity.  If your going to do a standard AA I would just go 50% VBMFX and 50% VT (or alternatively 25% VTI and 25% VEU).  Review annually and rebalance at 60/40. On a side note, while I'm a fan of the PP a Boglehead AA is by no means a bad investment scheme if you can handle a bit more volatility.  You are a little exposed to inflation risks. But keeping a quarter in international stocks should mitigate that at least somewhat.

[MediumTex]

I would probably just rebalance once a year.