Vanguard Mutual Fund

[Tcampbell]

Hello everyone, new here to the forum. I was searching for mutual funds and came across Vanguard. I looked at several of the core fund options they have to provide. I don't mind gambling but I also don't want to be fullish in doing so without knowing my better odds. Therefore, if any of you (other members) happen to have invested with Vanguard I would like to know what approach you took and has it worked out well or better then anticipated.

On another note, would the total international stock index be something worth investing in? I understand there is a high risk but after all I plan on living for many more years and don't mind a higher return which I hope would be destined at some point.

Thanks for your input ahead of time.

[disneysteve]

I don't mind gambling

First, you need to decide if you are gambling or investing. They are two very different things.

What is the purpose of the money you would be putting with Vanguard? Is it for retirement? Is it for a house down payment? Is it for your kid's college education? The answers to those questions will help guide how the money should be invested.

Is the Total Intl Stock fund a good one? Sure. It can certainly be part of a well-balanced and diversified portfolio. Depending on your age and timeline, probably 20% or so of your portfolio ought to be in international stocks.

You need to determine your goals and then from there determine your asset allocation. There are numerous websites that can help you do this. Vanguard's site may even have this information.

[buildmybudget]

Wow, this is a fairly loaded question... Have you done any research on investing or talked with any Certified Financial Planners(CFP)? I would recommend talking with a professional to make sure you have a solid foundation before jumping into a single mutual fund, for example. Deciding to invest is one big step, but managing the money once it is invested is another huge step in achieving success as an investor.

[snafu]

Adding to earlier postings, you need to determine your Risk tolerance. Many of us eased into investing by DCA [Dollar Cost Averaging]. Each month a set sum transfers from your Bank to your Investment a/c. The specific fund will be determined by your goals, age, timeline, RISK tolerance and current economic climate. I stated with an Index fund so that I had a 'marker' to follow in the future. Vanguard has a good reputation, low fee structure and a good selection of investment products.

[disneysteve]

I agree that paying a CFP is unnecessary unless your situation is particularly complex. Investing is not all that difficult but it does take educating yourself about things. You can do that by reading investing books, financial magazines like Money, Kiplinger's and Smart Money and by frequenting online sites like this one. I'm not saying that CFPs don't do good work but I don't believe they do anything that you can't easily do yourself for free.

[jpg7n16]

I agree that paying a CFP is unnecessary unless your situation is particularly complex. Investing is not all that difficult but it does take educating yourself about things. You can do that by reading investing books, financial magazines like Money, Kiplinger's and Smart Money and by frequenting online sites like this one. I'm not saying that CFPs don't do good work but I don't believe they do anything that you can't easily do yourself for free.

I actually disagree with this (but I'm kinda biased ) I sat for and passed the March exam. And there was a lot of study and effort that went into it. (I have a degree in Finance/math minor - plus an additional year of studying) Plus to get the actual certification, you need 3 years of actual planning experience. That's what I'm workin on otherwise I'd have it.

For extra simple cases, what you say is kinda true. But it's also like saying "well why get someone to do your taxes when you can do them yourself for free?"

There are reasons CPAs get paid to do people's taxes - they think of things that the average person might miss, even if they study it themselves. CFPs are the same, but for a whole range of financial topics.

CPAs, CFPs, and even doctors and lawyers are all human and so no one is perfect. But I think a CFP would know a lot more about evaluating someone's financial position, than the average person who doesn't do that for a living, but decides to do it themselves.

This is what CFPs are tested on: Certified Financial Planner Board of Standards Inc. - Topic List for CFP® Certification Exam

If you think you've got all that covered and could handle it all yourself, good deal. But most people don't have the time and energy to do all that.

[disneysteve]

There are reasons CPAs get paid to do people's taxes - they think of things that the average person might miss, even if they study it themselves. CFPs are the same, but for a whole range of financial topics.

I think a CFP would know a lot more about evaluating someone's financial position, than the average person who doesn't do that for a living, but decides to do it themselves.

Point taken. I agree with you. Heck, I don't do my own taxes and I'm pretty financially savvy.

I guess I tend to think of people using a CFP because they don't want to do everything themselves, not because they couldn't. I guess I'm biased because I'm a personal finance junkie so I like doing all this stuff and enjoy doing it. Lots of people aren't like that so they would benefit from professional guidance.

[jpg7n16]

I guess I'm biased because I'm a personal finance junkie so I like doing all this stuff and enjoy doing it.

Yes Yes you are!

I like reading your posts

Lots of people aren't like that so they would benefit from professional guidance.

That's pretty much what I'm wanting to do with the rest of my life - help those who don't know how to help themselves. Or can't because of the time involved, effort, whatever.

My ultimate goal is to become like a financial doctor.

And I'm sure you cringe a bit when someone comes in and tells you that they read about their condition online so they don't really need you. (You're a doctor right?)

A wise man sarcastically once said: "Yeah, who needs med school when you've got the internet?" -House

[disneysteve]

Thanks jpg. I appreciate the compliment.

Yes, the internet is a thorn in the side of most physicians today. I spend a lot of time explaining why what they read online isn't true or doesn't apply to their situation or why they shouldn't buy the product the website is selling.

The one saving grace for doctors is that patients still need us to write the prescription or order the diagnostic test. So they can't do everything themselves, which they can do in the financial world.

That's pretty much what I'm wanting to do with the rest of my life - help those who don't know how to help themselves. Or can't because of the time involved, effort, whatever.

Me, too. That's why I hang out here.

[Tcampbell]

I'm 19. I should ask what would my better option for investing where I could for a long time and in the end get a high return? This is for an individual purpose and to set long term goals. I have currently 3000 to invest. I've set up an etrade account and am willing to put in the min balance and buy and trade stock. Is that a good start? Any advice would be great. Thanks.

[jpg7n16]

Make sure you keep a buffer against life (EF: s/b 3-6 months; but can be lower if you're still supported by your parents at all). Assuming you've got at least 1 month living expenses saved up in cash then:

Since you're 19, your taxes are probably really low - and you say "invest for a long time" - so I'm thinking for retirement. If you've earned over $3000 this year, I'd put it all into a Roth IRA and begin investing there. If you understand that this money is to build towards a retirement and you wouldn't need access to it before then.

If you mean "a long time" like "until I graduate and want to buy a house" then the Roth idea isn't as good of an option, but still worth considering. You could use other money at that time, and have a good start on retirement savings.

So if you need the money in the next 2-5 years: short term investments (Money market, short term bond fund)
5-20 years: brokerage account
Retirement: Roth IRA - if you have enough earned income

In the IRA, I'd use a target date fund. Buy now, let it grow for a really long time.

Vanguard has a good option available:
Vanguard Target Retirement 2050: VFIFX quotes & news - Google Finance