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Vanguard Taxable Account

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Money Talk > Investing, Stocks and Bonds

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ithalvey
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Vanguard Taxable Account  Reply with quote  

Hi, so i have a vanguard roth ira account and a taxable account. I have already maxed out the roth ira with vanguards total stock market index fund. In my taxable account i have the vanguard 500 index fund. I am wondering if there is another fund that you guys would recommend that i get from vanguard for my taxable, maybe the total bond market index fund? Also would it be better to have my roth ira in the the vanguard 500 index or the vanguard total stock market index? And would there be a fee if i took money out of an index and put it into another?
Post Tue Jun 02, 2015 7:56 am
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ithalvey
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ok so as long as it is under the same account there is no fee to exchange money into a different fund. I guess the real question is.. do you guys recommend a bond fund? And do you prefer the vangaurd 500 index or the vanguard total stock market index?
Post Tue Jun 02, 2015 8:59 am
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ithalvey
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"The Vanguard Total Market Index fund (VTSMX) was introduced on April 27, 1992, and earned an average return of 8.10 percent annually through January 15, 2010. This compares to a 7.98 percent annual return for the Vanguard S&P 500 Index fund (VFINX) during the same period."

Well i guess this answers my question. The funds performance is very close, i will stick with what i got now.

So i still need an answer on whether or not you guys think i should have a bond fund with vanguard? I also wanna know what you guys think about REIT and TIPS?

Here is my portfolio, feel free to make comments and recommendations.
I am 20 years old and am willing to accept a good amount of risk.

Emergency Fund (cash): $6,000

Vangard taxable Account:
vangaurd 500- $3,058

Vanguard Roth IRA
Vanguard total stock index- $5,552

TSP Roth Account:
Bond fund- $700
C Fund- $1,400
S Fund- $1,250
I Fund- $1,250

Total : $19,210
Post Tue Jun 02, 2015 9:28 am
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oldguy
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quote:
Well i guess this answers my question. The funds performance is very close, i will stick with what i got now.


Yes, I had both, one in a 401k and one in a 'taxable', for over 20 years - the graphs of the performance was almost an exact overlay - they run very close. Any difference would be beyond predictability, ie no way for you to predict the 2045 difference.

quote:
This compares to a 7.98 percent annual return for the Vanguard S&P 500 Index fund (VFINX) during the same period."


Right - and if you kept it until today, the return is about 9.51%/yr. That 17-year-block has a couple sharp dips (2001 & 2008) so it takes awhile for the average to build back up. But no matter, you can build wealth with a 9.5%/yr return.


[quote]So i still need an answer on whether or not you guys think i should have a bond fund with vanguard? I also wanna know what you guys think about REIT and TIPS?
quote:


No. Bonds, REITs, TIPs, are all places for safe storage of money, you should not own any of them at your age. Most of us are given about 30 years for wealth-building, and then, after we have wealth, we need to transition to wealth-preservation. You should stay 100% in equities for 30 years, maybe 35 yrs in your case because you are getting such a good start. Then, at about age 55 or 60, you can start moving into 'storage' places - bonds, reits, tips, cd, money market.
Post Tue Jun 02, 2015 3:18 pm
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ithalvey
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Alrighty, thanks oldguy I appreciate your advice. Ill stick with equities.
Post Tue Jun 02, 2015 5:47 pm
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