Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Investment for 10-15 year savings
Old 02-24-2011, 09:48 AM   #1
Confused about dryer sheets
 
Join Date: Dec 2010
Posts: 2
Investment for 10-15 year savings

I am looking to invest some savings and plan to use it when the kids get older. Kids are currently 4 - 7 - 10. I already have my 6 months of expenses, retirement, and college savings all funded. This money will be used for cars for the kids, misc college expenses, daughter's wedding, etc. I've been putting $50/week away for 2 years now, and it's just in a savings account. My thought is to move it to something with a better return. I use Vanguard for some of my other investments, so I was going to do the same with this one. A few days ago, I opened a Vanguard Star account and put 3000 in it to start this. Now, after a little more reading, I am having some second thoughts because of the tax implications. Would the VTSMX, total stock market index fund be a better fit?
__________________

__________________
jdman is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 02-24-2011, 04:53 PM   #2
Full time employment: Posting here.
 
Join Date: Sep 2006
Posts: 678
Quote:
Originally Posted by jdman View Post
Would the VTSMX, total stock market index fund be a better fit?
Yes.
__________________

__________________
JustCurious is offline   Reply With Quote
Old 02-24-2011, 08:15 PM   #3
Thinks s/he gets paid by the post
steelyman's Avatar
 
Join Date: Feb 2011
Location: Triangle
Posts: 3,218
I've owned both, and for quite a long time, and remain in them. I think they are both good funds with different goals.

One thing I find helpful when considering how to pick between two different investments is to visit Yahoo! Finance (finance.yahoo.com), enter the symbol for one of the funds in the little "Get quote" box that appears near the top left of the page, click on "Basic Chart" in the menu that appears on the left. Then, just above the chart itself, there is a box labeled "Compare XXX with". Enter the other fund symbol in that box, and you will get a comparison over a default period of time. You can adjust the time frame in various ways and get a feel how they have done head-to-head.

The two tickers you are interested in are VGSTX and VTSMX. As I said, I have them both, but for different reasons. It was interesting to see what happened as the market tanked a couple of years ago.
__________________
steelyman is offline   Reply With Quote
Old 02-24-2011, 08:22 PM   #4
Thinks s/he gets paid by the post
steelyman's Avatar
 
Join Date: Feb 2011
Location: Triangle
Posts: 3,218
Also, remember that eventually there will be tax implications no matter what you do. While one investment may not declare as many capital gains and dividends on a yearly basis, eventually you will have to sell (if you want to actually use the money). And at that point, the one with the greatest unrealized gain will trigger the higher taxes. It seems to me that for the chance to have the higher overall gain, then Total Stock is probably the better choice (as mentioned by someone else), but for lower volatility, STAR is better, as a more balanced fund. It also has a lower cost of entry.
__________________
steelyman is offline   Reply With Quote
Old 02-25-2011, 03:26 PM   #5
Full time employment: Posting here.
 
Join Date: Sep 2006
Posts: 678
Steelyman, she did not ask if STAR was a better fund, she asked if the total stock market was a better fit in a taxable account for tax reasons.
__________________
JustCurious is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
24 Year Old Looking for Savings/Investment Strategy brau0300 Hi, I am... 5 07-30-2010 11:33 AM
Lawmakers question Thrift Savings Plan investment strategy Helen FIRE and Money 1 07-15-2008 06:54 AM
New Worth, Savings & Investment Choices mb FIRE and Money 21 03-25-2006 05:23 PM
What's Best Savings Vehicle for 22 year-old? LearningToGrow Young Dreamers 13 07-06-2004 07:33 PM

 

 
All times are GMT -6. The time now is 11:31 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.