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A new Vanguard Fan
Old 01-01-2009, 11:19 AM   #1
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A new Vanguard Fan

Sold my small business at years end and now have some money to invest and use the dividends to help with living expenses. I won't be eligible for SS until the end of the year.

I've been researching different strategies for awhile and have come up with Wellesley Income Fund (VWIAX) or Vanguard Life-Cycle (VASIX).

Is anyone familiar with these and would you care to comment. I trying to decide between the two.

From reading the forum it appears a number of members are Vanguard fans.
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Old 01-01-2009, 11:58 AM   #2
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Another one drinks the Kool-Aid.
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Old 01-01-2009, 02:06 PM   #3
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I am a Vanguard fan. Wellesley is a favorite around here. I own it, many others do as well. I think it's fair to say most of us are very happy with it. I am less familiar with VASIX.
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Old 01-01-2009, 02:39 PM   #4
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I have been in Wellesley for over 5 years and would recommend it. I can't advise on VASIX except that it is comprised of 4 other Vanguard funds and I personally would rather hold individual funds to make up my asset mix. One of the funds VASIX holds is VG Asset Allocation whose asset mix can vary a lot and that would drive me nuts, regardless of performance. (I used to own Asset Allocation in an IRA before it's rules changed to allow the manager to alter the asset mix to almost anything he wants from 90/10 to 10/90)
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Old 01-01-2009, 04:46 PM   #5
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I love my VWIAX Wellesley! It provides nice, hefty dividends, with lower volatility than some other funds. I have 30% in Wellesley.

I chose to put the rest of my portfolio in VTSAX (Total Stock Market), VFWIX (FTSE All-World Ex-US), and some bond funds and money market funds.

To be honest, I don't remember why I decided against VASIX but for some reason it did not fit my needs.
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Old 01-01-2009, 05:30 PM   #6
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Well I dont drink Cool Aid and have accounts with Vanguard. I like some low cost index mutual funds.
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Old 01-01-2009, 07:23 PM   #7
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The wifey & I each have Roth IRA's in Vanguard Target Retirement funds. We're about to open another VG account of some kind to roll over her 401k funds from her former employer. I'm pretty happy with Vanguard, although we don't really have any seriously edgy funds with them. I'm 4 yrs from ER & I'm as risky as I need to be now, I think.
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Old 01-02-2009, 03:02 AM   #8
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Make my Cool Aid grape, please.

I appreciate VG more as time goes on, while acknowledging that they aren't perfect. One great thing about VG is the wide variety of funds they offer at very low cost. That gives great flexibility without changing fund companies. YMMV
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Old 01-02-2009, 08:29 AM   #9
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Well, when the cool-aid comes in a wide variety of flavors and super low expenses and very low tracking error (for index funds), I think you might be justified in taking a little sip of the cool-aid that Vanguard serves.

If Fidelity had similar tasting cool-aid, I would probably put my assets with them. Alas, they don't.
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Old 01-02-2009, 10:52 AM   #10
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Quote:
Originally Posted by Alan View Post
I have been in Wellesley for over 5 years and would recommend it. I can't advise on VASIX except that it is comprised of 4 other Vanguard funds and I personally would rather hold individual funds to make up my asset mix. One of the funds VASIX holds is VG Asset Allocation whose asset mix can vary a lot and that would drive me nuts, regardless of performance. (I used to own Asset Allocation in an IRA before it's rules changed to allow the manager to alter the asset mix to almost anything he wants from 90/10 to 10/90)
How were the rules changed? I'm under the impression that funds are more or less contracted to invest in the way you bought in to invest.

Just curious as to the procedure they use to change the investment strategy.
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Old 01-02-2009, 11:19 AM   #11
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Quote:
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How were the rules changed? I'm under the impression that funds are more or less contracted to invest in the way you bought in to invest.

Just curious as to the procedure they use to change the investment strategy.

The rules used to be that they could not change the allocations beyond certain limits. Can't remember what it was but something like no more than 40% equities. At the time my 401k did not offer a bond fund and this was the only option outside of stable value that I could have 401k money in bonds.

I received a letter and voting form from Vanguard stating that it was proposed to change the rules and remove all such boundaries. (I just checked and the fund is currently invested 100% equities). I voted against but the proposal went through.

I can't complain as the rules were changed with plenty of notice and due process. Shortly after, my 401k options increased and I was able to invest my bond money in Schwab Total bond index.
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Old 01-02-2009, 12:24 PM   #12
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I have been a big Vanguard fan for many years and have almost all of my stash in 8-10 different index funds. I looked at the various VG managed funds a while ago, but could not see any reason to assume a greater ER, so I have stayed with my initial AA mix of index funds.

I was down in 2008 (only) 21.45%. Not happy with it, but compared to other failed plans, I am not that wounded.
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