A $300k question...which Vanguard fund to invest in

[dvalley]

So in a moment of questionable wisdom a few weeks ago I decided to consolidate my old Fidelity rollover IRA as well as my old 401ks that were still with the previous employers to a new Vanguard rollover IRA. I moved all of those assets to their stable value funds and am awaiting transfers to complete.

So now I have approx $300k that I need to DCA into something. I was pretty well set on VTSAX at a once-a-month frequency throughout the year. However, I'm wondering if there are better options to grow these assets at the max rate possible over the next 18yrs until I turn 60. I won't be contributing any new money to these assets so started thinking about high yield dividend generating funds but not quite sure.

 

[pb4uski]

No need to get fancy. Slow and steady wins the race. VTSAX is a good choice with 18 years to go.

The only question is all at once or get in gradually... given we are close to market highs I think I would value average in but who knows!

 

[W2R]

I really like your choice too, and that is exactly what I would choose if I had 18 years to go. :

 

[LOL!]

So not only are you asking me if my Crystal Ball is working for the next few months, but you also want it to be accurate for the next 18 years or so.

OK, invest in Vanguard Small Cap Value Index fund and Vanguard FTSE all-world ex-US foreign small cap index fund.

But don't blame me if my crystal ball fails to come through.

 

[orangehairfella]

Just out of curiosity, why DCA?

Presumably all of these accounts were invested previously. Why not just go with the same asset allocation, but using vanguard funds? Why sit on cash while you DCA if you're really just moving brokerages?

 

[Keim]

Just out of curiosity, why DCA?

Presumably all of these accounts were invested previously. Why not just go with the same asset allocation, but using vanguard funds? Why sit on cash while you DCA if you're really just moving brokerages?

Dollar Cost Average

 

[dvalley]

No need to get fancy. Slow and steady wins the race. VTSAX is a good choice with 18 years to go.

The only question is all at once or get in gradually... given we are close to market highs I think I would value average in but who knows!

I really like your choice too, and that is exactly what I would choose if I had 18 years to go. :

Thank you both for validating VTSAX as being a good choice.

So not only are you asking me if my Crystal Ball is working for the next few months, but you also want it to be accurate for the next 18 years or so.

OK, invest in Vanguard Small Cap Value Index fund and Vanguard FTSE all-world ex-US foreign small cap index fund.

But don't blame me if my crystal ball fails to come through.

Lol, I did see your 27% returns on the value cap index but I'm thinking max diversity over the long haul. May be 10% or so of value cap?

Just out of curiosity, why DCA?

Presumably all of these accounts were invested previously. Why not just go with the same asset allocation, but using vanguard funds? Why sit on cash while you DCA if you're really just moving brokerages?

As pb4uski mentioned too the stock market's pretty high so might as well DCA and see if I get lucky with the timing. My gut feeling says there will be a pull back in the market before the end of the first quarter.

 

[DrRoy]

+1 for VTSAX

 

[dvalley]

With the market up today my early spring cleaning continued as I sold all my individual stocks and closed the Scottrade brokerage account - going Vanguard for everything!

The conversation with Scottrade went something like this:

Him: What are you planning to do with the money?
Me: I'm going to vegas next week
Him: Oh gambling?
Me: no...
Him: ohhh, I see, you sure you want to close out the account? How about opening an IRA etc.
Me: Nah I don't want to do boring things anymore, money is meant to be enjoyed
Him: Silence...ok sir, we'll mail you the check on Tue. Anything else I can help you with, if not have a great day.
Me: no thank you, you do the same.

 

[REWahoo]

The conversation with Scottrade went something like this:

Him: What are you planning to do with the money?
Me: I'm going to vegas next week
Him: Oh gambling?
Me: no...
Him: ohhh, I see, you sure you want to close out the account? How about opening an IRA etc.
Me: Nah I don't want to do boring things anymore, money is meant to be enjoyed
Him: Silence...ok sir, we'll mail you the check on Tue. Anything else I can help you with, if not have a great day.
Me: no thank you, you do the same.

Love it!

 

[Dawg52]

With the market up today my early spring cleaning continued as I sold all my individual stocks and closed the Scottrade brokerage account - going Vanguard for everything!

The conversation with Scottrade went something like this:

Him: What are you planning to do with the money?
Me: I'm going to vegas next week
Him: Oh gambling?
Me: no...
Him: ohhh, I see, you sure you want to close out the account? How about opening an IRA etc.
Me: Nah I don't want to do boring things anymore, money is meant to be enjoyed
Him: Silence...ok sir, we'll mail you the check on Tue. Anything else I can help you with, if not have a great day.
Me: no thank you, you do the same.

You should have told him there is more to do in Vegas than gamble.

 

[Yarnstormer]

Dumb question - Do you have to sell to transfer a brokerage account? Couldn't you transfer to vanguard and pay lower commissions ?

 

[dvalley]

@Yarnstormer, good question. I just didn't want to be in individual stocks anymore. Today I saw an opportunity and decided to liquidate it all - I'll reinvest the proceeds in a broad index in the near future when I see the opportunity (prob VTSAX for everything from here on out in both taxable and pre-tax accounts).

As for the old 401ks etc, I believe I was in vanguard target 2030 for a big chunk which could've been transfered in-kind perphaps but again I didn't want to keep the same funds after the transfer so I did it on my own. Sure I pay a few dollars (under $100 so far) in transaction fees and a few short term gains but it's a small percentage of the overall picture.

 

[coveredbridge]

Personally, I prefer the Wellington Fund (VWENX)

 

[RobLJ]

VTSAX sounds great (I have it in a brokerage account). If you're waiting more than 15 years, I would consider an additional allocation to small value or maybe Dividend Growth (which I also have).