A friend wants to start a $2000 Roth, and contribute maybe $1000 more per year. So, it'll be about a year before it hits $3000, if returns were 0%.
Would be great if there were a company offering index funds with low fees and minimums, but I don't know of one.
Am thinking of suggesting working to have 3 ETF holdings, eventually:
VTI or VV Vanguard Total Market Index or Largecap.
EFA ishares EAFE index
VWO Vanguard EM Index
Maybe, $1200 VTI and $800 EFA today.
When save up 18% (or perhaps more) of existing Roth value, put that into VWO.
Will then have, depending on returns, about
50% VTI
35% EFA
15% VWO (more if overallotted temporarily, to save on commissions)
And would have spent $21 on commissions at $7/trade.
From there, can put into whichever is most under target %, but transactions no smaller than $1000, to keep commissions low.
Better ideas??
Even if he had $3000 today, that would only be enough for one Vanguard fund.
Even if he had $6000 today, and split equally between Total (US) Stock index and Total International index, Vanguard would charge $40 a year in fees, worse than commissions+spread using ETFs.
(it's acutally a relative of my girlfriend. He trusts her & is letting her call all the shots. I'm helping advise her.)
Would be great if there were a company offering index funds with low fees and minimums, but I don't know of one.
Am thinking of suggesting working to have 3 ETF holdings, eventually:
VTI or VV Vanguard Total Market Index or Largecap.
EFA ishares EAFE index
VWO Vanguard EM Index
Maybe, $1200 VTI and $800 EFA today.
When save up 18% (or perhaps more) of existing Roth value, put that into VWO.
Will then have, depending on returns, about
50% VTI
35% EFA
15% VWO (more if overallotted temporarily, to save on commissions)
And would have spent $21 on commissions at $7/trade.
From there, can put into whichever is most under target %, but transactions no smaller than $1000, to keep commissions low.
Better ideas??
Even if he had $3000 today, that would only be enough for one Vanguard fund.
Even if he had $6000 today, and split equally between Total (US) Stock index and Total International index, Vanguard would charge $40 a year in fees, worse than commissions+spread using ETFs.
(it's acutally a relative of my girlfriend. He trusts her & is letting her call all the shots. I'm helping advise her.)
