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Suave Fedora posted:I'm a little confused with Vanguard. I'm trying to open an account for my kids' savings ($6k). The savings are primarily for college but I want them to have the freedom to buy other things if college ends up being less expensive than what the fund has 14-15 years from now. Those accounts are the money that you will use to buy and sell those things they listed from Vanguard. So, you'll fund one of those money market accounts and then use the money in that account to buy the funds you really want (usually you'll select both and then you'll hardly notice the money you put in going in the the money market). At least that is the way I understood it working. From my understanding, Vanguard makes you do this sort of thing so you aren't moving a bunch of money in and out on a short time scale, like would happen if you were buying ETFs (for example) from them using money in an account at a different bank. Unless you have reason to believe your earnings in that account will be tax exempt, go with the prime money market fund.
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May 21, 2014 15:04
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Got it, thanks.
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May 21, 2014 15:12
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MickeyFinn posted:Those accounts are the money that you will use to buy and sell those things they listed from Vanguard. So, you'll fund one of those money market accounts and then use the money in that account to buy the funds you really want (usually you'll select both and then you'll hardly notice the money you put in going in the the money market). At least that is the way I understood it working. From my understanding, Vanguard makes you do this sort of thing so you aren't moving a bunch of money in and out on a short time scale, like would happen if you were buying ETFs (for example) from them using money in an account at a different bank. Hold on a second, Suave Fedora is trying to buy a Vanguard mutual fund. He shouldn't need a brokerage account/settlement account. You can buy mutual funds directly from your bank account without any problems and I don't know what he's doing wrong that Vanguard is trying to give him a money market. Secondly, your advice to use the prime money market fund doesn't make sense. The tax-exempt money market has theoretically lower yields in exchange for its own earnings being tax-free. Where you transfer your money to from either money market has no bearing on your money market choice.
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May 21, 2014 16:29
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I'm pretty sure when you open an account and start trading, they want a default place to put money between trades (for things like dividends, etc.) Almost every investment account has asked me somthing similar when I started my first investments.
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May 21, 2014 16:33
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LorneReams posted:I'm pretty sure when you open an account and start trading, they want a default place to put money between trades (for things like dividends, etc.) There is no trading of shares, it is a mutual fund he is trying to buy/sell and you buy/sell in dollar amounts. The shares you own of mutual funds are entirely divisible unlike trading shares. He doesn't need a trading account for that, and dividends are auto-reinvested by default for those anyway. I have had in the past, and know someone that current has, a Vanguard account with only mutual funds and no money market/settlement/trading account.
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May 21, 2014 16:47
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I also have a Vanguard account with just the Target Retirement 2055 fund. Dividends are reinvested automatically as per the above post. When I invest money I buy new shares in the fund directly.
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May 21, 2014 17:11
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Yeah, I didn't need a Vanguard settlement account until I bought ETFs through them, not for mutual funds. Are you maybe trying to buy VOO instead?
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May 21, 2014 17:27
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Suave Fedora posted:I'm a little confused with Vanguard. I'm trying to open an account for my kids' savings ($6k). The savings are primarily for college but I want them to have the freedom to buy other things if college ends up being less expensive than what the fund has 14-15 years from now. You don't need a brokerage account to buy mutual funds. Did you select an ETF? If you ARE going to open a brokerage account, be aware that (IIRC) they cost something like $25 a year unless you hit their minimum balance (50k?). For brokerage accounts, everyone wants sweep accounts like this so they can transfer money directly rather than starting a bank transfer that can take 3-5 days to complete.
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May 21, 2014 17:44
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At some point in the near future I do want to do close my Tradeking account and do my stock trading through Vanguard, so if the prerequisite for stock trading is having a brokerage account, then I think I'm OK?
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May 21, 2014 18:14
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baquerd posted:Hold on a second, Suave Fedora is trying to buy a Vanguard mutual fund. He shouldn't need a brokerage account/settlement account. You can buy mutual funds directly from your bank account without any problems and I don't know what he's doing wrong that Vanguard is trying to give him a money market. I could swear I had to choose a money market account when I opened my IRA so that Vanguard has some approved place to put money when things happen like a fund gets closed down or something. I have never had a single penny in that money market fund either. I think Vanguard wants you to tell them where to park money while they sort out unusual things. This was a long time ago, so maybe I am mistaken. quote:Secondly, your advice to use the prime money market fund doesn't make sense. The tax-exempt money market has theoretically lower yields in exchange for its own earnings being tax-free. Where you transfer your money to from either money market has no bearing on your money market choice. When I said 'earnings in that account' I meant the money market fund, not whatever other funds are invested in. Should have been more clear.
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May 21, 2014 18:30
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Vilgan posted:You don't need a brokerage account to buy mutual funds. Did you select an ETF? If you ARE going to open a brokerage account, be aware that (IIRC) they cost something like $25 a year unless you hit their minimum balance (50k?). For brokerage accounts, everyone wants sweep accounts like this so they can transfer money directly rather than starting a bank transfer that can take 3-5 days to complete. Vanguard Brokerage FAQs posted:Vanguard Brokerage charges the following service fees: Looks like it's waived if you do e-statements.
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May 21, 2014 19:31
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So contributions to a traditional IRA reduce your AGI, but you can only deduct your contributions if your income is below the limit...which itself is based on AGI (well, modified AGI). So let's say you're married and thus the 96k limit applies to you. If your AGI, not counting IRA contributions, would normally be 101k, but you contribute 5k to your IRA, does that mean you get a deduction on the full 5k?
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May 22, 2014 01:48
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Cicero posted:So contributions to a traditional IRA reduce your AGI, but you can only deduct your contributions if your income is below the limit...which itself is based on AGI (well, modified AGI). It appears that your modified AGI is calculated by adding back in the IRA contribution (link to irs). So I don't think you can use IRA deductions to allow IRA deductions.
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May 22, 2014 06:05
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I'm pretty sure your 401k deducts from your AGI for purposes of calculating IRA eligibility though.
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May 22, 2014 14:37
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So I've got an HSA account with HSA Bank through work and it's got two options for investing the money there: 1. TD Ameritrade for stock trading and it has unspecified, possible fees for doing trades. Still trying to find out what those fees are. 2. Devenir Mutual Funds with a annual pro rata fee of $24. http://www.hsabank.com/~/media/files/devenir_mutual_fund_options Which way should I go? Setup with Ameritrade and establish a lazy portfolio of Vanguard ETFs? Or can I achieve similar results with the Devenir mutual fund and avoid trades fees, that may or may not exceed $24 annually)? I've been using the Vanguard 2050 retirement fund for my Roth IRA and 401k, so I've never really looked to deeply funds before. The stuff on linked page from HSAbank is gibberish to me. .Z. fucked around with this message at 06:47 on May 23, 2014 |
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May 23, 2014 06:44
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I'd personally opt for a lazy Vanguard ETF portfolio. In fact you might even consider just using one of the ETFs to keep it simple/avoid having to rebalance, and then diversify in either your Roth or 401k. Treat your money as one portfolio and all. I know that might not be possible due to a lower balance at the moment, but in the future that might be a good way to go.
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May 23, 2014 13:39
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Did you even look at that Devenir Mutual funds list? They're all poo poo.
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May 23, 2014 13:40
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Harry posted:Did you even look at that Devenir Mutual funds list? They're all poo poo.  Holy mother of god you're right. That fund selection is god awful. Yeah don't do that.They don't need trading fees to make money off you with those expense ratios(not that you should be trading that often anyway).
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May 23, 2014 14:00
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Speaking of really terrible expense ratios/costs I thought I would share the train wreck that is the Timothy Plan. Their gimmick is coined Biblically Responsible Investing. How much does this cost you? Well according to their Prospectus, a 5.5% front end load and expense ratios from 1.5% to 3%+.  But how do they perform you ask? Every single fund under-performs vs the comparable fund they include in their own prospectus. I don’t know how they can sell this to people with a straight face.
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May 23, 2014 15:22
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SmuglyDismissed posted:Speaking of really terrible expense ratios/costs I thought I would share the train wreck that is the Timothy Plan. Their gimmick is coined Biblically Responsible Investing. How much does this cost you? Well according to their Prospectus, a 5.5% front end load and expense ratios from 1.5% to 3%+. Tithe, bitch.
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May 23, 2014 15:38
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SmuglyDismissed posted:Speaking of really terrible expense ratios/costs I thought I would share the train wreck that is the Timothy Plan. Their gimmick is coined Biblically Responsible Investing. How much does this cost you? Well according to their Prospectus, a 5.5% front end load and expense ratios from 1.5% to 3%+. They were cast out of the temple and have to pay rent. 
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May 23, 2014 20:51
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MickeyFinn posted:They were cast out of the temple and have to pay rent. lol look at the hall of shame for sinful companies: http://www.timothyplan.com/download/HallofShame.pdf 
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May 24, 2014 02:56
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etalian posted:lol look at the hall of shame for sinful companies: The only thing I learned from that chart is that Anheuser-Busch, InBev performs pornographic abortions for entertainment.
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May 24, 2014 03:34
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MickeyFinn posted:The only thing I learned from that chart is that Anheuser-Busch, InBev performs pornographic abortions for entertainment. The sin 100 index would probably perform better than the bible approved index given how companies like GE, AT&T or Diageo are pretty solid plus pay quarterly dividends.
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May 24, 2014 07:50
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SlightlyMadman posted:I'm pretty sure your 401k deducts from your AGI for purposes of calculating IRA eligibility though. Correct. Being deducted directly from your paycheck, 401k contributions never even make it as far as your gross income as far as the IRS is concerned (except Roth 401ks obviously). .Z. posted:So I've got an HSA account with HSA Bank through work and it's got two options for investing the money there: You don't have to use the HSA your workplace provides you. As long as you're under a high-deductable health plan, you can open an HSA anywhere you want. Last I heard, the BFC favorite for HSAs was ELFCU.
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May 24, 2014 12:17
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Kilty Monroe posted:You don't have to use the HSA your workplace provides you. As long as you're under a high-deductable health plan, you can open an HSA anywhere you want. Last I heard, the BFC favorite for HSAs was ELFCU. ELFCU is still pretty good, it's just no longer the out-and-out kickass winner. Why? Starting 7/1/2014, you will be charged $3/month if your cash in ELFCU is lower than $2500. I need to call them to see what would happen if you have less than $3 in your account, but a best guess is a $30 fee for insufficient funds. You do earn 1% interest on the cash you have with them, which is still great for cash. Also, effective immediately, there is a $24 charge for each transfer to the investment account. So, if you do one transfer a year and keep all your money in investments, that cost is $60/year. This is competitive, but there are other possible winners now depending on your particular circumstances, particularly if you want to transfer more than once a year to investments: http://www.bogleheads.org/wiki/Health_savings_account#HSA_custodians_and_options I just found out about this today, but apparently it's been known for a couple of weeks.
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May 25, 2014 19:10
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I'm trying to decide how to allocate for my 401k. Any suggestions? I think the choices are a little weak, but, I'm no expert.pre:Fund Name Asset Class Symbol ER American Funds Amcap Fund R5 Large Cap Funds RAFFX 0.43% Columbia Dividend Opportunity R5 Large Cap Funds RSDFX 0.67% Eaton Vance Atlanta Capital SMID-Cap I Mid Cap Funds EISMX 1.00% Fidelity Advisor Biotechnology I Specialty FBTIX 0.85% Fidelity Advisor Materials I Specialty FMFEX 0.85% Great-West Lifetime 2045 Fund II T1 Lifetime MXPLX 1.09% Great-West S&P 500 Index Fund L Large Cap Funds MXVJX 0.85% Ivy High Income I Bond Funds IVHIX 0.70% Ivy Science & Technology I Specialty ISTIX 1.04% Janus Triton I Small Cap Funds JSMGX 0.76% MainStay ICAP International I International Funds ICEUX 0.95% MFS Mid Cap Value R5 Mid Cap Funds MVCKX 0.89% Oakmark International II International Funds OARIX 1.34% Oppenheimer Developing Markets I International Funds ODVIX 0.86% Oppenheimer Global Value Y International Funds GLVYX 1.05% Oppenheimer International Growth Y International Funds OIGYX 0.90% PIMCO Foreign Bond (USD-Hedged) I Bond Funds PFORX 0.50% PIMCO Income Instl Bond Funds PIMIX 0.45% PIMCO Total Return Instl Bond Funds PTTRX 0.46% Pioneer Oak Ridge Small Cap Growth Y Small Cap Funds ORIYX 1.02% TCW Total Return Bond I Bond Funds TGLMX 0.49%
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May 28, 2014 20:57
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Sand Monster posted:I'm trying to decide how to allocate for my 401k. Any suggestions? I think the choices are a little weak, but, I'm no expert. -How much risk do you like? -How much money do you have in other retirement vehicles, and what is the allocation of these other accounts like? Those ER's such, but its a 401k so that doesn't surprise me. Most of mine hurt badly, except VINIX. Which is the only thing I invest in via my 401k, because of that. I diversify with my RothIRA at Vanguard.
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May 28, 2014 21:00
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Kilty Monroe posted:Correct. Being deducted directly from your paycheck, 401k contributions never even make it as far as your gross income as far as the IRS is concerned (except Roth 401ks obviously). AHHHH, no poo poo, mind blown! I thought I was stuck with whatever they gave me? Awesome.
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May 28, 2014 21:01
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SiGmA_X posted:-How old are you? I have ~$20k in a Roth IRA (VTIVX) at Vanguard also as well as ~$40k in VFIAX. Target retirement date is 2045 and I'm not averse to risk but don't want to be in a super risky fund. I will plan to contribute the full amount to the 401k this year if it is practical. Sand Monster fucked around with this message at 21:09 on May 28, 2014 |
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May 28, 2014 21:05
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It's hard to give any kind of advice for allocation without knowing the allocation of that Roth IRA and the "admiral shares" and without knowing the balance of that 401k(you're not just starting to pay into a 401k, right? 20k is a sizeable chunk for a Roth IRA so you've clearly been paying into it for some time). Are the admiral shares in a taxable account, or are they in a traditional IRA that's a rollover from a previous 401k? Or are they just part of the Roth IRA and it's actually a 60k IRA?
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May 28, 2014 21:07
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Nail Rat posted:It's hard to give any kind of advice for allocation without knowing the allocation of that Roth IRA and the "admiral shares" and without knowing the balance of that 401k(you're not just starting to pay into a 401k, right? 20k is a sizeable chunk for a Roth IRA so you've clearly been paying into it for some time). I edited my post with the symbols. This 401k is new and I have a rollover from a previous job (~$20k) that hasn't completed yet. The admiral shares is a taxable account. Also I have contributed to the Roth for 2014 already.
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May 28, 2014 21:11
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So basically your current allocation is this: 22% Total US stock market(from target retirement fund) 9% International(from target retirement fund) 3% Bonds(from target retirement fund) 67% Large-Cap US Stocks Personally with all those taxable admiral fund S&P 500 shares, I'd think you'd be served well to split the 20k target retirement into some combination of international and/or bonds(hopefully with admiral shares to boot!), and go international and/or bonds in your 401k to get to the percentage allocation you like. 76% is a lot of weight to put on domestic stocks IMO. It seems to me like bond funds are the best (least-bad) choices in that 401k lineup. Well that and the American funds large cap US fund, but you don't need more domestic stock.
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May 28, 2014 21:20
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Sand Monster posted:I'm trying to decide how to allocate for my 401k. Any suggestions? I think the choices are a little weak, but, I'm no expert. Those are loving awful. Seriously, an S&P500 Index with an ER of 0.85%? What kind of match are you getting?
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May 29, 2014 00:12
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keiran_helcyan posted:Those are loving awful. Seriously, an S&P500 Index with an ER of 0.85%? 20%. Sand Monster fucked around with this message at 01:07 on May 29, 2014 |
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May 29, 2014 01:03
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The 401k concept can be pretty annoying since often you get stuck with high ER funds without having additional choices. I'm with Fidelity at work so I can at least use their low expense ratio Spartan funds.
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May 29, 2014 02:56
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etalian posted:The 401k concept can be pretty annoying since often you get stuck with high ER funds without having additional choices. Agreed, but if you're at the type of company where HR might take your input to heart you can always try to improve your 401k program. Often times HR is just as clueless about investing as your average person and 401k providers use that ignorance to sell packages made up of high-ER actively-managed funds. At my company enough employees put pressure on HR to improve our 401k plan and offer at least a couple of low-cost index funds, and we actually made it happen. We've been with Fidelity, but until we asked for them our plan didn't provide access to any Spartan funds. When we had our annual review and renegotiation we put together an employee committee to work with HR and attend the meeting with Fidelity. The Fidelity representative/salesperson pushed back pretty hard on offering the Spartan funds with a bunch of sales-speak crap, which was pretty obnoxious and sleazy. But we knew what we wanted and ignored their BS and got our Spartan funds earlier this year. Of course not all HR will be amenable to it, but our HR person is actually genuinely interested in doing the best she can for the employees within her power but you have to let them know what you want.
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May 29, 2014 03:07
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I just hit the point where I qualify for my company's 401k plan and was hoping to get some advice. The plan is through John Hancock and I had planned on just picking one of those target year retirement funds and letting it do it's thing but all of them look to have lovely expense ratio's or at least I am pretty sure they are lovely. For example: JH Thru 2050 Active Strategy Total Expense Ratio 1.52 JH Thru 2050 Manged Portfolio Total Expense Ratio 1.29 There are also a bunch of other individual options including Vanguard funds that it looks like they just tack on 1.0 to Vanguard's expense ratio. I am only contributing for a 3% match for now. Am I better off just picking one of the target date allocations even with the lovely ratio's? I guess .19-.42 isn't a huge difference in total expenses. Any advise is appreciated. edit: Just to clarify, I know the options are lovely. I plan on just contributing for match then working on a Roth since I won't be able to do more than that anytime soon. Just trying to do the best I can with the lovely options. hitachi fucked around with this message at 13:10 on May 29, 2014 |
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May 29, 2014 13:01
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What's the fund with the lowest expense ratio? You should be able to balance your portfolio as a whole (401k + Roth) by picking complimentary funds in your Roth.
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May 29, 2014 13:21
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Saint Fu posted:What's the fund with the lowest expense ratio? You should be able to balance your portfolio as a whole (401k + Roth) by picking complimentary funds in your Roth. pre:Symbol Investment Option Fund Manager Inception Date 3 yr 5 yr 10 yr FER AMC S&S Total Expense Ratio JFIVX 500 Index Fund John Hancock 01/19/1993 13.51 19.95 6.32 0.30 0.23 0.50 1.03 JECIX Mid Cap Index Fund John Hancock 08/18/2000 12.29 23.63 9.09 0.46 0.10 0.50 1.06 JETSX Total Stock Market Index Fund John Hancock 08/18/2000 13.50 20.84 7.09 0.57 0.00 0.50 1.07 JHOXX Money Market Fund John Hancock 07/30/1999 -0.79 -0.71 0.78 0.14 0.42 0.50 1.06 VVISX Vanguard Value Index Fund Vanguard 05/04/2007 13.03 19.88 6.42 0.10 0.50 0.50 1.10 VIGSX Vanguard Growth Index Fund Vanguard 05/04/2007 13.69 20.27 6.77 0.10 0.50 0.50 1.10 VSGAX Vanguard Small Cap Grow Index Vanguard 11/03/2006 12.47 25.70 9.07 0.10 0.50 0.50 1.10 VSIAX Vanguard Small Cap Value Index Vanguard 11/03/2006 13.34 24.83 8.08 0.10 0.50 0.50 1.10 VSGDX Vanguard Short-Term Federal Vanguard 03/31/1995 0.35 0.83 2.02 0.10 0.50 0.50 1.10 JLJOX JH Thru 2045 Active Strategy John Hancock 11/03/2006 8.91 18.45 0.89 0.10 0.50 1.49 JRVOX JH Ret To 2045 Managed Port John Hancock 05/07/2010 8.80 0.69 0.10 0.50 1.29 hitachi fucked around with this message at 13:48 on May 29, 2014 |
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May 29, 2014 13:42
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