Comments on: A New Rebalancing Strategy: A Change in Vanguard and a Clear Definition of the Goal http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/ Financial talk for the rest of us Sat, 16 Feb 2013 01:14:45 +0000 hourly 1 http://wordpress.org/?v=3.5.1 By: Markus http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-25794 Markus Tue, 15 May 2007 11:28:28 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-25794 I’m from Austria (Europe, don’t confuse that with Australia) and here it’s possible to invest regulary (for me it’s once a month) a small sum starting from 30€ into investment fonds.

This has some advantages:

Almost anybody can buy stocks and participate in investment gains
Cost-averaging as you can get more stocks for the same amount of money in bad times! Given a proper investment timeframe (5y+) it’s almost impossible to make a loss.
Not much bank fees as long as you stay with the fonds offered by the banking institution.

I personally have been now investing for 4 years into 3 different funds:

Emerging Markets Bonds
Eastern Europe Stocks
US Stocks

All of them had somewhat satisfying results, sadly most of the US Stocks gain was eaten up by the weak dollar. Still the return has been well above 10% a year.

I know that similar investment opportunities exist in all neightbouring countries, do such plan’s do not exist in the US?

]]> By: Trent http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-23250 Trent Sun, 06 May 2007 12:30:16 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-23250 Debbie: if I did that, I would incur some capital gains on the funds that I sold for no really good reason. Then I’d have to pay taxes on those gains. While the amount isn’t a big deal (the taxes would be something like $40 or so), it’s still not worth it.

Lynn: I was considering that before Vanguard went fee-free. Now it’s not worth it because I have to pay brokerage fees to do that.

]]> By: Lynn http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-23163 Lynn Sun, 06 May 2007 03:01:27 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-23163 May I ask why you don’t plan to diversify earlier with the ETF versions of Vanguard’s funds?

]]> By: Debbie http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21925 Debbie Mon, 30 Apr 2007 21:36:42 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21925 Why not save the extra in the fund you already have instead of the online savings account, and then when it reaches $6000, transfer $3000 to the next fund, etc.?

]]> By: Tanner http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21546 Tanner Sun, 29 Apr 2007 02:42:57 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21546 I am also invested in Vanguard. Great company with great support. I invest a lot of money in stocks at Scottrade, but I use Vanguard for my Roth. I invest all $400/yr into VWO, which is emerging markets and I have been receiving great returns. I am still young, so any risk doesn’t bother me.

Right now, I need to worry about saving up for my wedding (short term savings in Emigrant)
Saving for a Wedding

]]> By: Erica http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21367 Erica Sat, 28 Apr 2007 06:55:44 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21367 Great dream Trent, our life dream is to build our own home too, it’s what drives me on everyday :)

]]> By: chris http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21346 chris Sat, 28 Apr 2007 05:05:38 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21346 I also have invested in Vanguard, though they are 403(b), (I am a teacher). I also have my money in a REIT fund and it is doing great.

I wonder, are your funds through 401k, 403b or IRA.

My funds also includes the Vanguard Health fund, but it required $25000 to get into. I finally got into it after 5 years of investing in other Vanguard funds.

Currently I put in 500 a pay check, my goal is to have more than 1 million by the time I am 65. I am 35 right now.

One question Trent? Do you think it wise for a husband and wife to invest in the same funds, meaning, both their payroll deductible goes into the same funds?

]]> By: Trent http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21333 Trent Sat, 28 Apr 2007 02:17:56 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21333 Aymeric: Those funds are much more stable over the long term. The other two funds have much more risk. Over the last several years, they both look very good, but the small caps had a very, very rough patch between 2000 and 2002 and the international ones were ghastly in the late 1990s. The idea is that by having some stable funds in there, a giant loss won’t kill you as badly. It depends on how much risk you want.

Lorax: I am slightly nervous about that 1% fee (there is some reasonable possibility of some significant life changes in our lives in the near future), and given the efficiency of the V500, the slight difference in tax advantage isn’t enough to make me swing that way.

]]> By: lorax http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21314 lorax Sat, 28 Apr 2007 00:00:16 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21314 I’m assuming this is in a taxable account, have you considered a tax-managed fund like VMCAX? The 500 index fund is tax-efficient, but VMCAX has more depth and is slightly more tax-efficient. (The downside is that you take a 1% fee if you hold for less than five years, but you don’t plan to have that problem.)

]]> By: Aymeric http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21309 Aymeric Fri, 27 Apr 2007 23:49:21 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21309 Hello,

First of all, thank you, your website is very useful.

It is always very interesting to know where people invest their capital.

I am trying to educate myself to be able to invest ‘wisely’ and I wonder why you chose “Vanguard 500″ and “Vanguard Long Term Bond Index Fund” which seem to have a low interest rate over the long term. Is it because they are safer and enough for you to achieve your goal ?

]]> By: Dennis http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21301 Dennis Fri, 27 Apr 2007 22:33:01 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21301 Thanks for your blog. I have enjoyed it very much.

I am 52, and have essentially an all Vanguard portfolio, quite similar to what you have outlined, and have been very happy with it.

]]> By: jake http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21300 jake Fri, 27 Apr 2007 22:14:11 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21300 I really like this plan of yours.

]]> By: El Indio http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21298 El Indio Fri, 27 Apr 2007 22:03:19 +0000 http://www.thesimpledollar.com/2007/04/27/a-new-rebalancing-strategy-a-change-in-vanguard-and-a-clear-definition-of-the-goal/#comment-21298 Great explanation on your motivation for investing. I always find it difficult to put into words the driving force behind my actions. But it feels like many of us have the same ideas and having someone who can translate the complex workings of his brain is a very helpful resource.

Keep up the good work on your posts!

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