Which Fund to Pick?

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optimist11
Posts: 2
Joined: Mon Nov 13, 2017 4:07 pm

Which Fund to Pick?

Post by optimist11 » Mon Nov 13, 2017 4:21 pm

After paying off my debts, fully funding my 401K and 529 plan, and funding an 8-month emergency fund, I was finally able to set aside $10K solely for investment purposes. This is not for any specific purpose or date, I don't need to buy a car or remodel a home. I just want to set some funds aside so they can grow. Originally I contemplated Admiral shares in VTSMX. However, given the current valuations, this seems like a particularly bad time to sink a sizable (for me, anyway) amount of money into the U.S. stock market. Any advice on what could be a decent alternative? VGTXS? VEMAX? I would love to invest in promising economies in Latin America or Eastern Europe that aren't grossly overvalued yet, but Vanguard does not have the funds for that purpose. I have a decent risk tolerance, since this is, in a way, my play-money, but do want to get as good a deal as possible while keeping the costs low.

My 401K is invested in self-adjusting target date fund (target date - 2040) with the federal government at .038% expense ratio. No IRA.
My marginal tax rate is 28%.
Last edited by optimist11 on Mon Nov 13, 2017 5:36 pm, edited 2 times in total.

retiredjg
Posts: 30652
Joined: Thu Jan 10, 2008 12:56 pm

Re: Which Fund to Pick?

Post by retiredjg » Mon Nov 13, 2017 4:39 pm

The best funds, from a tax standpoint, to hold in a taxable account are a broad stock fund - US or International - so a total stock index or a total international index are the usual suggestions.

Don't worry about valuations. Invest when you have the money.

Welcome to the forum. Please remember to use fund names in your posts. When people speak in ticker, it means that others have to look them up to follow the conversation. :happy

optimist11
Posts: 2
Joined: Mon Nov 13, 2017 4:07 pm

Re: Which Fund to Pick?

Post by optimist11 » Mon Nov 13, 2017 4:41 pm

retiredjg wrote:
Mon Nov 13, 2017 4:39 pm
Welcome to the forum. Please remember to use fund names in your posts. When people speak in ticker, it means that others have to look them up to follow the conversation. :happy
Thanks, I will.

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ruralavalon
Posts: 11706
Joined: Sat Feb 02, 2008 10:29 am
Location: Illinois

Re: Which Fund to Pick?

Post by ruralavalon » Mon Nov 13, 2017 4:55 pm

Welcome to the forum :) .
optimist11 wrote:
Mon Nov 13, 2017 4:21 pm
After paying off my debts, fully funding my 401K and 529 plan, and funding an 8-month emergency fund, I was finally able to set aside $10K solely for investment purposes. This is not for any specific purpose or date, I don't need to buy a car or remodel a home. I just want to set some funds aside so they can grow. Originally I contemplated Admiral shares in VTSMX. However, given the current valuations, this seems like a particularly bad time to sink a sizable (for me, anyway) amount of money into the U.S. stock market. Any advice on what could be a decent alternative? VGTXS? VEMAX? I would love to invest in promising economies in Latin America or Eastern Europe that aren't grossly overvalued yet, but Vanguard does not have the funds for that purpose. I have a decent risk tolerance, since this is, in a way, my play-money, but do want to get as good a deal as possible while keeping the costs low.
It depends.

What is your tax bracket, both federal and state?

What funds are you using in your 401k?

Do you also have any IRA? If so what funds are you using in it?

Please give fund names, tickers and expense ratios. You can simply add this to your original post using the edit button, so that all of your information is in one place

In general Vanguard Total Stock Market Index Fund Investor Shares (VTSMX) ER 0.15% or Admiral Shares (VTSAX) 0.04% is a very good choice. That is because it gives you a good combination of broad diversification (to reduce risk) and low expense ratio (to increase your net gain).

Market timing is a fool's errand. No one can successfully do that consistently. If you wait for a good day to buy, you will never know if the next day, next week or next month might be better to buy.

It was always my policy to invest whenever I had extra money available to invest.

Please read this: "What if you only invested at market peaks?"
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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