Vanguard Balanced Index Fund Lovers?

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kadibex1
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Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Wed Oct 03, 2018 2:22 pm

Just curios to see if there are any Vanguard Balanced Index fund lovers out there who do a one-fund approach to investing and use VBIAX as their sole fund?

Personally, I've been investing in VBIAX for over 20 years and haven't looked back.

PFInterest
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Re: Vanguard Balanced Index Fund Lovers?

Post by PFInterest » Wed Oct 03, 2018 2:25 pm

Nope. I have reason to have greater control.

Mike Scott
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Re: Vanguard Balanced Index Fund Lovers?

Post by Mike Scott » Wed Oct 03, 2018 2:27 pm

You could certainly do worse. I'm not using it now but I have in the past. Splitting into component funds is a bit cheaper. Taxes may be a mild concern in a taxable account.

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JoMoney
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Re: Vanguard Balanced Index Fund Lovers?

Post by JoMoney » Wed Oct 03, 2018 2:28 pm

Jack Bogle is a fan of the fund. I know there are a few other posters on here who like it. Personally, I desire a higher equity allocation, and a bit more control over my cash/bond allocation.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

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ruralavalon
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Re: Vanguard Balanced Index Fund Lovers?

Post by ruralavalon » Wed Oct 03, 2018 3:57 pm

I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

WhiteMaxima
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Re: Vanguard Balanced Index Fund Lovers?

Post by WhiteMaxima » Wed Oct 03, 2018 4:01 pm

I am a big fan of balanced fund. Go for it. Wonder if Vanguard has an ETF of the fund.

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beyou
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Re: Vanguard Balanced Index Fund Lovers?

Post by beyou » Wed Oct 03, 2018 4:03 pm

For someone who does not want international stocks, and is primarily investing in an IRA/401k and wants a fixed AA,
then this is fine. I would think that given all the discussion about optimizing fees, taxes, AA, etc on BH.org that few would
simplify to that extent.

I know I want to change my AA over time.
I use asset location and put taxable bonds in IRA/401k, stocks in taxable account, and munis in taxable as well.
So i would not combine these 2 components. And someone with just an IRA might not want only 60% in stocks, as they
tend to be younger folks who are more aggressive. Not sure how this appeals to many at all.

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ruralavalon
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Re: Vanguard Balanced Index Fund Lovers?

Post by ruralavalon » Wed Oct 03, 2018 4:38 pm

blevine wrote:
Wed Oct 03, 2018 4:03 pm
For someone who does not want international stocks, and is primarily investing in an IRA/401k and wants a fixed AA,
then this is fine. I would think that given all the discussion about optimizing fees, taxes, AA, etc on BH.org that few would
simplify to that extent.
. . . . .
Tax-efficiency may not matter much if the taxable account is relatively small compared to the tax-advantaged accounts, or if the tax bracket is fairly low.

If tax-efficiency is an issue there is Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) ER 0.09%, with a 50/50 asset allocation.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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GerryL
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Re: Vanguard Balanced Index Fund Lovers?

Post by GerryL » Wed Oct 03, 2018 5:17 pm

I have always used VG Balanced Index Fund for my taxable account. Since I have a 60/40 AA anyway, it means I don’t have to muck around with rebalancing that part of my portfolio. My traditional and Roth IRAs are composed of the basic 4-funds. No balances to add any other funds to taxable.

wrongfunds
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Re: Vanguard Balanced Index Fund Lovers?

Post by wrongfunds » Wed Oct 03, 2018 5:25 pm

Is there an equivalent Fidelity fund?

mountainsoft
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Re: Vanguard Balanced Index Fund Lovers?

Post by mountainsoft » Wed Oct 03, 2018 7:09 pm

kadibex1 wrote:
Wed Oct 03, 2018 2:22 pm
Just curious to see if there are any Vanguard Balanced Index fund lovers out there who do a one-fund approach to investing and use VBIAX as their sole fund?
I have been using the VBIAX fund since I moved my traditional IRA to Vanguard a couple years ago. I have been happy with it so far.

I recently opened a taxable brokerage account and am using the Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) on that account.

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Re: Vanguard Balanced Index Fund Lovers?

Post by abuss368 » Wed Oct 03, 2018 8:14 pm

There are many Jack Bogle interviews where he has noted his grandkids college funds were in a one fund strategy - Vanguard Balanced Index fund.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

remomnyc
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Re: Vanguard Balanced Index Fund Lovers?

Post by remomnyc » Wed Oct 03, 2018 8:21 pm

I don't use it but I recommend it to people who are not financially savvy and have no interest in their finances. It is a perfect no fuss vehicle.

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Re: Vanguard Balanced Index Fund Lovers?

Post by abuss368 » Wed Oct 03, 2018 8:26 pm

Another approach is Jack Bogle's Two Fund Portfolio recommendation: Vanguard Total Stock Index Fund and a Bond Fund (i.e. Total Bond Index or Intermediate Term Tax Exempt).

Keep investing simple!
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

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abuss368
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Re: Vanguard Balanced Index Fund Lovers?

Post by abuss368 » Wed Oct 03, 2018 8:27 pm

GerryL wrote:
Wed Oct 03, 2018 5:17 pm
I have always used VG Balanced Index Fund for my taxable account. Since I have a 60/40 AA anyway, it means I don’t have to muck around with rebalancing that part of my portfolio. My traditional and Roth IRAs are composed of the basic 4-funds. No balances to add any other funds to taxable.
Is there a negative tax impact or is the simplicity more important?
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

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abuss368
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Re: Vanguard Balanced Index Fund Lovers?

Post by abuss368 » Wed Oct 03, 2018 8:28 pm

ruralavalon wrote:
Wed Oct 03, 2018 3:57 pm
I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
Another approach is Jack Bogle's Two Fund Portfolio recommendation: Vanguard Total Stock Index Fund and a Bond Fund (i.e. Total Bond Index or Intermediate Term Tax Exempt).
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

kadibex1
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Re: Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Wed Oct 03, 2018 9:38 pm

ruralavalon wrote:
Wed Oct 03, 2018 3:57 pm
I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
The Balanced Index funds is the better option in retirement. Having exposure to international I think would only make sense during the accumulation phase of your life.

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vineviz
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Re: Vanguard Balanced Index Fund Lovers?

Post by vineviz » Wed Oct 03, 2018 9:39 pm

kadibex1 wrote:
Wed Oct 03, 2018 9:38 pm
ruralavalon wrote:
Wed Oct 03, 2018 3:57 pm
I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
The Balanced Index funds is the better option in retirement. Having exposure to international I think would only make sense during the accumulation phase of your life.
As long as you own stocks, 25-50% of them should be international stocks.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

kadibex1
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Re: Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Wed Oct 03, 2018 9:40 pm

mountainsoft wrote:
Wed Oct 03, 2018 7:09 pm
kadibex1 wrote:
Wed Oct 03, 2018 2:22 pm
Just curious to see if there are any Vanguard Balanced Index fund lovers out there who do a one-fund approach to investing and use VBIAX as their sole fund?
I have been using the VBIAX fund since I moved my traditional IRA to Vanguard a couple years ago. I have been happy with it so far.

I recently opened a taxable brokerage account and am using the Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) on that account.
Does Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) only make sense in a taxable account for people in higher tax brackets? I mean to fully get the benefits of it's tax efficiency? I ask because want to start a balanced fund via taxable, but am not sure if I should choose between VBIAX or VTMFX.

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stemikger
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Re: Vanguard Balanced Index Fund Lovers?

Post by stemikger » Wed Oct 03, 2018 10:13 pm

I'm all in the Vanguard Balanced Index Fund. No need to complicate things. I'm 54 and will hold this for life. IMHO investing doesn't get much better than that.

If it's good enough for Jack's grandchildren it's good enough for me.

This approach has Jack's blessing because I asked if there was anything wrong with simply holding the balanced index for life and never looking back.
His answer was quick with there is Nothing Wrong! Here he is answering my question. If you want to go directly to my question it starts at 59:02. I have to tell you, having Jack's blessing when it comes to this approach tells me, there is no need to search any further. It doesn't really get any better.

https://vimeo.com/channels/bogleheads/241479867

I have never invested in international funds and have no desire to, so this fund is the ultimate in simplicity and it works!

If you want more, check out this thread I started a while back.

viewtopic.php?t=164521
Choose Simplicity ~ Stay the Course!! ~ Press on Regardless!!!

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SpringMan
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Re: Vanguard Balanced Index Fund Lovers?

Post by SpringMan » Thu Oct 04, 2018 8:27 am

wrongfunds wrote:
Wed Oct 03, 2018 5:25 pm
Is there an equivalent Fidelity fund?
Yes but actively managed, FBALX (Fidelity Balanced) and FPURX (Fidelity Puritan). Vanguard's Wellington is an actively managed Vanguard equivalent.
Best Wishes, SpringMan

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ruralavalon
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Re: Vanguard Balanced Index Fund Lovers?

Post by ruralavalon » Thu Oct 04, 2018 9:23 am

vineviz wrote:
Wed Oct 03, 2018 9:39 pm
kadibex1 wrote:
Wed Oct 03, 2018 9:38 pm
ruralavalon wrote:
Wed Oct 03, 2018 3:57 pm
I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
The Balanced Index funds is the better option in retirement. Having exposure to international I think would only make sense during the accumulation phase of your life.
As long as you own stocks, 25-50% of them should be international stocks.
I favor 20-30% of stocks in international stocks, but no such fund exists. The idea is a one fund portfolio, so that my wife can easily manage when I am not here.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

wrongfunds
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Re: Vanguard Balanced Index Fund Lovers?

Post by wrongfunds » Thu Oct 04, 2018 9:35 am

SpringMan wrote:
Thu Oct 04, 2018 8:27 am
wrongfunds wrote:
Wed Oct 03, 2018 5:25 pm
Is there an equivalent Fidelity fund?
Yes but actively managed, FBALX (Fidelity Balanced) and FPURX (Fidelity Puritan). Vanguard's Wellington is an actively managed Vanguard equivalent.
Being actively managed, the expense ratio is quite high for both those funds.

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ruralavalon
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Re: Vanguard Balanced Index Fund Lovers?

Post by ruralavalon » Thu Oct 04, 2018 10:03 am

wrongfunds wrote:
Thu Oct 04, 2018 9:35 am
SpringMan wrote:
Thu Oct 04, 2018 8:27 am
wrongfunds wrote:
Wed Oct 03, 2018 5:25 pm
Is there an equivalent Fidelity fund?
Yes but actively managed, FBALX (Fidelity Balanced) and FPURX (Fidelity Puritan). Vanguard's Wellington is an actively managed Vanguard equivalent.
Being actively managed, the expense ratio is quite high for both those funds.
The two Fidelity funds mentioned, Fidelity Balanced Fund and Fidelity Puritan Fund, have an expense ratio of 0.55% which is not "quite high", but fairly moderate.

Vanguard Wellington Fund has a low expense ratio, 0.25% for Investor Shares and 0.17% for Admiral Shares.

The asset allocation of all three funds is about 65/35, pretty similar to the 69/40 asset allocation of Vanguard Balanced Index Fund.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

wrongfunds
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Re: Vanguard Balanced Index Fund Lovers?

Post by wrongfunds » Thu Oct 04, 2018 10:19 am

I am not sure if the expense ratios are "comparable"; Vanguard Balanced Index Fund Admiral Shares (VBIAX) is .07% ($10K min)
I do not see similar fund under Fidelity which is even in the same ballpark. I am even willing to pay double the expenses for an equivalent Fidelity fund but I am not seeing it at all. Am I missing something?

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vineviz
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Re: Vanguard Balanced Index Fund Lovers?

Post by vineviz » Thu Oct 04, 2018 11:30 am

ruralavalon wrote:
Thu Oct 04, 2018 9:23 am
vineviz wrote:
Wed Oct 03, 2018 9:39 pm
kadibex1 wrote:
Wed Oct 03, 2018 9:38 pm
ruralavalon wrote:
Wed Oct 03, 2018 3:57 pm
I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
The Balanced Index funds is the better option in retirement. Having exposure to international I think would only make sense during the accumulation phase of your life.
As long as you own stocks, 25-50% of them should be international stocks.
I favor 20-30% of stocks in international stocks, but no such fund exists. The idea is a one fund portfolio, so that my wife can easily manage when I am not here.
Mostly my comment was addressing the idea that international stocks "only make sense during the accumulation phase", an idea I think has no merit.

As for your dilemma, my view is that at a certain point you just have to accept that you're putting your decisions in the hand of someone whose judgement you trust. Vanguard's judgement seems to be that international should be 40% of equity allocation, so I suspect that it is much more likely that Vanguard will add international to VBIAX in the future than it is that Vanguard will reduce international in their LifeStrategy funds.

And, objectively, the 39% allocation in LifeStrategy is a lot closer to your 20-30% preference than the 0% allocation in VBIAX.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

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Re: Vanguard Balanced Index Fund Lovers?

Post by HEDGEFUNDIE » Thu Oct 04, 2018 11:37 am

ruralavalon wrote:
Thu Oct 04, 2018 9:23 am
vineviz wrote:
Wed Oct 03, 2018 9:39 pm
kadibex1 wrote:
Wed Oct 03, 2018 9:38 pm
ruralavalon wrote:
Wed Oct 03, 2018 3:57 pm
I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
The Balanced Index funds is the better option in retirement. Having exposure to international I think would only make sense during the accumulation phase of your life.
As long as you own stocks, 25-50% of them should be international stocks.
I favor 20-30% of stocks in international stocks, but no such fund exists. The idea is a one fund portfolio, so that my wife can easily manage when I am not here.
Global Wellington or Global Wellesley should fit the bill. They cost more but perhaps it’s worth the cost for ease of management for your wife.

lifeisinmirrors
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Re: Vanguard Balanced Index Fund Lovers?

Post by lifeisinmirrors » Thu Oct 04, 2018 2:36 pm

Regular Wellington and Wellesley funds can hold some international stocks too. Morningstar says VWELX has 13.5% international stocks, which represents about 20% of its stock holdings. VWINX has 5.62% international stocks, about 15% of its stock holdings.

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GerryL
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Re: Vanguard Balanced Index Fund Lovers?

Post by GerryL » Thu Oct 04, 2018 3:36 pm

abuss368 wrote:
Wed Oct 03, 2018 8:27 pm
GerryL wrote:
Wed Oct 03, 2018 5:17 pm
I have always used VG Balanced Index Fund for my taxable account. Since I have a 60/40 AA anyway, it means I don’t have to muck around with rebalancing that part of my portfolio. My traditional and Roth IRAs are composed of the basic 4-funds. No balances to add any other funds to taxable.
Is there a negative tax impact or is the simplicity more important?
When I started investing, I was not aware of the tax impact of "bonds in taxable." At this stage, the tax impact of trading out of Balanced Index would be ugly. And I do appreciate the simplicity.

At this point I have never taken anything out of my taxable account, but for the past ~4 years I have been using the dividends for expenses rather than reinvesting. At some point in the not-too-distant future I may start reinvesting dividends again. I expect SS and RMDs to more than meet my needs.

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Re: Vanguard Balanced Index Fund Lovers?

Post by abuss368 » Thu Oct 04, 2018 4:04 pm

GerryL wrote:
Thu Oct 04, 2018 3:36 pm
abuss368 wrote:
Wed Oct 03, 2018 8:27 pm
GerryL wrote:
Wed Oct 03, 2018 5:17 pm
I have always used VG Balanced Index Fund for my taxable account. Since I have a 60/40 AA anyway, it means I don’t have to muck around with rebalancing that part of my portfolio. My traditional and Roth IRAs are composed of the basic 4-funds. No balances to add any other funds to taxable.
Is there a negative tax impact or is the simplicity more important?
When I started investing, I was not aware of the tax impact of "bonds in taxable." At this stage, the tax impact of trading out of Balanced Index would be ugly. And I do appreciate the simplicity.

At this point I have never taken anything out of my taxable account, but for the past ~4 years I have been using the dividends for expenses rather than reinvesting. At some point in the not-too-distant future I may start reinvesting dividends again. I expect SS and RMDs to more than meet my needs.
Thanks!
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

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ruralavalon
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Re: Vanguard Balanced Index Fund Lovers?

Post by ruralavalon » Thu Oct 04, 2018 4:08 pm

wrongfunds wrote:
Thu Oct 04, 2018 10:19 am
I am not sure if the expense ratios are "comparable"; Vanguard Balanced Index Fund Admiral Shares (VBIAX) is .07% ($10K min)
I do not see similar fund under Fidelity which is even in the same ballpark. I am even willing to pay double the expenses for an equivalent Fidelity fund but I am not seeing it at all. Am I missing something?
No.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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Re: Vanguard Balanced Index Fund Lovers?

Post by bbrown » Thu Oct 04, 2018 5:56 pm

I wonder the same myself. It's 1/3 of my portfolio and it has outperformed the rest of my portfolio for several years. Vanguard's portfolio tester encourages more international, but my experience has been that vbiax is the sherman tank, yet I follow their advice & keep 15% international. Obviously I'm not totally sold on International...
Bbrown

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Re: Vanguard Balanced Index Fund Lovers?

Post by beyou » Thu Oct 04, 2018 6:27 pm

ruralavalon wrote:
Wed Oct 03, 2018 4:38 pm
blevine wrote:
Wed Oct 03, 2018 4:03 pm
For someone who does not want international stocks, and is primarily investing in an IRA/401k and wants a fixed AA,
then this is fine. I would think that given all the discussion about optimizing fees, taxes, AA, etc on BH.org that few would
simplify to that extent.
. . . . .
Tax-efficiency may not matter much if the taxable account is relatively small compared to the tax-advantaged accounts, or if the tax bracket is fairly low.

If tax-efficiency is an issue there is Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) ER 0.09%, with a 50/50 asset allocation.
If your taxable account is small, doesn't matter much what you put in it.
If it's large, chances are unless you started with this fund, you already have unrealized gain in another taxable fund (like Total Stock)
and selling to simplify in taxable is a very expensive decision. It is for me.

While I prefer to simplify I will not do so at great expense to myself, not paying extra taxes or fees.
We have BH who go overboard (tilting, etc) and others who over-simplify. I am a believer in compromise.
Simple but no too simple as to ignore savings that are easy to attain.

As I plan to mostly spend our taxable in retirement, when older and we start spending the tax deferred accounts,
I can rebalance those accounts tax-free to simplify. I will need to make changes likely if I have spent all my taxable,
since I don't keep same AA in each account (not tax efficient to do so for your lifetime). But when taxable is almost gone,
then of course I would use an AA like one of the Vanguard balanced funds (though I might prefer a Target Date fund with
inflation bonds, international stocks, the Balanced Fund is a bit old school and not sufficiently diversified by asset class).

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Ricola
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Re: Vanguard Balanced Index Fund Lovers?

Post by Ricola » Thu Oct 04, 2018 7:13 pm

Yes, moving towards tax-advantaged all in the balanced fund.

kadibex1
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Re: Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Thu Oct 04, 2018 7:20 pm

vineviz wrote:
Wed Oct 03, 2018 9:39 pm
kadibex1 wrote:
Wed Oct 03, 2018 9:38 pm
ruralavalon wrote:
Wed Oct 03, 2018 3:57 pm
I do not currently use the fund. I am retired, we are both 73, and my wife has zero interest in investing.

I plan to switch to a one fund portfolio sometime soon, and am torn between Vanguard Balanced Index Fund Admiral Shares (VBIAX) (too little international stock) and Vanguard LifeStrategy Moderate Growth (VSMGX) (too much international stock).
The Balanced Index funds is the better option in retirement. Having exposure to international I think would only make sense during the accumulation phase of your life.
As long as you own stocks, 25-50% of them should be international stocks.
Having U.S. multi-national corporations in an index, which get international exposure through revenues from overseas is good enough.

kadibex1
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Re: Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Thu Oct 04, 2018 9:44 pm

blevine wrote:
Thu Oct 04, 2018 6:27 pm
ruralavalon wrote:
Wed Oct 03, 2018 4:38 pm
blevine wrote:
Wed Oct 03, 2018 4:03 pm
For someone who does not want international stocks, and is primarily investing in an IRA/401k and wants a fixed AA,
then this is fine. I would think that given all the discussion about optimizing fees, taxes, AA, etc on BH.org that few would
simplify to that extent.
. . . . .
Tax-efficiency may not matter much if the taxable account is relatively small compared to the tax-advantaged accounts, or if the tax bracket is fairly low.

If tax-efficiency is an issue there is Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) ER 0.09%, with a 50/50 asset allocation.
If your taxable account is small, doesn't matter much what you put in it.
If it's large, chances are unless you started with this fund, you already have unrealized gain in another taxable fund (like Total Stock)
and selling to simplify in taxable is a very expensive decision. It is for me.

While I prefer to simplify I will not do so at great expense to myself, not paying extra taxes or fees.
We have BH who go overboard (tilting, etc) and others who over-simplify. I am a believer in compromise.
Simple but no too simple as to ignore savings that are easy to attain.

As I plan to mostly spend our taxable in retirement, when older and we start spending the tax deferred accounts,
I can rebalance those accounts tax-free to simplify. I will need to make changes likely if I have spent all my taxable,
since I don't keep same AA in each account (not tax efficient to do so for your lifetime). But when taxable is almost gone,
then of course I would use an AA like one of the Vanguard balanced funds (though I might prefer a Target Date fund with
inflation bonds, international stocks, the Balanced Fund is a bit old school and not sufficiently diversified by asset class).
"The Balanced Fund is a bit old school and not sufficiently diversified by asset class"? I likened the 60/40 Balanced Fund (Vanguard's specifically) to that 30 year old freezer you keep in the garage, which never breaks down. It just keeps going and going.

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beyou
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Joined: Sat Feb 27, 2010 3:57 pm
Location: Northeastern US

Re: Vanguard Balanced Index Fund Lovers?

Post by beyou » Fri Oct 05, 2018 10:24 am

kadibex1 wrote:
Thu Oct 04, 2018 9:44 pm
blevine wrote:
Thu Oct 04, 2018 6:27 pm
ruralavalon wrote:
Wed Oct 03, 2018 4:38 pm
blevine wrote:
Wed Oct 03, 2018 4:03 pm
For someone who does not want international stocks, and is primarily investing in an IRA/401k and wants a fixed AA,
then this is fine. I would think that given all the discussion about optimizing fees, taxes, AA, etc on BH.org that few would
simplify to that extent.
. . . . .
Tax-efficiency may not matter much if the taxable account is relatively small compared to the tax-advantaged accounts, or if the tax bracket is fairly low.

If tax-efficiency is an issue there is Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) ER 0.09%, with a 50/50 asset allocation.
If your taxable account is small, doesn't matter much what you put in it.
If it's large, chances are unless you started with this fund, you already have unrealized gain in another taxable fund (like Total Stock)
and selling to simplify in taxable is a very expensive decision. It is for me.

While I prefer to simplify I will not do so at great expense to myself, not paying extra taxes or fees.
We have BH who go overboard (tilting, etc) and others who over-simplify. I am a believer in compromise.
Simple but no too simple as to ignore savings that are easy to attain.

As I plan to mostly spend our taxable in retirement, when older and we start spending the tax deferred accounts,
I can rebalance those accounts tax-free to simplify. I will need to make changes likely if I have spent all my taxable,
since I don't keep same AA in each account (not tax efficient to do so for your lifetime). But when taxable is almost gone,
then of course I would use an AA like one of the Vanguard balanced funds (though I might prefer a Target Date fund with
inflation bonds, international stocks, the Balanced Fund is a bit old school and not sufficiently diversified by asset class).
"The Balanced Fund is a bit old school and not sufficiently diversified by asset class"? I likened the 60/40 Balanced Fund (Vanguard's specifically) to that 30 year old freezer you keep in the garage, which never breaks down. It just keeps going and going.
Keeping food cold is not anything close to investment diversification.
And I don't keep an old freezer in my garage, waste of electricity.
I care about the environment.

kadibex1
Posts: 41
Joined: Fri Sep 28, 2018 6:17 pm

Re: Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Fri Oct 05, 2018 12:32 pm

blevine wrote:
Fri Oct 05, 2018 10:24 am
kadibex1 wrote:
Thu Oct 04, 2018 9:44 pm
blevine wrote:
Thu Oct 04, 2018 6:27 pm
ruralavalon wrote:
Wed Oct 03, 2018 4:38 pm
blevine wrote:
Wed Oct 03, 2018 4:03 pm
For someone who does not want international stocks, and is primarily investing in an IRA/401k and wants a fixed AA,
then this is fine. I would think that given all the discussion about optimizing fees, taxes, AA, etc on BH.org that few would
simplify to that extent.
. . . . .
Tax-efficiency may not matter much if the taxable account is relatively small compared to the tax-advantaged accounts, or if the tax bracket is fairly low.

If tax-efficiency is an issue there is Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) ER 0.09%, with a 50/50 asset allocation.
If your taxable account is small, doesn't matter much what you put in it.
If it's large, chances are unless you started with this fund, you already have unrealized gain in another taxable fund (like Total Stock)
and selling to simplify in taxable is a very expensive decision. It is for me.

While I prefer to simplify I will not do so at great expense to myself, not paying extra taxes or fees.
We have BH who go overboard (tilting, etc) and others who over-simplify. I am a believer in compromise.
Simple but no too simple as to ignore savings that are easy to attain.

As I plan to mostly spend our taxable in retirement, when older and we start spending the tax deferred accounts,
I can rebalance those accounts tax-free to simplify. I will need to make changes likely if I have spent all my taxable,
since I don't keep same AA in each account (not tax efficient to do so for your lifetime). But when taxable is almost gone,
then of course I would use an AA like one of the Vanguard balanced funds (though I might prefer a Target Date fund with
inflation bonds, international stocks, the Balanced Fund is a bit old school and not sufficiently diversified by asset class).
"The Balanced Fund is a bit old school and not sufficiently diversified by asset class"? I likened the 60/40 Balanced Fund (Vanguard's specifically) to that 30 year old freezer you keep in the garage, which never breaks down. It just keeps going and going.
Keeping food cold is not anything close to investment diversification.
And I don't keep an old freezer in my garage, waste of electricity.
I care about the environment.
Yet we invest into stock indexes, which have oil companies in them. So how's caring about the environment working out for you?

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beyou
Posts: 2089
Joined: Sat Feb 27, 2010 3:57 pm
Location: Northeastern US

Re: Vanguard Balanced Index Fund Lovers?

Post by beyou » Fri Oct 05, 2018 12:56 pm

Only a matter of time before those oil companies either build wind farms or go under.
How long I don't know, but it will happen.

warner25
Posts: 340
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Re: Vanguard Balanced Index Fund Lovers?

Post by warner25 » Fri Oct 05, 2018 1:27 pm

All of our assets (IRAs and taxable) at Vanguard are in VBIAX, and have been since 2012. However, we also have the Thrift Savings Plan where we invest heavily in the I-fund (international). I don't think we'd be comfortable with 0% international if we had the option to put our entire portfolio in VBIAX. It probably doesn't matter except in certain edge cases, but we want the international diversification in those cases.

I do favor the simplicity, and nisiprius convinced me of the value of auto-rebalancing with his reflections on the 2008-2009 crash. Unfortunately, other funds with auto-rebalancing, like target-date funds and life strategy funds, have higher costs and have been the subject of too much tinkering in recent years. The composition of VBIAX has been remarkably stable.

dumbmoney
Posts: 2292
Joined: Sun Mar 16, 2008 8:58 pm

Re: Vanguard Balanced Index Fund Lovers?

Post by dumbmoney » Fri Oct 05, 2018 3:15 pm

The nice thing about this fund is that it's pretty much guaranteed to stay as-is (or very close), unlike other all-in-one funds which may be jazzed up every few years with new asset classes.
I am pleased to report that the invisible forces of destruction have been unmasked, marking a turning point chapter when the fraudulent and speculative winds are cast into the inferno of extinction.

kadibex1
Posts: 41
Joined: Fri Sep 28, 2018 6:17 pm

Re: Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Sat Oct 13, 2018 10:56 pm

dumbmoney wrote:
Fri Oct 05, 2018 3:15 pm
The nice thing about this fund is that it's pretty much guaranteed to stay as-is (or very close), unlike other all-in-one funds which may be jazzed up every few years with new asset classes.
I agree. If it ain't broke, why fix it!

drzzzzz
Posts: 270
Joined: Sat Sep 22, 2012 9:56 pm

Re: Vanguard Balanced Index Fund Lovers?

Post by drzzzzz » Sun Oct 14, 2018 7:21 am

wrongfunds wrote:
Wed Oct 03, 2018 5:25 pm
Is there an equivalent Fidelity fund?
You might also look at FFNOX (Fidelity Four-in-One) at fidelity, while likely not as tax efficient, it includes fewer bonds, some international, and expense ratio only 0.08%

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grabiner
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Re: Vanguard Balanced Index Fund Lovers?

Post by grabiner » Sun Oct 14, 2018 7:41 am

kadibex1 wrote:
Wed Oct 03, 2018 9:40 pm
mountainsoft wrote:
Wed Oct 03, 2018 7:09 pm
I recently opened a taxable brokerage account and am using the Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) on that account.
Does Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) only make sense in a taxable account for people in higher tax brackets? I mean to fully get the benefits of it's tax efficiency? I ask because want to start a balanced fund via taxable, but am not sure if I should choose between VBIAX or VTMFX.
Munis, in general, only make sense in a high tax bracket; they have lower yields than taxable bonds of comparable risk, but have higher after-tax yields if your tax rate is high enough. I would guess that munis are of marginal benefit in the 24% bracket, and should be used in the 32% bracket if you hold bonds in your taxable account. (They should also be used, even in the 22% bracket, if you can use a low-cost muni fund for a high-tax state, because you are avoiding about 30% in tax.)

But I don't like Tax-Managed Balanced even for this purpose, because it locks you into its asset allocation. If you hold separate stock and bond funds (49% Tax-Managed Capital Appreciation and 51% Intermediate-Term Tax-Exempt would be similar), and then you want to hold fewer bonds, or a different type of bonds, or bonds in a different account, you can sell your muni fund with little or now tax cost. If you hold a single fund, you have to sell stocks at the same time, for a capital gain.

Balanced Index has the same problem in a taxable account, unless you are in a low tax bracket and thus have no tax on capital gains. If you want to hold a balanced fund in taxable for simplicity, I prefer the target-date funds, which will adjust to keep a reasonably appropriate allocation over time.
Wiki David Grabiner

kadibex1
Posts: 41
Joined: Fri Sep 28, 2018 6:17 pm

Re: Vanguard Balanced Index Fund Lovers?

Post by kadibex1 » Sat Oct 27, 2018 12:27 am

drzzzzz wrote:
Sun Oct 14, 2018 7:21 am
wrongfunds wrote:
Wed Oct 03, 2018 5:25 pm
Is there an equivalent Fidelity fund?
You might also look at FFNOX (Fidelity Four-in-One) at fidelity, while likely not as tax efficient, it includes fewer bonds, some international, and expense ratio only 0.08%
I've often wondered about this fund. The AA and fund choices, albeit on the U.S. Stock side are odd.

rgs92
Posts: 2273
Joined: Mon Mar 02, 2009 8:00 pm

Re: Vanguard Balanced Index Fund Lovers?

Post by rgs92 » Sat Oct 27, 2018 12:46 am

I have about a quarter million in it so I like it a lot. When the market sinks, I like the idea that it is rebalancing every day.

bearcub
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Re: Vanguard Balanced Index Fund Lovers?

Post by bearcub » Sat Oct 27, 2018 5:02 am

My MIL has this fund in a trust for her 3 nephews for around a dozon years. She kept adding to it monthly. When she passes on my SIL will give it to them. They are in for a nice surprise. Has done pretty well.

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