Taxable Vanguard help invest $50,000

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

I am looking to invest approx one time investment of $50000 into my taxable vanguard account,
I am planning to use this money for retirement only.

age 31 married filing jointly
retirement age probably not until 60 or 65
State Florida
Ratio 90%/10% or 100% stocks
Debt house/condo - $67000, paying $1000 every month interest rate 2.75%
planning to buy a house in 2-3 years
income $100000
tax bracket is 28%, no state tax in florida

401k Company 1
Vanguard Extended Market Index $19,000
Vanguard Inst Index, Plus $170,000

401k Company 2
Diversified Bond $5,291.33 ER 0.44
Moderate Lifestyle $1,569.65 ER 0.35
Aggressive Lifestyle $5,496.25 ER 0.44
Growth and Income $5,594.86 ER 0.34
Core Equity (VIIIX) $5,551.11 ER 0.09
Large Cap Growth $8,254.47 ER 0.33
Mid Cap Index ( VMCPX) $6,185.72 ER 0.12
International Equity Index (VDIPX) $5,460.32 ER 0.13

I am thinking one time investment for $50000 AND I'll be investing 500-1k additionally every month to avoid any market crash and loss

what mutual funds/ETFs should I invest in ? please advise for one time investment of $50000 AND also for monthly investing.

please let me know if I am missing any critical info which help to choose mutual funds/ETFs
Last edited by noobtoinvesting on Mon Oct 09, 2017 4:09 pm, edited 6 times in total.
WL2034
Posts: 490
Joined: Tue May 21, 2013 10:36 pm

Re: Taxable Vanguard help invest $50,000

Post by WL2034 »

Without knowing anything else about your situation, I would choose $35k in Van Total Stock Market (VTI ETF) and $15k in Van Total International (VXUS ETF). I don't recall the tickers for the mutual funds off hand, but they would be the same functionally if you are buying and holding. Keep the bonds in tax advantaged accounts.

If you want more educated advice, read the wiki and post the question in the "portfolio questions" format with the rest of your financial situation included.
EnthusiasticLearner
Posts: 82
Joined: Fri Dec 18, 2015 9:18 am
Location: North

Re: Taxable Vanguard help invest $50,000

Post by EnthusiasticLearner »

I'd put it into VTSAX and call it a day. If you are looking to be 100% in equities, the bond placement question is moot, but as you change your AA, still invest in VTSAX in taxed and put your bonds in your taxed advantaged space. https://www.bogleheads.org/wiki/Lazy_portfolios
WL2034
Posts: 490
Joined: Tue May 21, 2013 10:36 pm

Re: Taxable Vanguard help invest $50,000

Post by WL2034 »

EnthusiasticLearner wrote: Mon Oct 09, 2017 11:47 am I'd put it into VTSAX and call it a day. If you are looking to be 100% in equities, the bond placement question is moot, but as you change your AA, still invest in VTSAX in taxed and put your bonds in your taxed advantaged space. https://www.bogleheads.org/wiki/Lazy_portfolios
This would be my choice 1a. Another option would be to put it all into Vanguard Total World (VT ETF) which includes market cap of the global stock market. The ER is slightly higher than having VTI and VXUS separately, but you would never need to rebalance. Really hard to go wrong with choosing between those 3.
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Re: Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

WL2034 wrote: Mon Oct 09, 2017 11:46 am Without knowing anything else about your situation, I would choose $35k in Van Total Stock Market (VTI ETF) and $15k in Van Total International (VXUS ETF). I don't recall the tickers for the mutual funds off hand, but they would be the same functionally if you are buying and holding. Keep the bonds in tax advantaged accounts.

If you want more educated advice, read the wiki and post the question in the "portfolio questions" format with the rest of your financial situation included.
I updated my OP to add my 401k balance
mega317
Posts: 4585
Joined: Tue Apr 19, 2016 10:55 am

Re: Taxable Vanguard help invest $50,000

Post by mega317 »

Welcome to the forum.
I think we still need more information. Please try to model this example:
viewtopic.php?t=6212

What are you going to use the money for? Retirement? Down payment for a home?

Please also read about lump sum vs dollar cost averaging. What are you hoping to accomplish by spacing your investment over 4-8 years?
https://www.bogleheads.org/forum/viewtopic.php?t=6212
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Re: Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

mega317 wrote: Mon Oct 09, 2017 12:33 pm Welcome to the forum.
I think we still need more information. Please try to model this example:
viewtopic.php?t=6212

What are you going to use the money for? Retirement? Down payment for a home?

Please also read about lump sum vs dollar cost averaging. What are you hoping to accomplish by spacing your investment over 4-8 years?
I am open to both lump sum and dollar cost averaging. the reason for lump sum is i have 50,000 cash sitting doing nothing and i can afford to add $500-1000 per month to avoid any loss in case market goes down and still keep investing with good return of my investments
mega317
Posts: 4585
Joined: Tue Apr 19, 2016 10:55 am

Re: Taxable Vanguard help invest $50,000

Post by mega317 »

I understand now. You mean you will lump sum the 50k AND you'll be investing 500-1k additionally. I'm on board with that plan.
https://www.bogleheads.org/forum/viewtopic.php?t=6212
John Laurens
Posts: 437
Joined: Mon Nov 14, 2016 7:31 pm

Re: Taxable Vanguard help invest $50,000

Post by John Laurens »

To answer your question, 100% VT. If I were you based off the info you gave, I would pay off any debt including the condo before taxable investing.

Regards,
John
radiowave
Posts: 2700
Joined: Thu Apr 30, 2015 5:01 pm

Re: Taxable Vanguard help invest $50,000

Post by radiowave »

It recommend using mutual funds, e.g. VTSAX (total domestic stock) rather than the ETF (e.g. VTI). You have a option to automate purchases each month from an outside source, say an online savings account but cannot do that with an ETF.
Bogleheads Wiki: https://www.bogleheads.org/wiki/Main_Page
kathyauburn
Posts: 192
Joined: Thu May 07, 2015 12:25 pm

Re: Taxable Vanguard help invest $50,000

Post by kathyauburn »

John Laurens wrote: Mon Oct 09, 2017 1:51 pm If I were you based off the info you gave, I would pay off any debt including the condo before taxable investing.

Regards,
John
Second this. Be debt free.
retiredjg
Posts: 44070
Joined: Thu Jan 10, 2008 12:56 pm

Re: Taxable Vanguard help invest $50,000

Post by retiredjg »

I think there is too much information missing to help you much. Without knowing some of these things, I don't think you can rely on the answers you are getting.

Do you have an emergency fund?

What do you plan to use for a downpayment in 2 to 3 years?

What is your tax bracket?

Are you completely filling your 401k plan?

Why are you not contributing to a Roth IRA before putting retirement money into a taxable account?

I also think much improvement can be made in 401k #2.

If you are serious about getting reliable answers, consider posting in the format we use to help people with their portfolios. See the link at the bottom of this message. It's some work. You'll learn a lot.
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Re: Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

retiredjg wrote: Mon Oct 09, 2017 3:03 pm I think there is too much information missing to help you much. Without knowing some of these things, I don't think you can rely on the answers you are getting.

Do you have an emergency fund? yup 3-6 months easily

What do you plan to use for a downpayment in 2 to 3 years? I have a stable job and can put down money for my house or ask family member to chip in, but I can come up with money for down payment in 2-3 years

What is your tax bracket? 28%

Are you completely filling your 401k plan? yes i maxed out my 401k and trad IRA- will be doing back door for this year thus no trad IRA in my portfolio

Why are you not contributing to a Roth IRA before putting retirement money into a taxable account?-- my total household income 200000+ make me ineligible for roth, so I had been doing trad ira, this year doing back door

I also think much improvement can be made in 401k #2. care to elaborate??

If you are serious about getting reliable answers, consider posting in the format we use to help people with their portfolios. See the link at the bottom of this message. It's some work. You'll learn a lot.
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Re: Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

mega317 wrote: Mon Oct 09, 2017 1:40 pm I understand now. You mean you will lump sum the 50k AND you'll be investing 500-1k additionally. I'm on board with that plan.
yup thanks
WL2034
Posts: 490
Joined: Tue May 21, 2013 10:36 pm

Re: Taxable Vanguard help invest $50,000

Post by WL2034 »

noobtoinvesting wrote: Mon Oct 09, 2017 3:34 pm
retiredjg wrote: Mon Oct 09, 2017 3:03 pm

I also think much improvement can be made in 401k #2. care to elaborate??

You need to provide the ERs, specific fund names for the funds you are using and then also for the other fund options you have available for you. Again, see the link in retiredjg's post. There is a lot of information needed to give better advice.
retiredjg
Posts: 44070
Joined: Thu Jan 10, 2008 12:56 pm

Re: Taxable Vanguard help invest $50,000

Post by retiredjg »

retiredjg wrote: Mon Oct 09, 2017 3:03 pm I also think much improvement can be made in 401k #2. care to elaborate??
There is considerable overlap in the funds you are holding. Overlap does not hurt performance, but it interferes with your ability to look at your portfolio and know what you've got. It does not appear there is any plan there - just a collection of what you have thought might be good funds.
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Re: Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

retiredjg wrote: Mon Oct 09, 2017 4:06 pm
retiredjg wrote: Mon Oct 09, 2017 3:03 pm I also think much improvement can be made in 401k #2. care to elaborate??
There is considerable overlap in the funds you are holding. Overlap does not hurt performance, but it interferes with your ability to look at your portfolio and know what you've got. It does not appear there is any plan there - just a collection of what you have thought might be good funds.
Yes, i just moved my trad IRA to my 401k, going forward next year i'll be investing
Moderate Lifestyle 20.00%
Core Equity 30.00%
Large Cap Growth 40.00%
Mid Cap Index 10.00%
retiredjg
Posts: 44070
Joined: Thu Jan 10, 2008 12:56 pm

Re: Taxable Vanguard help invest $50,000

Post by retiredjg »

Not that much of an improvement, but if you know what you have and if it suits you, there's no problem. :happy
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Re: Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

retiredjg wrote: Mon Oct 09, 2017 4:31 pm Not that much of an improvement, but if you know what you have and if it suits you, there's no problem. :happy
Image

here are the possible alternative for 401k #2

thanks for the input
I really appreciate help
retiredjg
Posts: 44070
Joined: Thu Jan 10, 2008 12:56 pm

Re: Taxable Vanguard help invest $50,000

Post by retiredjg »

What a nice plan!

What is in the Aggressive LifeStyle fund? What is its ER (expense ratio)?

You could use the Equity Index (500 Index), Small Cap Index, International Equity Index, and Bond Index to make something close to the 3 fund portfolio. Look up 3 fund portfolio in the Wiki to see what I'm talking about.

Not sure how much help this will be since we don't know your big picture. For example, are you married or single? If married, does your spouse have any accounts? Which 401k are you contributing to? Are there other accounts?

All this comes into play when making portfolio plans.
Topic Author
noobtoinvesting
Posts: 24
Joined: Mon Oct 09, 2017 11:08 am

Re: Taxable Vanguard help invest $50,000

Post by noobtoinvesting »

retiredjg wrote: Mon Oct 09, 2017 5:05 pm What a nice plan!

What is in the Aggressive LifeStyle fund? What is its ER (expense ratio)?

You could use the Equity Index (500 Index), Small Cap Index, International Equity Index, and Bond Index to make something close to the 3 fund portfolio. Look up 3 fund portfolio in the Wiki to see what I'm talking about.

Not sure how much help this will be since we don't know your big picture. For example, are you married or single? If married, does your spouse have any accounts? Which 401k are you contributing to? Are there other accounts?

All this comes into play when making portfolio plans.
I dont have access to her account but i think all her 401k is in target retirement fund.
what do you suggest for vanguard account? which stocks to invest in ?
retiredjg
Posts: 44070
Joined: Thu Jan 10, 2008 12:56 pm

Re: Taxable Vanguard help invest $50,000

Post by retiredjg »

noobtoinvesting wrote: Mon Oct 09, 2017 6:21 pm
retiredjg wrote: Mon Oct 09, 2017 5:05 pm What a nice plan!

What is in the Aggressive LifeStyle fund? What is its ER (expense ratio)?

You could use the Equity Index (500 Index), Small Cap Index, International Equity Index, and Bond Index to make something close to the 3 fund portfolio. Look up 3 fund portfolio in the Wiki to see what I'm talking about.

Not sure how much help this will be since we don't know your big picture. For example, are you married or single? If married, does your spouse have any accounts? Which 401k are you contributing to? Are there other accounts?

All this comes into play when making portfolio plans.
I dont have access to her account but i think all her 401k is in target retirement fund.
what do you suggest for vanguard account? which stocks to invest in ?
I hope this does not sound harsh, but I'm trying to be truthful with you. Without more complete and understandable information from you, no suggestion you get can be considered reliable.

It will take three things to know how to invest in the Vanguard account.
  • 1) We need to know what you and your spouse have now.

    2) We need to know what you want to have in terms of stock to bond ratio and how much of your stocks you want in foreign stocks.

    3) What is the taxable account for?
We don't know any of those things.

That said, a general guideline is this. If the money is for a long term goal, such as retirement, a broad index fund (such as a total stock index or a total international index) is a good choice for a taxable account because this type of fund is very tax efficient. Whether you need either of them or how much you might need is anyone's guess.

If the money going to taxable is for a shorter term goal, those might not be good choices at all.
AccordingToLuke
Posts: 8
Joined: Sat Oct 07, 2017 4:33 am

Re: Taxable Vanguard help invest $50,000

Post by AccordingToLuke »

kathyauburn wrote: Mon Oct 09, 2017 2:51 pm
John Laurens wrote: Mon Oct 09, 2017 1:51 pm If I were you based off the info you gave, I would pay off any debt including the condo before taxable investing.

Regards,
John
Second this. Be debt free.
What is the reasoning behind this?
User avatar
Earl Lemongrab
Posts: 7270
Joined: Tue Jun 10, 2014 1:14 am

Re: Taxable Vanguard help invest $50,000

Post by Earl Lemongrab »

AccordingToLuke wrote: Mon Oct 09, 2017 10:31 pm
kathyauburn wrote: Mon Oct 09, 2017 2:51 pm
John Laurens wrote: Mon Oct 09, 2017 1:51 pm If I were you based off the info you gave, I would pay off any debt including the condo before taxable investing.
Second this. Be debt free.
What is the reasoning behind this?
Makes no sense to me, especially if you're able to deduct some or all of the interest. There's a contingent of "debt-o-phobes" that always recommend paying off loans whether it makes any financial sense or not. Some tout a supposed emotional value, but I personally have never experienced it. Perhaps you would. I would ignore this advice.
Last edited by Earl Lemongrab on Tue Oct 10, 2017 4:19 pm, edited 1 time in total.
User avatar
Earl Lemongrab
Posts: 7270
Joined: Tue Jun 10, 2014 1:14 am

Re: Taxable Vanguard help invest $50,000

Post by Earl Lemongrab »

When you invest the lump sum, Vanguard is not the only option for a custodian. I would look at getting a bonus at a good discount broker like Merrill Edge or TD Ameritrade. There you can buy Vanguard ETFs.

See here for more information on bonuses: The Final, Definitive Thread on Brokerage Transfer Bonuses
Post Reply