Welcome to a new series at JosephSangl.com – The Mutual Fund Series.
During each part of this weekly series, I will be looking at a specific mutual fund company.
Today's company is The Vanguard Group.
Vanguard is one of the largest mutual fund companies in the world. Based in Valley Forge, Pennsylvania, they currently manage $1.3 TRILLION dollars for their clients and offer 150 domestic funds and additional funds in international markets.
What I Like About Vanguard
- Target Retirement Funds. Vanguard was one of the first companies to offer target retirement funds. It is a fantastic idea to address the complete confusion that some people feel when making retirement mutual fund choices. All one has to do is select their target retirement date and Vanguard will automatically shift the mutual fund to become less risky/volatile as one approaches retirement. It really helps address the need to rebalance one's portfolio.
- Very low annual expense ratios. Vanguard is client-owned. This means that the company is owned by those who invest with the company. This results in Vanguard having the lowest management costs in the mutual fund industry. The average expense ratio for their mutual funds is 0.20% (the industry averages around 1.50%). This means that I get to keep more of the annual growth of my money.
- Lots of mutual fund options. With over 150 domestic funds and additional funds in the international markets, I have a lot of choice. I like choices.
- Full-service investment company. Vanguard offers mutual funds, IRAs, Roth IRAs, 401(k) rollovers, 529s, ESAs, and brokerage services.
What I Would Like To See Improved At Vanguard
- Lower "initial investment requirement". Most of Vanguard's funds require an initial investment of at least $3,000. This rules out a lot of beginning investors. Of course, this is not a problem when someone is investing within the bounds of their company 401(k), 403(b), or other retirement plan where minimum investment requirements are usually removed.
Vanguard Mutual Funds I Own
- I currently own one Vanguard mutual fund – Vanguard Institutional Index Fund [Ticker: VINIX]. I own this mutual fund as part of a 401(k). You can see other mutual funds that I currently own by clicking HERE.
- This mutual fund has a minimum investment requirement of $5,000,000. The reason that I am able to own shares of this mutual fund is because it is offered as part of the company 401(k) plan.
- It is a large-cap blend fund.
Vanguard Mutual Funds That I Am Considering Purchasing
- Vanguard Target Retirement 2040 Fund [Ticker: VFORX] This fund will automatically rebalance for me as I approach retirement. I chose the 2040 fund because that is a target retirement year for me. Vanguard has Target Retirement funds for every five year period from year 2005 to 2050.
- Vanguard 500 Index Fund Investor Shares [Ticker: VFINX] This fund tracks the performance of the S&P 500. It has very low expense ratios. It does need $3,000 to begin an individual investment.
What Vanguard funds do you own? Do you have any Vanguard funds that you really like? Dislike?
Receive each post automatically in your E-MAIL by clicking HERE