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Bogleheads is a great resource, but I expect most HN readers can handle managing their asset allocation manually (using a simple "three-fund portfolio" or simil
by tempestn 12y ago
Bogleheads is a great resource, but I expect most HN readers can handle managing their asset allocation manually (using a simple "three-fund portfolio" or similar), which allows you to save a bit on expenses compared to a target date fund, as well as take more advantage of tax management techniques like municipal bonds and tax loss harvesting.
- saryant 12y agoIn Vanguard's case, the TD funds generally make sense starting out given their lower minimum investment requirements ($1000 vs $3000 for most others). Once you reach $10-20k and can starting using Admiral funds, then you can switch to a three-fund portfolio and take advantage of lower ERs.
- ForHackernews 12y agoThis is very true. But for people who know nothing about investing and just want to get started, the simplest non-harmful advice I always give is "Vanguard Target Date Fund". That way, at least they are not doing anything wrong that will serious hurt their returns. Later on, when they have more experience or more money, they might want to switch to some other allocation.
- tempestn 12y agoTotally. I give similar advice (although we don't have anything quite as good as the Vanguard TD funds up here in Canada yet). Was just thinking for this particular audience it wouldn't hurt to suggest a bit more effort. Still, nothing wrong with a low-cost TD fund to get started, especially with a portfolio in the 4 or 5 figures.