I am a beginning investor and want to merely invest in index funds...?

Question

...but I am really not sure where to begin. I thought it would be as easy as going to Vanguard, getting an account, and putting my money there, but I am confused. I am young enough to handle some risk and am only looking for growth, so i was thinking something like 80% stocks, 20% bonds.

Is there a real basic book that I can buy that will give me a very straight forward plan for a total newbie?

Thanks.

Answer 1

If you are trying to decide your asset allocation in stocks and bonds, you can take the Vanguard quiz to get an idea of what your allocation should be:
https://flagship.vanguard.com/VGApp/hnw/FundsInvQuestionnaire?cbdInitTransUrl=https%3A//flagship.vanguard.com/VGApp/hnw/planningeducation/education
You can also talk to other Vanguard investors on the "Boglehead" forum:
http://diehards.org/forum/index.php
"Boglehead" asset allocation advice:
http://diehards.org/forum/viewtopic.php?t=144

Answer 2

Frankly, there isnt relatively a stable reason for many persons to no longer make investments frequently in index money fairly than individual shares or controlled mutual money. There a many reasons index money are better. First, costs. a stable S&P index fund from somebody like forefront runs a fragment of a p.c. in an annual fee. Many are .18% to .40 5% A controlled fund has commonly a million.5-2.5 p.c. annual costs as properly to any sales rates(plenty). So, the controlled fund precise off the bat is two% return in the back of. So so as to triumph over an S&P Index fund in a 300 and sixty 5 days that has 11% earnings, the controlled fund has to get 13% return just to get even. additionally, controlled money tend to be traded extra heavily and have extra tax implications. Is "index and a few" a stable approach? somewhat. As continuously, verify your investment aims and create an asset allocation based in it sluggish-physique and danger tolerance. Use index money for merely about all your portfolio.

Answer 3

I prefer T Rowe Price over Vanguard, because of the fees.
You should want no load.
I like your mix. In real life asset allocation is tough to change.
Open an account with a discount broker and hold the shares there. Easier to make changes between fund groups. On the other hand, if you will always be satisfied with your fund family it is cheaper for them to hold.
I use TD Ameritrade.
I wish there was a book with all the answers.

Answer 4

You can get free saving and investment advice at Uncle Leo's Den (www.uncleleosden.com). The site lays out a basic framework for thinking about saving and investing. Use the navigation bar to pick the subjects you want to read about.

You seem to be focused on long term investing. That's a very good thing. A simple way to build wealth is to invest in a lifecycle or target date retirement fund. These funds to do the investing and diversification of investments for you. They are growth oriented when you are young and change their investment focus as you grow older to lower the risk profile of your investment portfolio. That's desirable because you should reduce investment risk as you approach your retirement (in order to protect the wealth you've built up). Vanguard, Fidelity, and T. Rowe Price, as well as other mutual fund companies, offer lifecycle or target date funds. Pick one with a target year around the time when you hope to retire.

Answer 5

Vanguard has an excellent no-load total market index fund that invests in all segments of the market, both big and small companies.

Fidelity has a no-load total market fund that has a slightly lower expense ratio than Vanguard's. The Fidelity fund is FSTMX.
.

Answer 6

Sure but an even cheaper way would be to go to www.fool.com and review some of their advice. They are fee adverse, into risk management and love the index funds. It's a great place for a new investor to get their feet wet. The "dummies" series of books are pretty good to for objective advice.