Author Topic: $50 a month  (Read 6124 times)

Ajmsbu

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$50 a month
« on: May 08, 2014, 07:55:56 AM »
32 years old maxed out my 401k and have been since 22.  Wife maxed  out 403b.  Trying to cut spending and have found $50/$60 a month to invest.  I know it is small but it is a start.  No CC debt, no auto, mortgage is reasonable and student loans @2.6%.  Do I have to have to wait till I accumulate $2,500 to pick up a vanguard account?  I have my 401k with Fidelity and my wife has the same should I go down that path?   

BuzzardsBay

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Re: $50 a month
« Reply #1 on: May 08, 2014, 08:19:58 AM »
Some mutual funds will waive the minimum if you sign up for an automatic monthly investment that's electronically withdrawn from your checking or savings account.  I don't know if this one offers that, but it should be easy to find on the website where it lists minimum investment info, etc.

payitoff

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Re: $50 a month
« Reply #2 on: May 08, 2014, 08:37:11 AM »
*following*

i would like to start to invest something with Vanguard too, and rollover to VFINX when it's big enough, i saw there's a STAR fund that's $1000 to start too.


k-vette

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Re: $50 a month
« Reply #3 on: May 08, 2014, 08:57:18 AM »
You could always use loyal3 to build up stocks until you get to a high enough number to transfer to an investment account.  No fee and build up cc points while youre at it.

MooseOutFront

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Re: $50 a month
« Reply #4 on: May 08, 2014, 09:00:08 AM »
TD Ameritrade offers free Vanguard ETF's.  You could just deposit whatever cash you have left at the end of each month into a cash account at TDA and then invest in taxable ETF's at your leisure.

That's what I do.

payitoff

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Re: $50 a month
« Reply #5 on: May 08, 2014, 10:09:05 AM »
TD Ameritrade offers free Vanguard ETF's.  You could just deposit whatever cash you have left at the end of each month into a cash account at TDA and then invest in taxable ETF's at your leisure.

That's what I do.

so you can invest in Vanguard funds through TD Ameritrade? do you plan to move then to Vanguard later? sorry these might be dumb questions, still learning this world.

mikedom

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Re: $50 a month
« Reply #6 on: May 08, 2014, 10:12:20 AM »
If you're only buying 1-5 shares of an ETF each month, when it comes time to finally sell these, would the tax reporting be a nightmare because you'd have to list every purchase individually?

sol

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Re: $50 a month
« Reply #7 on: May 08, 2014, 10:31:51 AM »
If you're only buying 1-5 shares of an ETF each month, when it comes time to finally sell these, would the tax reporting be a nightmare because you'd have to list every purchase individually?

We recently sold a bunch of nonETF funds in our taxable account to fund a house purchase.  Taxes aren't due til next year but it looks pretty simple.  Vanguard breaks it all out for you and should send you a tax form with total gains and losses for short and long term capital gains.  So you don't need to track each individual purchase, they aggregate them for you.

MooseOutFront

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Re: $50 a month
« Reply #8 on: May 08, 2014, 10:46:43 AM »
TD Ameritrade offers free Vanguard ETF's.  You could just deposit whatever cash you have left at the end of each month into a cash account at TDA and then invest in taxable ETF's at your leisure.

That's what I do.

so you can invest in Vanguard funds through TD Ameritrade? do you plan to move then to Vanguard later? sorry these might be dumb questions, still learning this world.
Yeah TDA has some deal where they allow free buy and sell of many Vanguard ETFs and other companies.  You would have to pay to buy a Vanguard mutual fund.  I don't intend to ever transfer the funds in my TDA account anywhere.  There's no cost for having them sitting there and once you own them it doesn't matter which company they're sitting with.  The importance of buying Vanguard funds and ETFs is because of their low expense ratios per fund, and again that doesn't matter which company you used to buy the Vanguard fund.

For tax accounting, everything since 2012 is tracked by the brokerages so a buy and sell would generate paperwork for taxes, but nothing I have to track manually.  You could always just let the cash build un your brokerage account and only buy when it gets to $500 or $1000 if you prefer.  This is what I do, but I'm not too worried about the record keeping either way when it's time to sell them.

Reepekg

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Re: $50 a month
« Reply #9 on: May 08, 2014, 11:39:05 AM »
TD Ameritrade offers free Vanguard ETF's.  You could just deposit whatever cash you have left at the end of each month into a cash account at TDA and then invest in taxable ETF's at your leisure.

That's what I do.

so you can invest in Vanguard funds through TD Ameritrade? do you plan to move then to Vanguard later? sorry these might be dumb questions, still learning this world.

Absolutely. ETFs are funds that you can easily buy and sell like individual stocks. TD Ameritrade (and other online brokerages) offers about 100 ETFs which are free to buy and sell, and a few of these are the Vanguard funds we know and love:

BND - Vanguard Total Bond Market ETF (same fund as VBTLX)
VNQ - Vanguard REIT Index ETF (same fund as VGSLX)
VB -  Vanguard Small Cap ETF
VIG - Vanguard Dividend Appreciation Index Fund ETF Shares
VO - Vanguard Mid Cap ETF
etc, etc.

If you are new and a fan of MMM, you are probably going to want to start by looking at VTI - Vanguard Total Stock Market ETF which is the same fund as VTSAX.

I referee soccer games on the weekends and pull in $50-100, which goes exclusively to my taxable investment account... basically exactly what you're talking about doing. All the benefits of Vanguard because I do own the Vanguard fund, but none of the hassles of an actual mutual fund like minimum amounts. You could transfer it to Vanguard once you have enough, but it probably isn't worth the trouble.

You will want to keep a log of everything you buy, date, amount, price, etc. because although TD Ameritrade does keep track of it all, I can't yet vouch for how smooth it is to report come tax time.

Grog

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Re: $50 a month
« Reply #10 on: May 08, 2014, 12:47:18 PM »


We recently sold a bunch of nonETF funds in our taxable account to fund a house purchase.  Taxes aren't due til next year but it looks pretty simple.  Vanguard breaks it all out for you and should send you a tax form with total gains and losses for short and long term capital gains.  So you don't need to track each individual purchase, they aggregate them for you.

Lol I'm so happy we don't have capital gain taxes.

payitoff

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Re: $50 a month
« Reply #11 on: May 08, 2014, 12:50:57 PM »
TD Ameritrade offers free Vanguard ETF's.  You could just deposit whatever cash you have left at the end of each month into a cash account at TDA and then invest in taxable ETF's at your leisure.

That's what I do.

so you can invest in Vanguard funds through TD Ameritrade? do you plan to move then to Vanguard later? sorry these might be dumb questions, still learning this world.

Absolutely. ETFs are funds that you can easily buy and sell like individual stocks. TD Ameritrade (and other online brokerages) offers about 100 ETFs which are free to buy and sell, and a few of these are the Vanguard funds we know and love:

BND - Vanguard Total Bond Market ETF (same fund as VBTLX)
VNQ - Vanguard REIT Index ETF (same fund as VGSLX)
VB -  Vanguard Small Cap ETF
VIG - Vanguard Dividend Appreciation Index Fund ETF Shares
VO - Vanguard Mid Cap ETF
etc, etc.

If you are new and a fan of MMM, you are probably going to want to start by looking at VTI - Vanguard Total Stock Market ETF which is the same fund as VTSAX.

I referee soccer games on the weekends and pull in $50-100, which goes exclusively to my taxable investment account... basically exactly what you're talking about doing. All the benefits of Vanguard because I do own the Vanguard fund, but none of the hassles of an actual mutual fund like minimum amounts. You could transfer it to Vanguard once you have enough, but it probably isn't worth the trouble.

You will want to keep a log of everything you buy, date, amount, price, etc. because although TD Ameritrade does keep track of it all, I can't yet vouch for how smooth it is to report come tax time.

Thanks to you both,

i just opened an account with them, 2 ROTH's and 1 IRA for DH, $50 automatic transfer in each account per month investing in Vanguard funds! my dream has come true, i thought this wont happen till i pay off debt! baby steps :)

Reepekg

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Re: $50 a month
« Reply #12 on: May 08, 2014, 01:09:31 PM »

Thanks to you both,

i just opened an account with them, 2 ROTH's and 1 IRA for DH, $50 automatic transfer in each account per month investing in Vanguard funds! my dream has come true, i thought this wont happen till i pay off debt! baby steps :)

You will be amazed how fast baby steps add up. Congratulations on being investor class.

MooseOutFront

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Re: $50 a month
« Reply #13 on: May 08, 2014, 01:16:55 PM »
This is great.  I'm happy for you 2wakefulFlea.  Just take your time and get used to the interface.  Read an article about ETF buying because it's the same as buying an individual stock so there's some nuance that's different than classic mutual funds.  Nothing hard about it once you get used to it though.

sheepstache

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Re: $50 a month
« Reply #14 on: May 08, 2014, 05:51:12 PM »

Thanks to you both,

i just opened an account with them, 2 ROTH's and 1 IRA for DH, $50 automatic transfer in each account per month investing in Vanguard funds! my dream has come true, i thought this wont happen till i pay off debt! baby steps :)

You will be amazed how fast baby steps add up. Congratulations on being investor class.

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