Author Topic: 5-7 year stash fund: Vanguard Star VGSTX  (Read 5082 times)

fmzip

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5-7 year stash fund: Vanguard Star VGSTX
« on: May 14, 2014, 07:02:40 AM »
So my finances are in order, all retirement accounts and HSA's are maxed. Asset allocations are all set.

As we have some extra funds, my wife and I would like to begin stashing away money towards a down payment on our future retirement house (in a much warmer climate). We are thinking that within 5-7 years we'd like to access this cash. I am not overly risk adverse (I am 48, with is 50). Our AGI is around $120K.

I was starting to stash our extra cash in Vanguard STAR Fund (VGSTX). We have about $10K in that, another $10K ready to invest. Since I sold my non-mustachian hot rod, another $17K in the lurch too.

I read that because of the bond exposure VGSTX isn't really suitable for a taxable account. Do I really need to me overly concerned about that? If so, what other suggestions are available if I want a 50/50 or 60/40 stock/bond ratio? I understand the premise of the reasoning but rules are sometimes meant to be broken.

Ideas/Suggestions on a fund/funds are welcome....

Thanks!

soccerluvof4

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Re: 5-7 year stash fund: Vanguard Star VGSTX
« Reply #1 on: May 14, 2014, 07:23:32 AM »
Alot of people use different funds but since were similar an age/time frame i can just share with you what I use.  I also am 60/40 currently. But i am also overweight energy. As of today my Vanguard Index's are

VTSAX
VTIAX
VBTLX
VTABX
VGSLX
VGENX to be slightly overweight Energy (very small percentage of my overall indexes)

fmzip

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Re: 5-7 year stash fund: Vanguard Star VGSTX
« Reply #2 on: May 14, 2014, 07:29:03 AM »

fmzip

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Re: 5-7 year stash fund: Vanguard Star VGSTX
« Reply #3 on: May 14, 2014, 07:30:34 AM »
Alot of people use different funds but since were similar an age/time frame i can just share with you what I use.  I also am 60/40 currently. But i am also overweight energy. As of today my Vanguard Index's are

VTSAX
VTIAX
VBTLX
VTABX
VGSLX
VGENX to be slightly overweight Energy (very small percentage of my overall indexes)

Are all these funds in a taxable accounts?

soccerluvof4

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Re: 5-7 year stash fund: Vanguard Star VGSTX
« Reply #4 on: May 14, 2014, 08:24:57 AM »
Alot of people use different funds but since were similar an age/time frame i can just share with you what I use.  I also am 60/40 currently. But i am also overweight energy. As of today my Vanguard Index's are

VTSAX
VTIAX
VBTLX
VTABX
VGSLX
VGENX to be slightly overweight Energy (very small percentage of my overall indexes)


These are yes....They are not available in my 401k.

Are all these funds in a taxable accounts?

El Limon

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Re: 5-7 year stash fund: Vanguard Star VGSTX
« Reply #5 on: May 15, 2014, 06:55:41 AM »
I own VGSTX in a taxable account. Ideally we want all our of bond exposure in tax advantaged, but i see it this way. If you own a Total Stock Market fund in taxable, it yields about 2% dividends, and you owe some taxes on the distributions. VGSTX yields about the same, and you owe about the same amount in taxes.

One alternative to STAR is the V-Balanced Index fund. If you're investing 10K or more, you can own the admiral shares which have a super-low expense ratio. (.09) vs. the (.34) of STAR.

Why not do both? I like the STAR because of the Internationals and you get in on the PRIMECAP. Very nice!       

payitoff

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Re: 5-7 year stash fund: Vanguard Star VGSTX
« Reply #6 on: June 16, 2014, 04:29:18 PM »
Would you consider using this fund as your emergency fund (put in general savings, instead of Roth)?  I am looking for a place where i can put our sinking fund --- we are contributing $600 per month and use it to pay for tuition twice a year, vacation, sport event registrations etc.  versus just sitting in INGdirect/CapitalOne360

fmzip

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Re: 5-7 year stash fund: Vanguard Star VGSTX
« Reply #7 on: June 16, 2014, 06:55:37 PM »
Only if you can stomach losing 20-30% of your cash at any given time

http://quotes.morningstar.com/fund/VBINX/f?t=VBINX

I can, so I am good with it.