"Day one" type questions are always welcome.
You missed step one, actually: make a written investment plan, including deciding on an asset allocation. You also need to decide what you're saving for, and if all of your retirement accounts are going to be treated as one (as opposed to treating taxable and tax-advantaged separately).
Among other things, you need to have decided if VFINX is the right index fund for you. It isn't a bad fund, but many of us prefer the total stock market index (greater diversity, same expense ratio, among other reasons) for our domestic (U.S.) allocation. You also may want to be diversified internationally - check out Vanguard's total international stock market index (this has the added bonus that you'll get some credits for foreign tax paid on this one).
As for the frequency, it doesn't really matter. I keep my emergency fund in my bank (my 'stash isn't large enough to warrant going without -- yet) and, after I've paid each month's bills, I use what's leftover (budgeted for, so I generally know how much it will be, although it's sometimes more than anticipated if I've spent less than planned) to put into my asset allocation. Others do this quarterly. Some have a designated amount they put in each month and leave the rest to spend.
