Author Topic: I only have $4,000 to invest right now...advice?  (Read 1701 times)

bast

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I only have $4,000 to invest right now...advice?
« on: October 12, 2018, 12:34:31 PM »
Hi there.

I was so excited about investing in Vanguard's VTSAX, that I didn't realize I had to have $10,000 to do that. I have $4,000 that is in the process of being transferred over by my credit union. I have a couple of questions, that seem to breed more:

1 - Do I truly have to have $10,000 in order to invest in VTSAX?
2 - Does the $4k stay in my bank or does it get completely transferred over to Vanguard?
3 - I thought of more; please be kind as I am smart, but completely new to investing - How do you suggest I use the 4k in Vanguard to get up to 10k in order to invest in VTSAX?
4 - What I am truly trying to do is use Total Stock Market Index Funds...help?

Thank you so much!

onlykelsey

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Re: I only have $4,000 to invest right now...advice?
« Reply #1 on: October 12, 2018, 12:41:16 PM »
On vanguard's site, under the title of the VTSAX is the fact that it's available for a lower minimum as "Investor Shares": https://investor.vanguard.com/mutual-funds/profile/VTSAX

They have a slightly higher expense ratio but are otherwise identical.  It's VTSMX.  You need 3K to invest.

This 4K is beyond your emergency fund, right?  This is money you can afford to invest?  And you've already maxed out your 401K/IRA/etc?  I think you should read through the sticky post on order of investments before you make any purchasing decisions.

Mother Fussbudget

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Re: I only have $4,000 to invest right now...advice?
« Reply #2 on: October 12, 2018, 04:31:18 PM »
On vanguard's site, under the title of the VTSAX is the fact that it's available for a lower minimum as "Investor Shares": https://investor.vanguard.com/mutual-funds/profile/VTSAX

They have a slightly higher expense ratio but are otherwise identical.  It's VTSMX.  You need 3K to invest.

This 4K is beyond your emergency fund, right?  This is money you can afford to invest?  And you've already maxed out your 401K/IRA/etc?  I think you should read through the sticky post on order of investments before you make any purchasing decisions.
^^
This.

And if you accumulate more than $10K in VTSMX, and are still hung up on owning a particular symbol/fund, you can contact Vanguard, and ask to have your holdings in VTSMX converted to VTSAX.  I did this four years ago.

YttriumNitrate

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Re: I only have $4,000 to invest right now...advice?
« Reply #3 on: October 12, 2018, 04:34:11 PM »
How about using Vanguard's  Total Stock Market ETF: VTI? You can buy as little as one share for about $140.

Saving in Austin

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Re: I only have $4,000 to invest right now...advice?
« Reply #4 on: October 12, 2018, 05:37:35 PM »
VTI has the lowest expense ratio for a $4,000 investment.

You can convert to VTSAX once you have $ 10,000 to invest.

letired

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Re: I only have $4,000 to invest right now...advice?
« Reply #5 on: October 12, 2018, 06:20:02 PM »
When I was in your shoes, I bought VTSMX and kept adding to it. Vanguard automatically flipped it over to VTSAX once I hit 10k.

TheAnonOne

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Re: I only have $4,000 to invest right now...advice?
« Reply #6 on: October 12, 2018, 11:40:23 PM »
*ALERT - Incoming dick comment - ALERT*

You need to get more money.

//End dick comment


It probably doesn't REALLY matter too much what you do with 4k. You should be able to push a few grand a month into VTI until you hit 10k (VTI is VTSAX in ETF form)

 

Paul der Krake

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Re: I only have $4,000 to invest right now...advice?
« Reply #7 on: October 12, 2018, 11:45:27 PM »
VTI has the lowest expense ratio for a $4,000 investment.

You can convert to VTSAX once you have $ 10,000 to invest.
VTSAX -> VTI is a one way street. If you want to go back you would have to sell and it would be a taxable event. However this may not matter if OP is investing in a tax-advantaged account.

bast

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Re: I only have $4,000 to invest right now...advice?
« Reply #8 on: October 16, 2018, 12:05:19 PM »
Thank you everyone! These ideas help a lot.

RWD

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Re: I only have $4,000 to invest right now...advice?
« Reply #9 on: October 16, 2018, 12:49:25 PM »
How about using Vanguard's  Total Stock Market ETF: VTI? You can buy as little as one share for about $140.
VTI has the lowest expense ratio for a $4,000 investment.
You should be able to push a few grand a month into VTI until you hit 10k (VTI is VTSAX in ETF form)

You can only buy whole shares of VTI. So you could buy 27 shares right now for $3,877.47 and the remaining $122.53 will be left uninvested. The amount leftover (~3%) may very well cause performance drag that exceeds the difference in expense ratios between VTSMX and VTI (0.1%).

Not that it even matters much at this investment level. So you might as well go with VTSMX then upgrade to VTSAX at the $10k mark.
« Last Edit: October 16, 2018, 12:51:06 PM by RWD »

Finances_With_Purpose

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Re: I only have $4,000 to invest right now...advice?
« Reply #10 on: March 07, 2019, 10:01:06 AM »
VTI has the lowest expense ratio for a $4,000 investment.

You can convert to VTSAX once you have $ 10,000 to invest.

Actually @Saving in Austin I believe Vanguard recently opened up the option to convert balances of $3k or more into VTSAX...

RWD

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Re: I only have $4,000 to invest right now...advice?
« Reply #11 on: March 07, 2019, 10:11:20 AM »
VTI has the lowest expense ratio for a $4,000 investment.

You can convert to VTSAX once you have $ 10,000 to invest.

Actually @Saving in Austin I believe Vanguard recently opened up the option to convert balances of $3k or more into VTSAX...

You know you just revived a thread from a month before Vanguard lowered their minimums, right?

Finances_With_Purpose

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Re: I only have $4,000 to invest right now...advice?
« Reply #12 on: March 07, 2019, 02:22:10 PM »
VTI has the lowest expense ratio for a $4,000 investment.

You can convert to VTSAX once you have $ 10,000 to invest.

oops!

Actually @Saving in Austin I believe Vanguard recently opened up the option to convert balances of $3k or more into VTSAX...

You know you just revived a thread from a month before Vanguard lowered their minimums, right?