Hey everyone, sorry if this is post is like beating a dead horse, but I didn't see a recent thread with my question.
I'm in my early 20s and want to get a head start on investing. I'm looking at going through Vanguard and have a little under 4k to invest. My main question is, how do I know what a solid index fund would be to invest in? Do I put my lump sum in one and let it grow, or should I spread it out across a few different ones? Any tips to picking a solid high yielding fund for the long term?
Thanks!
Early 20s and focused on investing. Congrats.
Let's be honest. Beating a dead horse is a great way to early retirement. Really. Save more, spend less, invest in diversified index funds. Those concepts are in a majority of the posts here. Talk about beating a dead horse. Why? Because it works!
To your point of DCA, it's a wonderful way to invest via paycheck contribution. It's not a wonderful way to invest a lump sum.
To your main question, how do you define a solid index fund? I bet dollars AND donuts that my version of solid is different from yours. Point is that you need to stop and create your own personal risk profile. You say the term long term so I have to guess that you are focused on your net worth in your 30s, 40s, and beyond. If so, research boglehead lazy portfolios and pick one that matches your risk feeling.
When you feel overwhelmed, and you will at a few points in your journey to financial independence, remember it's your savings rate that matters. Your have decades ahead of you. Don't get too wrapped up in S&P500 vs Dividend Appreciation vs Russell 1000 funds.