How much is not having your money tied up worth to you?

[alrocky]

$3k each in Vanguard fund:

Large,
Large-Value,
Small,
Small-Value,
Int'l Developed Markets (Large),
Int'l Emerging Markets

Earlier you posted that you invested $3k in each of the above funds. Please provide 5 letter symbol for each to verify each specific fund. Please note: "Each Vanguard index fund (except the REIT Index Fund) charges a maintenance fee if the balance is below $10,000. The fee of $10 is deducted..."

TSP
Just a FYI: A 48-24 C-S ratio would more closely represent the entire US stock market. My TSP AA is C=S, so we are both overweighted in the S Fund. You may wish to eventually include some bond exposure. The G Fund (adjusted for risk/reward) is considered better than the F Fund. It's never lost a cent.

From the TSP website: "Whether you are an active or separated Federal employee you can transfer or roll over money from a traditional IRA or an eligible employer plan into your existing TSP account." - that's a great option!

ROTH
As noted above there is a $10 'nuisance' fee for Vanguard Index fund below $10,000. Also note: "$10 a year for each ROTH fund account with a balance of less than $5,000." So if you open (and invest $4000) in VEIEX in a ROTH for this year, you'll get tagged $20. You can drop $8000 for ONE index fund in early January (for years 2006 & 2007) and save $10. So you probably want to stick to ONE index fund in your ROTH until it reaches $10,000 before you start another fund. Please clarify, when can you invest in your year 2005 ROTH IRA?

TAXABLE
Need more information. Need the 5 letter symbol for each of the 6 funds as quoted at top of this post. You shouldn't sell any of your funds just yet.

Also consider signing up at Morningstar.com and post your questions at Vanguard Diehards. It's free and you'll get the benefit of more people's insight and knowledge.


And by the way, thank you for your military service to our country! :thumbsup:

 

[b0mbrman]

Originally posted by: alrocky

$3k each in Vanguard fund:

Large,
Large-Value,
Small,
Small-Value,
Int'l Developed Markets (Large),
Int'l Emerging Markets

Earlier you posted that you invested $3k in each of the above funds. Please provide 5 letter symbol for each to verify each specific fund. Please note: "Each Vanguard index fund (except the REIT Index Fund) charges a maintenance fee if the balance is below $10,000. The fee of $10 is deducted..."

VFINX - Vanguard 500
VIVAX - Value Index
NAESX - Small
VISVX - Small Value
VDMIX - Developed markets
VEIEX - Emerging markets

TSP
Just a FYI: A 48-24 C-S ratio would more closely represent the entire US stock market. My TSP AA is C=S, so we are both overweighted in the S Fund.

You may wish to eventually include some bond exposure. The G Fund (adjusted for risk/reward) is considered better than the F Fund. It's never lost a cent.

Eventually, I'm sure I will. I don't plan on retiring very soon though. Still, will check into historic rates.

From the TSP website: "Whether you are an active or separated Federal employee you can transfer or roll over money from a traditional IRA or an eligible employer plan into your existing TSP account." - that's a great option!

Did not know that and yes that is an extremely helpful option...I'll use the TSP as long as I can then...also takes off some pressure for me to not stuff it as much as possible right now (mind you, I'll put as much as possible until it becomes uncomfortable)

ROTH
As noted above there is a $10 'nuisance' fee for Vanguard Index fund below $10,000. Also note: "$10 a year for each ROTH fund account with a balance of less than $5,000." So if you open (and invest $4000) in VEIEX in a ROTH for this year, you'll get tagged $20. You can drop $8000 for ONE index fund in early January (for years 2006 & 2007) and save $10. So you probably want to stick to ONE index fund in your ROTH until it reaches $10,000 before you start another fund. Please clarify, when can you invest in your year 2005 ROTH IRA?

I will look into that as well. I want to run the numbers...diversification might just be worth $10 to me...

The HERO Act lets me deposit 2004/2005 combat pay as late as May 2009...I really wish more soldiers knew about it...

TAXABLE
Need more information. Need the 5 letter symbol for each of the 6 funds as quoted at top of this post. You shouldn't sell any of your funds just yet.

Also consider signing up at Morningstar.com and post your questions at Vanguard Diehards. It's free and you'll get the benefit of more people's insight and knowledge.

I signed up but it's trying to charge me a one-time $5 fee to post. Am I doing something wrong?

And by the way, thank you for your military service to our country! :thumbsup:

No problem. I actually enjoy what I do...most days

 

[alrocky]

VFINX - Vanguard 500 Index
VIVAX - Value Index
NAESX - Small Cap Index
VISVX - Small Cap Value Index
VDMIX - Developed Markets Index
VEIEX - Emerging Markets Stock Index

0.05% C Fund... 0.18% (VFINX) 500 Index
0.05% S Fund... 0.25% (VEXMX) Extended Market Index
0.05% I Fund... 0.29% (VDMIX) Developed Markets Index

Yikes all 6 are Index funds! Keeping < $10K in each would've cost you $60 in December. Selling VFINX and VDMIX to indirectly fund the TSP is a no brainer since they duplicate the C and I Funds. Selling VEIEX in your taxable and then buying it for your ROTH involves annoying fees. There is a 0.50% purchase and 0.50% redemption fee ($5 per $1,000 invested). So getting in and out of taxable costs about $30 (~$15*2 for $3K).

-----

Roth
@Vanguard
2006: $4000 to VEIEX (Int'l EMkts to diversify toward more int'l) c. Jul 06
2007: $4000 to VIVAX (Large Value) c. Feb 07
2005: $4000 to VISVX (Small Value) c. Jul 07

2005 (VISVX) $20
2006 (VISVX) $20 + (VEIEX) $20 = $40
2007 (VISVX) $20 + (VEIEX) $20 + (VIVAX) $20 = $60

or

2006: $4000 in VEIEX -- cost $20
2007: $4000 in VIVAX -- cost $20 + $20 (for VEIEX) = $40
2008: $5000 ($2.5K in each) -- cost $10 + $10 = $20

or

2007: $8000 in VEIEX -- cost $10
2008: $5000 in VEIEX -- cost $00

If you invest $8000 in early January 2007 (for your 2006 and 2007 ROTH) the nuisance fee is only $10. Doing 2 funds at the same time costs $80 for the 3 years shown. Your original plan costs even more for the 3 years shown = $1200. Remember it's $10 for each IRA under $5000 and $10 for each index under $10,000.

Sorry, I joined years ago and didn't know they've since introduced a one-time $5 fee.

 

[b0mbrman]

Originally posted by: alrocky
Yikes all 6 are Index funds! Keeping < $10K in each would've cost you $60 in December. Selling VFINX and VDMIX to indirectly fund the TSP is a no brainer since they duplicate the C and I Funds.

Selling VEIEX in your taxable and then buying it for your ROTH involves annoying fees. There is a 0.50% purchase and 0.50% redemption fee ($5 per $1,000 invested). So getting in and out of taxable costs about $30 (~$15*2 for $3K).

Yes, VFINX is on its way out today...NAESX and VEIEX are already gone.

In other news, I was surprised to find that I'm being promoted tomorrow (I was expecting October) so that means I can raise contributions a bit

 

[b0mbrman]

So I can get this statement out of my head:

From the TSP website: "Whether you are an active or separated Federal employee you can transfer or roll over money from a traditional IRA or an eligible employer plan into your existing TSP account." - that's a great option!

I should be out of the Army within a year. Would it be worth it to keep some of the money out of TSP for now so that I can max a civilian employer's 401k?

I don't get the tax savings now...and an employer might match contributions...of course, this all depends on where I'm able to find a job afterward...

 

[alrocky]

E.R. ................. E.R. -- equivalent fund
0.05% C Fund... 0.18% (VFINX) 500 Index
0.05% S Fund... 0.25% (VEXMX) Extended Market Index
0.05% I Fund... 0.29% (VDMIX) Developed Markets Index
0.04% G Fund... free lunch!
0.04% F Fund... 0.20 (VBMFX) Total Bond Market Index

You want to invest as much as the $15,000 (or as in your case $40,000) in the TSP as you can afford to this year. And as much as you can of $15,000 (or whatever the limit is in 2007) for next year. One reason you'd want to invest less than $15,000 in the TSP next year is if you'd lose out on the company match at your new job. Let's assume you'll be in the Army until the end of June 2007 and you start your new civilian job July 1 and they have a 1:1 company match of up to $1,000 a month. This means you'd want to invest ($15,000 - $6,000 =) $9,000 in the TSP for the first half of next year.

Of course this assumes you've already got a job lined up and know their company match. If you get a federal job, you're back in the TSP and get a 5% match!

The reason you'd want to transfer the 401k money to the TSP is primarily because of the super low Expense Ratios and the fact the the TSP funds (or their equivalent) should represent the CORE of anyone's portfolio. FYI there may be restrictions from your new job on whether and when you could roll your 401k into the TSP.