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Subject:  Re: Thinking about retirement...plans Date:  1/31/2004  12:06 PM
Author:  2old4bs Number:  38860 of 88027

Congrats on paying down that cc debt!

I just went on the Vanguard website and looked up the Vanguard Institutional Index Fund (VINIX). I don't know if this is exactly the same as the one that's offered to you, but it's probably close. According to Vanguard this fund tries to match the S&P500 index and it's expense ratio is .05 (don't know if you can find anything cheaper than that). Check the prospectus you have to see if it's the same one, or close.

Also found a 'Wellington' fund (VWELX), but again yours might be slightly different. This one was a balanced fund of stocks (60-70%) and bonds (30-40%). Claims to be the nation's oldest balanced fund. The bond holdings have an average maturity of 5-15 years. It's always best to check the actual prospectus and see what their current bond holding maturity is. The Expense Ratio is .36 and it has a yield of 2.36%.

Since you're still young, you might not want to hold anything in bonds, so the Institutional Index Fund might be better for you. Also, if interest rates rise, bonds with maturities of longer than 5 years will almost certainly decrease in price, thus decreasing the value of the fund's bond holdings.

So, if I were you, I'd go with the Institutional Index, but as the other poster noted, I'd also look for another fund that matches the Russell 2000. Then you could divide your investment between the two so that you have some exposure to small-cap equities also. What percentage should go to each is really up to you.

That's my 2 cents...


NOTE: All figures and facts given here for the Vanguard funds came from the Vanguard website and I am not responsible for their accuracy!
As the saying goes, "Read your prospectus!"

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