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Subject:  Re: Hello, time for my IRA Date:  4/12/2002  4:54 PM
Author:  bagginses Number:  34176 of 98897


Take a look at Vanguard's LifeStrategy ("LS") funds. Each one is a "fund of funds," meaning that rather than holding a series of stocks and bonds, each holds several funds which, in turn, hold the stocks and bonds. It's a great way to diversify. It's simple. It's got a great (i.e., very low) expense ratio.

There are LS funds for your preferred asset allocation, too. For example, the LS Growth fund is 80% equity/20% bond, while the LS Moderate Growth fund is 60%/40%. There are two others, I think, that have an even greater allocation to bond. Each of the four LS funds invests in (1) Vanguard total stock market index fund, (2) Vanguard total bond market index fund, (3) Vanguard Asset Allocation fund, and (4) Vanguard total international stock index fund.

I think the LS funds are a great place to start. Once you have a lot more money in the account, you can diversify yourself (for example, if you'd rather have an 85/15 split, or if you'd prefer not to have the asset allocation fund, etc.). In the meantime, having just the one LS fund keeps your annual expenses low (I think it's $10/yr until your account balance reaches $10,000).

Good luck (from a guy who owns one of the LS funds),

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