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I currently have a Roth IRA with Scottrade. My style is simple: buy Vanguard 500 Index Funds (VFINX) and leave a little cash. I don't see myself changing this style any time soon. Maybe one day I will want to trade stocks, but not now. With the new $17 transaction fee, I am looking to move to Vanguard. But I am not sure if that is the right decision. Maybe I should stay with Scottrade and just buy VFINX less times with more money, instead of more times with less money. What do you think?

Also, my husband plans to open Roth IRA. The same issues apply to him, except that he currently doesn't have any account with anyone. We need to decide before April 15, so he can get his 2004 contributions in on time.

Thanks,
diat
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I currently have a Roth IRA with Scottrade. My style is simple: buy Vanguard 500 Index Funds (VFINX) and leave a little cash. I don't see myself changing this style any time soon. Maybe one day I will want to trade stocks, but not now. With the new $17 transaction fee, I am looking to move to Vanguard. But I am not sure if that is the right decision. Maybe I should stay with Scottrade and just buy VFINX less times with more money, instead of more times with less money. What do you think?

You could always buy SPY instead of VFINX. You do have to pay the $7 (?) commission, but the expense ratio is lower than VFINX.

Just a thought,
B+C
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Get the facts from Vanguard on what fees they charge, minimums, etc. and look at how often you plan to make purchases. Just add up the numbers and decide which one is the best deal.

My DW uses vanguard for her rollover IRA and has all her money in VTSMX (total stock market). They charge $10/year because the account balance is below $10K and $2.50/quarter because the fund has less than some amount (maybe $10K, I'm not exactly sure). So that's $20/year for us plus fund expenses @ 0.18%. One nice feature is that they allow us to pay the annual fee separately so it's not deducted from the value of our account.

Adenovir

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Maybe I should stay with Scottrade and just buy VFINX less times with more money, instead of more times with less money. What do you think?

That depends on how many dollars you think you would have to amass to make it worthwhile to buy in. For example, if you wait one year to amass $3500 instead of investing at ~$300/month, you might miss out on a year that returns 20%, that would hurt (about $340 lost). I've often heard that major market moves often take place over days, not even months, so it seems to me that investing more often than yearly (i.e. monthly), if one can, is the better way to go.

It really depends on how often you normally buy into VFINX, and in what amounts.

2old



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