Sunday, April 27, 2008

Investing and planning

I received my tax refund on Friday. Together with my paycheck, I used that to start my account at Vanguard (VFINX). My initial plan had been to invest my first $3,000 into an "income" class fund. This is classified as a large blend fund, however, and I think I'm comfortable with that.

Once I have $6,000 in that fund, I will split it into a growth fund (VIGRX?) and an income fund (VIVAX). This will allow me to keep $3,000 in a relatively low-risk account for a financial catastrophe while using the bulk of my money to try to obtain a better rate of return. Eventually, I would also like to add in a small/midcap blend fund (VEXMX?) and an international fund (VGTSX?). Thus, I need $9,000 more to set up my portfolio the way I would like it. If I really stretched, I might be able to manage that by the end of the year. More likely, I'd like to have all 4 funds purchased by May 1, 2009.

Meanwhile, I am adding $50/paycheck to this fund. Additionally, at the end of every month, I plan to transfer additional "leftover" money (hopefully at least $400) to the fund. I'm expecting this to become the primary location for my mid- and long-term savings. If I can average $500/month, I'll be on track to seriously consider purchasing property of my own by the time I'm 30. Being debt free and a homeowner at 30 is a nice dream!


  1. You have a lot of debt... why are you worried about investing? that makes no sense...

    I'm guessing the rate of return at Vanguard is better than the interest they charge on your debt?

    If I was you I would pay off debt asap! collectors are getting much more agressive, they don't just call anymore, they will sue you and take you to court, so in the end you will need a lawyer. Once you get out of court, a judge can garnish your wages and force you to pay back your debt.