Are there better investments than VTSAX?
Sources:
While VTSAX has been highly regarded, especially within the FI (financial independence) community, there are several alternative investments that might offer better returns or more suitable features, depending on individual investment goals and circumstances.
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ETFs like VTI: Brad Barrett recommends considering ETFs like VTI for those seeking to invest in the total stock market without the fees associated with purchasing mutual funds like VTSAX at certain financial institutions. VTI is functionally similar to VTSAX but accessible as an ETF, which often comes with lower or no commission fees at platforms like Fidelity or Schwab 1.
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Active Funds such as VW ELX: While VTSAX is a passive index fund, VW ELX (Vanguard Wellington Fund) is an actively managed fund with a long track record that includes a mix of stocks and bonds. It has historically outperformed broad-based index funds like VTSAX, although it does come with higher fees and a different investment strategy 2.
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Charles Schwab's SWTSX: This fund is similar to VTSAX but without the minimum investment requirement and with even lower expense ratios. It provides an accessible alternative, especially for investors starting with smaller amounts 3.
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Other Vanguard Funds: Other Vanguard funds like the Vanguard Mid Cap Index Fund (VIMAX) and Vanguard Small Cap Index Fund (VS MAX) have shown histories of higher returns compared to VTSAX, suggesting that they could be considered depending on one's risk tolerance and investment horizon 4.
Given these options, it's crucial to consider individual financial goals, risk tolerance, and the specific features of each fund, such as fees, fund structure (ETF vs. mutual fund), and historical performance, to make the most suitable investment decision.
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