Should You Invest in Multiple Index Funds or Just Pick One?

Should You Invest in Multiple Index Funds or Just Pick One?

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[noveltyrobot]

At my risk tolerance, I would put side hustle money into aggressive growth index funds... But that's just me.

[wuziwu]

I prefer Multiple index funds because it gives me more control.
If 1 of my 15 funds are down 30%, I can take advantage of ETF fire sales. If 1 of my funds is up 40% I can strategically sell at the top.

I agree with these guys ONLY if one gets intimidated by complexity. The psychology of money is so critical that if simplicity helps one stay committed to investing than it is more than worth the cost of giving up a little control.

[chiparooo]

Watch the fees on the target funds. You can do it a bit cheaper yourself and over 30+ years this adds up.

[Jumpman]

A lot of those target date funds have a higher fee to manage them. Remember compound interest works both ways. If you have a target date fund with a high fee to manage it, you could be giving up a lot of money over the course of your career.

[cceerr]

The majority of my stock is in a total market index FSKAX but I also have smaller slices in sector index funds such as large cap growth index FSPGX. Also a piece in the extended market index FSMAX to help offset the clustering of the 10 or 12 top companies in the total market fund. Bonds are primarily in US bond index FMBIX and some in inflation protected bond index FIPDX for the short term. I did use target date index funds when I was younger but as I age I no longer feel they are appropriate.

[nickdoyle-achievefinancial]

Agree target retirement are great for people that want a hands off / autopilot. The three fund portfolio allows for some minor optimizations with fees and taxes if someone is so inclined. I made a couple vids on this.

[afternoononthedock]

Thank you, I was not aware that target retirement index funds were a thing. Just looked at Vanguard's version, called all-in-one funds under mutual funds. Are these tax-advantaged? The expense ratio is higher. Are these meant to be more passive still, as in "set and forget" so you don't have to adjust as frequently. Just curious.

[Zorlig]

VTI vs target retirement 2040 total returns for 5 years:
Total Return 130.09% 88.61%

Sorry I gotta hard pass that target retirement fund. They seem to be for people who like to be poor.

[philiplanz]

Those funds tend to put too much in Bonds. Buying bonds in your 20s is wasting too much upside

[capttokki]

He still didn't answer the question and should you get multiple different ETF's and im new to this but i think investing 1 or 2 specially every week or month and also the other ETF you get should be for different company's or you are gonna have alot of overlap (VOO and Spy give almost identical stocks for instance) its a slow build but worth it if you can afford it.

[darkhumphrey]

Just get one total market index, one bond index and one international index (optional). I go 90% us total market right now since I'm yong, but as I hit 40s, 50s, just need to change allocation little by little to bond index. Simple as that

[thebigjohnson]

100% VTWAX and chill. Lower expense ratio and higher expected returns than a target retirement fund. You don’t need a bond allocation decades from retirement - it will just be a drag on your returns.

[ganthc]

Awesome question, and awesome answer. Thanks, Money Guy Show! :)

[cbgibs]

Only thing is if everybody buys index then everybody is buying good companies yes but also bad companies that need to fall so might be bubble.

[parthsharmabala]

Heyy suggest something about Investing in India and India's Nifty Index.

[Yusheesan]

What if you don't have a lot of money to invest, just a few hundred dollars a month? What do you invest in? 1 ETF or several ETF with lower amounts spread around? Which ETF should you pick? S&P 500 or high dividend? Or should you just keep your money in a 4% savings or put it in ROTH IRA?

[billycoggins]

Nice video!! Very engaging from beginning to end. Nevertheless, businesses and investment are the easiest way to make money irrespective of which party makes it to the oval office.

[Simon-jeko]

I completly disagree with both of you. You do what you want. But I have my own stategy. Me I just focus on what is on sale and what have the more growth. What move the most during the day on the stock market. You have to be a long term company. You give me growth or I am out. I sell and I buy something else with this money. No I am not a scientist or a rocket scientist 🚀. I set goals and then let's go.

[shortstopdawgs]

Target retirement in Betterment account 76% stocks 24% bonds. Fidelity account FXAIX, FZROX, FSPSX, FDRV, FSELX, FSRNX, JEPI, SCHD