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Question about Two Vanguard Funds

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  • Avatar running403 
    Participant
    Status: Other Professional
    Posts: 7
    Joined: 09/07/2017

    Hello,

    I am looking to add additional funds to my current 401k that would be representative of the Total US Stock Market. The three funds with the lowest expense ratios are the John Hancock 500 Index Fund (JFIVX/JHVIT) at 1.39% as well as the Vanguard Growth Index Fund (VIGAX) and Vanguard Value Index (VVIAX) which both are 1.40%. There are no Total Stock funds available like the Vanguard Total Stock Market. My current plan is the use the Vanguard funds since they are much larger and I could not find the John Hancock fund on the Morningstar website which makes me question its reliability. If I do a 50-50 ratio of both Vanguard Funds listed above will that be a close representation of the Total US Stock Market? If not which ratio would you choose. Thanks in advance!

    #248198 Reply
    Yowza Yowza 
    Participant
    Status: Physician
    Posts: 39
    Joined: 08/25/2019

    Those expense ratios make me sad and angry.

    #248199 Reply
    Liked by Hank, Vagabond MD, Peds
    Dreamgiver Dreamgiver 
    Participant
    Status: Physician
    Posts: 894
    Joined: 03/09/2017

    Growth and value are two specific subsections of the market and would not consider them a substitute of a total market fund in any shape. Those are some high fees, yikes

    #248200 Reply
    Avatar running403 
    Participant
    Status: Other Professional
    Posts: 7
    Joined: 09/07/2017

    I know right! We are a very small medical office that has the 401k is set-up through Northwestern Mutual. I have brought up switching 401ks with my employer several times due to that exact issue. Unfortunately, nothing has been acted on yet. They seem to be more concerned about paying the yearly third party administrator fees than the expense ratios. I would assume they don’t have much money in the account yet and that its tied up in the buildings/practice at this time. I’m going to keep working on it.

    #248202 Reply
    Liked by Vagabond MD
    triad triad 
    Participant
    Status: Dentist, Small Business Owner
    Posts: 279
    Joined: 04/29/2016

    are you sure the expense ratios are right?  on vanguard.com those funds are .05%

    #248205 Reply
    Molar Mechanic Molar Mechanic 
    Participant
    Status: Dentist, Small Business Owner
    Posts: 408
    Joined: 10/29/2017
    #248206 Reply
    Avatar running403 
    Participant
    Status: Other Professional
    Posts: 7
    Joined: 09/07/2017

    Thanks for the link. Yes, those are the correct expense ratios. The adviser from Northwestern Mutual and John Hancock both get the difference between the expense ratio I pay and the actual expense ratio.

    #248213 Reply
    Avatar Peds 
    Moderator
    Status: Physician
    Posts: 4666
    Joined: 01/08/2016

    Just use s&p 500.

    #248215 Reply
    Hank Hank 
    Moderator
    Status: Attorney
    Posts: 1463
    Joined: 03/27/2017

    You (and your employer) are being robbed.

    #248542 Reply

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