Anonymous
Post 01/26/2022 21:06     Subject: Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Now that state attorneys general are investigating, there may end up being some restitution
Anonymous
Post 01/26/2022 21:05     Subject: Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:https://m.youtube.com/watch?v=CxAEi42U3gU

15 min video but he gives an good overview of what happened and some potential risk for other Vanguard funds.


Very useful video, thanks for posting.
Anonymous
Post 01/26/2022 20:48     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:I had a long term gain of $60,000 in one of my international growth funds. WTF?


VWILX?
Anonymous
Post 01/26/2022 20:48     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:Anyone find this kind of amusing? The bogleheads and FIRE crowds are so smug about their investing in index funds. I personally think diversity is so important. Index funds are fine but there is always a risk.


This specific issue has been discussed on the Bogleheads forum. It has nothing to do with index funds and everything to do with an investor being educated enough to know what they buying and about asset location. TDF do not belong in taxable accounts for a variety of reasons, this being one of them. Even ETFs have capital gains distributions.


Your response very much conflicts with the message I’ve seen shared over and over again by those who promote index funds. The message has been something along the lines of “index funds allows you to be a passive investor. You don’t need to research the funds. Do the three index fund approach. Put your money in the funds and sit back.”

It seems odd to me that now the promoters are saying you need to educate yourself about index funds and this happened because the investors are uneducated.



Target date funds do not equal index funds. TDR’s are actively managed, index funds are not.
Asset allocation is critical in investing. Where you put retirement funds vs taxable funds vs tax free funds is very important and has implications.

What VG did here was very weird but not illegal. They will probably get sued and we will see what happens.
Anonymous
Post 01/26/2022 20:44     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
I had a long term gain of $60,000 in one of my international growth funds. WTF?
Anonymous
Post 01/26/2022 20:35     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:
Anonymous wrote:again, you get what you pay for..doesn't make it right, but it's true[/quote


Actually is the reverse is mostly true in investing— you get what you don’t pay for!


Good point!
Anonymous
Post 01/26/2022 20:34     Subject: Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
https://m.youtube.com/watch?v=CxAEi42U3gU

15 min video but he gives an good overview of what happened and some potential risk for other Vanguard funds.
Anonymous
Post 01/26/2022 20:34     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:Anyone find this kind of amusing? The bogleheads and FIRE crowds are so smug about their investing in index funds. I personally think diversity is so important. Index funds are fine but there is always a risk.


This specific issue has been discussed on the Bogleheads forum. It has nothing to do with index funds and everything to do with an investor being educated enough to know what they buying and about asset location. TDF do not belong in taxable accounts for a variety of reasons, this being one of them. Even ETFs have capital gains distributions.


Your response very much conflicts with the message I’ve seen shared over and over again by those who promote index funds. The message has been something along the lines of “index funds allows you to be a passive investor. You don’t need to research the funds. Do the three index fund approach. Put your money in the funds and sit back.”

It seems odd to me that now the promoters are saying you need to educate yourself about index funds and this happened because the investors are uneducated.


The target date funds are not regular index funds, to my understanding. Kind of a different animal.
Anonymous
Post 01/26/2022 20:18     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:
Anonymous wrote:Anyone find this kind of amusing? The bogleheads and FIRE crowds are so smug about their investing in index funds. I personally think diversity is so important. Index funds are fine but there is always a risk.


This specific issue has been discussed on the Bogleheads forum. It has nothing to do with index funds and everything to do with an investor being educated enough to know what they buying and about asset location. TDF do not belong in taxable accounts for a variety of reasons, this being one of them. Even ETFs have capital gains distributions.


Your response very much conflicts with the message I’ve seen shared over and over again by those who promote index funds. The message has been something along the lines of “index funds allows you to be a passive investor. You don’t need to research the funds. Do the three index fund approach. Put your money in the funds and sit back.”

It seems odd to me that now the promoters are saying you need to educate yourself about index funds and this happened because the investors are uneducated.
Anonymous
Post 01/26/2022 20:16     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:again, you get what you pay for..doesn't make it right, but it's true[/quote


Actually is the reverse is mostly true in investing— you get what you don’t pay for!
Anonymous
Post 01/26/2022 20:07     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
OP, are you retired? Are you saying you moved your TSP funds to Vanguard and put them in the target date funds?
Anonymous
Post 01/26/2022 20:05     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:I just think it's ridiculous OP and other are using the terms average and small investor when they have $6m. What Vanguard did is unfortunate, but chalk it up and pay your taxes, OP.


Op here....you aren't reading this right.

I don't have $6million. In fact, these target date funds are now for people with $5million or less. But, I'm talking about $1million....and yes, that does make me a "small investor" to Vanguard.


To most Americans you would be a very large investor and in fact you are a millionaire.


Big whoop.
Anonymous
Post 01/26/2022 20:00     Subject: Re:Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:
Anonymous wrote:I just think it's ridiculous OP and other are using the terms average and small investor when they have $6m. What Vanguard did is unfortunate, but chalk it up and pay your taxes, OP.


Op here....you aren't reading this right.

I don't have $6million. In fact, these target date funds are now for people with $5million or less. But, I'm talking about $1million....and yes, that does make me a "small investor" to Vanguard.


To most Americans you would be a very large investor and in fact you are a millionaire.
Anonymous
Post 01/26/2022 19:49     Subject: Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
Anonymous wrote:And you fools continue to pile into mutual funds where you know damn well this can happen


Okay we heard you 1000 times. You can rest now.
Anonymous
Post 01/26/2022 19:38     Subject: Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?
And you fools continue to pile into mutual funds where you know damn well this can happen