Vanguard Distribution Questions
 

Hi again guys.

I made a post like a year ago asking for advice here, and I really appreciated all the responses. I am planning on getting a Vanguard account within the next week or 2, looking for some advice on how to allocate my funds in a somewhat competent manner. I looked through previous posts but I think my situation might be different because I am young and can take on a little more risk than older posters preparing for retirement.

Background:

Turning 20 in 2 months

100k net worth: 20k online, 20k in a 5.5ish % CD (renewing in a week or so), 60k remaining to invest, plan is to put 50-55k of this into vanguard, saving the rest for expenses.
Income from poker is variable, if it stays legal (UIGEA ugh) my best estimate would be 10-15k/month.

College expenses should be minimal. My parents are paying for a decent amount, and I have a few scholarships to cover expenses. I think this will be 3-4k/year.

I dont have any big purchases planned real soon, maybe a house in 6 or 7 years?

I dont plan on declaring slef employment, so an IRA or whatever is out of the question (I think)

Question

I am somewhat lost on how to best distribute the 50k I plan to invest. I know each Vanguard fund has a different amount of return/risk associated with it. How much can I mess up the distribution?

An example suggestion I have seen:

30% Small Cap
25% Mid Cap
25% Large Cap
20% Total Market Index (i.e. Vanguard 500)


Sorry if this post is asking too many questions that have been asked before, I did my best to research everything but i'm still pretty lost, as there is a lot of conflicting advice.

Thanks.

Re: Vanguard Distribution Questions
 

One thing to note: Vanguard 500 and Vanguard Total Market are two different funds.

I think that my allocation is a good one:

http://forumserver.twoplustwo.com/showfl...ue#Post10119153

Re: Vanguard Distribution Questions
 

I largely mimicked the Ultimate Buy and Hold Strategy on fundadvice.com. If you are interested I posted a few times about it that I could point you to or I could attempt to answer questions.

Re: Vanguard Distribution Questions
 

I like this:

50% VTSMX (Total Stock Market)
20% VFWIX (FTSE All-world Ex-US)
20% VISVX (Small Cap Value Index)
10% VGSIX (REIT Index)

Re: Vanguard Distribution Questions
 

Should I bother with any of the "tax managed" funds? Not sure what sorts of situations merit using them.

Re: Vanguard Distribution Questions
 

[ QUOTE ]
Should I bother with any of the "tax managed" funds? Not sure what sorts of situations merit using them.

[/ QUOTE ]

Only use them IMO since the funds aren't going to be in a tax-sheltered account (probably a bad move btw).

Also, you may not get a choice with filing as recreational gambler. I'd expect you to receive a letter telling you your status has been changed with a nice shiny sum of money you now owe them.