If you were going to purchase 4 mutual funds today

smtfx

I'm conservative but like equities so the vanguard total stock market fund is what I sink my savings into. Minimal expenses and broad exposure to the market. I don't try to time the market so it's always a good time to start a long term investment.

Second wrote:

I'm conservative but like equities so the vanguard total stock market fund is what I sink my savings into. Minimal expenses and broad exposure to the market. I don't try to time the market so it's always a good time to start a long term investment.

So as a newcomer to the investing world, I shouldn't pay too much attention to or agonize over whether we're in the midst of a bull or bear market? Or, for that matter, whether market trends are ascending or descending when I invest my money?

Sorry if my question seems glib or naive. Would you suggest I make an initial investment to vanguard index fund (the timing matters not) and then subsequent monthly contributions?

oh just keep following the system like a good little lemming!

There was a relatively well-known study down a while back which concluded that the performance of your portfolio is 96% of how well diversified and only 4% due to stock-picking and market-timing. In other words, it is futile to try to time the market or to even spend too much time on picking stocks and mutual funds but instead try to develop a very well-diversified portfolio (I would shoot for low-cost mutual funds (Vanguard (both index and low-cost actively managed) comprised of domestic small and large-cap equity, international small and large cap equity, some bond mutual funds, real estate mutual funds, and perhaps some commodity).

Do a search for David Swenson. Look at what he suggests.

But you have to determine how much risk you are willing to take, how long you plan to have the money invested, and what you want from the money - a source of income or growth.

Or pose a question with more details at

www.boggleheads.org

Terrific advice. Vanguard Funds are the lowest cost mutual funds. The Vanguard Total Stock Market Index Fund (VTSMX or VTSAX - Admiral) is about the largest equity (stock) mutual fund and tracks approximately the top 5000 USA stocks.

It is an index fund and mirrors the ups & downs of the market over time; it kicks off close to a 2% dividend per year which can be re-invested or paid out. The annual expense ratio (0.08%) on this fund is approximately $0.08 per $100 of investment. Compare with typical "managed" mutual funds around 1.42% ... or about 18 times more expensive than Vanguard.

But the key is: Vanguard meets the market. Other managed funds try to beat the market. Studies over the years show that over 80% of the funds don't beat the market each year ... those 20% that do beat the market change every year ... so how do you know which ones will perform to beat the market year after year? None do consistently.

Then you have to figure out: When to sell; then when to buy back in; then, which ones to buy in...

Keep it simple & cheap .... Vanguard Total Stock Market Index Fund.

I am actually impressed that so many in the running community pointed out the value of Vanguard Funds.

Personal Investment:

($20k) Vanguard Balanced Index Fund (60% stock 40% bonds)

($5k) Total International Stock Index

Roth IRA:

($5k) Vanguard Lifecycle 2050 (year depends on your age)