Vanguard

Vanguard offers an elite 403b that allows you to construct a fully diversified portfolio with rock bottom fees. They revolutionized the industry with the invention of the index fund and they’ve fought on behalf of investors for decades. Due to their unique history and culture, Vanguard is the only financial institution we trust to act in our best interest. As a result, there is no vendor that we endorse more strongly.

Portfolios and Fees

Three Fund Portfolio
Over 30 years the roughly 0.058% annual fee costs you 2.55% of your real profits.

  • Vanguard Total Stock Market (VTSAX)
    • 0.04% fee per year (expense ratio)
  • Vanguard Total International Stock Market (VTIAX)
    • 0.11% fee per year (expense ratio)
  • Vanguard Total Bond Market (VBTLX)
    • 0.05% fee per year (expense ratio)

One Fund Portfolio
Over 30 years the 0.11% – 0.15% annual fee costs you 4.82% – 6.54% of your real profits.

  • Vanguard Target Retirement Funds (VTTSX, VTXVX, etc)
    • 0.13% – 0.15% fee per year (expense ratio)
  • Vanguard LifeStrategy Funds (VASIX, VASGX, etc)
    • 0.11% – 0.14% fee per year (expense ratio)

Notable Fees

  • $60 per year to maintain an account.

Notes on Fee Calculations

  • Assumes a 6% market return and a 3% inflation rate.
  • Assumes the following allocation:
    • 52.5% domestic stocks.
    • 22.5% international stocks.
    • 25% bonds.
  • Ignores the flat $60 annual fee.

Sources

  • Fund information can be found here.
  • Plan information can be found here.

 

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