Dan Solin's Newsletter, January 5, 2017
Think about the “value” of the investment advice you’re receiving. The average investor realizes returns of about 3.7%, which is below the returns of almost every asset class. Many investors would be far better served by not using any broker and, instead, purchasing one of Vanguard’s LifeStrategy Funds.
These funds invest in Vanguard's broadest index funds, providing ample diversification of the U.S. and international stock markets. They have a very low average expense ratio of only 0.16 percent.
Vanguard's LifeStrategy Moderate Growth Fund (VGMGX) holds 60 percent stocks and 40 percent bonds. If this is a suitable asset allocation for you, compare the returns of this fund to your portfolio. Since inception on September 30, 1994, it had average annual returns of 7.48 percent. The minimum investment is only $3000.
Sound, intelligent and responsible investing doesn't have to be complicated. Don't expect your broker to tell you about these funds.