investornews.vanguard/our-index-funds-changed-investing-forever-now-were-making-them-even-better/
No DRIP drag, fractional shares, NAV pricing, no spread, and no trading risk. Honestly, I think the mutual fund is better than the ETF version now.
If you’re like many successful investors, you like to keep it simple. That means saving consistently in low-cost, straightforward investments like index funds. We get it. We pioneered index investing for individuals. Simplicity, transparency, and low fees are core to who we are. And we’re constantly looking for ways to build on those values.
That’s why we’re making a change.
We’re lowering costs for more than 1 million current index fund investors and giving new investors one more reason to choose Vanguard. To do that, we’re dropping the minimum investment for Admiral™ Shares on 38 index funds.
Our Admiral Shares were previously available to investors with over $10,000 per fund. Now you’ll only need $3,000 to take advantage of the low expense ratios Admiral Shares offer. In turn, we’re eliminating higher-cost Investor Shares of those same index funds for individual investors.*
What this means for you
Whether you’re just starting out, adding to your portfolio, or catching up, this change can help you:
- Reach your goals faster. Lower expense ratios mean more of your returns stay in your account, so it can grow faster. For example, $50,000 invested in Investor Shares might cost an average of $90 per year versus $55 per year in Admiral Shares. A $35 difference might not sound like much. But when it’s compounded over 10 years, it can add over $600 to your bottom line.**
- Diversify your portfolio. When choosing how to allocate your money, you’ll have more flexibility to diversify. For example, if you have $10,000 to invest, you can still put it in a single index fund. Or you can split it up into 3 different index funds and get the same low-cost benefits.
If you currently own Investor Shares of any affected funds, you don’t have to do anything. We’ll convert them to Admiral Shares over the next year. Or you can immediately and easily convert your shares using our online process.
h/t AbulaShabula