[USER]

Also, are dividend ETFs best held in a Roth IRA to avoid taxes on dividends, although not liquid till 59 1/2 years of age?

TIA

[Mark]

Just pick one. Don’t get analysis paralysis. This gets asked daily. Theyre the same. Pick one and move on

[Lisa]

I actually looked into it and figured out the difference. I was confused because VTI had a slightly lower expense ratio so it didn’t make sense that folks were going for VTSAX and why it was considered admiral shares until I realized that VTSAX is significantly cheaper per share, meaning you’ll get more shares for your money and more opportunity for those shares to grow. It’s possible I’m not thinking about this correctly but it at least made enough sense for my brain!

If you have the $3000 to start it out with I’d go for VTSAX.

[Aaron]

In a Roth I’d use VTSAX because you can easily setup auto investments. Not all platforms can buy ETF’s on a scheduled basis.

It’s in a tax advantaged account so it’s not as critical to choose one over another as a brokerage account.

Anything that’s throwing off income is a consideration for a tax advantaged account. Needs to fit in with your plan. I’m not a fan of dividend investing, especially for younger investors. It limits performance over the long term and is forced taxation in a brokerage. I can see some merits once you’re in retirement.

[Lauren]

I personally prefer ETF versions for the reason you can set a buy price limit order and take advantage of intraday swings- a lot of times stocks will sell off in the am then recover a bit by the close.

With a mutual fund, you are just stuck with whatever the EOD price is.

[Jiajie]

VTSAX is a mutual fund while VTI is an ETF. Vanguard allows setting up automatic investments but only for Mutual Funds.

So I do VTSAX monthly automatically. You can’t do automatic into VTI using Vanguard.

Whichever you choose should still be into a Roth IRA to avoid taxes on dividends til you withdrawal. A regular brokerage will tax the dividends.

[Zach]

VTI because it’s easier to spell.

Using a ROTH vehicle depends on whether you think you’ll be in a higher tax bracket now or upon withdrawal. Using something like an IRA depends on your goals, but generally speaking it can be very beneficial for your income after 59 1/2.

So, like most things in life, it depends.

[Author]

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