This Week's Finance Lesson: Vanguard is NOT a Vacuum Cleaner Company

I made some type of investment this week. Not really the real grown up kind, but like a savings account that does more for you than a savings account. I did it through the grown-up company Vanguard which I thought was a vacuum cleaner company until I learned they are not as I was transferring one thousand dollars to them. One thousand dollars is their minimum investment amount which is what I chose and now I have a very real fear that I’ll never again see 4 digits in my bank account balance. I was really proud of that thousand dollars. “But what about your savings?” you ask? I don’t have any. THAT’S RIGHT. I DON’T HAVE ANY SAVINGS, OK!? OK!?? Well, I have my tax refund. Which I have vowed will be the beginning of my glorious savings. People (my age) are now saying things like “well, I’m considering going on that trip but I’d hate to dip into my savings” to which I respond by nodding with a neutral face. Did someone give out a packet about this in high school that I didn’t get? Or maybe I got it and ignored it and threw it away because sometimes I do that. But I would have followed directions if I had known. I wonder when those people found out they were supposed to do that…


So anyway, I decided to open some type of investment account. Through a long series of complicated events, my roommates and I got 2 months free rent on our apartment and I was worried I wouldn’t have the discipline to save that money which lead me to try and figure out how to do this investment account thing because I heard it’s harder to get your money out quickly. I would tell you if it’s a money market or a bond or stock or ETF or a Mutual Fund or an Annuity but I can’t because I have no idea which one it is. I just learned all those word when I saw them on the website. I picked Vanguard because my Mom told me to. I thought she was silly because she meant to tell me the name of a bank but instead told me the name of that Vacuum cleaner company, but it turns out she had the right name. There were only 4 options of things with a minimum of $1,000. The rest had a minimum of $3,000 and I don’t have $3,000 so that made the process a lot easier right there. 3 of the options were “Target Retirement” options and one was a “STAR Fund”. Now it seemed like I had only 2 choices. Retirement or STAR. Retirement feels like a long way away and Star was one of the few words I recognized on the Vanguard site and I like Stars so I picked it. And gave the stars $1,000 of my dollars. And put a gold star on my mirror in my bedroom to remind myself not to forget I have $1,000 somewhere. Out of sight, out of mind, you know. So there you have it. I have an investment (fund? Account)… something. I figure worst case, it will be a really great $1,000 financial lesson.

So if you’re in the same position, wishing you had savings to “try and not dip into” … let me know. I can’t give you advice, but I have 28 gold stars left on this sticker pad if you need one as a reminder. And then I will go out for drinks with you.



Keeping you posted-

-d