Considerations When Choosing An Index Fund

I was bold enough to ask jlcollinsnh on his view on this whole index investing for Europeans situation. His advice can be read in the comments section right here. You can read the contents of three emails we sent each other.

His own considerations when choosing an index fund are these:

1. If you can do business with Vanguard, do so as they are the only investment company out there that puts the interests of their customers first.
2. Buy broad based index funds.
3. Costs matter hugely.
4. Keep it simple.

In our case we:

1. Do favour Vanguard indeed, after having read a lot about Vanguard and Jack Bogle. Also, the statistics don’t lie. Vanguard almost always (if not: always?) outperforms other index funds based on the same benchmark.
2. Like the idea of broad based index funds very much.
3. Are comparing costs like crazy
4. Yeah, that tends to become an issue.

We still haven’t decided on what to do. But we’re getting there.

Love,

Mrs EconoWiser

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4 thoughts on “Considerations When Choosing An Index Fund

  1. Mqrius

    I’m from the Netherlands as well, and looking into it too. Currently it looks like Binck Basic is the cheapest option, and does indeed offer the opportunity to invest in the US version of Vanguard. No yearly fees at all for Binck Basic, no fees to open an account, only transaction fees. But we’re all looking into long-term investing anyway, so they don’t matter much.

    I’ve also been looking into dividend tax (bronbelasting), and Binck taxes 15% automatically (instead of the 30% you get from US funds). This saves us the effort. This last 15% you can reclaim in box 3 on your tax form. (Do correct me if I’m wrong.)

    I’ll be able to doublecheck everything once PostNL finally delivers my documents to Binck Bank. C’mon, this is more important than christmas greetings! 🙂

    Reply
  2. Pingback: Reader Case Study: To Invest Or Not To Invest? | EconoWiser

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