So you've been working hard to save  and is now looking to invest your  

hard earned money. But where to start? You ask your co-workers and they talk  

your ears off about cryptocurrency. You asked your brother in law  

and he says investing is tech companies  is sure way to becoming a billionaire 

You ask your mom and she says, why would  you go and do a silly thing like that? 

It's overwhelming and frustrating. You worked  hard to save your money, but don't know where  

to start when it comes to investing. What if I was to tell you that there  

is just one investment you need to  know that'll solve your dilemma. 

Hi, my name is Tae from Financial Tortoise, a channel dedicated to creating Personal  

Finance content for the Sandwich Generation. Investing feels intimating to most people.  

It conjures up images of complex financial models  and jargons that normal people don’t understand. 

Enter your solution – Vanguard’s VTSAX! When I started in my investing journey,  

I was overwhelmed by all the options out  there – How do I find the winning stock?  

Can I research the best companies  to invest in? What is a mutual fund  

and why are there so many of them?? In this video, I want to share with you  

our one stop investment – the Vanguard’s VTSAX  Index Fund that has helped us reach financial  

security and continues to grow our net worth. Before we start, I've time stamped each section,  

so if there's any part of the video that you'd  like to skip, then don't worry it's all right  

there in the description Let's get started 

Who is Vanguard? If you’ve watched any of my other videos,  

you know that I’m a big fan of Vanguard and  their products. My two primary reasons are due  

to the company’s incentive structure and their  specialization in high quality index funds. 

Mr. Jack Bogle founded Vanguard in 1975. When  he started the company he created it with a  

quite unique structure – a company that  is client owned and operated at-cost. 

What does this mean? Unique Company Structure – Most companies have  

different stakeholders that they have to serve. If it is a publicly traded company,  

it needs to serve its shareholders as well as  the customers that it sells its products to. 

If it is a private company, it needs to serve its  owner as well as its customers. It must create  

value to both groups. If things are going well,  this is not a problem. Customers get the widget  

they want at a good value and the shareholders  get the profit they’ve been expecting. 

However, when times are tough, we see the  tension that this model can create. In the  

case of investment companies, in order to create  more profit for the owner or the shareholders,  

we often see them passing those expenses  to the customers with higher fees. 

Vanguard on the other hand has a model where  because the investors of funds (the customers)  

are also the owners of Vanguard,  everyone’s interest aligns perfectly. 

Technically Vanguard is incentivized to provide  value to only ONE group of people that plays  

the role of both the customer and the owner. Pioneers of Index Fund – Vanguard is also the  

pioneer of low cost index funds. In 1976, Jack  Bogle launched the world’s first index fund,  

the S&P index, and this concept of  index fund has really taken a hold  

of mainstream investing in the last few decades. For those of you hearing about index fund for the  

first time, an index fund is an investment  that basically tracks the stock market, 

You might have heard of terms like S&P  500 or the Dow Jones Industrial Average. 

Instead of trying to pick stocks and manage  assets - the index simply tracks the stock market. 

There is minimal human element  involved, which also makes these  

investment available at a very low cost. Index funds also perform extremely well  

over time compared to actively managed funds  regardless of which asset class it is in. 

I have a video that explains why you want  to avoid financial advisors and actively  

managed funds that you can check out here. These days almost all major investment firms  

offer some variation of index  funds; Fidelity, Schwab, etc. 

However given the aligned company incentive  structure and the consistent low expense ratios,  

Vanguard is still my number one investment firm.

What is VTSAX Index Fund? VTSAX is Vanguard’s Total Stock Market Index Fund. 

Ok you are probably asking – What does that  mean?? It may sound complicated but don’t  

let fancy name intimidate you.

Just know that it is an index of every  

publicly traded company in the United States. At  the time of this video, there are approximately  

3,700 companies being represented in this fund. In essence, by purchasing a share of VTSAX  

you are essentially buying a piece of  every publicly traded company in the US. 

Ever heard of Apple, Amazon, Johnson &  Johnson? If you purchase VTSAX, you are  

essentially buying a piece of all these companies. Market, thus the Index Normally Goes Up – Since  

the recession of 2009, the market has done  fairly well. In the last 10 years, VTSAX has had  

an average return of almost 15% annually! That means that if you had invested $1,000  

ten years ago, it would have grown to over  $4,000 from just the compounding growth alone  

– 4x your original investment and you  did nothing except invest in VTSAX. 

The Fund is Self Cleansing – Because  all companies are working hard to  

create value for its shareholders, there  is endless upward potential for the stocks  

to go up. Who could have imagined Amazon or  Facebook to have gotten as big as they have? 

However, the lowest a company can go is $0. It  can’t fall any further. When a company fails, it  

will go bankrupt and disappear essentially making  its stock price $0. But there are always hundreds  

of new companies coming into take the reign. Sounds pretty awesome, don't you think? 

How many of your friends can say they own a  piece of every publicly traded company in the US  

and are able to tap into the phenomenal growth  of the stock market, to grow their wealth??

Is VTSAX Index Fund Better  Than Buying Single Stocks? 

The simple answer – YES. Jack Bogle, the founder of Vanguard  

had a great quote about beating the market. “I’ve been in the business 61 years and I  

can’t do it. I’ve never met anybody  who can do it. I’ve never met anybody  

who’s met anybody who can do it.” – Jack Bogle People naturally think they are smarter than  

they actually are. I have a big problem in this  area – and my wife has to put me in my place  

daily. God bless her. 

We think we can easily spot good  companies from the bad ones. 

We all have a friend, a relative or a neighbor  that "knows" what the best investment is 

“Oh my God, Tesla is the future! It’s  no brainer you should buy Tesla stocks!” 

But the reality is no one knows. The rising  star today could become bankrupt tomorrow  

and the struggling company today could  become the industry standard in the future. 

Anyone remember Blockbuster? Or how about Circuit  City? And people forget that Apple actually went  

through a pretty rough patch in the 90s. If you can’t pick winning stocks, the best  

bet is to bet on the whole market. Buy VTSAX and hold them forever.

Is VTSAX Index Fund Better Than  Actively Managed Mutual Funds? 

Another simple answer – YES. When you read big newspapers or  

magazines dedicated to financial advice, they  oftentimes list the ‘top mutual funds,’ or ‘the  

top performing mutual funds of the year.’ And if you read further, the article goes  

onto explain how this amazing fund  manager was able to produce ridiculous  

returns on his or her fund year after year. However, what it forgets to mention is how  

expensive these active managers are. And the  way they pay for these expensive managers are  

by charging the investor outrageous fees.

You can easily compare these  

expenses by looking at the ‘expense ratio.’ Expense ratio is the annual fee that all  

funds charge their shareholders for basic  administrative and operating expenses.  

The average expense ratio for actively managed  mutual funds ranges anywhere from 0.5% to 1.0%. 

Now compare that to VTSAX’s  expense ratio. Stunning 0.04%! 

That’s almost 10x less than the cheapest  

actively managed mutual fund. Even when  compared to other passively managed funds,  

who’s average ratio is about  0.2%, VTSAX is still 4-5x cheaper. 

When we consider the fees that these actively  managed mutual funds charge, even if they  

outperform the index by a few percentage points,  the extra expense ratio wipes out any advantage. 

In addition, I’m sure we’ve all seen tons  of ads as regards to these actively managed  

funds. But when was the last time you  saw an ad for a low cost index fund. 

I like to believe that Vanguard would rather  keep the expense to its investors low. and not  

waste its money on ads, while other companies  are spending hard earned investor money on  

promoting their funds to gain more business,  and to fund their highly paid active managers. 

Keep it simple and opt for the  best passive index fund – VTSAX.

Now that you understand why VTSAX is  the best investment vehicle out there,  

go out there and get yourself some  VTSAX and start growing your wealth! 

If you’d like to learn more about investing,  I highly encourage you to read JL Collins, the  

Simple Path to Wealth. My favorite investing book. He goes more in depth about index funds and VTSAX,  

and explains it so much better  than I did in this video.

Thank you guys for watching. If you found value from this video,  

please hit the like button, leave  a comment and subscribe to the  

channel so that you don't miss out  on any of my other upcoming videos. 

I firmly believe that being part of the Sandwich  Generation doesn't have to mean financial stress.  

With careful planning and preparation,  we can thrive during this stage of life.  

Help me spread the knowledge. Thank you again and I'll see you in my next video.