Navigating the Vanguard Universe: VT, VTI, and VXUS—Which Is Right for You?

In the realm of investing, the brand ‘Vanguard’ has become synonymous with low-cost, high-quality index funds. Their offerings like VT, VTI, and VXUS have gained almost cult-like followings among passive investors. Yet, despite the fame of these funds, they serve different investment goals, and understanding these distinctions can be pivotal in sculpting your portfolio.

The Funds Unpacked

Before diving into the pros and cons, let’s decode what these acronyms stand for.

  • VT: Vanguard Total World Stock ETF
  • VTI: Vanguard Total Stock Market ETF
  • VXUS: Vanguard Total International Stock ETF

What Do They Invest In?

  • VT: A one-stop-shop for global equity exposure. VT encapsulates the entire world’s stock markets, including the U.S. and international equities.
  • VTI: This ETF focuses on the U.S. stock market from large-cap to small-cap companies. Think of it as a snapshot of Wall Street.
  • VXUS: This fund is the international counterpart to VTI, offering exposure to all countries except the United States.

Risk and Return: Diversification Matters

  • VT: Since VT combines both U.S. and global markets, it’s like having a bit of VTI and VXUS in one package. It’s diversified but still subject to the whims of global economics.
  • VTI: U.S.-centric, which means it’s a little more volatile than a global mix but also reaps the benefits of a strong U.S. market.
  • VXUS: Risk and returns can vary based on global market conditions, but having international exposure can hedge against a downturn in the U.S. market.

Cost Considerations

All three funds are relatively cost-efficient, but there are slight variations in their expense ratios. At the time of this writing, VTI had an expense ratio of 0.03%, VXUS was at 0.07%, and VT was at 0.07%. While these differences may seem minor, they can add up in the long run, especially for larger portfolios.

Tax Efficiency

Tax laws can be labyrinthine, and I’m no tax advisor, but broadly speaking, all three funds are fairly tax-efficient due to their ETF structure. However, owning international stocks (as in VT and VXUS) can lead to foreign tax withholding, which might impact your returns.

Why Pick One Over the Other?

  • Simplicity: If you want to set it and forget it, VT offers a one-stop solution for global equity exposure.
  • Geographic Preference: If you have a bullish outlook on the U.S., VTI is your guy. If you’re looking to diversify away from Uncle Sam, say hello to VXUS.
  • Customization: Want to tailor your U.S. to international ratio? Combining VTI and VXUS gives you that flexibility.
  • Cost: If you’re a stickler for fees, VTI has the lowest expense ratio.


Your investment choice between VT, VTI, and VXUS should align with your risk tolerance, investment goals, and belief in the future performance of global vs. U.S. markets. While each fund offers its own set of advantages, the right choice for you might even be a blend of these options. As always, consult a financial advisor for personalized advice tailored to your unique financial situation.

More Articles to Prop Up Your Financial Health

Tax Loss Harvesting: A Strategy for Maximizing Your Investment Potential

Tax loss harvesting is an investment strategy that can help investors minimize their capital gains tax liability and ultimately achieve their financial goals more effectively. By understanding the concept of tax loss harvesting and implementing it in a strategic manner, investors can save thousands of dollars in taxes, allowing them to redirect those funds towards their long-term financial objectives.

Before we go any further you have to understand some basic concepts…

What is a capital loss? A capital loss occurs when you sell any asset (ie: stock, ETF, mutual fund, etc.) at a loss. In other words you read the tea leaves wrong, or the monkey threw the dart poorly, or whatever metaphor you want to use, and now you are paying the price.

What is a capital gain? A capital gain occurs when you sell an asset for a gain. In other words you buy something and it goes up in value. Don’t think for a minute that you get to keep all that gravy… Uncle Sam wants his share of the “gained” money. This is what a capital gains tax is! As Benny Franklin said, “there are two certainties in life: death and taxes.”

With that understanding we can discuss tax loss harvesting. At its core, tax loss harvesting involves selling an underperforming investment at a loss and using that loss to offset capital gains realized from other investments. This process can help to reduce an investor’s overall tax burden, as capital gains taxes are only applied to the net gains after accounting for the losses. In other words, tax loss harvesting allows investors to turn an unfortunate situation, such as a declining stock value, into a financial advantage.

Step-by-step explanation of how tax loss harvesting works:

  • Identify underperforming investments: Review your investment portfolio and pinpoint any assets that have experienced a decline in value. These losses may be eligible for tax loss harvesting.
  • Sell the underperforming investment: By selling the investment at a loss, you can now use that loss to offset capital gains realized from other investments, effectively reducing your overall tax burden.
  • Reinvest the proceeds: It is important to reinvest the proceeds from the sale of the underperforming investment into a similar, but not identical, asset. This is to avoid the “wash-sale rule,” which prevents investors from claiming a tax loss if they repurchase the same or a substantially similar investment within 30 days before or after the sale. By reinvesting the proceeds, you can maintain your desired asset allocation and continue to work towards your financial goals.
  • Report the loss on your tax return: When filing your taxes, you will need to report the capital loss from the sold investment. This loss can be used to offset capital gains from other investments, reducing your overall tax liability.

Let’s work through this in a hypothetical scenario…

Joe has a stock that he bought for $100. The stock plummets to 1 dollar representing a loss of $99 and his wife is pissed. He sells the stock taking it on the chin like a man. Fortunately, he bought another stock for $100 and the stock increased in value to $199. He sold that stock and netted a profit of $99 so his wife is not nearly as pissed now. He now has a net loss of $99 and a net gain of $99 meaning he owes NO taxes on the gains from the winning stock.

However, had he not sold the losing stock and instead only sold the winning stock he would owe capital gains on the $99 win. In a perfect world he would reinvest that one dollar on the losing stock into another stock and watch it ride the market back up (assuming he is good at picking stocks, which his wife is not so sure of yet). If he is not good at picking stocks, and most people are not, he should read our article on the wisdom of the Bogleheads.

Tax loss harvesting is what large corporations do to minimize their tax burdens for years potentially. This is why some companies have almost zero tax burden in some years because they are using losses from prior years to offset gains from current years. Donald Trump, love him or hate him, used this to his advantage very well.

Stamp Act and Taxation
Just a Little History Bomb on Taxation (Stamp Act of 1765)

If you had a particularly horrendous year in the stock market and your wife is now contemplating divorce, you can say, “hey babe, I can use some of these losses against our earned income taxes.” It may not keep her from divorcing you, but, hey, at least you tried. Please note that only $3000 per year of capital losses can be deducted against ordinary income. The nice thing is that remaining losses can be held over to the subsequent tax years in perpetuity.

It’s important to note that tax loss harvesting is most effective for investors with taxable investment accounts, as tax-advantaged accounts, such as 401(k)s and IRAs, have different tax treatment rules. Moreover, tax loss harvesting is subject to certain limitations, such as the annual $3,000 limit on net capital losses that can be deducted against ordinary income.

In conclusion, tax loss harvesting is a valuable strategy for investors seeking to minimize their capital gains tax liability and maximize their investment potential. By implementing tax loss harvesting in a thoughtful and strategic manner, investors can leverage their losses to achieve their long-term financial goals more effectively. As always, it is advisable to consult with a financial advisor or tax professional to ensure you are implementing this strategy in a manner that is compliant with tax regulations and aligned with your specific financial situation.

More Financial Advise to (Hopefully) Keep Your Wife Happy…

Gold: The Ageless Asset Class That Glitters Through Time

When it comes to investing, gold has been the ultimate “bling” for centuries, dazzling investors with its enduring appeal and ability to retain value. As an asset class, gold has withstood the test of time, outshining many a fad investment that has come and gone. In this article, we’ll delve into the golden world of this precious metal, exploring its unique qualities as an asset class and why it continues to captivate investors – and let’s be honest, who doesn’t love a bit of sparkle in their life?

Gold as an Asset Class: A Shining Star

Gold has several unique characteristics that set it apart from other asset classes and contribute to its reputation as a store of value:

  • Tangible: Unlike stocks or bonds, gold is a tangible asset that you can hold in your hand – or wear on your finger, if you’re feeling particularly fancy. This physicality offers a sense of security and permanence that many investors find appealing.
  • Finite Supply: Gold is a finite resource, with limited quantities available on Earth. This scarcity helps maintain its value over time, as the saying goes, “You can’t print more gold.” Unless, of course, you’ve discovered the secret to alchemy, in which case, please share your secrets!
  • Inflation Hedge: Gold has historically been seen as a hedge against inflation, as its value often rises when the purchasing power of currency declines. This makes it an attractive option for investors looking to protect their wealth from the eroding effects of inflation – or simply those who prefer their assets to glitter.
  • Diversification: Gold often moves independently of other asset classes, such as stocks and bonds, making it an excellent diversification tool for investors looking to spread their risk. After all, you know what they say: don’t put all your eggs in one basket – unless that basket is made of gold, of course!

Why Gold Has Stood the Test of Time

Gold’s enduring appeal as a store of value can be attributed to several factors:

  • Historical Significance: Gold has been highly valued by civilizations throughout history, used as a form of currency, a symbol of wealth, and even a means of adorning one’s teeth (looking at you, ancient Mayans). This long-standing cultural significance has ingrained gold in our collective psyche as a symbol of value and prestige.
  • Psychological Appeal: There’s something undeniably alluring about gold – perhaps it’s the way it catches the light or the satisfying weight of a gold bar in your hand. Whatever the reason, gold has a psychological appeal that captures our imagination and makes it an attractive investment option.
  • Resilience: Gold has proven to be a resilient store of value, maintaining its worth through times of economic uncertainty, geopolitical upheaval, and even zombie apocalypses (probably). This resilience is one of the primary reasons gold has stood the test of time as an asset class.

It is important to note that investing in gold does not mean you have to go out and buy gold bars or coins (although you can if you want, just make sure you have a safe hiding place for it). There are alternatives such as ETFs that track the price of gold or companies that mine gold. These alternatives allow you to reap some of the investment benefits of gold without actually having to physically hold and store it.

When it comes to investing, gold truly is the timeless classic that never goes out of style. As an asset class, it offers unique qualities that make it an attractive store of value and a means of diversifying one’s portfolio. While other investments may come and go, gold will likely continue to captivate investors with its enduring appeal and sparkling performance. So, next time you’re considering where to invest, remember: all that glitters may not be gold, but gold will always glitter!

More Interesting Reading on Wealth

Tamatoa the Crab: What a Disney Character Can Teach Us About Fulfillment

Tamatoa is a character from the Disney movie Moana. He is better known as the giant crab who lives in Lalotai, the realm of monsters. Tamatoa is known for his love of treasure and his massive collection of shiny objects. He sings a song called “Shiny” in which he boasts about his love for all things glittery and flashy.

Tamatoa’s love of shiny things can be seen as a metaphor for the human tendency to be attracted to external appearances and superficial qualities, rather than focusing on the more important aspects of life. Just as Tamatoa is obsessed with collecting shiny objects, many people become obsessed with accumulating material possessions, wealth, or social status, often at the expense of neglecting their relationships, personal growth, and inner fulfillment.

This emphasis on superficiality and external validation can lead to a sense of emptiness and dissatisfaction, as people realize that the things they thought would bring them happiness and fulfillment do not actually fulfill them. I myself am guilty of this phenomenon (damn you Amazon and Facebook for making it so easy!). Keeping up with the Jones’ is a very real problem that if left unchecked can really cause emotional and financial harm. In contrast, focusing on the more important aspects of life such as personal growth, relationships, and inner fulfillment can bring a deeper sense of satisfaction and contentment. And as a bonus, these things are often much cheaper financially and pay much larger dividends over the long term.

Furthermore, Tamatoa’s love of shiny objects can also be seen as a warning against becoming too attached to material possessions. Just as Tamatoa becomes so focused on his collection of shiny objects that he loses sight of everything else, people can become so attached to their possessions that they forget about the more important things in life. In fact, it is this attachment to shiny things that allow Moana and Maui to escape his grip

In summary, Tamatoa’s love of shiny things can remind us to focus on the more important aspects of life, such as personal growth, relationships, and inner fulfillment, and to avoid becoming too attached to material possessions.

Other Rockin’ Articles

Jack Bogle with Stacks of Money

Financial Stability Using the Wisdom of the Bogleheads

The Boglehead’s philosophy is named after John C. Bogle, the founder of Vanguard and a pioneer of low-cost index investing. If you follow the Boglehead reddit group you will find that many people are die hard fans of the vision of Vanguard’s founder. Bogleheads believe in following a simple and disciplined investment strategy to achieve their financial goals. Here’s how the wisdom of Bogleheads can help you achieve financial stability:

  • Start early: Compound interest is your friend… I repeat, compounding interest is your friend! Albert Einstein famously said, “compounding interest is the 8th wonder of the world” (in actuality there is no evidence that he actually said this, but it certainly may be true). By investing early, you can allow your investments to grow over time and use compounding interest to your advantage. Compounding occurs when the money you earn in interest also starts earning interest. This can be an extremely powerful force for wealth generation over the long-haul.
  • Focus on low-cost index funds: Bogle believed that low-cost index funds are the best way for the average investor to achieve their financial goals. Index funds provide broad market exposure and reduce the risk of investing by avoiding the need to pick individual stocks. Historically even highly experienced investment “professionals” rarely beat the return of the various stock indices!
  • Diversify your portfolio: Diversification is key to reducing risk and achieving financial goals. The Bogleheads recommend investing in a mix of stocks, bonds, and other assets in order to diversify your portfolio and reduce risk. The old adage of “never put all your eggs in one basket” is an important part of smart investing.
  • Avoid trying to time the market: The Bogleheads believe that trying to time the market is a losing game. They advise investors to focus on the long-term potential of their investments and not react to short-term market fluctuations. As frequently mentioned by die-hard Bogleheads – “time in the market always beats timing the market”.
  • Be patient: The Bogleheads emphasize the importance of patience in achieving financial goals. To be a Boglehead you have to have a reasonably long time horizon. The idea of “quick money” doesn’t exist in the lexicon of a true Boglehead, which brings us to…
  • Avoid chasing high-yield investments: The Bogleheads warn against chasing high-yield investments, which often come with high risk. They advise investors to focus on low-cost index funds that provide broad market exposure and reduce risk.
  • Rebalance your portfolio regularly: Regular rebalancing is a key component of the Bogleheads investment strategy. By rebalancing your portfolio, you can ensure that your investments remain in line with your financial goals and risk tolerance.

By following the wisdom of the Bogleheads, individuals can take control of their finances and achieve their financial goals. Whether you are just starting out or you have been investing for years, this philosophy provides valuable insights that can help you make informed decisions and achieve your financial goals.

***The is not a financial advisor so use this information at your own success or peril!***

Make That Money… More Articles on Financial Success

Building Wealth with Benjamin (Franklin that is)…

Benjamin Franklin was not only a founding father of the United States, but he was also an accomplished author, inventor, and diplomat. He is also remembered for his financial acumen. In this article, we will draw on Franklin’s wisdom to provide practical tips for achieving financial success.

  1. Develop a frugal lifestyle

One of Franklin’s most famous sayings is, “A penny saved is a penny earned.” He was a firm believer in living a frugal lifestyle. This means avoiding wasteful spending and being mindful of where each dollar (or cent for that matter) goes. Living within your means, avoiding debt, and making smart spending decisions are paramount to financial success.

  1. Make a budget and stick to it

Another key to financial success is to create a budget, and more importantly, stick to it! A budget helps ensure you are living within your means; it can also help you identify areas where you can cut back on spending. Franklin was known for his meticulous record-keeping; he kept detailed records of his income and expenses. By doing the same, you can gain a better understanding of your finances and make informed decisions about your spending habits.

  1. Invest wisely

Franklin was a savvy investor, and he believed in the power of compound interest. He famously said, “Money makes money. And the money that money makes, makes money.” To achieve financial success, it is important to invest wisely, whether it is in stocks, real estate, or other assets. It is also important to start investing early, as the earlier you start, the more time your investments have to grow. Remember that, almost invariably, time in the market beats timing the market.

“If you would know the value of money, go and try to borrow some; for he that goes a borrowing, goes a sorrowing.” – Ben Franklin

  1. Pursue multiple streams of income

Franklin believed in the importance of pursuing multiple streams of income. He was an accomplished author, inventor, and diplomat, and he leveraged his talents to create a diverse portfolio of income streams. To achieve financial success, it is important to find ways to diversify your income, whether it is through a side hustle, freelance work, or passive income streams.

  1. Cultivate a growth mindset

Finally, Franklin believed in the power of a growth mindset. He was a lifelong learner, and he believed that anyone could achieve success if they were willing to put in the effort. Learn new skills, take risks, and persist in the face of challenges; the more skills and knowledge you have the better equipped you are to take advantage of opportunities.

Benjamin Franklin’s wisdom on financial success is still relevant today. By living a frugal lifestyle, making a budget, investing wisely, pursuing multiple streams of income, and cultivating a growth mindset, anyone can achieve financial success. The key is to be disciplined, patient, and willing to put in the effort to achieve your financial goals.

More Great Content Below…