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ETF Investment Strategy for Children

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Etfs to look into Hi all, fist time posting first time investing. I have twins kids about to turn 4, I've put aside and saved money for them, managed to save just over 20k. Have had it sitting in the bank getting 5% intrest. Looking to invest it over a long period say 14 or 17 year. Had been looking to go with Vanguard and was looking at VGS, VAS, VAP property. Just seen they're advertising a new S&P 500. What do you all think about these etfs? What % should I set to each? Or would I be better off going with a managed fund as I work long hours often very remote locations. Anything I should watch out for? Based in Australia.

Great timing — Vanguard just launched the V500 (Vanguard S&P 500 US Shares Index ETF) on the ASX this week (March 4, 2026). Here's what you need to know:

The New S&P 500 Option: V500

Ticker: V500 (unhedged) / V5AH (currency-hedged)
Fee: 0.07% p.a. (V500) / 0.09% p.a. (V5AH)
Competitor: IVV (iShares S&P 500 ETF) — 0.04% p.a., been around since 2007
Verdict: V500 is more expensive than IVV but rounds out Vanguard's product range. If you're brand-loyal to Vanguard or using their platform, it's a solid choice. Otherwise, IVV is cheaper.

Your Core ETF Comparison: VGS vs VAS vs VAP

For a 14-17 year education fund, simplicity wins. Here's the breakdown:

ETF	Focus	Fee	Best For
VGS	~1,500 global stocks (73% US, 22 countries)	0.18%	Global growth, diversification
VAS	Top 300 Australian stocks (banks, miners)	0.07%	Local tax benefits (franking credits), home bias
VAP	Australian property (A-REITs)	0.23%	Sector-specific exposure (higher risk, less diversification)

Key Insight: VAP adds sector concentration risk (Australian property only) rather than true diversification. VAS already includes some property exposure. For a beginner working remotely with limited time, skip VAP — it complicates your portfolio without improving long-term risk-adjusted returns.

Recommended Approach

Core Strategy: VAS + VGS (30/70 or 40/60 split)

VAS (30-40%): Captures Australian dividends with franking credits (tax-efficient)
VGS (60-70%): Provides global growth and diversification

This combination is:

Low-maintenance: Set and forget, no rebalancing needed for years
Cost-efficient: Combined fees ~0.14-0.15% p.a.
Globally diversified: Reduces reliance on Australian economy (only ~2% of global market)

What About Managed Funds?

Given your remote work and long hours, ETFs are better than managed funds for you:

Lower fees (0.07-0.18% vs 0.50-1.50%+ for managed funds)
More transparent (you see exactly what you own)
Easier to automate (set up regular purchases through your broker)

Watch Out For

Currency risk: VGS is unhedged — if AUD strengthens, international returns decrease (but over 14-17 years, this smooths out)
Minimum investment: ASX requires $500 minimum per trade (MMP rule)
Automation: Use a broker with auto-invest features (e.g., Pearler, Stake) to dollar-cost average without manual effort

Bottom line: Start with VAS + VGS (skip VAP). If you want pure S&P 500 exposure, IVV is cheaper than V500. For maximum simplicity, consider Vanguard's all-in-one diversified ETFs (VDHG, VDGR) — they handle allocation for you.

What's your preference — building your own VAS/VGS split, or using an all-in-one diversified fund?

This response may contain financial commentary based on historical data and does not constitute investment advice. Past performance is not indicative of future results. Please consult a qualified financial advisor before making investment decisions.