It ' s a catch 22 or a double edged sword . It ' s crazy how we cannot see our own pitfalls sometimes because we are so wrapped in emotion and forever stuck in the role we were given as children . <| sep |> I want to open an index fund for short term corporate bonds I expect that is a bad idea , but that isn ' t what you asked about . Could I simply purchase the equivalent ETFs until I reach $ 3000 , then sell them off and open the index fund , without too much penalty ? Why would you want to switch from the ETF to the mutual fund ? A Vanguard ETF typically has the same ER as the admiral shares , so the investor shares $ 3 K minimum have higher ER . One reasonable answer might be that after switching to the mutual fund version , you can buy more in tiny amounts without worrying about whole share inconveniences . But unless you are on a very strict budget , whole share boundaries aren ' t that big a deal in a taxable account . So whole share boundaries when buying more are a pretty weak reason to switch to mutual fund , and I can ' t think of any other reason .