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Fidelity index funds with exp ratio 0.1% or less
Old 10-14-2004, 08:42 AM   #1
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Fidelity index funds with exp ratio 0.1% or less

Anyone thought about these funds? Seems like they beat Vanguard funds expensewise.

The question for me is how can I switch from my Vanguard funds into those without suffering tax consequences. I guess I can't.

Well, I may be buying Fidelity index funds from now on.

Any thoughts?

Fund type Fidelity Vanguard ETF
S&P 500 0.1% 0.18% (SPY) 0.10%
Total Stock 0.1 0.20 (IYY) 0.20
Extended Market 0.1 0.26 (IWM) 0.20
International Idx 0.1 0.34 (EFA) 0.35

http://moneycentral.msn.com/content/P92986.asp
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 09:00 AM   #2
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Re: Fidelity index funds with exp ratio 0.1% or le

What a hoot - these are the guys who lead the campaign against index funds twenty five or so years ago. I think Johnson is still alive and kicking. After getting their worthless butt kicked for so long - I guess they decided to join the party and offer some meaningful competition. Heh, heh, heh - Fidelity isn't all THATttt! bad - but it is football season.

BTY - I have owned and do own Fidelity currently via a tiny 401k.

After all this time - 'Do you trust'em. Well do you?'.

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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 09:37 AM   #3
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Re: Fidelity index funds with exp ratio 0.1% or le

For starters, how much exactly would you be saving? Granted the fees are significantly lower on a % basis and moving from a 1-2% fund to these would help bring in the bacon...but I dont think I'd incur a capital gain I didnt want to go from .2 to .1%.

Also, vanguard will either have to show value or lower theirs as well. Or they'll lose customers.

Looks like they're going to try to show value first with their "we beat the indexes just a little bit" argument. If they're right, then I'll keep sticking with them.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 01:12 PM   #4
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Re: Fidelity index funds with exp ratio 0.1% or le

A couple of follow-up questions for Fidelity customers in the group:

--How is Fidelity when it comes to customer service? Vanguard is terrible, in my experience. Is Fidelity any better?

--Vanguard has some perks for high net-worth clients (fee waivers, etc.). Does Fidelity have something similar to Voyager/Flagship?
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 02:53 PM   #5
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Re: Fidelity index funds with exp ratio 0.1% or le

In the past Fido has offered fee waivers (ie "real" er in the prospectus is higher than the "advertised" one) I am too lazy to look this up but it might be the case this time too
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 02:54 PM   #6
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Re: Fidelity index funds with exp ratio 0.1% or le

I have had NO PROBLEM with Fidelity's customer service for years. *I do like the fact that they have offices in two cities I frequent, but their telephone and online service is excellent.

After my father died I had Mom clean out her stash of bearer bonds and stock certificates and brought her and her stash to the local Fidelity office- the fact that she could give those papers to a real person was important to her. *They have given excellent service to my mother, finding bonds to her liking. *They also follow up periodically to see if she has any needs. *Mom is not a wealthy woman, we are talking about a couple 100T. *She is now in a nursing home, Fid will call me from time to time. *

Their free retirement income planning service is OK. *They are not "financial planners" (seen similar comments about Vanguard) but they give sound general advise about managing IRA $ in retirement. *For those with little inclination to do the research the information has high value. *However, they do prefer what they know (Fidelity products).

I have no problem reaching a human on the phone. *The CSRs are well trained, efficient, and nice. *They do refer to specialists when appropriate.

The online mutual fund research isn't the best but the price is right.

Fidelity does have a "Premium Service" level. They add all the $ associated with your SSN. So Mom's $ are added to mine- I am a trustee on her living trust, my ssn is associated with both my husband's and my IRAs. It adds up.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 02:56 PM   #7
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Re: Fidelity index funds with exp ratio 0.1% or le

Quote:
A couple of follow-up questions for Fidelity customers in the group:

--How is Fidelity when it comes to customer service? Vanguard is terrible, in my experience. Is Fidelity any better?

--Vanguard has some perks for high net-worth clients (fee waivers, etc.). Does Fidelity have something similar to Voyager/Flagship?
I'm a double dipper, i.e. I have accounts at both places.

My Vanguard account is the rollover of my 403B. I have to admit, that was quite a chore, but since then I haven't had any problems. I haven't done much either though . I did at some point become qualified for Admiral status for one of my funds, which gets you lower expense ratios.

At Fidelity I have both funds and stocks. I like Fidelity 'cause I can do stuff online - including selling funds, etc. And because I am at some limit (per family I believe) I have something called Private Access. I think that means I have some specific person I can call if I want. Which I don't. The cost of selling stocks at this level is $8.95, unless the commission would put you in the negative - then it's free. I don't think there are management fees on IRAs. They do have walk-in office in several places.
http://personal.fidelity.com/global/...?quser=offices

I did hear tell that the little print in the Fidelity literature allows them to up their expense ratio in the future. I think they're try to skim from Vanguard. I've gone to some uppity-up meetings where people will ask about the Vanguard funds (which you can buy through Fidelity, I think, though they'll take their bit) and the speakers would always get testy.

Anyhoo - I like them both, and I like having money in 2 different places.

arrete
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 04:37 PM   #8
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Re: Fidelity index funds with exp ratio 0.1% or le

I just send a letter to Fidelity telling them how superior I felt their customer service is. *I had a very difficult IRA-DBA transfer from a bank to Fidelity and spend a total of hours on the phone with Fidelity customer service to help expedite the transfer. * In the course they told me that their raises in customer service are based on follow-up surveys, so if they want a raise they give good service. *I can't say enough good things about this experience. *They have won a portion of my future investments even if the rates are slightly higher.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 04:49 PM   #9
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Re: Fidelity index funds with exp ratio 0.1% or le

I've also had nothing but good experiences with Fidelity's customer service. I've done two rollovers with them - one from a 403b, one from a 401k, and in both cases they were on the ball. In fact, when the 403b rollover hit a snag (the money wasn't arriving!) they helped me figure out where in the process it had derailed so I could call up the right people and straighten it out.

I also like all their online account features (I don't want to do anything by phone or mail if I can help it) although it bugs me that their site is optimized for @^%! IE and Netscape, so I can't browse their fund selection with Mozilla Firefox. Everything else works fine though.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 06:26 PM   #10
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Re: Fidelity index funds with exp ratio 0.1% or le

Quote:
A couple of follow-up questions for Fidelity customers in the group:

--How is Fidelity when it comes to customer service? Vanguard is terrible, in my experience. Is Fidelity any better?

--Vanguard has some perks for high net-worth clients *(fee waivers, etc.). Does Fidelity have something similar to Voyager/Flagship?
I have had a Fidelity brokerage account since 1973. IMO, they are the best. There has never been a mistake. In addition, they are polite, mostly well trained, and responsive to my concerns.

As to perks, they have 3 commission tiers, Bronze, Silver and Gold. I think the floor for Gold level is US$ 1 million. This gets you rock bottom Web Trade commissions of $8 per stock trade, regardless of size. You also get a dedicated team. At a higher level, I think $3mm, you get a single broker and his/her assistants. I believe the commission structure stays the same as the Gold level. I don't qualify for this, so I can't say in detail.

I believe all investors are set up with a brokerage account, even if they only plan on mutual fund transactions. This may not be true, as I have only done very limited mutual fund investing

Their website has recently been improved, and I believe is considered one of the very best. It seems outstanding to me, but I have only used a couple of others. I formerly had 3 separate accounts at 3 brokers, but when Fidelity offered the low commissions, I consolidated there, am very happy with it.

At tax time, I had no trouble downloading accurate information into Turbo-Tax.

I have heard criticism of Fidelity, but my own experience has been excellent. And I am a sometimes difficult customer.

Mikey
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 07:12 PM   #11
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Re: Fidelity index funds with exp ratio 0.1% or le

I also endorse the positive experiences with Fidelity. I also have a small position with Vanguard who has all of my Mom's assets for who I am her Attorney in Fact.
Just today I had to call Vanguard the second but could be third time on the same issue. Vanguard seems to break down on simple administrative issues. In the most recent case I traded out of one mutual fund to a new fund. It has been over 6 months and I still can not get them to include the new position in my printed statements. They ar e always polite and appropriately concerned---just seems to take forever to get simple things fixed!
If you only are going to pick one financial entity, I would put my vote on Fidelity
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-14-2004, 11:45 PM   #12
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Re: Fidelity index funds with exp ratio 0.1% or le

Thanks for the feedback. I'm going to delve into this some more in view all of your positive experiences with Fidelity. Almost all of my appreciated assets are in retirement plans, and I should be able to transfer my brokerage accounts in-kind. If Fidelity boosts their expense ratio in a year or so, I can always switch back.

I have a folder on my drive called "Vanguard Screw-ups" which contains emails and documents regarding bungled transactions, erroneous fees, beneficiary errors, etc. It's getting huge. They require constant vigilance, and the only thing holding me at Vanguard has been their low costs. I thought maybe it was just me until someone here (Wab, I think) posted a link to the Doris Havens affidavit.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-15-2004, 05:29 AM   #13
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Re: Fidelity index funds with exp ratio 0.1% or le

I hope to get great customer service when I transfer my last Fidelity 401k to a Vanguard IRA.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-15-2004, 08:36 AM   #14
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Re: Fidelity index funds with exp ratio 0.1% or le

unclemick
Hope is a good thing. However, do not be surprised if your best service experience happens when you are transferring your account to Vanguard.
It is not the Vanguard has bad service---unless you count whether or not they do what they say they will do. The only issue I have with them is that they seem to struggle with excution items relative to administration.
Be sure to check out both websites--frankly I think Fidelity is far superior in content and useability.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-15-2004, 11:29 AM   #15
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Re: Fidelity index funds with exp ratio 0.1% or le

Hmmm - may be a Ford or Chevy kind of thing. I executed a roll over once about ten years ago and if I get around to it - may deal with both this year.

Don't use either website - do read Bogle and Berstein's.

If Fidelity had a fund I became interested in - wouldn't hesitate to use them - although for the life of me, I can't imagine why. But - never say never.
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Re: Fidelity index funds with exp ratio 0.1% or le
Old 10-15-2004, 05:17 PM   #16
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Re: Fidelity index funds with exp ratio 0.1% or le

I havent had a lick of trouble with vanguards customer service.

Their web site does stink though. Its quite functional, but its very hard to understand.

For example, they call everything an "account". As far as I'm concerned, I have one "account" with a company. They insisted on calling every fund an "account", so the first time I tried to open a new fund online, I got into a loop where it kept asking me "do you want to open a new account" and I kept saying "NO! I want to add a fund!".

When you open a new fund, there is no option to open it and fund it with an EFT. But you can open it, say you're going to send in a check, do a "buy" via EFT, and then never send in a check. This appears to work great.

Since I just got married, I wanted to "joint" all of my accounts with my wife. The online wizard dutifully led me to the forms to joint a brokerage account, which I have with a zero dollar balance...but did nothing for my taxable non-retirement fund accounts...which is the part I *did* want to joint.

Further, they have some weird disjointed set of restrictions where you can do 90% of a lot of things online, but something somewhere that requires printing something out and mailing it in always comes up.

For example, when I wanted to designate beneficiaries, I had to print, fill out and mail a form. Subsequently, they refused to allow me to perform online transactions on accounts that had beneficiaries specified. I was able to change or remove beneficiaries online, but once removed I have to print, fill out and mail another form to put the same people back on. Probably some dumb law or rule.
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