Leaving Vanguard ASAP

Major Tom said:
That wasn't the point I was trying to make. Referring to them (or thinking of them) as "Jesus" , is obviously an extreme and unrealistic characterization. In the same way, so is referring to them as a nickel and dime store.
Click to expand...

It is someone's opinion, they have the right to that, right? :confused: It is ok to be a fan of VG and an investor of VG, but folks should be a little less prickly, as even they make mistakes..........and piss people off, and don't do what they say, noone's perfect, not even VG.........;)
 
I don't think they walk on water... so no Jesus complex for me to worry about....

BUT, the do offer some very low cost funds that nobody else seem to want to offer (except the Spartan funds at FIDO)...

One of the other things that I also like is they seem to invest in what they say the fund is about... I remember having some money in FIDO way back when in the asset allocation fund... there was a big loss that did not make much sense at the time... learned later that the fund manager made a big play on Mexican pesoes at the wrong time... since the AA fund was not supposed to be international.... I was wondering why they were playing in Mexico.... I have heard this was fixed, but who knows for sure...

And how many funds got caught up in the selling to brokers after close? Or some other funny thing that helped the investment company at the expense of the investors... so far I have not heard any of this kind of stuff happening at VG.... maybe you can share something:confused:

I do have funds in FIDO, but not that much (current company 401).... and I am not negative to them.... I just think they charge to much....
 
What pisses me off is after I read my first investment book and found out what my broker was up to. Now that pisses me off!

Vanguard may make a few mistakes here and there but it's the best alternative out there, at least IMHO.
 
FinanceDude said:
It is quite simple really, makes perfect sense. Vanguard holds VERY LITTLE cash in reserve for redemptions. Since VG is a passive investment company, they want folks to invest and stay in the funds. Most fund managers keept 3-5% in cash for redemptions, VG is more like 1% or so. Just a different way of doing things......I got that from a VG manager who was at a meeting I went to, he was talking about their ETF portfolios, but was asked about it at a Q&A........
Click to expand...

Ah, so allowing frequent deposits after a withdrawal has been made (withdrawals are not restricted, by the way, which is interesting if they don't have the cash on hand to honor redemptions) might disrupt Vanguard's management strategy? Oh, wait, that's what Vanguard said was the reason, wasn't it? ......;)
 
73ss454 said:
Would you believe Moses?:)
Click to expand...

Isn't he the guy who manages VG's Wellesley funds? (ps - that was a joke)

+1 for the folks who are infrequent traders and don't mind at all the frequent trading restrictions.

As well as VG, we also have a large chunk in Fidelity with all of DW's IRA's and like them as a company to deal with as well. They certainly made the process of her 401k rollover very easy, and their Spartan funds have nice low costs.
 
FinanceDude said:
It is someone's opinion, they have the right to that, right? :confused: It is ok to be a fan of VG and an investor of VG, but folks should be a little less prickly, as even they make mistakes..........and piss people off, and don't do what they say, noone's perfect, not even VG.........;)
Click to expand...

Of course he's welcome to his opinion. I disagreed with his characterization of VG, that's all.
 
Major Tom said:
+1

Also, how seriously can you take a post in which the OP calls Vanguard "a nickel and dime store"?
Click to expand...

13 months ago I rolled $90K into VG and they put it in the current MM fund which they said was my MM sweep acct. The next week I bought $20K each of GNMA, and 2 other funds, leaving $30K still in the MM fund.

So a total of 3 transactions in 13 months. All buys into their funds. Now I want to unload the GNMA before I have no gain and I cannot do it in 1 transaction.

I think 'Nickel and Dime' is an understatement considering they will let me take $20K from the fund 3 times, but will come up with stupid gimmicks to thwart my redemption. VG is OK, if you still follow buy and hold, i.e. ride em up and ride em down, but I take my finances a little more 'seriously' and prefer a positive return on my money.
 
jayc said:
13 months ago I rolled $90K into VG and they put it in the current MM fund which they said was my MM sweep acct. The next week I bought $20K each of GNMA, and 2 other funds, leaving $30K still in the MM fund.

So a total of 3 transactions in 13 months. All buys into their funds. Now I want to unload the GNMA before I have no gain and I cannot do it in 1 transaction.

I think 'Nickel and Dime' is an understatement considering they will let me take $20K from the fund 3 times, but will come up with stupid gimmicks to thwart my redemption. VG is OK, if you still follow buy and hold, i.e. ride em up and ride em down, but I take my finances a little more 'seriously' and prefer a positive return on my money.
Click to expand...
Which MM fund is this? They have a number of alternatives, some of which are no longer open. If you were to change MM funds would the same restriction exist?
 
You probably should move to another firm because you won't ever be happy with VG now, it sounds like. If I were you, I would want to understand from VG exactly why I couldn't move the proceeds of the GNMA into the MM fund so it doesn't happen again at another firm which might also have restrictions.

-It sounds like there is a maximum of $40K that you could have in the MM account and you still had $30K in it. Which MM account is that?
-You could redeem all of the GNMA but put only $10K into the current MM fund and VG wants to put the rest of the GNMA into a different MM fund for you. Which MM do they want to use now?
-You said earlier that initially VG picked the original MM fund. Did they not give you information about it and did you not approve it?
 
MichaelB said:
Which MM fund is this? They have a number of alternatives, some of which are no longer open. If you were to change MM funds would the same restriction exist?
Click to expand...

Federal something. The first tier rep I talked too would not make a suggestion. I have not researched another selection but other members have said there are others with no restrictions.

Thanks to all who made suggestions and did the trial transaction on GNMA.
 
This link will take you to a list of all Vanguard funds. The money market funds are listed first and you will see which are closed (the first two) and which are available without restriction.
 
jayc said:
VG is OK, if you still follow buy and hold, i.e. ride em up and ride em down, but I take my finances a little more 'seriously' and prefer a positive return on my money.
Click to expand...

You definitely want to find a different broker, VG rules will inhibit you from timing the market. They do it on purpose so I'm unclear why you invested with them in the first place.

DD
 
Last edited:
jayc said:
13 months ago I rolled $90K into VG and they put it in the current MM fund which they said was my MM sweep acct. The next week I bought $20K each of GNMA, and 2 other funds, leaving $30K still in the MM fund.

So a total of 3 transactions in 13 months. All buys into their funds. Now I want to unload the GNMA before I have no gain and I cannot do it in 1 transaction.

I think 'Nickel and Dime' is an understatement considering they will let me take $20K from the fund 3 times, but will come up with stupid gimmicks to thwart my redemption. VG is OK, if you still follow buy and hold, i.e. ride em up and ride em down, but I take my finances a little more 'seriously' and prefer a positive return on my money.
Click to expand...



It would be interesting to know the MM fund so people here can see what it says....

There is NO restriction on you moving your money OUT of the fund you want to sell... NONE... the restriction (now that we have fleshed it out) is on BUYING into a fund... many funds have buying restrictions... that is why you have to decide if you want to sell that fund....

As an example... I have money in Primecap... it has a buy restriction... I think $25K a year... I have over $100K in there... I can sell that $100K right now... the problem is if I want to get back in... first, if I got the account down to zero I will not be able to invest in the fund until it opens again (my account would be 'closed')... but if I went down to $1,000... I could start to invest into that fund but only $25K this year... so it would take me 4 years to get back to where I am now...

It is all spelled out on their site... when I sold some of Primecap a few months ago... it told me that I would not be able to buy any for 90 days and that my annual limit was $25K... I bet when you sold your MM, it gave you a warning... you might not remember or might have ignored it... but I have seen them enough to know you are warned...


No big deal to me... I could care less if you stay or go.... just saying that it is not a 'nickel and dime' organization...
 
I can understand your frustration jayc. In retrospect, I shouldn't have jumped on you for the nickel and dime comment; it led to a series of exchanges in this thread that were counter-productive.

I notice that you mentioned talking to a VG rep on the phone. Have you asked them why you weren't allowed to make that final transaction? Although at this point it's pretty obvious that VG is not the broker for you, it would be instructive to understand the exact reason. I would have thought that they could answer that question for you.

Good luck with your next broker; I'm assuming you'll be looking for another one pretty soon.
 
jayc, like others are suggesting, you might be better served with a different brokerage firm/mutual fund provider. Fidelity and Schwab seem commonly recommended, and I can personally recommend Fidelity. You can buy (and sell) Vanguard's Exchange Traded Funds which are available for most of their mutual fund options. Just pay a small commission each time (under $10 usually) and trade as often as you want.

If you continue to buy mutual funds direct from Vanguard, be very careful of the trading restrictions and early redemption fees. Some will charge a percent if you sell the funds within one to five years. Not a big deal for most investors that are holding long term, but it can be a big deal if you want to sell more often. Even long term buy and hold investors may want to sell more often than every 5 years to take advantage of tax loss harvesting.
 
jayc, I think I see what you are talking about on my accounts. I have the VG Admiral Treasury MM fund and the VG Federal Money Market Fund. I tried buying more than $10,000 in each of these funds, and it does not allow me to do so, stating that there is a $10,000 purchase limit per fund per day.

The solution is to open the "VG Prime Money Market fund" and you can make unlimited purchases in that fund. It yields more than the other MM funds anyway (by a few basis points).

Another thing to point out, and something that took me a while to wrap my head around. Vanguard doesn't have a "sweep" account in their mutual fund accounts. There are only specific money market funds that are basically cash accounts. But you have to think of them as just another mutual fund in your account. When you sell something and put the proceeds into your cash account, you are actually "exchanging" shares of the fund you are selling for shares of the money market fund you are putting the sales proceeds into. It's a little complicated since it is different from how most other brokerage accounts do it.
 
FUEGO said:
jayc, I think I see what you are talking about on my accounts. I have the VG Admiral Treasury MM fund and the VG Federal Money Market Fund. I tried buying more than $10,000 in each of these funds, and it does not allow me to do so, stating that there is a $10,000 purchase limit per fund per day.

The solution is to open the "VG Prime Money Market fund" and you can make unlimited purchases in that fund. It yields more than the other MM funds anyway (by a few basis points).

Another thing to point out, and something that took me a while to wrap my head around. Vanguard doesn't have a "sweep" account in their mutual fund accounts. There are only specific money market funds that are basically cash accounts. But you have to think of them as just another mutual fund in your account. When you sell something and put the proceeds into your cash account, you are actually "exchanging" shares of the fund you are selling for shares of the money market fund you are putting the sales proceeds into. It's a little complicated since it is different from how most other brokerage accounts do it.
Click to expand...


That is why I asked if he had a brokerage account... if you do there IS a sweep account...

Also, if you do not reinvest dividends, you can think of the MM account as a sweep...
 
I have my dividends and sales going directly into Vanguard's Prime Money Market (VMMXX) and have never had the problems the OP raised. I rolled a lot of money through it last year when I consolidated my inheritance and never had any restrictions. There is a minimum $3K investment in this but my IRA account only has ~$1.2K in the money market so it must be less for IRA accounts.

I kind of vaguelly remember that I had to select a MM account to sweep my brokerage accounts into when I set them up and that there was a Federal MM as one of the options. But that was many years ago. I can't remember why I picked Prime MM at the time but it seems to be more flexible.

To the OP: Its a shame that the Vanguard rep didn't really understand what you were trying to do or explain your options well. It looks like you locked into trying to exchange your original shares for your Federal MM and weren't allowed to do that because of limits on the closed MM fund. If you had understood that this was the problem, you could have just elected to open a new Prime Money market fund & exchange for that & we would never have had this discussion.

Lorne
 
DblDoc said:
You definitely want to find a different broker, VG rules will inhibit you from timing the market. They do it on purpose so I'm unclear why you invested with them in the first place.

DD
Click to expand...

I did not think one sell in 12 months would be considered timing the market.

Is it like Hotel California, you can check in but never check out. :(
 
You must log in or register to reply here.

Similar threads

K
Another Vanguard Rant
2 3 4
Replies
97
Views
7K
MarieIG
M
D
How to deal with taxable holdings with large gains
Replies
20
Views
1K
Texas Proud
T
arch57
Individual Mutual funds to broker account
Replies
5
Views
298
pb4uski
pb4uski
Midpack
Vanguard PAS $
Replies
8
Views
616
Koolau
Koolau
T
Hedgefundie's portfolio
Replies
9
Views
1K
Texas Proud
T

Latest posts

Back
Top Bottom