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Putting all your eggs in one brokerage firm
Old 07-16-2005, 04:24 PM   #1
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Putting all your eggs in one brokerage firm

I currently have about half of my non-retirement assets in a Charles Schwab account and the other half is in a Vanguard account. I would really like to consolidate the two accounts so that I only have one statement to look at each month, and one website to log into to view all my assets. I plan on using Vanguard for almost everything. I also have my Roth IRA with Vanguard. Is there any risk for me in doing this? If Vanguard goes bankrupt, do I lose all of my stock holdings and IRA holdings?

P.S. The reason I'm choosing Vangaurd over Schwab is that I like investing in some of their low cost index funds.
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Re: Putting all your eggs in one brokerage firm
Old 07-16-2005, 04:40 PM   #2
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Re: Putting all your eggs in one brokerage firm

Well, first of all, if any brokerage goes bankrupt, you still own the securities in your account.* *The only concern might be cash in the account, which they typically insure for a million or so.* *Second, I think Vanguard has built a structure in which each fund is a stand-alone entity with joint ownership in the Vanguard Corp.* *I may have this somewhat wrong, but I think the bottom line is that you are safe in the unlikely event that Vanguard fails as a company.
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Re: Putting all your eggs in one brokerage firm
Old 07-16-2005, 04:48 PM   #3
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Re: Putting all your eggs in one brokerage firm

I might have a combined total of $30K in cash (money market) between the two accounts so I should be safe. I keep the other million in the coin tray of my car. 8)
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Re: Putting all your eggs in one brokerage firm
Old 07-16-2005, 05:18 PM   #4
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Re: Putting all your eggs in one brokerage firm

some brokerage accounts get better commissions with higher account balances so that is something to look into. Also, you have more "leverage" with higher balances in general in my opinion.
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Re: Putting all your eggs in one brokerage firm
Old 07-16-2005, 05:29 PM   #5
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Re: Putting all your eggs in one brokerage firm

I myself would not worry about putting all my eggs in Vanguard.

OTOH, I like to get multiple statements and the newsletters from different financial concerns. If I had accounts only at Vanguard, I would see only the Vanguard opinion on things.

I use MS Money (came free on this computer) to keep track of everything, so I rarely look at my statements that are mailed to me. Is it really such a chore to look at a statement? If that's really the case, why not go all-electronic and online? Maybe you should look into a brokerage that will not even mail you statements if you so desire?
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Re: Putting all your eggs in one brokerage firm
Old 07-16-2005, 07:00 PM   #6
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Re: Putting all your eggs in one brokerage firm

I agree with wabmester. Each fund in vanguard is a seperate entity, independant from the Vanguard company. I remember them publishing artilces on this during the scandals of some funds a short while back. as a vanguard customer you could post them a question to confirm.

Outside of my 401(k) I have everything in Vanguard funds, and will not hesitate to roll over my 401(k) to Vanguard when I retire in a few years.
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