Originally Posted by Wishin 2B Fishin
We have a whole bunch of index funds in our brokerage account with a company other than Vanguard. Over the next 10 years I really need to beef up the taxable portion of that account and would like to add some Vanguard Funds(especially Wellesley) I think the sales charge is $50 for funds of a different company. I would really like to keep everything together at the same company and I have been with the current company for 15 years.
If I am adding Vanguard funds in 5K or 10K amounts do you think its worth it to pay $50 or should I stay with the other companies funds that have no cost, or should I open a Vanguard account?
$50 is 1% net return on a $5k investment. That's a lot.
Seems to me that you are being EXTREMELY nice with this brokerage company, while they are happily ripping you off... $50 per transaction, really? It costs them cents... And given such numbers, I am ready to bet there are other more subtle ways in which you're paying more money than you should (e.g. fees).
I would suggest that you do open a Vanguard account for all new funds you select and new savings you invest, and then develop a strategy to slowly move your existing assets to Vanguard. The latter part is easy for IRAs and such plans as you can roll them over at no cost. But it's trickier for regular securities, because of capital gain taxes. Hard to comment on such move without particulars, but think about it... In the long run, this should save you significant money.
PS. Another value of opening a Vanguard account is access to their admiral funds, with even lower fees. That, you can't get from another brokerage company. Otherwise, I would have suggested to select any low-fee brokerage you like (E-Trade, etc), but for this reason alone, moving to Vanguard is well worth it.