vanguard beneficiary policy stinks

Katiek said:
I know everyone's experience is different, but when I inherited some accounts at Vanguard, they were very easy to deal with. They split the deceased's account and transferred it to me and the other beneficiaries very quickly.
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But did you know that you were on the accounts? It seems the other poster said they would not talk to the executor about anything nor tell who was on the accounts, much less what accounts needed to be talked about... PLUS, they made zero effort to contact the beneficiaries.... to me that is something that I would think should be litigated against Vanguard if true....
 
spoke to bank of america /merril yesterday . they are offering 600 bucks to baby sit my etf for 90 days . they allow joint accounts with beneficiaries as well .

they have some nice deals going . 1200 bucks to baby sit 500k for 6 months

i will speak to chase private client today again . while i am more inclined to go with them i want to see if i can leverage the fact they are next door to boa and see if i can get them to increase the points on the sapphire reserve card if i take one to offset some or all of the first year fee since boa is giving 600 bucks .

chase too has no problem with joint account and adding beneficiaries .
 
mathjak107 said:
spoke to bank of america /merril yesterday . they are offering 600 bucks to baby sit my etf for 90 days . they allow joint accounts with beneficiaries as well .

they have some nice deals going . 1200 bucks to baby sit 500k for 6 months

i will speak to chase private client today again . while i am more inclined to go with them i want to see if i can leverage the fact they are next door to boa and see if i can get them to increase the points on the sapphire reserve card if i take one to offset some or all of the first year fee since boa is giving 600 bucks .

chase too has no problem with joint account and adding beneficiaries .
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What kind of fees etc. does Chase charge? What asset size do you need?

I cannot find anything on their site that answers either question...
 
Texas Proud said:
But did you know that you were on the accounts? It seems the other poster said they would not talk to the executor about anything nor tell who was on the accounts, much less what accounts needed to be talked about... PLUS, they made zero effort to contact the beneficiaries.... to me that is something that I would think should be litigated against Vanguard if true....
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I'm not sure what valid claim that one would have against Vanguard. Their obligation is to dispose of the account consistent with the ownership and beneficiary designations once they receive notification and proof of death of the owner (or one of the owner's in the case of joint accounts). If an executor is not listed as a co-owner or beneficiary of an account then they are not party to the account and Vanguard may be validly precluded from discussing the account details with the executor and perhaps even acknowldging that an account exists.

What an executor could to is to send Vanguard a letter notifying Vanguard of the death of an account owner with a death certificate and ask that Vanguard contact any co-owners or beneficiaries of accounts in the decedent's name. If there is not such account owner then Vanguard can do nothing.... if there is an account owner then they might arguably be compelled to act.

I'm not a lawyer, but just my 2 cents.
 
i really have no use for vanguard .

they make my estate planning more complex because we have every thing we own passing via beneficiary to our 3 kids . it is as simple as can be .

anything in our state without a beneficiary either has to go in to a trust or be probated . there is no such thing as presenting a will and a death certificate here and getting access .

i find their customer service slow and lacking .

i can easily move my etf anywhere else and pick up all kinds of cash or perks with various types of accounts .

i do 90% of all my investing at fidelity so this is really an account that just needs a baby sitter .
 
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pb4uski said:
I'm not sure what valid claim that one would have against Vanguard. Their obligation is to dispose of the account consistent with the ownership and beneficiary designations once they receive notification and proof of death of the owner (or one of the owner's in the case of joint accounts). If an executor is not listed as a co-owner or beneficiary of an account then they are not party to the account and Vanguard may be validly precluded from discussing the account details with the executor and perhaps even acknowldging that an account exists.

What an executor could to is to send Vanguard a letter notifying Vanguard of the death of an account owner with a death certificate and ask that Vanguard contact any co-owners or beneficiaries of accounts in the decedent's name. If there is not such account owner then Vanguard can do nothing.... if there is an account owner then they might arguably be compelled to act.

I'm not a lawyer, but just my 2 cents.
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But the poster said that Vanguard made no attempt at all.... IOW, talking to an executor to get contact info is probably the best resource... you do not have to tell them anything about what accounts or what balances are involved, just exchange info for contacting the beneficiaries....

Also, they said that if the beneficiary did not know which account they were on, Vanguard also did not do anything... so if Ms. pb4usk had an account and they said Mr. pb4usk then you would not get info...

Now, is this true? I do not know... nobody else has chimed in on their experience with Vanguard on accounts they did not know about or who was the beneficiary.... the only other one I can remember said it went OK but they seemed to know all info, but I do not think Vanguard reached out to them....

As it exists now, there is no contact info for beneficiaries at Vanguard. Just name and SS number...
 
I'm not sure that Vanguard can even acknowledge to the executor that the decedent had an account with Vanguard unless the executor is named in some way on the account.... privacy rules. Similarly, Vanguard would not normally have a duty to ascertain whether account holders are still alive and if not chase down beneficiaries.

You may recall that until recently life insurers had no duty to try to chase down beneficiaries of deceased policyholders..... however, their folly was that they were doing that for annuities but not for life insurance and they got caught in that inconsistency and got their hands slapped by regulators... now, they have to have some sort of program to chase down beneficiaries under certain circumstances. To my knowledge, the same idea does not (yet) apply to mutual funds.

OTOH, if an executor has knowledge that a decedent had accounts at Vanguard but not any details, s/he could pin them in by sending them a letter notifying them that an accountholder has died along with a death certificate... I'm not sure if they are required to do anything but they would have trouble defending their inaction. If Vanguard (or just about anyone for that matter) has a name and SS number then they can track them down unless they are consciously trying not to be found and are very careful about it.
 
mathjak107 said:
i really have no use for vanguard .

they make my estate planning more complex because we have every thing we own passing via beneficiary to our 3 kids . it is as simple as can be .....
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While I share your frustration with Vanguard's policy regarding designating beneficiaries for joint accounts, IMO it is unduly harsh to jump from that to "i really have no use for vanguard" since it only affects joint accounts.

In our case, and I suspect many others, it only applies to one of our seven accounts at Vanguard since tax-deferred retirement accounts cannot be held jointly.
 
I've printed off my beneficiary/TOD info and put it in my lock box that my son knows to access if I die. I've got all of my bank/investment/insurance/pension account info written down in there too, so he knows where to go looking. I review it periodically. Just did so again today, updating it to tell him that each of my beneficiaries will have to contact Vanguard to get their share.

That policy makes some sense, since each person has to set up an account, even a temporary one, to transfer the assets too. However, I'd think the executor should have the ability to see beneficiaries. I've never really looked into the legal responsibilities and rights of an executor but since they have to do things like pay bills, I'd think they should have the right to see beneficiaries so they can get the money to the right place. It seems to me this is a way for financial institutions to hold onto abandoned accounts. I don't expect them to track down my beneficiaries, but I would expect them to provide that info to my executor. In any case, I'm providing that information myself, though my piece of paper has no legal standing if it doesn't match the information they have.
 
pb4uski said:
While I share your frustration with Vanguard's policy regarding designating beneficiaries for joint accounts, IMO it is unduly harsh to jump from that to "i really have no use for vanguard" since it only affects joint accounts.

In our case, and I suspect many others, it only applies to one of our seven accounts at Vanguard since tax-deferred retirement accounts cannot be held jointly.
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no , i really have no use for vanguard , literally , not in a retaliation sense .. i only used them because i wanted a small percentage of assets outside of fidelity so we opened a fund account and bought an index fund . .

but their funds do not fit , mesh nor are used in any of my portfolio's in any way . all my models follow fidelity insights portfolio's and have done so for almost 30 years now .

i just bought an index fund so as to have something outside of fidelity .

there really is not one reason i am there other than that . those shares can be held anywhere .

so between the fact that it does not mesh with our estate plan anymore and the fact there is all kinds of cash and perks offered all over now there really is no reason for me to be there .

this just opened the door for me to act and take advantage of what is being offered out there because it solves the beneficiary issue too .
 
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RunningBum said:
I've printed off my beneficiary/TOD info and put it in my lock box that my son knows to access if I die. I've got all of my bank/investment/insurance/pension account info written down in there too, so he knows where to go looking. I review it periodically. Just did so again today, updating it to tell him that each of my beneficiaries will have to contact Vanguard to get their share.

That policy makes some sense, since each person has to set up an account, even a temporary one, to transfer the assets too. However, I'd think the executor should have the ability to see beneficiaries. I've never really looked into the legal responsibilities and rights of an executor but since they have to do things like pay bills, I'd think they should have the right to see beneficiaries so they can get the money to the right place. It seems to me this is a way for financial institutions to hold onto abandoned accounts. I don't expect them to track down my beneficiaries, but I would expect them to provide that info to my executor. In any case, I'm providing that information myself, though my piece of paper has no legal standing if it doesn't match the information they have.
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your story reminds me of what we did and it was so funny .

we have 3 kids , 2 of mine and 1 of my wife's .

we gave all three a sealed envelope to be opened upon the death of the last one of us .

it explained where in the house to go and find all our papers and the number for our attorney .

and of course it explains where to look , what draw ,etc . then in the will is all our account papers and info they will need . .

it did not take one day and all our kids are texting each other and going this is going to be so cool , it is going to be like a treasure hunt . my wife and i cracked up .
 
mathjak107 said:
your story reminds me of what we did and it was so funny .

we have 3 kids , 2 of mine and 1 of my wife's .

we gave all three a sealed envelope to be opened upon the death of the last one of us .

it explained where in the house to go and find all our papers and the number for our attorney .

and of course it explains where to look , what draw ,etc . then in the will is all our account papers and info they will need . .

it did not take one day and all our kids are texting each other and going this is going to be so cool , it is going to be like a treasure hunt . my wife and i cracked up .
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:LOL: That is funny!

I just have the one kid. He doesn't become the executor until he hits 30, 3 years away. I figure at that point I'll ask him to go through a drill with me of what to do if I am dead.

-- which reminds me of the joke about the guy who calls 911 to report that he and his buddy were out hunting, and his buddy is dead. The operator says, calm down, let's first make sure he's really dead. Right, says the guy, hold on. Operator hears a gun shot. Guy gets back on the phone and says, OK, now what? --

Anyway, I just want to see that he knows for sure where to find the keys, what to look for in the lock box, and to have him read all the instructions to make sure it's clear. I wrote up more than the basics. It covers MRDs, taxes, all that kind of stuff, and good sites and books (Fairmark, NOLO) for more and current info. It doesn't have $ amounts other than to say he shouldn't have to deal with estate taxes.
 
pb4uski said:
I'm not sure that Vanguard can even acknowledge to the executor that the decedent had an account with Vanguard unless the executor is named in some way on the account.... privacy rules. Similarly, Vanguard would not normally have a duty to ascertain whether account holders are still alive and if not chase down beneficiaries.
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You are spot on on the privacy. There were very strict rules in place regarding this. I mean how do you leave money to the mistress(Yes this happens) if everybody sees everything.
 
Something has gone on in Vanguard since 2008 when my DM passed. I was executor and provided the death certificate. My sister was basically disinherited by will but my DM purposely left her as beneficiary in a mutual fund with about 5% of her estate value. Her thinking it was to keep her from harassing the other inheritors--not true but that is another story.
At that time, Vanguard immediately ask me for contact info for my sister and initiated contact and transferred the ownership to my sister. Quite a surprise to me as Executor I really wanted/needed to get other obligations of my Mom identified and resolved before funds started to be distributed. Like many things Vanguard does what it wants!
 
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pb4uski said:
I'm not sure that Vanguard can even acknowledge to the executor that the decedent had an account with Vanguard unless the executor is named in some way on the account.... privacy rules. Similarly, Vanguard would not normally have a duty to ascertain whether account holders are still alive and if not chase down beneficiaries.

You may recall that until recently life insurers had no duty to try to chase down beneficiaries of deceased policyholders..... however, their folly was that they were doing that for annuities but not for life insurance and they got caught in that inconsistency and got their hands slapped by regulators... now, they have to have some sort of program to chase down beneficiaries under certain circumstances. To my knowledge, the same idea does not (yet) apply to mutual funds.

OTOH, if an executor has knowledge that a decedent had accounts at Vanguard but not any details, s/he could pin them in by sending them a letter notifying them that an accountholder has died along with a death certificate... I'm not sure if they are required to do anything but they would have trouble defending their inaction. If Vanguard (or just about anyone for that matter) has a name and SS number then they can track them down unless they are consciously trying not to be found and are very careful about it.
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Let me put a question: since the executor is responsible for determining if estate tax is due and needs to know about anything passing by tod to add to the total (it is included in estate tax) vanguard needs to tell the executor the total amount. I suspect a letter from a lawyer to the vanguard legal department would dislodge things, with a copy to the IRS about not being able to get totals to determine if estate tax is due. Just like the executor needs to get information on life insurance paid out to beneficiaries as it might be included in the taxable estate. (This is also true if the estate has inheritance taxes).
Legally the executor has the full powers of the decedent, and has a right to know about accounts the deceased held. (for tax purposes if nothing else, indeed if estate tax is due the executor can claw funds back from the beneficiaries to pay the tax (the government always gets what is due them standing at the front of the line of creditors in most cases)

The executor might need to forward a copy of the letters testimentary appointing the executor.
 
meierlde said:
Let me put a question: since the executor is responsible for determining if estate tax is due and needs to know about anything passing by tod to add to the total (it is included in estate tax) vanguard needs to tell the executor the total amount.
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IANAL, but Vanguard cannot withhold information from an estate executor for exactly this reason. I am sure that once they are presented with a death certificate and a court order declaring the estate executor, they must at least provide info on the amount and nature of assets held. Not sure about beneficiary information, although I suspect that too must be provided.
 
the info about who gets what as beneficiary should be provided to the estate executor as well as yearly account balances .

we leave up dated statements in our paper work every jan 1st showing total account balances regardless of who gets what as beneficiary . at least it provides a rough gauge as far as any estate taxes .
 
the continuing saga :
so vanguard compiles statements quarterly . the problem is the new upgraded brokerage account is not on a statement yet .

jpm said they need the statements and not a screen shot but we can't get a statement until october .

so we were advised to call the acat dept at vanguard to see if we can get a letterhead showing all the new account info .

well vanguard had us on hold for over 1 hour and 10 minutes . we tried on 2 phones to get someone to answer. we just got a recording that says thank you for holding , all representatives are busy .

are they kidding with this service , it is unacceptable . we hung up 1 hour and 16 minutes later .

chase /jpm is trying to submit a work around by using the old statement and the letterhead that shows the transfer to the upgraded account and new number .

not sure if compliance will let it go through or not . other wise i will have to wait until october to move the account .

no one answering a phone in over an hour is pathetic customer service . if i was transferring money in and calling the acat dept i would have said forget it .
 
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I'm getting the feeling some of the posters work for either Fidelity or JPM or some other financial company trying to badmouth Vanguard. We've been with Vanguard for over 30 years. I do not recognize a single one of the complaints on this thread. The customer service is knowledgable, very quick to answer our calls and they return calls quickly. We've had hour long discussions on 3 way lines. Beneficiary questions, Trust questions, how to maneuver the website questions, the list is pretty long over the years. We don't have one complaint. We're always treated with respect as our decisions.

Our statements, tax information, fund information etc are always available. We had concerns about security, they walked us through an extremely secure way to work with them on the phone and online. If we ask for any statement or letter in writing, we get it within days.
 
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Rianne said:
I'm getting the feeling some of the posters work for either Fidelity or JPM or some other financial company trying to badmouth Vanguard. We've been with Vanguard for over 30 years. I do not recognize a single one of the complaints on this thread. The customer service is knowledgable, very quick to answer our calls and they return calls quickly. We've had hour long discussions on 3 way lines. Beneficiary questions, Trust questions, how to maneuver the website questions, the list is pretty long over the years. We don't have one complaint. We're always treated with respect as our decisions.
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Not really!! Just a lot of us who expect more than rote responses to questions and the ability and desire to execute on promises. It is great you have not had such experiences but once you do, the frustrations with Vanguards to do more than keep your money safe will be more clear.
 
nwsteve said:
Not really!! Just a lot of us who expect more than rote responses to questions and the ability and desire to execute on promises. It is great you have not had such experiences but once you do, the frustrations with Vanguards to do more than keep your money safe will be more clear.
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Not sure what you mean by "rote responses." Anyone who started out in life with very little and retired when we did, does not accept "rote responses." Our hour long discussions with our rep at VG are hardly "rote." And we've had more than a few. I sort of like the fact our situation will take us comfortably into 40+ years of retirement, thanks to Vanguard. And our lengthy discussions are at no charge and our fees are low. Of course, there's a point in time one needs a tax accountant. I don't expect VG to be our accountant too. They know what they're doing and have never tried to "sell" any fund or investment.
 
Rianne said:
I'm getting the feeling some of the posters work for either Fidelity or JPM or some other financial company trying to badmouth Vanguard. We've been with Vanguard for over 30 years. I do not recognize a single one of the complaints on this thread. The customer service is knowledgable, very quick to answer our calls and they return calls quickly. We've had hour long discussions on 3 way lines. Beneficiary questions, Trust questions, how to maneuver the website questions, the list is pretty long over the years. We don't have one complaint. We're always treated with respect as our decisions.

Our statements, tax information, fund information etc are always available. We had concerns about security, they walked us through an extremely secure way to work with them on the phone and online. If we ask for any statement or letter in writing, we get it within days.
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Good for you that you are fully satisfied with VG. There is no reason you should consider moving your money then. What you see in this thread are individual examples of customers whose experience has been different from yours. I myself was with Vanguard for many, many years and their customer support was never their strongest suit. Acceptable, by and large, but not top notch. I was willing to cut them a good bit of slack, because they always made up for it by running the tightest ship and lowest fees. HOWEVER, the fee advantages have largely been wiped out, compared with Fidelity, Schwab, etc) now for a few years, and so it is harder to justify inferior customer service. Therefore, people leave when they have a bad experience (I did earlier this year). This doesn't mean Vanguard is the crappiest company out there - it is definitely NOT. It is still a very solid choice - just not the top choice any longer.
 
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