Why I Don't Have Much Confidence in Vanguard

[easysurfer]

We transferred 4 different accounts to Vanguard but it was done all electronically without any paperwork.

I'm thinking as long as I do things via computer instead of paper I'll be good to go. I do not really care about customer service only the lowest fees possible (and secure electronic systems).

When retiring and moving my 401K through w*rk held in Fidelity to an existing Vanguard IRA, I had to do the actual check then send to Vanguard. The process went through without a hitch (I found Vanguard very helpful and we even did a 3 way conference call with Vanguard, Fido and myself to make sure we were all on the same page), and if my memory serves right, took about 2-3 weeks. Yet, just waiting was one of the most nerve wracking weeks in my entire life though just imagining something can go wrong with a huge portion of my life's savings in the mail.

 

[FANOFJESUS]

I started to move my Roth to them 2 months ago. Filled out forms twice and it is still not there yet. But other than that I think they are a good company.

 

[Texas Proud]

I made the mistake of moving money from IB to Vanguard, it literally took over 30 days from them to activate my account. Granted it was a trust account but still that is absurd. It took IB literally 3 business days and was handled beautifully. The trading interface at Vanguard is juvenile at best and they have tons of restrictions. Yes, I am not a passive buy and hold guy but use a modified Ivy Portfolio, for some of my money. I gave up on Vanguard and pulled all my money out back to IB. While I still use the Vanguard funds , I see no reason to deal with their clumsy brokerage.

Vanguard has never been known for their brokerage account....

I would never recommend anybody who wants to trade to use them...

But, interestingly, all new accounts are being moved into a brokerage account setup...

 

[Mulligan]

Vanguard has never been known for their brokerage account....

I would never recommend anybody who wants to trade to use them...

But, interestingly, all new accounts are being moved into a brokerage account setup...

As a general rule, I agree... And in fact, I was considering closing it down and moving all my money since my initial attraction of their mutual funds, I do not use anymore... But then they have snagged me 4 trades in highly illiquid grey market issues that Ameritrade and Tradeking couldnt get or even find for me. Not a reason for most, but I do just enough of that so I will keep them...I was actually shocked because I originally thought they would be the last to accomplish it. But they really went the extra mile down on the trade floor to find them for me.


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[MRG]

I started to move my Roth to them 2 months ago. Filled out forms twice and it is still not there yet. But other than that I think they are a good company.

Did you talk to them? Discuss how the money was to be moved?

I rolled over 2 different accounts from 2 providers and the instructions for the rollovers were different for each. Each of the rollovers were assigned to a different specialist perhaps just personal preference.

One was a check the other wired. The manual check was twice as fast as the wire from Fidelity.

I could see the progress of each rollover by logging into Vanguard.

 

[Texas Proud]

As a general rule, I agree... And in fact, I was considering closing it down and moving all my money since my initial attraction of their mutual funds, I do not use anymore... But then they have snagged me 4 trades in highly illiquid grey market issues that Ameritrade and Tradeking couldnt get or even find for me. Not a reason for most, but I do just enough of that so I will keep them...I was actually shocked because I originally thought they would be the last to accomplish it. But they really went the extra mile down on the trade floor to find them for me.


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Interesting... glad to hear that they do offer a service that others do not..

I have not had any problem with trading with them.... it just is not as easy as other places, but every one of my trades have gone through without a hitch...

I even sold that BGL?? that was called 30 minutes or so after I bought it... it just gave me a warning that I could not use the funds until everything was settled... no problem with me...

Still, I do not think they are set up for people who trade... but, for people who just want to buy and hold for awhile they are just fine...

 

[Mulligan]

I bet they stood on the line 20-30 minutes digging around for me each time, so I have to give them credit there....But like you say, for my regular trading I use cheaper brokerages. Since I am a nobody, their commissions are higher for me. I just keep the issues that I never trade in that account and my Roth brokerage, also (just being lazy there, and try not too trade too much in it either).
How I discovered this was an illiquid CTWSO, that rarely has any shares for sale. I knew a guy from another forum put 500 up for sale. Ameritrade and TradeKing couldnt find them and said none were available. Tradeking went as far to tell me they couldnt do it anyways as it is illegal to buy directly from someone (whatever, as it didnt have to be his anyways, I was just giving them proof there were some). Not only did Vanguard find me those the seller was selling they found me 500 more also at same price. I was amazed...


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[tjjennis]

Fidelity hates Vanguard, the bane of Fido's existence. They even resist sharing details of their funds on their research tool, ditto for T.Rowe (they have shown some funds to be "closed to new investors" when they were not. But Fido has had a change of heart regarding fees and now offer some funds that are even cheaper to own than Vanguard.

 

[Another Reader]

This gets better. The money left the other company on September 2. The Vanguard website states that I can expect the transfer to take 4 to 6 weeks. WTH? I called Vanguard. No electronic transfer. A check was probably mailed. If it takes them as long to find and process the check as it did to process the request, this should take until the end of September.

Only Vanguard offers the Admiral shares of Wellington. So the rollover IRA that holds the Wellington shares will remain at Vanguard. However, I won't be sending them any other money.

 

[Whisper66]

Been interesting to read people's experiences here and helps us watch out for issues like others have had.

Our experiences with Vanguard to date have all been good. We've had accounts with Vanguard for several years. In the last year we've transferred one 5 figure and one 7 figure account from other institutions to Vanguard without problem. In both cases, we called Vanguard and had them do most of the work. During one phone call, they filled out the paperwork for us which we reviewed and electronically approved. After the call, they contacted the other institutions and made the transfers happen. They had given us initial estimates of the time things would take and things went as planned.

 

[REWahoo]

Been interesting to read people's experiences here and helps us watch out for issues like others have had.

Our experiences with Vanguard to date have all been good. We've had accounts with Vanguard for several years.

Same here - 11 years with Vanguard with no issues. (Hope I didn't jinx myself by posting this).

 

[MRG]

This gets better. The money left the other company on September 2. The Vanguard website states that I can expect the transfer to take 4 to 6 weeks. WTH? I called Vanguard. No electronic transfer. A check was probably mailed. If it takes them as long to find and process the check as it did to process the request, this should take until the end of September.

Only Vanguard offers the Admiral shares of Wellington. So the rollover IRA that holds the Wellington shares will remain at Vanguard. However, I won't be sending them any other money.

I guess you didn't call when you started the rollover?

In my case the other institution overnighted me the check and I overnighted it to Vanguard at Devon Park. Entire process took a week.

I'd probably confirm who's doing what and that your old firm is on board with what's occurring.

 

[Another Reader]

I called Vanguard at the beginning of August. The CSR said the transfer required the paper form and a wet signature. Only way to do this. Mailed the form two days later. Called again after three weeks, was told they never received it. Was notified of a transaction confirmation by the other company last Friday afternoon. Checked Vanguard, saw the transfer in process. That was late Friday. Called Vanguard yesterday. Vanguard never notified me.

The old company did as asked, promptly. Vanguard shows the transaction was initiated on September 1st. Money was out of the old account September 2. That part had to have been done electronically because of the time frame.

I would hate to give them anything complicated to do. I don't think they could handle it.

 

[samclem]

Same here - 11 years with Vanguard with no issues. (Hope I didn't jinx myself by posting this).

Same here--over 25 years with Vanguard and not a single issue. I'm sure with the sheer number of transactions of all their customers that sometimes mistakes occur. As we've seen here before, one factor in some case is the "losing" entity (a broker, another fund company) dragging their feet. They've got nothing to gain by cooperating.

 

[RetireAge50]

When I did our transfer their was no paper involved.
1. Started at Vanguard.com
2. Open new account
3. Select Transfer an Account
4. Fill in all the information
5. Maybe a week later all done.

Never even contacted old brokerage.

 

[MichaelB]

While I've had multiple issues with Vanguard, including some that are similar to the OP's, they were all resolved quickly, easily, and to my satisfaction. One reason is that whenever I do anything with a broker that involves forms, I always confirm by phone what forms are needed, then photocopy all the forms that will be mailed, and then mail with proof of receipt. The follow-up becomes much easier, and phone conversations with the reps are much more effective when I have proof and date of delivery and can reference copies of the specific documents.

 

[nwsteve]

While I've had multiple issues with Vanguard, including some that are similar to the OP's, they were all resolved quickly, easily, and to my satisfaction. One reason is that whenever I do anything with a broker that involves forms, I always confirm by phone what forms are needed, then photocopy all the forms that will be mailed, and then mail with proof of receipt. The follow-up becomes much easier, and phone conversations with the reps are much more effective when I have proof and date of delivery and can reference copies of the specific documents.

I agree and follow the same approach especially with new relationships.
OTOH, I find it a bit "telling" one has to make such an effort to manage the level of competent performance from a relationship vendor. The one thing I found frustrating with Vanguard surface was how incredibly inconsistent service issues were performed. Their estate group was near worthless in my experience with them.
Nwsteve

 

[UpAnchor]

I've had no problems with either Vgd or Fido but, not being a "trader", my needs are pretty simple. In fact I seem to be in the minority here in that I actually prefer Vanguard's online interface to that of Fido. It tells me everything I need to know (and nothing I don't).

I've done paper-check rollovers to both entities and both were finalized in less than a week. Yes, even that short waiting period is more than a little uncomfortable when substantial sums are involved. But paper check was the only option out of both my esop and 401k so whatcha gonna do...

But - based on this and prior threads - I lean toward using Fidelity should I have any complex requirements down the road. And it doesn't hurt that I have one of their investor centers nearby. But with the bulk of our investments being in Vgd Admiral shares, I won't be giving up on them anytime soon. (Though the one thing that could possibly drive things in that direction eventually might be the oft-discussed consolidating of accounts for DW's benefit upon my demise.)

 

[dixonge]

I found a real nice discussion of Vanguard vs Schwab vs Fidelity over on the Bogleheads forum. It seems fairly even-handed and gives many perspectives. I have a feeling that the E-R forums here would probably mirror their experiences...

https://www.bogleheads.org/forum/viewtopic.php?t=184255