Admiralty Shares Invitation

[redduck]

There may be other threads on this but I couldn't find them, so here goes...

I've been invited by Vanguard to upgrade two of my funds with them to the Admiralty class. The question is, is there any downside to Admiralty class funds?

 

[REWahoo]

No, only lower costs. Do it!

 

[Marquette]

Some people may start referring to you as Cap'n, Admiral, or Skipper.

 

[retire@40]

It ticks me off that I have way over the Admiral minimum in total with Vanguard, but they only consider the minimum on a per fund basis, not a per account basis.

Do they let you keep Admiral status even if you go below that minimum later, or do they return you to non-admiral status once that happens?

 

[WilliamG]

It ticks me off that I have way over the Admiral minimum in total with Vanguard, but they only consider the minimum on a per fund basis, not a per account basis.

Do they let you keep Admiral status even if you go below that minimum later, or do they return you to non-admiral status once that happens?

They warn that shares can revert to non-admiral if balance falls below $100k, even if due to market fall. I think they do not usually revert unless you make a withdrawal that takes you below $100k. I believe they contact you before doing any changes to give you an "opportunity" to make a deposit!

 

[FUEGO]

Do they let you keep Admiral status even if you go below that minimum later, or do they return you to non-admiral status once that happens?

In my limited experience, I own the Admiral Federal Money Market Fund (min $50,000). I have dipped below the $50k mark and currently have under $1000 in it. VG told me that they would not close the fund due to low balance or revert the fund over to the non-admiral class. Not sure if this is a special case w/ the money mkt fund or if the rule applies generally to all admiral class funds. Maybe give VG a call?

 

[Life_is_Good]

Same as Fuego. I dipped down under the Admiral threshold on Wellesley due to the market conditions. They have not converted me into Investor class nor sent any communications about it.

No news is good news!

 

[bamsphd]

I've been invited by Vanguard to upgrade two of my funds with them to the Admiralty class. The question is, is there any downside to Admiralty class funds?

Your number of shares will change. So if you are using specific identification of shares for tax purposes, you will need to recalculate the number of shares in each of your lots. However, that is not an issue if you are instead letting Vanguard calculate your average cost.

Even with that minor bookkeeping issue, I would still convert.

 

[clifp]

I've been invited by Vanguard to upgrade two of my funds with them to the Admiralty class. The question is, is there any downside to Admiralty class funds?

Biggest downside is having to figure out where to spend the extra ~$100 (per 100K) a year you'll save by making the switch.

If you run out of ideas try here.

 

[cute fuzzy bunny]

They review the funds balance levels several times a year, and if you're in the ballpark they leave it alone, especially if its due to fund depreciation.

I drew down one admiral fund to well below the limit and around six months later my flagship rep sent me a nice little note about it. I said I was doing something with the money and was considering putting it back after a time, but I'd consider it a lot less if they downconverted it to a non admiral fund. They left it alone another six months until I drew the rest of the money out.

 

[redduck]

Some people may start referring to you as Cap'n, Admiral, or Skipper.

Well, a few months ago my wife started referring to me as "Darnell," in her sleep. That's kind of like "Admiral" isn't it?

Anyhow, since it was unanimous on the board and before Vanguard actually checked my references, I decided to become the proud owner of two Admiral funds.

 

[mexmeme]

We bought our VG shares through E-trade. I am assuming Admiral shares are not available unless you buy them with Vanguard. We really don't want to have our accounts strung out again, since it took so much trouble getting them in one place while spending a 9 mo. stretch in Mexico. Really hate to loose that low fee.

 

[redduck]

We bought our VG shares through E-trade. I am assuming Admiral shares are not available unless you buy them with Vanguard. We really don't want to have our accounts strung out again, since it took so much trouble getting them in one place while spending a 9 mo. stretch in Mexico. Really hate to loose that low fee.

mexmeme:

You assume correctly. You need to for sure buy them from Vanguard and perhaps keep them in Vanguard to qualify for Admiral shares. I'm in the same situation you are in regarding a Vanguard fund bought for a Schwab account. But, keep in mind we are still paying an incredibly low fee.

 

[youbet]

We bought our VG shares through E-trade. I am assuming Admiral shares are not available unless you buy them with Vanguard. We really don't want to have our accounts strung out again, since it took so much trouble getting them in one place while spending a 9 mo. stretch in Mexico. Really hate to loose that low fee.

If there is a Vanguard ETF equivalent (such as VTI for VTSMX) buy that and enjoy an even lower ER. For example, I hold VTI in my Schwab account.

 

[cute fuzzy bunny]

I was of the understanding that some brokerages do allow you to buy and hold admiral share funds. I believe Fidelity does not have that capability but some of the other brokerages allegedly do. The funds simply have a different ticker symbol. I also see some admiral funds available in various retirement plans that are not vanguard administered.

You do not pay any transaction fees when buying them directly with vanguard.

You may transfer vanguard funds, admiral or not, into a vanguard account and then convert the non admiral shares to admiral status at no cost and with no paperwork.

 

[youbet]

I was of the understanding that some brokerages do allow you to buy and hold admiral share funds. .

Well darn bunny, you got me all excited and then let me down...... You shouldn't tease a fella like that big boy.......

I have a significant position in VTSMX in my Schwab acct I would like to convert to VTSAX (admiral shares of VTSMX). But alas, calls to both Schwab and Vanguard said not allowed. I then asked about just buying VTSAX with a $100k minimum and, again, not allowed. So, my additional purchases of TSM will continue to be VTI.

 

[Texas Proud]

I converted a fund in the middle of last year... and it went below for awhile... then went back over.... back down...

I THINK I am over now... but not sure... have heard nothing from them at all...

 

[cute fuzzy bunny]

You shouldn't tease a fella like that big boy.......

I usually save it for the girls.

Check here: Bogleheads :: View topic - Admiral shares - only through Vanguard?

Looks like you need Scottrade or some other discount brokerage. Seems vanguard and some outfits dont cooperate.

Never really did much holding of funds outside of the fund provider. I found that when I did that, that the reporting of dividends and reinvestments was frequently inaccurate. Plus someone was always trying to slap some sort of fee on me for something.

 

[youbet]

Check here: Bogleheads :: View topic - Admiral shares - only through Vanguard?

Looks like you need Scottrade or some other discount brokerage. Seems vanguard and some outfits dont cooperate.

I suppose. At least Fidelity and Schwab don't have that feature with Vanguard.

Never really did much holding of funds outside of the fund provider. I found that when I did that, that the reporting of dividends and reinvestments was frequently inaccurate. Plus someone was always trying to slap some sort of fee on me for something.

Trying to simplify things for DW, I have most everything at Schwab. Holding Vanguard funds there does involve a higher commission to purchase, but I bought my VTSMX all at once several years ago, so the one time commission was negligible. Absolutely no issues with accuracy in reporting either for annual tax purposes or in keeping track of cost basis details. Absolutely no surprise fees. Just the issue of not being able to hold Admiral shares. For the past couple of years I've just made my additions by buying VTI which avoids the high commission to buy VTSMX and has an even lower ER than VTSAX. So, it's generally working out fine. I haven't switched the VTSMX to VTI because there would be significant capital gains involved. However, if we get word that the new president is going to increase LT cap gains above the current 15%, I will be making that switch.

 

[cute fuzzy bunny]

I havent tried it, but doesnt vanguard allow you to convert the etf's to the funds and vice versa? At least in-house?

 

[clifp]

I held Vanguard GNMA in my Schwab account for several years, but they didn't allow Admiral share conversions. Two+ years ago I finally got the bright to move the money over to Vanguard. The process was pretty smooth the shares got transfered in kind to Vanguard. Vanguard converted them to Admiral shares, and avoid paying even the modest capital gains that would have occurred with sales and repurchase at Vanguard.

I figure it saves me a couple hundred each year in fees, well worth the small amount of trouble.

I expect that I'll be moving more money to Vanguard in the coming years, because when you factor everything in generally admiral funds are cheaper than ETFs. I still am a big fan of Schwab service the commissions are down $8.95 and are often cheaper for things like bonds and options than most other name discount brokerages.

Unfortunately,Schwab's mutual funds which used be merely mediocre have really gone down hill. For example the Schwab Yield Plus fund (ultra short term bond fund) has just collapse the last year, and its Morningstar rating has plummeted from 5* to 1* as its NAV has dropped from 9.60 to 6.60...

 

[cute fuzzy bunny]

Wow. Pretty darn amazing losing that much on an ultrashort.

Also a good example of why morningstar fund ratings arent very good predictors of the future.

 

[redduck]

I held Vanguard GNMA in my Schwab account for several years, but they didn't allow Admiral share conversions. Two+ years ago I finally got the bright to move the money over to Vanguard. The process was pretty smooth the shares got transfered in kind to Vanguard. Vanguard converted them to Admiral shares, and avoid paying even the modest capital gains that would have occurred with sales and repurchase at Vanguard.

I figure it saves me a couple hundred each year in fees, well worth the small amount of trouble.

I expect that I'll be moving more money to Vanguard in the coming years, because when you factor everything in generally admiral funds are cheaper than ETFs. I still am a big fan of Schwab service the commissions are down $8.95 and are often cheaper for things like bonds and options than most other name discount brokerages.

Unfortunately,Schwab's mutual funds which used be merely mediocre have really gone down hill. For example the Schwab Yield Plus fund (ultra short term bond fund) has just collapse the last year, and its Morningstar rating has plummeted from 5* to 1* as its NAV has dropped from 9.60 to 6.60...

I also plan on moving my Keogh over to Vanguard eventually, but, for now, I gotta stay with Schwab. I'd also like to save a few hundred a year on mutual fund investments and I figure Charles Schwab himself is rich enough as it is. Do you think he's still in the accumulation stage or is he drawing out his 4%?

 

[youbet]

I held Vanguard GNMA in my Schwab account for several years, but they didn't allow Admiral share conversions. Two+ years ago I finally got the bright to move the money over to Vanguard. The process was pretty smooth the shares got transfered in kind to Vanguard. Vanguard converted them to Admiral shares, and avoid paying even the modest capital gains that would have occurred with sales and repurchase at Vanguard.

I figure it saves me a couple hundred each year in fees, well worth the small amount of trouble.

I expect that I'll be moving more money to Vanguard in the coming years, because when you factor everything in generally admiral funds are cheaper than ETFs. I still am a big fan of Schwab service the commissions are down $8.95 and are often cheaper for things like bonds and options than most other name discount brokerages.

Unfortunately,Schwab's mutual funds which used be merely mediocre have really gone down hill. For example the Schwab Yield Plus fund (ultra short term bond fund) has just collapse the last year, and its Morningstar rating has plummeted from 5* to 1* as its NAV has dropped from 9.60 to 6.60...

Interesting inputs...... I've thought about moving my VTSMX to a Vanguard account. My only hesitation is that DW needs financial arrangements to be as simple and straight forward as possible and, if I wasn't around, a convenient walk-in office would be extremely beneficial. It's really just my VTSMX being unconvertible to VTSAX while It's at Schwab that's the problem. And moving just that position to Vanguard might make sense since.

I admit to dragging my feet because it seems that one of our current presidential candidates would like to increase the LT cap gain rates. If that's going to happen, I suppose I'd just sell the VTSMX and buy VTI and go ahead and pay the (substantial) cap gains tax while it's still 15%.

Ref Schwab - Agree on Schwab branded funds. I own small positions in two (both four star rated) but generally don't think Schwab is competitive in MF's. But they do offer a long list of non-Schwab MF's you can buy with no commission (sadly Vanguard and Fidelity not on the no-commission list) and, of course, ETF's are available. As a brokerage house, they're great. Cheap, convenient local office I visit a few times a year, quality folks answering the phone when you have a question, good web site, good cap gains tracking and good end-of-year reporting of tax info. Just that nagging problem of paying commissions to buy Vanguard or Fidelity funds and Admiral Shares not available.