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Old 09-09-2021, 09:31 AM   #101
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I still am at a loss for what Vanguard is doing in regards to trusts. Are they actually doing trusts for people? If so, I would be real leery of that approach, since trusts are very specific to each individual situation, state, etc, and should be done between the person(s) setting up a trust and a lawyer who specializes in this area. After that you merely change the beneficiary on your Vanguard accounts to read the official trust name. Basic question - what are people looking to Vanguard to do beyond what I have stated. Thanks.
No they don't do trusts*, they follow the rules of the trust as it and the state laws stipulate. As far as I know the only thing Vanguard or whomever needs to do is register the account properly including the beneficiaries. This is generally covered in the third day of training at organizations that do this type of work.

* the trust department may do them for ultra high net worth people or organizations but OP has said nothing to indicate that is their situation.
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Old 09-09-2021, 09:42 AM   #102
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I agree

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No they don't do trusts, they follow the rules of the trust as it and the state laws stipulate. As far as I know the only thing Vanguard or whomever needs to do is register the account properly including the beneficiaries. This is generally covered in the third day of training at organizations that do this type of work.
I agree. I guess my question was not for you specifically, but the poster who was stating to the effect that "Vanguard doesn't know what they are doing when it comes to trusts". Since the only thing one needs to do with Vanguard in regards to trusts can be accomplished online after one sets up their Vanguard account(s), I am at a loss as to where the poster criticism is coming from
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Old 09-09-2021, 10:01 AM   #103
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I agree. I guess my question was not for you specifically, but the poster who was stating to the effect that "Vanguard doesn't know what they are doing when it comes to trusts". Since the only thing one needs to do with Vanguard in regards to trusts can be accomplished online after one sets up their Vanguard account(s), I am at a loss as to where the poster criticism is coming from
+1

It's almost like I read a commercial or something for an individual company based on bits and pieces of information that really doesn't make any sense to me. Perhaps understanding how these processes actually work is confusing to me?
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Old 09-09-2021, 11:41 AM   #104
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Originally Posted by ychuck46 View Post
I agree. I guess my question was not for you specifically, but the poster who was stating to the effect that "Vanguard doesn't know what they are doing when it comes to trusts". Since the only thing one needs to do with Vanguard in regards to trusts can be accomplished online after one sets up their Vanguard account(s), I am at a loss as to where the poster criticism is coming from
There are two things (at least) that Vanguard can "do with trusts":

1. Make a trust a beneficiary of an account. This is super easy to do and not really that hard to do correctly.

2. Open and handle a trust account. This would be an account that is owned by a trust and titled to the trust, contains trust assets, reports tax information to the trustee of the trust, and eventually distributes these assets to the trust beneficiaries. Vanguard can also do this if the trustee fills out the proper forms. As you might imagine, this is more involved than the first.

I'm not sure but I think you're talking about the first one, and the other posters might be talking about the second one.
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Old 09-09-2021, 12:19 PM   #105
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When you say "Vanguard does not know how to set up trust accounts", I'm not sure what you want them to do. We recently set up a revocable trust with our LAWYER, not with Vanguard, and then went online to change the Vanguard accounts to read the beneficiary for each being the trust. What else do you expect from Vanguard?
We have our trust set up / documented by a trust attorney since 2011. Fidelity and Merrill Lynch had set up our accounts as trust forever and ever. Vanguard could not create a Vanguard trust account for us plain and simple.
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Old 09-09-2021, 12:26 PM   #106
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Our revocable trust is a bit more complicated than most because we have a ton of separate property assets and the certification of trust spells out exactly how to title community property trust and sole and separate property trusts. Vanguard could only do community property trust but not sole and separate property trusts even though they are spelt out exactly how to title them. Fidelity and Merrill Lynch set them up as spelt out. Vanguard said we had to get another lawyer and set up 2 more trust documents for separate properties. The other alternative that Vanguard offered was that we have a lawyer to document that the other trustee has been fired. They just don't understand that there is such a thing as sole and separate property.
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Sounds right
Old 09-09-2021, 03:20 PM   #107
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Sounds right

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There are two things (at least) that Vanguard can "do with trusts":

1. Make a trust a beneficiary of an account. This is super easy to do and not really that hard to do correctly.

2. Open and handle a trust account. This would be an account that is owned by a trust and titled to the trust, contains trust assets, reports tax information to the trustee of the trust, and eventually distributes these assets to the trust beneficiaries. Vanguard can also do this if the trustee fills out the proper forms. As you might imagine, this is more involved than the first.

I'm not sure but I think you're talking about the first one, and the other posters might be talking about the second one.
You are likely correct. Not sure what the benefit is of doing the second, but my situation does not require such a setup. Others may disagree and explain why they feel the 2nd step is required for their situation.
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Old 09-09-2021, 03:56 PM   #108
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You are likely correct. Not sure what the benefit is of doing the second, but my situation does not require such a setup. Others may disagree and explain why they feel the 2nd step is required for their situation.
My parents had what was called a marital bypass trust or A/B trust, designed to help minimize estate taxes.

When my Mom died, her will said (essentially) that her estate was supposed to go into this bypass trust. My Dad can spend money from the trust if he needs to while he is alive; when he passes away then the trust is divided among the kids.

So when my Mom was alive, she could have used item 1. (She didn't use a beneficiary designation; she used a will, but it's the same idea.) After she passed away, the assets needed to be moved into a trust account. That's item 2.

If you have a trust as a beneficiary of a Vanguard account (item 1), then when you pass away, that Vanguard account's assets will probably likewise go into a trust account (item 2) until disbursed to the beneficiaries of the trust. (That trust account could be at Vanguard or somewhere else.) As long as you're alive, it sounds like item 1 is enough for you.

Some people set up revocable and irrevocable trusts of all different sorts for estate planning, and in certain situations I think those assets are actually moved into trust accounts while the people are still alive. But that is beyond what I need so I don't know much about that stuff.
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Old 09-09-2021, 06:00 PM   #109
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FWIW, Schwab has a separate entity (https://www.schwab.com/personal-trust-services) with trust powers (https://www.law.cornell.edu/uscode/text/12/92a) Schwab is named in our estate plan as trustee for several irrev trusts that are created. They not only hold and manage the assets, they are the named trustee.

Fidelity seems to have something similar: https://www.fidelity.com/managed-acc...trust-services
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Old 09-09-2021, 06:14 PM   #110
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No they don't do trusts*, they follow the rules of the trust as it and the state laws stipulate. As far as I know the only thing Vanguard or whomever needs to do is register the account properly including the beneficiaries. This is generally covered in the third day of training at organizations that do this type of work.

* the trust department may do them for ultra high net worth people or organizations but OP has said nothing to indicate that is their situation.
Well, in current employees handling trust accounts only went through 2 days of training.
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Old 09-09-2021, 09:35 PM   #111
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Well, in current employees handling trust accounts only went through 2 days of training.
No. They told you exactly what they needed per your post #106. However you have repeated your claim of they don't know how opposed to "I don't like their answer". Seems like you're misleading this board.

Apparently you don't understand when a financial services provider tells you this is how we do things.... maybe you might want to listen to their best practices. They've been there done that.

Funny thing about trusts is you probably won't know how it turns out. For example when my DF passed his Fidelity account transferred money via his TOD order into my Fidelity brokerage account as his estate lawyer planned. No problem. Except that he was a resident of Pennsylvania when he died and PA wanted their inheritance tax that could only be payable after his estate settled. To insure they would get their 10k sum of money they locked my 500k brokerage account. For 6 months I had no access to my money! Unintended consequences can many times be avoided by listening to the people who do it for a while. Fidelity could have avoided this problem for me in advance by checking the account when the TOD was set up but they didn't, maybe Vanguard's processes would have. Good luck.
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Old 09-09-2021, 09:58 PM   #112
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No. They told you exactly what they needed per your post #106. However you have repeated your claim of they don't know how opposed to I don't like their answer. Seems like you're misleading this board.

Apparently you don't understand when a financial services provider tells you this is how we do things.... maybe you might want to listen to their best practices. They've been there done that.
You are absolutely wrong. Our certification of trust is very clear on how each should be titled and who is the trustee of each of the 3 separate titles. Our trust was setup by a top trust attorney in California. Fidelity got our accounts set up exactly that way in 2011. They went through their legal department. Similarly, Merrill Lynch also got us set up exactly as the certification of trust in 2013. Vanguard said it could not be done. Fidelity's and Merrill Lynch's legal departments are not inferior to Vanguard's, I can assure you. We went back to Fidelity yesterday and the CFP who set up our accounts said he is very familiar with trusts and set them up all day long, including sole and separate properties. Vanguard does not know their arses from their elbows.
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Old 09-10-2021, 07:09 AM   #113
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Still question the motive

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You are absolutely wrong. Our certification of trust is very clear on how each should be titled and who is the trustee of each of the 3 separate titles. Our trust was setup by a top trust attorney in California. Fidelity got our accounts set up exactly that way in 2011. They went through their legal department. Similarly, Merrill Lynch also got us set up exactly as the certification of trust in 2013. Vanguard said it could not be done. Fidelity's and Merrill Lynch's legal departments are not inferior to Vanguard's, I can assure you. We went back to Fidelity yesterday and the CFP who set up our accounts said he is very familiar with trusts and set them up all day long, including sole and separate properties. Vanguard does not know their arses from their elbows.
Maybe it is just me but I still don't know exactly what you want Vanguard to do. Some of us explained the two instances where Vanguard would be involved with a trust, the easiest being when the beneficiary designated on various Vanguard account is designated to be the actual name of the legal trust (which can be done by any account holder online without Vanguard's direct involvement). Outside of these examples I am not sure what you or anyone else would expect Vanguard to be doing, particularly since your trust "was setup by a top trust attorney in CA". To this writer I feel you are being unfair to Vanguard by constantly criticizing them for not knowing trusts, especially since you have a trust in place that "was setup by a top trust attorney in CA".
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Old 09-10-2021, 07:29 AM   #114
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Maybe it is just me but I still don't know exactly what you want Vanguard to do. Some of us explained the two instances where Vanguard would be involved with a trust, the easiest being when the beneficiary designated on various Vanguard account is designated to be the actual name of the legal trust (which can be done by any account holder online without Vanguard's direct involvement). Outside of these examples I am not sure what you or anyone else would expect Vanguard to be doing, particularly since your trust "was setup by a top trust attorney in CA". To this writer I feel you are being unfair to Vanguard by constantly criticizing them for not knowing trusts, especially since you have a trust in place that "was setup by a top trust attorney in CA".
It waa straightforward. I filled out the form online, with the trust owning the account, naming myself as the sole trustee. My husband did the same, naming himself as the sole trustee. Vanguard emailed each of us indicating that we had to call as they could not open our trust accounts. After hours of hold yet again, the agent read me to me that they needed more documentation despite having already submitted the certification of trust document. I directed the agent on the sections of the document on where to look for the verbiage. He said ok. A few days later we got another email and we called and waited on hold for hours again. Another agent said they could not have only one trustee for the trust and said we needed a lawyer to set up 2 more trusts or a document to indicate that the other trustee had been fired.

I am done with you guys. Have a good day.
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Old 09-10-2021, 07:35 AM   #115
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Maybe it is just me but I still don't know exactly what you want Vanguard to do. ....
I'm getting curious about this as well. I was unfamiliar with "separate" and "sole" trusts, but a web search gave the basics.

Hopefully someone can correct me if I'm wrong on this, but it sounds like the distinction is in the trust wording itself (who is trustee, etc). It seem to me there would be no difference in setting one up at a financial institution (the account is titled as the trust name). It is just filling out the forms with the proper info (trust name and trustees, co-trustees, successors, etc) and providing some of the pertinent trust pages. Seems to me the financial institution would have no idea whether the trust was "separate" or "sole" unless they actually looked through the trust itself and the other trusts.

To me, seems no different than taking out a credit card in one spouses name, or the other spouses name, or jointly. The process is no different, just the information provided.

Maybe OP tried to insist this difference, and that threw off Vanguard?

Speculation on my part, I'm hoping to be informed.

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Old 09-10-2021, 07:42 AM   #116
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I cross posted with this...

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.... Another agent said they could not have only one trustee for the trust and said we needed a lawyer to set up 2 more trusts or a document to indicate that the other trustee had been fired.

I am done with you guys. Have a good day.
Well it took several posts in this thread before you described the specific problem, but did a lot of complaining and Vanguard bashing in the mean time. I'm chalking this up to poor communication, probably on both sides.

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Now I get it
Old 09-10-2021, 07:50 AM   #117
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Now I get it

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I cross posted with this...



Well it took several posts in this thread before you described the specific problem, but did a lot of complaining and Vanguard bashing in the mean time. I'm chalking this up to poor communication, probably on both sides.

-ERD50
So after all his bashing he finally admitted that he wanted Vanguard to change the ownership status of his accounts, with himself as trustee. Sorry but that involves a change to the trust itself, which involves spending more $. I am guessing but I think the OP wanted to get Vanguard to do something for free that should have been done by his lawyer for a cost. Guess it was easier for him to come on here and bash Vanguard. Wasted a lot of peoples time.
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Old 09-10-2021, 08:53 AM   #118
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So after all his bashing he finally admitted that he wanted Vanguard to change the ownership status of his accounts, with himself as trustee. Sorry but that involves a change to the trust itself, which involves spending more $. I am guessing but I think the OP wanted to get Vanguard to do something for free that should have been done by his lawyer for a cost. Guess it was easier for him to come on here and bash Vanguard. Wasted a lot of peoples time.
I'm not sure what's being said by OP. But this...

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Our revocable trust is a bit more complicated than most because we have a ton of separate property assets and the certification of trust spells out exactly how to title community property trust and sole and separate property trusts. ....
sounds off to me (or poorly communicated). Seems to me that each of these must be a separate trust. So saying that Our revocable trust (singular) is complicated sounds wrong.

But IANAL, so I'm interested in being informed by someone in the know.

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Old 09-10-2021, 08:56 AM   #119
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So after all his bashing he finally admitted that he wanted Vanguard to change the ownership status of his accounts, with himself as trustee. Sorry but that involves a change to the trust itself, which involves spending more $. I am guessing but I think the OP wanted to get Vanguard to do something for free that should have been done by his lawyer for a cost. Guess it was easier for him to come on here and bash Vanguard. Wasted a lot of peoples time.
+1
This thread reads like an angry Facebook post aimed at bashing a particular fund provider. Sad thing is if Vanguard doesn't catch this during account setup they bear the burden of supporting something they know won't end well. Hopefully when the trust is executed the heirs won't spend mega bucks on legal fees attempting to get their inheritance.
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Old 09-10-2021, 09:02 AM   #120
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Another agent said they could not have only one trustee for the trust and said we needed a lawyer to set up 2 more trusts or a document to indicate that the other trustee had been fired.

I am done with you guys. Have a good day.
I wonder if things have changed. My Mom's bypass trust (which I mentioned earlier in this thread) is at Vanguard, was set up with zero issues, and has only one trustee (my Dad). Of note, though, the setup and funding was done in 2016, and now the account mostly just sits there, with a few transactions every spring for income taxes.

While I like Vanguard, I do agree that their customer service has apparently gone downhill in the past few years. I've read about it here from several people, and I've experienced it myself this year when trying to close out one 529 into another existing 529 at Vanguard. I was able to get done what I wanted to do, but it took more time and was more confusing and required more paperwork than I expected.

I think Vanguard is excellent at doing the basics at very low cost. If you want to do something complex or outside the scope of their forms, then they may have difficulty now.

...

I'm not sure what annoyed you, OP. It might have been that we didn't agree with you about Vanguard being horrible, or that we didn't understand what the issue was that Vanguard had with the way your trusts were set up.

If it's the former, you're going to have a tough time here as people don't generally just agree with anyone just because they say something they think is true. If it's the latter, your explanation of the issues have been a bit difficult for me to follow. And there are some things that Vanguard just doesn't do - and not being willing or able to do something is not the same as not knowing how to do something, although you seem to conflate these two.
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