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Old 08-21-2015, 08:25 AM   #21
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Vanguard ETFs, uniquely among ETFs to the best of my knowledge, are actually a share class of the corresponding mutual funds. Same management - and same dim view of active trading of index funds. Personally I see it as an advantage, in that you're far less likely to see your Vanguard ETFs trading at a steep discount during times of market panic. Active traders have the entire rest of the ETF world open to them (which is of course one of the main reasons Vanguard founder John Bogle has such a negative view of ETFs).
Anything that restricts my ability to change a position is never an advantage. Also your point that Vanguard's restriction will result in less of a discount in down turns simply doesn't hold water. What percentage of the brokerage world does Vanguard hold? Minimal. Therefore the restriction will have no impact on premium/discounts. ETFs are great because they are liquid, Vanguard doesn't see this as a virtue, weird.
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Old 08-21-2015, 10:12 PM   #22
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When I moved my money from Schwab to Vanguard, I was surprised that Vanguard required two accounts for each IRA. All of those dual accounts were clunky. I received the same letter the OP received, gave Vanguard approval to combine the series of dual accounts to one, and it was a non-event. I'm glad for any pain-free opportunities to keep finances simple.


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Old 08-22-2015, 09:12 AM   #23
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When I moved my money from Schwab to Vanguard, I was surprised that Vanguard required two accounts for each IRA. All of those dual accounts were clunky. I received the same letter the OP received, gave Vanguard approval to combine the series of dual accounts to one, and it was a non-event. I'm glad for any pain-free opportunities to keep finances simple.


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+1.... I do not like change and do not particularly like to lift a finger in effort to assist in change. But even I did this. Easy to do, and like you said...simpler.


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Old 09-24-2016, 11:57 AM   #24
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I logged onto Vanguard today and noticed for the first time an "Upgrade" option on each mutual fund account where I could upgrade from a mutual fund account to a brokerage fund account online.

Curious about the experience of people who have converted and any benefits or detriments.
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Old 09-24-2016, 12:47 PM   #25
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Many of us did that in the last year. Simplicity is a good thing.
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Old 09-24-2016, 12:55 PM   #26
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It has been reported and I have found true that the "upgrade" will mess up one's instructions on what to do with automatically reinvesting distributions.

I think the upgrade resets things to the "account default" whatever that was for you. If you had different funds to do different things from the "account default", then you may be in a for a surprise.

So double check after you upgrade what the settings are for each and every one of your investments in the new account structure. I certainly had to reset mine back to what I wanted and had previously.

For me, I had brokerage accounts at Vanguard for ETFs, but my default was not to reinvest any ETF distributions back into the ETFs. When my mutual funds got "upgraded" and placed in the existing brokerage accounts, they lost my choice to have distributions automatically reinvested, so I had to reset those. Perhaps this would not be a problem for folks with no previously existing brokerage account.
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Old 09-24-2016, 04:14 PM   #27
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A few of the differences that I have noticed. First, the settlement account (MMF) does not allow paper checks. Second, the settlement account is a sweep account. It can be a bit more difficult to figure out where the sweep came from. For example if you have dividends go into the sweep account they get aggregated quickly and it is difficult to figure out where it came from . And finally, transfers between old style and upgraded accounts if not allowed. I had opened up a new ROTH to do a rollover and found that I could not roll over until the Traditional IRA was upgraded first.
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Old 09-24-2016, 04:38 PM   #28
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All good intelligence... thank you !
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Old 09-24-2016, 08:07 PM   #29
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Many of us did that in the last year. Simplicity is a good thing.
Does anyone know how/if it affects Quicken downloads/links ?
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Old 09-25-2016, 06:48 AM   #30
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I feel left out. Have no upgrade button. I remember seeing something in the past, but did not proceed. Our accounts are very simple , buy and hold variety. Now, if they offered a toaster...
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Old 09-25-2016, 07:13 AM   #31
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One thing I experienced when I upgraded last year is it resulted in an additional 1099 tax statement that I was not anticipating. In the spring, I went through my usual checklist of documents and when I had everything (I thought), I filed the return.

Didn't know there would be separate 1099's for before & after the upgrade. A new one was released a week or two later and I had to file amended federal and state returns. That was annoying and I wished, if they had to be separate statements, that they were released together so this could have been avoided.
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Old 09-25-2016, 07:16 AM   #32
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I feel left out. Have no upgrade button. I remember seeing something in the past, but did not proceed. Our accounts are very simple , buy and hold variety. Now, if they offered a toaster...
Didn't banks stop doing that in the middle of the last century?
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Old 09-25-2016, 07:26 AM   #33
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I feel left out. Have no upgrade button. I remember seeing something in the past, but did not proceed. Our accounts are very simple , buy and hold variety. Now, if they offered a toaster...

Same here, I just logged into Vanguard now and don't see any "upgrade button" anywhere, anyplace for any of my funds in either of my T-IRA account or Regular. Account. All my funds are at admiral level and most are index funds with Vanguard ETF equivalents (e.g. VFIAX and VOO).

I'm so very confused.
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Old 09-25-2016, 07:31 AM   #34
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Since you can't go back, I would instead consider opening a new brokerage account separate from the mutual fund account. I would try to title the new account so that it is not identical to the MF account to avoid an involuntary "upgrade" in the process.

This way, if you really like the brokerage account you can keep it and move the old assets to it and close the MF account.

If on the other hand, the brokerage account is not all that it was cracked up to be, you haven't forever lost your MF account.

I have a VG brokerage account from about a decade ago but it has been inactive and empty for some time.

BTW - I just noticed that I have been presented the Upgrade link too on vanguard.com. Thanks for the heads up on this!

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Old 09-25-2016, 07:33 AM   #35
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Same here, I just logged into Vanguard now and don't see any "upgrade button" anywhere, anyplace for any of my funds in either of my T-IRA account or Regular. Account. All my funds are at admiral level and most are index funds with Vanguard ETF equivalents (e.g. VFIAX and VOO).

I'm so very confused.

For your T-IRA, do you have one account or two, i.e. a brokerage account and a second one? If one, then you are already upgraded, as Another Reader above said would happen automatically soon.
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Old 09-25-2016, 07:35 AM   #36
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Didn't banks stop doing that in the middle of the last century?
Wouldn't know what to with toaster, now that you mention it.
Maybe a pair of suspenders?
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Old 09-25-2016, 07:53 AM   #37
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Same here, I just logged into Vanguard now and don't see any "upgrade button" anywhere, anyplace for any of my funds in either of my T-IRA account or Regular. Account. All my funds are at admiral level and most are index funds with Vanguard ETF equivalents (e.g. VFIAX and VOO).

I'm so very confused.
This Vanguard page explains things, and it may lead to the option for you to upgrade.
https://investor.vanguard.com/info/account-upgrade
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Old 09-25-2016, 08:11 AM   #38
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This Vanguard page explains things, and it may lead to the option for you to upgrade.
https://investor.vanguard.com/info/account-upgrade
Thank you for the link, I just went there and saw the START button. Got some reading to do before I select it (if I decide to select it). It looks like they are looking for "my permission" before they start messing around with things.

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For your T-IRA, do you have one account or two, i.e. a brokerage account and a second one? If one, then you are already upgraded, as Another Reader above said would happen automatically soon.
Just the same old Investor Side Account (and acct#) I've had for a bunch of years before they even started the "two sides of the house".

I don't understand how they can start moving people's money around without permission.
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Old 09-25-2016, 08:50 AM   #39
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I don't understand how they can start moving people's money around without permission.
They can't move things without your permission.
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Old 09-25-2016, 08:51 AM   #40
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We did it last year.
I like having everything in 1 place, it does break out the different accounts by the type for me.
Regular Account, 401k Roth, 401K IRA, etc. but now I just log in 1 place and see it all.
It adds the amounts from each together to show 1 final Total.
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