Vanguard Financial Planning

[Trooper]

Hi,

I thought I read that Vanguard offers free retirement planning if you have an account with them? I have about $40K in a mutual fund with them.

Can anyone confirm this and have any other details?

Thanks,
Trooper

 

[teejayevans]

Hi,

I thought I read that Vanguard offers free retirement planning if you have an account with them? I have about $40K in a mutual fund with them.

Can anyone confirm this and have any other details?

Thanks,
Trooper

I thought you need to be a Voyager member, unless that's change recently

 

[Texas Proud]

Yes, the free one is the top level account..... over $1 million...

Sorry, but $40K will not get you a free one....

 

[Dimsumkid]

Yes, the free one is the top level account..... over $1 million...

Sorry, but $40K will not get you a free one....

That's not correct, it's 500k (Investors with a minimum of $500,000 in Vanguard assets):

Free consultations with a CFP® professional from Vanguard anytime the need arises, or a more detailed financial plan for your long-term investment goals—also at no cost.

 

[travelover]

I thought you need to be a Voyager member, unless that's change recently

$50,000 to be Voyager

 

[Dimsumkid]

A financial plan will cost you $1,000 if your assets are less than $50k, $250 if your assets are greater than $50k and free if over $500k.

 

[Ready]

I told them that I was planning on investing over $500K with them and they gave me a free plan prior to even sending the first dollar to them. Of course I really was planning on doing so, and I did send the money shortly afterward, once they helped me figure out what to do with it.

 

[Texas Proud]

That's not correct, it's 500k (Investors with a minimum of $500,000 in Vanguard assets):

Free consultations with a CFP® professional from Vanguard anytime the need arises, or a more detailed financial plan for your long-term investment goals—also at no cost.

It is at $500K... I thought it was in the Flagship...


Voyager Select Services®

Voyager Select Services offers access to a team of experienced investment professionals, complimentary advice, and additional discounts on brokerage trades.
Investors with a minimum of $500,000 in Vanguard assets*

• A team of experienced investment professionals who will act as your guide to all we have to offer. They can answer your questions, make transactions, and help you learn about all of the products and services available to you.
• Free consultations with a CFP® professional from Vanguard anytime the need arises, or a more detailed financial plan for your long-term investment goals—also at no cost.
• Discounts on brokerage costs, which includes—in addition to commission-free Vanguard ETF trades—$2 commissions for stock and non-Vanguard ETF trades.**
• Freedom from account service fees at Vanguard.

 

[Dimsumkid]

I told them that I was planning on investing over $500K with them and they gave me a free plan prior to even sending the first dollar to them. Of course I really was planning on doing so, and I did send the money shortly afterward, once they helped me figure out what to do with it.

This is really interesting to hear. Last year I called them about moving more assets over from another brokerage, enough to get me over the $500k status (I have $150k at Vanguard now), but it's an all stock portfolio and I didn't want to sell them off. I got a Flagship transfer specialist who wanted me to transfer my assets over, but wouldn't offer me any planning or free trades to entice me to transfer my assets to them because I still wouldn't qualify since stocks are considered non-Vanguard assets.

 

[Ready]

Try calling their concierge desk, (800) 337-8476. They are generally more accommodating in that group.

 

[Dimsumkid]

Try calling their concierge desk, (800) 337-8476. They are generally more accommodating in that group.

I just checked the email. it was the concierge services group.

 

[LOL!]

It would be generous to call the Vanguard service a "financial plan". My impression is that it covers an investment plan or what funds to invest in and not the usual financial plan stuff such as insurance, taxes, mortgage, college expenses, estate issues, when to have trust, saving for new cars, vacations, etc.

 

[Trooper]

I told them that I was planning on investing over $500K with them and they gave me a free plan prior to even sending the first dollar to them.

Good to know Ready, I am also planning to invest that much (more).

I really don't need any of the other "Financial Services" typically offered by a full service broker...just another set of eyes on my retirement plan.

 

[FinanceDude]

It would be generous to call the Vanguard service a "financial plan". My impression is that it covers an investment plan or what funds to invest in and not the usual financial plan stuff such as insurance, taxes, mortgage, college expenses, estate issues, when to have trust, saving for new cars, vacations, etc.

And you are 100% correct.........

 

[pb4uski]

This is really interesting to hear. Last year I called them about moving more assets over from another brokerage, enough to get me over the $500k status (I have $150k at Vanguard now), but it's an all stock portfolio and I didn't want to sell them off. I got a Flagship transfer specialist who wanted me to transfer my assets over, but wouldn't offer me any planning or free trades to entice me to transfer my assets to them because I still wouldn't qualify since stocks are considered non-Vanguard assets.

Couldn't you just have the shares transferred from your broker to Vanguard and avoid having to sell the shares?

 

[Midpack]

It would be generous to call the Vanguard service a "financial plan". My impression is that it covers an investment plan or what funds to invest in and not the usual financial plan stuff such as insurance, taxes, mortgage, college expenses, estate issues, when to have trust, saving for new cars, vacations, etc.

And you are 100% correct.........

Would you really expect a comprehensive financial plan for free (even at $500K in assets)? The plan is generic Bogle, but the phone call (mine was 45 min) was the most worthwhile aspect of the exercise. And the planner I talked with seemed willing to field any and all questions, the call wasn't over until I had no more questions.

What would a plan that covered everything listed above cost if you went to a local planner? Most of the plans I have seen exclude taxes, though I am sure more expensive ones will include tax impact (using who knows what assumptions).

Couldn't you just have the shares transferred from your broker to Vanguard and avoid having to sell the shares?

You can, that's exactly what I did when I moved my portfolio. I was still holding several individual stocks.

No disrespect intended, but does $40K warrant a comprehensive financial plan?

 

[LOL!]

Would you really expect a comprehensive financial plan for free (even at $500K in assets)?

No, but I expect some truth in advertising.

The Vanguard web site has this text:

A detailed financial plan at a discount. A Certified Financial Planner™ (CFP®) professional from Vanguard will analyze your investments and saving strategy.

If it was "A detailed investment plan at a discount.", then that would be better, wouldn't it? They falsely raised expectations by using CFP in the next sentence.

But elsewhere on the site, Vanguard has

A Vanguard Financial Plan for long-range planning by a Certified Financial Planner™ (CFP) professional from Vanguard who analyzes your investments and saving strategy.

I can see that there might be a difference between "A detailed financial plan" and "A Vanguard Financial Plan". I suppose Vanguard will eventually fix its web site.

OTOH, Vanguard now offers "face-time" via the internet instead of a phone call.

 

[pb4uski]

It would be generous to call the Vanguard service a "financial plan". My impression is that it covers an investment plan or what funds to invest in and not the usual financial plan stuff such as insurance, taxes, mortgage, college expenses, estate issues, when to have trust, saving for new cars, vacations, etc.

I think your criticism is unduly harsh. I have never, ever seen a financial plan cover all of the items that you list.

The Vanguard offering is a typical retirement plan. It was good, but I still had to improvise some for it to meet my needs. IIRC it had trouble providing for special expenses like our mortgage (which will only last another 14 years), college costs for DS, DD's wedding costs, etc. All I did was reduce the retirement assets that they used in evaluating the adequacy of funding for our recurring living expenses by my mortgage balance and the expected college and wedding costs. I include provision for new cars and vacations in my living expenses. If I knew I was going to buy a car near term, I would have just reduced the investment assets by the cost of the car.

While the actual plan itself wasn't much better than what I can do myself with Quicken Lifetime Planner and Firecalc, as Midpack mentioned the real value was in being able to spend some with with the CFP asking questions and bouncing some ideas off him.

 

[Midpack]

No, but I expect some truth in advertising.

I don't see any false advertising whatsoever among your quotes. They don't meet your definition of a financial plan (comprehensive to be sure), but you're certainly entitled to your POV. Of course there is no accepted definition of what a financial plan should include, so like so much in financial services, (very deliberately) subject to interpretation.

 

[Dimsumkid]

Couldn't you just have the shares transferred from your broker to Vanguard and avoid having to sell the shares?

I could but then I'd be giving up the all the benefits (free fin. planning, reduced/ free stock trades, reduced/free turbotax, etc) that should come as a Voyager Select or Flagship customer. Vanguard has this stupid restriction calculating your status based on Vanguard only assets and stocks don't qualify. I'm already getting most of these benefits as a Fidelity Private Client customer and can move 50-100k over time to get free stock trades or some other cash/rewards promotion. At the higher asset levels, I see bigger differences in the customer service between Vanguard and Fidelity. Vanguard has been completely inflexible to entice me to bring over more business to them.

 

[Bestwifeever]

LOL, have you used the Vanguard financial planner?

 

[DevonMiles19]

What i the quality/acumen of the advisors Vanguard provides?

 

[Midpack]

What i the quality/acumen of the advisors Vanguard provides?

I've had good experiences (twice), but all advisors are not created equal based on what I've read from others here. There may be some luck of the draw involved.

IME they are very good at analyzing your current holdings and mapping out a Bogle style plan using low expense, passive/index funds. They provide two proposed plans (see below), one that maintains your current holdings as much as possible (including non Vanguard funds) and another that's closer to their fundamental approach. If you current plan is much like what Jack Bogle has promoted over the years, they may recommend little if any change (my case). My report was 24 pages, which qualifies as very detailed IMO.

If you are hoping for a completely original portfolio with other than mutual funds or incorporating other investment philosophies, you will be disappointed. But given that

• what they offer is "free,"
• they are a business offering in-house mutual funds, and
• they were founded on the principals of index fund investing

I wouldn't expect them to promote other completely different investment philosophies. While a full service broker may choose from a wider array of investments, you never really know what motivation may underlie the choices they make on your behalf (commissions & fees).

We have developed two portfolios for you to consider. Each one incorporates Vanguard’s investment philosophy, including a commitment to maintain broad diversification. However, each portfolio goes about it in a different way. Both portfolios strive to match your target asset allocation within acceptable ranges, and depending on your objectives, you may find one portfolio more suitable to your style.

Integrated Portfolio
The Integrated Portfolio maintains current holdings where possible while integrating them into a diversified portfolio. This approach is suitable for clients who have a preference for and are comfortable with their current holdings, but are looking to ensure they are properly diversified.

Consolidated Portfolio
Vanguard believes there are additional measures you can take to further enhance your chances for success over the long term provided you are willing to move more assets within your portfolio. This Consolidated Portfolio is also highly diversified, and may also offer these additional benefits:

• Lower annual portfolio costs. Vanguard funds charge a small fraction of the industry average to manage your assets. Because costs subtract directly from investment returns, this may result in a higher balance for you over the long term. (The projected impact of costs on your portfolio is illustrated in the Your retirement outlook section of this report.)
• Greater tax−efficiency. The taxes you pay on the distributions from your portfolio also detract from returns. Adjusting your portfolio to hold tax−efficient investments in taxable accounts can help minimize the impact taxes have on your portfolio’s returns.
• Simplicity. The convenience of consolidating your investments at one or only a few companies can greatly ease the management of your portfolio, as well as help with recordkeeping and tax preparation.

During your consultation, your financial planner will discuss both the Integrated and Consolidated approaches

 

[Trooper]

No disrespect intended, but does $40K warrant a comprehensive financial plan?

No disrespect perceived...it's a valid question. I have about $2.2M in total assets, and looking for another set of eyes.

If/when I move assets to Vanguard, won't that create a taxable event, unless the assets are qualified?

 

[Midpack]

No disrespect perceived...it's a valid question. I have about $2.2M in total assets, and looking for another set of eyes.

If/when I move assets to Vanguard, won't that create a taxable event, unless the assets are qualified?

Assets that can be transferred in kind do not create a taxable event. Almost all the funds and stocks I owned were transferred in kind. If that hadn't been the case, I would have taken years to transfer my portfolio, if at all. Selling everything and paying CG taxes on all of it would have been a show-stopper for me, and presumably anyone else.

The easiest way to know is to simply tell Vanguard (or whoever) what your holdings are and they can readily tell you which can be transferred in kind, and which cannot. Costs nothing but a phone call/email exchange. As you might imagine they've done this successfully thousands if not millions of times.