Vanguard - last straw?

[travelover]

I don't even know what Flagship gives you. .........

I thought maybe they'd send an intern over to mow my lawn for me.

Now that I've researched it a little, there are 60,000 Flagship members out of 25 million investors at Vanguard. Sorta like being one in a million in China - there are a thousand other guys just like you.

 

[RobbieB]

More like 20 million guys here in USA. We just minted 2 million more.

 

[Markola]

More like 20 million guys here in USA. We just minted 2 million more.

The article doesn’t say so, but most of these people must simply be homeowners, given the following three statements. You own a house in one of these places, you are quite possibly a millionaire.

17. Where do millionaires invest their money?

(Source: The College Investor)

Investing in real estate is still the most popular of all millionaire investment and spending choices. For over 200 years, approximately 90% of the global millionaires have been spending their fortunes on real estate investments. This trend is expected to grow.

For investors, real estate offers the biggest opportunity to develop wealth. A good way to dip your toes in the real estate business is to buy your first primary residence.

18. Which US city has the highest number of UHNW people?

(Source: Wealth-X)

New York is the city with the highest concentration of ultra-rich millionaires, with 24,660 UHNW. The second spot belongs to Los Angeles, with 16,295 millionaires. San Francisco is third, with 6,740 millionaires. Chicago and Miami take the fourth and fifth positions with 6,085 and 5,615 UHNW individuals, respectively.

19. How many properties are owned by the average American millionaire?

(Source: Statista)

The largest fraction (43%) of millionaires in the US owns only one house. Roughly 20% own two, and only 8.5% of them own five or more.

When it comes to millennial millionaires, they own an average of three properties with a real estate portfolio worth $1.4 million.

 

[Another Reader]

More like 20 million guys here in USA. We just minted 2 million more.

What makes you think they are all guys? For example, look at the young PF blogger types. They aren't all guys...

 

[OverThinkMuch]

When I asked why I wasn't upgraded after being 1.5x over a certain limit, Vanguard informed me the assets have to be in their ETFs and mutual funds. (What did they think I was going to do with $0/trade? Remain loyal when it's free to switch?)

Another very limited annoyance with Vanguard. If you do a lot of buying and selling at once, the buying comes from cash, while the selling provides credit (which turns to cash 3 days later, T+3 settlement). When you do a lot, Vanguard starts warning you about "regulation T", involving the same security sold then bought. But when I buy a new stock I've never held before, they give me the warning. They spam me with the stupid warning. I've previously accidentally violated regulation T, and Vanguard instantly freezes the account and stops displaying prices. So they can instantly detect reg T violations, but they spam me with warnings they know don't apply ... Great. Not a recent thing, either - been that way for years.

 

[FLSUnFIRE]

Silent majority here...I'm still happy with Vanguard. All big organizations have their annoyances but Vanguard is better than most and the few time (maybe 2x in 22 years) I've had to contact them it has been pleasant and quickly resolved. I'm boring, almost all index funds, no day trading, and the few individual securities I play with, I do my own analysis (value) and set limit orders at the price I was willing to buy and they all executed on volatile days, one right at the bottom! If I was actively trading, I'd probably find a platform that caters to that market.



I recently opened a Fidelity Account for my HSA (and may open an IRA there just to "diversify") but find their website clunky and I had to call them to set up my transfer.... they know of the error on the website but don't disable the function or tell you to call. -Horrible first impression, so I'm not sold yet.

 

[Amethyst]

I consider "guys" a unisex term. "Dudes" is for all men. As is "Fellows."

What makes you think they are all guys? For example, look at the young PF blogger types. They aren't all guys...

 

[Koolau]

Silent majority here...I'm still happy with Vanguard. All big organizations have their annoyances but Vanguard is better than most and the few time (maybe 2x in 22 years) I've had to contact them it has been pleasant and quickly resolved. I'm boring, almost all index funds, no day trading, and the few individual securities I play with, I do my own analysis (value) and set limit orders at the price I was willing to buy and they all executed on volatile days, one right at the bottom! If I was actively trading, I'd probably find a platform that caters to that market.



I recently opened a Fidelity Account for my HSA (and may open an IRA there just to "diversify") but find their website clunky and I had to call them to set up my transfer.... they know of the error on the website but don't disable the function or tell you to call. -Horrible first impression, so I'm not sold yet.

Yeah, I'm still reasonably happy with Vanguard. Far from perfect but the price is right. Service EVERYWHERE has degraded! That's how they are keeping the prices low. Anyone even know a travel agent anymore? That model (of service) is like the dodo bird - extinct. It's the "price" we pay for low price.

By the way, I tried to call one of my docs not too long ago (potential life issues!) and was disconnected - twice in a row before I could leave a message. Now THAT's something to be concerned about! YMMV

 

[MissMolly]

I called Vanguard today to close my Solo 401K and roll it into my IRA. The call was answered in less than 5 minutes and the entire transaction was completed in less than 30 minutes, including Vanguard sending some electronic documents which I signed by DocuSign and sent back. I already have the emails with the transaction confirmations.

 

[sengsational]

I wonder if Vanguard honors the "as of date" on OFX inquiries. Fidelity ignores it. Fidelity also dropped reporting functionality without warning. Maybe a reason to switch to Vanguard.

 

[OverThinkMuch]

Yeah, I'm still reasonably happy with Vanguard. Far from perfect but the price is right ... It's the "price" we pay for low price.

If you mean low expense ratios and fees, other brokerages followed Vanguard's lead in charging $0/trade for stocks and ETFs. Schwab, Fidelity and TD Ameritrade all switched, thanks to Vanguard's leadership. I deeply respect what Vanguard has done for the industry.

 

[Koolau]

If you mean low expense ratios and fees, other brokerages followed Vanguard's lead in charging $0/trade for stocks and ETFs. Schwab, Fidelity and TD Ameritrade all switched, thanks to Vanguard's leadership. I deeply respect what Vanguard has done for the industry.

Heh, heh, yeah, I have a picture of Jack Bogle on my bulletin board. He started it all many years ago. The fact that nothing stays the same and everything is imperfect is to be expected. Limiting expectations is probably a good idea. YMMV

 

[FLSUnFIRE]

If you mean low expense ratios and fees, other brokerages followed Vanguard's lead in charging $0/trade for stocks and ETFs. Schwab, Fidelity and TD Ameritrade all switched, thanks to Vanguard's leadership. I deeply respect what Vanguard has done for the industry.

Yes, others did lower their expenses once they started losing market share but they are making money off you somehow and their ultimate loyalty is to their shareholders and not to the investors in their funds. Vanguard isn't perfect but I will choose a mutually owned business every time all else being relatively equal.

 

[Time2]

At one time I had a personal representative at Vanguard, that was nice. At some point that was dropped.

 

[OldShooter]

If you mean low expense ratios and fees, other brokerages followed Vanguard's lead in charging $0/trade for stocks and ETFs. Schwab, Fidelity and TD Ameritrade all switched, thanks to Vanguard's leadership. ...

My recollection was that Schwab was the leader there and that VG was late to the party. Some Googling gave me this:

Tuesday October 1, 2019: Schwab goes to zero, followed a couple of hours later by TDAmeritrade (https://www.npr.org/2019/10/01/7661...to-zero-as-free-trading-edges-toward-the-norm)

October 2: Etrade follows.

October 10: Fido follows. (https://www.npr.org/2019/10/01/7661...to-zero-as-free-trading-edges-toward-the-norm)

January 2, 2020: Vanguard follows. (https://abcnews.go.com/Business/wireStory/vanguard-cuts-commisions-online-stock-trading-68035212)
​

VG and Jack Bogle deserve a lot of credit for offering low-cost mutual funds but in this case they appear to have been an also-ran.

 

[Koolau]

My recollection was that Schwab was the leader there and that VG was late to the party. Some Googling gave me this:

Tuesday October 1, 2019: Schwab goes to zero, followed a couple of hours later by TDAmeritrade (https://www.npr.org/2019/10/01/7661...to-zero-as-free-trading-edges-toward-the-norm)

October 2: Etrade follows.

October 10: Fido follows. (https://www.npr.org/2019/10/01/7661...to-zero-as-free-trading-edges-toward-the-norm)

January 2, 2020: Vanguard follows. (https://abcnews.go.com/Business/wireStory/vanguard-cuts-commisions-online-stock-trading-68035212)
​

VG and Jack Bogle deserve a lot of credit for offering low-cost mutual funds but in this case they appear to have been an also-ran.

My understanding is that JB "invented" index funds. As such, HE would be the father of low-cost funds, even if another company beat VG to lowering the actual prices on index (and other) funds. Indexing is - by definition - lower cost than managed funds. By the way, as usual, I've now told you way more than I know so YMMV.

 

[grasshopper]

Just spent a whole 10 minutes on the phone with Vanguard start to finish. I needed to convert a mutual fund to an ETF.

 

[OldShooter]

My understanding is that JB "invented" index funds. As such, HE would be the father of low-cost funds, even if another company beat VG to lowering the actual prices on index (and other) funds. Indexing is - by definition - lower cost than managed funds. By the way, as usual, I've now told you way more than I know so YMMV.

I think we have apples and oranges here. I interpreted @overthinkmuch's comment to refer to the recent eliminations of trading fees, not to low mutual fund fees where VG led for years.

Re "invented" my recollection from reading is that Wells Fargo gets credit for the index fund idea. One version I have read says that Rex Sinquefield was part of that. Later, he and David Booth went on to found DFA and to get very rich. I think that Bogle was possibly the first to offer an index fund to the public, mid 1970s, and it was an initial flop. A couple of histories Google just gave me: https://www.getrichslowly.org/history-of-index-funds/ and https://www.investmentnews.com/the-secret-history-of-index-mutual-funds-69099

 

[youbet]

If you mean low expense ratios and fees, other brokerages followed Vanguard's lead in charging $0/trade for stocks and ETFs. Schwab, Fidelity and TD Ameritrade all switched, thanks to Vanguard's leadership. I deeply respect what Vanguard has done for the industry.

Except Vanguard wasn't first..........

 

[freddyw]

Disappointed with Customer Service

I have been with Vanguard since the late 70's. Never really experienced issues until the pandemic hit. Now the wait time for a rep is totally unacceptable and needs to be addressed. I don't call much, but when I do, I expect prompt service and not having to wait up to an hour for someone to answer. Not a happy camper that Vanguard has not done more to address this.

 

[MRG]

I think we have apples and oranges here. I interpreted @overthinkmuch's comment to refer to the recent eliminations of trading fees, not to low mutual fund fees where VG led for years.

Re "invented" my recollection from reading is that Wells Fargo gets credit for the index fund idea. One version I have read says that Rex Sinquefield was part of that. Later, he and David Booth went on to found DFA and to get very rich. I think that Bogle was possibly the first to offer an index fund to the public, mid 1970s, and it was an initial flop. A couple of histories Google just gave me: https://www.getrichslowly.org/history-of-index-funds/ and https://www.investmentnews.com/the-secret-history-of-index-mutual-funds-69099

+1
It's mentioned but extremely important in 1960s, the date of the original unmanaged fund papers, the systems to make this happen didn't exist. Funds were extremely expensive to just to own as until the late 60s the ownership was tracked manually via spreadsheets. Cheaper ownership came as the industry added more systems to automate their business. In my career I saw many changes in how all fund companies serviced their customers.

Maybe we could go back to 1970 and enjoy the great services offered and see what it's like to walk uphill to work both ways in the snow while battling record heat waves.

If you asked a question about your investments and there wasn't immediately an answer from the limited data available your request went to "research" where people would comb through microfilm to try finding your paperwork. Maybe your paperwork was filmed and maybe it was lost.

 

[JoeWras]

+1
It's mentioned but extremely important in 1960s, the date of the original unmanaged fund papers, the systems to make this happen didn't exist. Funds were extremely expensive to just to own as until the late 60s the ownership was tracked manually via spreadsheets. Cheaper ownership came as the industry added more systems to automate their business. In my career I saw many changes in how all fund companies serviced their customers.

My head just exploded when I imagined a smokey room filled with clerks at open desks, all with a big old paper spreadsheet in front of them along with the handy manual calculating machine.

Spreadsheet means paper! Ahhhh!

More pictures like this one below to tickle your imagination. https://www.vintag.es/2018/05/offices-from-the-1950s-and-1960s.html

 

[OverThinkMuch]

My recollection was that Schwab was the leader there and that VG was late to the party. Some Googling gave me this:

Tuesday October 1, 2019: Schwab goes to zero, followed a couple of hours later by TDAmeritrade (https://www.npr.org/2019/10/01/7661...to-zero-as-free-trading-edges-toward-the-norm)

October 2: Etrade follows.

October 10: Fido follows. (https://www.npr.org/2019/10/01/7661...to-zero-as-free-trading-edges-toward-the-norm)

January 2, 2020: Vanguard follows. (https://abcnews.go.com/Business/wireStory/vanguard-cuts-commisions-online-stock-trading-68035212)
​

VG and Jack Bogle deserve a lot of credit for offering low-cost mutual funds but in this case they appear to have been an also-ran.

Wow, thanks for the correction - that is what I meant, and I was wrong about it.

Luckily I've already thanked Schwab by moving 1/10th of my assets there. Specifically Schwab International, which supports people with foreign addresses.

 

[OverThinkMuch]

Except Vanguard wasn't first..........

My apologies, I was wrong about that.

I only had a Vanguard account at the time, and this move fit with their overall lowering of costs. I think the article also mislead me, quoting something about this being such a small part of their business, they were okay with it being free. They did not mention Vanguard was following the lead of multiple other brokerages in that article.

Sorry for the confusion - the merged combination of Schwab and TD Ameritrade was first. (I just double-checked that merger, to make sure I didn't remember that wrong, too!)

 

[Amethyst]

I've been angry with Vanguard ever since they nagged us into accepting their new "brokerage" funds.

For some reason, we can no longer set up an automatic transfer of dividends from one fund (e.g. Total Bond Index) to VTSAX. No, now we have to remember to do an online exchange from the "settlement fund" every time there is a dividend.

Just one more online chore added to the daily pile.