Vanguard Financial Planning

Despite all the arguments about VG CFPs recommending their managed funds, do we have any proof that they do? I've requested one, completed the preliminary work and have an appointment scheduled next month with one of their CFP's. I'll be wary about any managed funds or annuities they recommend, although they didn't do that last time I had a plan done some years ago.
 
Although I like the services, tools, and responsiveness that Fido provides, my experience with them is that most roads lead to annuities of some kind in some quantity. That's what their website 'retirement income' tools do, and that's what the FP I met with did. Frankly, it's a little disappointing. But, that's why it's called 'advice', I don't have to take it.

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Recently attended 2 Fido retirement/investment seminars offered locally and it feels like a very low key annuiity pitch even though they never specifically push an annuity.......I assume that comes in the individual session. I am married to them through two 401k plans so I expect to be a client for the duration and will keep going to the seminars.
 
Despite all the arguments about VG CFPs recommending their managed funds, do we have any proof that they do? I've requested one, completed the preliminary work and have an appointment scheduled next month with one of their CFP's. I'll be wary about any managed funds or annuities they recommend, although they didn't do that last time I had a plan done some years ago.
Mine was done back in 2006. They did not recommend moving anything to managed funds. At the time I held maybe 20% in individual stocks at another brokerage, and around 5-10% with another mutual fund company and they only recommended selling a couple of the individual stocks, and not the other mutual funds. No reasons given for the ones they recommended selling, btw, and I didn't ask. I also had some Wellington and they actually recommended moving that to the Total Stock Index Fund.

They did offer a "simplified alternative" of the Life Strategy Funds. This is all index funds as well, which they keep balanced, and the one they recommended to me matched my AA goal at the time. I didn't add up the expense ratios of the parts to see how they matched up.

I thought the call would end with an offer to assist with switching my portfolio around to match their recs, or to set up a call-back date to do this, but they didn't even ask. The report they provided just gave a number and offer to help do that if I wanted to. Low-to-zero sales pressure.

Overall I think for most of us it's just a sanity check on investments. For some they may find they aren't considering their AA correctly across all accounts. And for those switching from a financial adviser, I think taking advantage of this would be a good step to get guidance and learn from.

I would agree this isn't a complete financial plan since there is no discussion of things like insurance and other stuff that a recent poster listed.

I don't recall any discussion of tax efficiencies either. At the time most of my tax deferred was in my company 401K so I'm not sure if the bond funds there were considered inadequate. But I did have bonds in both my IRA and taxable funds and I don't think they suggested any changes to those.
 
ETFs,
Welcome to the board. You've been here two days, posted 26 times, and said about the same thing every time ("indexing is good"). Okay already.
You might be a broker trying to justify your job.
You've made similar allegations in other places. Before you start swinging, take awhile and learn the players here.
 
The notion that a large cap, value fund is riskier than a total stock fund is an interesting angle that I guess we'll just need to agree to disagree on.
:horse:

I would agree that VTV is a good comparison since both VTV and Windsor II are large cap value focused, but VTV does not outperform Windsor II as you suggest. The growth of $10,000 for Windsor II was higher then VTV for the 3, 5 and 10 year periods ended 10/31/13 and actually substantially higher for the 10 year period ($22,100 vs $18,900) and for the 1 year period VTV eked out a win.
YOU are the one who compared VWNFX to the total stock market. I'm saying that is not an apples to apples comparison. How VWNFX does compared to the total stock market says NOTHING about whether or not their managers are outperforming their RESPECTIVE benchmark indexes. The way you evaluate manager performance is by comparing the fund to their respective benchmark indexes. VWNFX may be low cost compared to other actively managed funds but it still doesn't look like the managers have outperformed their benchmarks. Most actively managed funds average about .8% worse than their respective benchmark index. Large cap stocks especially are so widely followed and highly traded that managers really CANNOT outperform their respective indexes. The efficient market hypothesis is too overwhelming.

Proof is in the pudding....

img_1379870_0_ee452a1232195076873001c6bad12d38.jpg

And I'm not even sure if Yahoo accounts for expense ratio and turnover. If so then VTV did EVEN BETTER than this comparable actively managed fund!
Have any others you would like for me to compare?
 
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Looks like you are only looking at share prices and not including the value of reinvested dividends.

Anyhow, in 3 years and over 5,000 posts, I've never felt the need to add anyone to my Ignore List. Since ignorant is a derivative of ignore, I guess it is appropriate that you're the first - congratulations!
 
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Welcome to the board. You've been here two days, posted 26 times, and said about the same thing every time ("indexing is good"). Okay already.
And if you read the thread someone claimed that they had found that one actively managed diamond in the rough that did better. I proved them wrong with a Yahoo chart and they couldn't handle the truth.

And to their last point I prove them wrong again....

VTV = 2.31 yield
VWNFX = 2.08 yield
 
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And if you read the thread someone claimed that they had found that one actively managed diamond in the rough that did better. I proved them wrong with a Yahoo chart and they couldn't handle the truth.
And guess what--you are WRONG even about this one case.
The big problem with your Yahoo chart is something I will leave for you to discover, but it is missing important data. The right info covering the exact same time period is in the attached chart. Windsor 2 outperformed your (much flogged) ETF as well as the appropriate index (large cap value). Now, most of the time an index fund or ETF will outperform the applicable index, but your blanket statement that a manager of a large fund cannot ever outperform is just silly. Don't be such a Johnny One Note.

Stick around, cool the attitude, read more.
 

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Looks like you are only looking at share prices and not including the value of reinvested dividends.
A winner!
(And you already threw on the wet blanket with that stuff about "commissions". Wait until the news about bid-ask spread hits!)
 
I must be going back and forth with brokers trying to defend their jobs. We'll let everyone else reading this thread let the facts speak for themselves. I've already posted the dividend and performance chart comparing ETF to actively managed fund. The last issue that was raised was expense ratio. Here we go. Case closed...

VTV expense ratio = 0.10
VWNFX expense ratio = 0.35

Most of the time, ETFs trade with negligible premiums or discounts. Sorry. No Perry Mason moment. Nice try.

Also VWNFX has an R-squared rating of 98.31 over the last 5 years. Anything in the 90's is proof that all they are doing is closely copying their benchmark index -- for .25% MORE per year! Sorry to burst everyone's bubble.
 
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ETF,
You're coming back for more?
I must be going back and forth with brokers trying to defend their jobs.
Back there again?
We'll let everyone else reading this thread let the facts speak for themselves.

Here are numbers for the time period you selected (April 30, 2007 through present):
Value of $10K invested on April 30, 2007:

Large Value Index: $11,944 (This is the index, not something in which people can invest)
Vanguard Value ETF $12,163
Vanguard Windsor II : $12,491

Note: I selected the "Investor" class of Windsor II, the Admiral class would have outperformed your ETF by a higher margin.

I'm not a fan of actively managed ETFs, and Windsor II surely lagged i's index over some periods. But not all periods, and not the one you chose (for whatever reason).
This would be a good point for you to change the subject. If you know any others.
 
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I must be going back and forth with brokers trying to defend their jobs. We'll let everyone else reading this thread let the facts speak for themselves. I've already posted the dividend and performance chart comparing ETF to actively managed fund. The last issue that was raised was expense ratio. Here we go. Case closed...

VTV expense ratio = 0.10
VWNFX expense ratio = 0.35

Most of the time, ETFs trade with negligible premiums or discounts. Sorry. No Perry Mason moment. Nice try.

Also VWNFX has an R-squared rating of 98.31 over the last 5 years. Anything in the 90's is proof that all they are doing is closely copying their benchmark index -- for .25% MORE per year! Sorry to burst everyone's bubble.
I am not a broker, but I won't resort to throwing unfounded labels at you.

I've had two free VFP's done in 8 years, and I've detailed my thoughts on the strengths and weaknesses of the exercise elsewhere. Neither recommended active funds, and in fact they consistently recommended that I sell off the few active funds I held/hold - but they don't push at all, they leave it to the customer to decide. Furthermore, the first time I had non-Vanguard MFs and they did not suggest I sell those because they fit Vanguards IP - frankly I was surprised.

Most members here prefer passive/index funds, you're preaching to the choir in that respect, something you'd know if you actually read a few posts before you preach.

We could have a meaningful discussion if you'd support all your broad allegations with specific examples. Until then...best of luck.
 
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Midpack;1379925. Most members here prefer passive/index funds said:
Have to admit there's irony in the last string of posts, which argue about which low cost investment approach is best. Reminds me of the the saying, 'We're in violent agreement."
 
Beware of anyone who offers "free" financial planning advice. Free = non-fiduciary. Non-fiduciary means that they don't legally work for you. They are acting in the capacity of salesmen. You want fiduciary advice.

Hopefully that's a PASSIVELY managed mutual fund! AKA an "index fund", AKA an ETF.

So DFA qualifies?
 
Please provide your definition of "fee-only" RIA.
Fee-only means that they cannot earn money from any source other than you. No commissions. When there are no commissions you don't have to worry about whether or not the recommendation they make are really in your best interests or not even though they are required to do so under their fiduciary duty.

you're preaching to the choir in that respect, something you'd know if you actually read a few posts before you preach
Wohhh trigger! Not everyone if you had taken the time read all of the posts in this thread.
 
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Just had my VG FP done, and was very pleased with the results and guidance. However, i will drill down to the not so pleasant experience i'm having consolidating:

1) very good advice (IMO) regarding AA and funds, nothing mentioned regarding actively managed funds; FP's (i spoke to 3) were extremely helpful, answered all questions
2) am consolidating roth, ira and an employer retirement account to VG
3) dealt with one (excellent!) VG rep who effortlessly guided the transfer of my roth and ira to VG...HOWEVER (yes, i'm shouting)
4) for some asinine reason, VG bifurcates personal (roth, ira) and employer account service...so
5) i'm having to deal with two different entities within VG to consolidate my accounts to them :mad:
6) the excellent rep who handled my roth/ira transfer wasn't even able to see my employer retirement accounts on his screen :mad:
7) next, for some reason they are unable to activate my employer account at VG
8) meanwhile i have funds being transferred to VG from my current vendor (TIAA CREF) with no account to place them into...
9) every time i call the employer account service number at VG i talk to a different person in what appears to be a call center. this is "concierge service"?

If this is not resolved by next week I will give serious thought with moving everything to fidelity...
 
Re: moving everything to fidelity ...

I just want to mention that Fidelity may be no better. Just one anecdote: I have a Fidelity 401(k) and had some difficulty opening an inherited IRA at Fidelity (deceased had their IRA at Fidelity). The left-hand didn't know what the right-hand had done and vice versa. It took 3 phone calls to get things sort of straightened out.
 
We started with VG by moving about $350k of my wife's to VG; not enough to classify as a Voyager, but I outlined all our assets and indicated in a year I wanted to begin moving more assets over. They took a listing of all our assets, with my input about allocation, etc, and devised an overall plan, even for the nonVG assets, and didn't charge for the service. Basically, the one time service offered to Voyager clients. I spoke to the adviser several times with concerns, and she made alterations to suit my wishes. Again, not charged. At this point, to get further free services, I would have to be a flagship member. I later transferred another $375k of my funds over to VG. When the bond situation changes I'll transfer another $250k+. Even though DW and I have two separate accounts they've indicated We would qualify for flagship privileges ( the total balance will be over $1m) The differences are listed online I think VG will originally recommend a core portfolio of passive funds, unless the member indicates a need/desire for something more/different. I think the member will have to start the conversation in those directions. They pretty much expect their members to be self thinkers who have an idea of what they want. They're more than wiling to discuss and recommend managed and non-core funds if there is an interest. Just a sense I have gotten from working with them. The only additional suggestions they made to me involved international exposure. They talked about tax efficiency, which was figured into the original plan. I've been pleased.
 
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You're preaching to the choir in that respect, something you'd know if you actually read a few posts before you preach.
Wohhh trigger! Not everyone if you had taken the time read all of the posts in this thread.
Wohhh trigger, really? I was referring to the content of the forum, not just this thread.

Midpack said:
We could have a meaningful discussion if you'd support all your broad allegations with specific examples. Until then...best of luck.
We're still waiting for you to stand behind all you've alleged, not just what works for you moment to moment.
 
Wow, another candidate for Dale Carnegie, huh boys?

And now 31 posts saying the same thing. Maybe he could introduce himself in the Hi, I Am forum and tell us a little something about himself, because I think we already get it that he thinks ETFs are the bees knees for everyone all the time.
 
Just had my VG FP done, and was very pleased with the results and guidance. However, i will drill down to the not so pleasant experience i'm having consolidating:

1) very good advice (IMO) regarding AA and funds, nothing mentioned regarding actively managed funds; FP's (i spoke to 3) were extremely helpful, answered all questions
2) am consolidating roth, ira and an employer retirement account to VG
3) dealt with one (excellent!) VG rep who effortlessly guided the transfer of my roth and ira to VG...HOWEVER (yes, i'm shouting)
4) for some asinine reason, VG bifurcates personal (roth, ira) and employer account service...so
5) i'm having to deal with two different entities within VG to consolidate my accounts to them :mad:
6) the excellent rep who handled my roth/ira transfer wasn't even able to see my employer retirement accounts on his screen :mad:
7) next, for some reason they are unable to activate my employer account at VG
8) meanwhile i have funds being transferred to VG from my current vendor (TIAA CREF) with no account to place them into...
9) every time i call the employer account service number at VG i talk to a different person in what appears to be a call center. this is "concierge service"?

If this is not resolved by next week I will give serious thought with moving everything to fidelity...

Frankly, what you are experiencing with VG's administrative quagmire is what drove me to consolidate most of our assets at Fidelity where we have Private Client status. With Fidelity,I talk with the same CFP and her right hand only but can access other Private Client reps if I need something simple and quick.
We were just below the Flagship status when VG again pulled out their Administrative cudgel and mandated separate hoops to solve a simple issue.
Gave up and moved 70% to Fidelity--didn't hurt that Fidelity offered some cash incentive.
If you do decide to move to Fidelity, ask for what incentives are available, they have FF miles as well as an assortment of other goodies, especially for sizeable accounts.
Good Luck
Nwsteve
 
Frankly, what you are experiencing with VG's administrative quagmire is what drove me to consolidate most of our assets at Fidelity where we have Private Client status. With Fidelity,I talk with the same CFP and her right hand only but can access other Private Client reps if I need something simple and quick.
We were just below the Flagship status when VG again pulled out their Administrative cudgel and mandated separate hoops to solve a simple issue.
Gave up and moved 70% to Fidelity--didn't hurt that Fidelity offered some cash incentive.
If you do decide to move to Fidelity, ask for what incentives are available, they have FF miles as well as an assortment of other goodies, especially for sizeable accounts.
Good Luck
Nwsteve

Oh my, cash incentive. That's my kind of talk. :bow:How are their fees overall as compared to VG? Think I'll threaten VG with this when I talk to them on Monday. It's a hassle moving to VG, but no more so doing it again to Fidelity if I have to.
 
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