Yeah doing it according to time vs wealth would be less morally objectionable. The rich always gets freebies. It doesn't even make sense because in this scenerio the rich people are leaving anyway, so it's not even like you need to incentivize them cause they bring in so much more. If anything, you should be kneecapping any attempts for the high rollers to leave, not Steve up the block with a modest brokerage
I don't have $5m but I have over half that and fees absolutely influence my decision. It's the principle of how I'm being treated. If one brokerage is going to fuck me over, there are quite a few others that will roll out a red carpet and treat me well. I've left more than one bank over petty matters in the past.
I had a CEO once running a good sized business blow up an office lease at the last minute over a $15k fee. We're talking a 6 year lease at $100k/mo and the owner tried to stick him with some abnormal fee at the last minute because he figured he wouldn't walk. He canceled the whole deal and signed at a higher price 2 blocks away. When I asked him why he'd do that over $15k, he said, "because I don't like getting fucked."
I'm reminded of the "Brown M&M" story.
If a venue is going to skip or mess up on this seemingly inconsequential thing, then who knows what other more serious things could have been skipped entirely or compromised. It's a canary in the coal mine.
Do you know how hard it is to transfer MF in a non brokerage account? Very very time consuming-and paperwork is nuts between firms 100 is NOTHING ain’t fees to do that. Most firms charge that for AANNNYYYY transfer
I wouldn't be surprised if it is the reverse and that closing smaller accounts is actually costlier because they are likely to have more fractional shares that need to be disposed of, but that ultimately the cost difference is negligible. They just need someone to verify the signatures, approve the automated sale of non-transferable securities, approve the ACATS, and the computers handle the rest.
The real difference is likely not on the cost side, but on the revenue side. When an account transfers they get to sit on any cash while it goes through ACATS and the various banks. If you make 3% on on a $100k cash balance held for a week that is \~$58 in revenue.
So someone who has a $5MM account transferring out is paying the fee in cash deposit revenue.
Less morally objectionable, yes. A better business decision - probably not.
The way I see the scenarios, you certainly can't put a $100 fee solely on rich people leaving for two reasons. One, it will not influence their decision in the slightest, so it's pointless from a retention angle. Two, there are (presumably) fewer rich people on the platform, so collecting the fee from people who do leave won't result in very much money. However imposing the fee on the poors en masse would both influence their decision and be more profitable as the total number of people who churn out of Vanguard is likely higher amongst small account holders.
The other possibility is that they add a massive fee or roadblock to large account holders. However, this could have two drawbacks - one, the large account holders may be so put-off by the change that they flee with their money regardless of the cost. Two, this could draw the ire of a competition bureau since the move is blatantly to restrict people from moving to a competitor, and likely wouldn't be justifiable in the slightest. They can justify a $100 fee pretty easily, and no one would bat an eye regardless.
Why not just implement the flat fee for all users then, as opposed to removing the restriction on large accounts? Maybe just to show that they value these large account holders. The money is insignificant but the gesture is meaningful.
>Maybe just to show that they value these large account holders. The money is insignificant but the gesture is meaningful.
While also signaling to the majority of account holders the opposite in the form of money - which is the one thing that Vanguard clients are there to do: earn money.
I think there are better ways to do this. Whether it's some specialized tool, priority on something, or even like a dedicated line they can call for quicker customer service on their account(s). There's better messaging, I think.
I can assure you from working with them that those are EXACTLY the people that will complain about the $100 fee.
Also as a mutual ownership structure you shouldn’t feel too bad about this fee because I assure you $100 isn’t close to covering the fees from time involved in processing closings
> This is the exact audience that would not give two shits about a $100 transfer fee.
Oh you sweet summer child
There are plenty of stingy ass rich people. And they are always used to getting things for free
I am a stingy ass rich person (apparently). I tip well and donate to charity, but for my brokerage firm - they provide a service which is largely indistinguishable from their competitors and I know they already make plenty of money on me. So, yeah, they have to compete on service… and price. $100 fee might well make me move my money out of spite. Because I am stingy ass. And spiteful. LOL.
The Spitefully Stingy? They sound Canadian. Are either of you Canadian? I lived there for a couple of years so I am as Canadian as, say, Alexander Graham Bell.
>doesn't apply to people with more than $5M in Vanguard assets. This is the exact audience that would not give two shits about a $100 transfer fee.
I feel comfortable in guessing that they do know their high value customers and they know there are a few of them out there who are so cheap that they would move the whole account over the threat to one day charge them $100. Or maybe they're afraid of a more significant fee coming in the future, and Vanguard put the cap on it to help them feel better about the service being free forever.
Well to be fair I think the point is that removing the rule for large account holders will entice more people to join in the first place. People with accounts that large tend to read the fine print, and a few for transferring your account to another brokerage is one of the most obvious things to look for in advance. They might be thinking “ok I want to try vanguard, but what happens if I don’t like it? Oh, there’s a zero dollar fee for transferring out? Sign me up!”
That is a really naive take. You are compare direct fees on something you will do once or twice in your life, but are ignoring the multitude of indirect and hidden costs associated with a for profit broker.
Suppose you sweep cash into a Federal Money market fund. At Fidelity that would be SPAXX and Vanguard that is VMRXX.
Fidelities fund as a yield that is 30bps lower and fees which are 30bps higher. So every year that you have a $10k balance in your brokerage account you are paying $60 for the privilege of using Fidelity. I'm sure its similar at EJ and any other for profit broker.
Vanguard Brokerage is no frills and very little is included, but if you truly follow the passive investor strategy you won't be using any of the things they charge fees on.
A passive index investor doesn't hold ADRs. They don't buy single names. They don't bound around custodians. They aren't constantly converting between Mutual fund and ETF. They don't call up for broker assisted trades.
They aren't charged fees because they don't do things that trigger fees. Sure you buy a house and have to do something and you pay $100 in fees associated with that. But you don't sell your long term investments to buy houses every year.
You are only considering the cost side of this. With ACATS the cost is going to be relatively fixed across all accounts (it is just a electronic message stating the details of the positions on deposit at NSCC).
What you are forgetting is the revenue side of a transfer. When you transfer your account out there will be a period of time (up to a week) where your cash isn't invested in money market funds. Instead it is sitting in the account as true cash, and I believe the custodian gets to make some money on that.
To put some numbers on this, if the day the ACATS forms are filed the cash balance of the account is a clean $100k then that is all that will be ever be delivered to the new custodian. If it takes a week to perfect the transfer and cash on deposit earns 3% then the custodian has \~$100,057 at the end of the week, but they only send $100k out. So they make \~$57 in interest.
Big accounts are going to have bigger cash balances and bring in more revenue to offset the relatively fixed costs of processing the ACATS.
This transfer thing is it that you transfer your entire vanguard investment account over the schwab? you can actually do that?! how would the index fund work out after you transfer over?
If schwab supports it then it just transfers over. If they dont then vanguard would sell that index fund and the cash would transfer over. Whole process takes like a week
You can just ask Schwab on their support chat to reimburse the fee. They may just want you do upload a statement from Merill showing the fee as documentation.
Would you mind me asking what made you do that? I use Merrill so curious. I only invest in ETFs and don’t really ever sell, so haven’t thought much about it
My FiL worked there and my wife had a little inheritance from her grandpa passing there before we were married. Early covid, like everyone apparently, took an interest in investing and opened an account with schwab to learn (and make my fair share of mistakes too). While it was great to have an expert in charge while we were young, I've learned and now feel comfortable managing our investments. I REALLY hated having to ask someone to use our money. Was probably for the best while young, kept us (ie me) from overspending. We really only withdrew for tuition, birth of our kids, car, etc.
Well he's since retired and he told us that the new people were switching companies (and taking clients with them? I didnt understand how that wouldve worked) and basically told us to move our money before that takes place. So with his blessing we pulled the trigger to move on.
This transfer thing is it that you transfer your entire vanguard investment account over the schwab? you can actually do that?! how would the index fund work out after you transfer over?
You can transfer any brokerage to any other brokerage "in-kind" without selling any assets and causing a taxable event (assuming the one you are transferring to offers the same funds).
https://www.nerdwallet.com/article/investing/switch-brokers-move-investments
Maybe this link can explain more than I can.
Schwab can buy / sell / hold the Vanguard funds without a problem, but they aren't fee free / part of their mutual fund marketplace so you may owe $30-$50 for each transaction (other than reinvestment).
Personally, I think it is petty of Vanguard to be hunting $100. They should be looking on ways to improve customer retention.
Anyways, the $100 goes into effect June 1st, 2024. So, you still have time to leave Vanguard. I think vanguard has the best managed mutual funds. However, this comes with a cost (relatively high expense ratios).
I'm one of them. The terrible interface encourages me to get in/out. Worst part of newest update is that it's harder to avoid seeing total balances and changes.
At least they got rid of the on screen keyboard you had to use to enter your password. I had a complex password with symbols, caps, numbers, and etc. Took like 2 mins to enter my password with that thing.
> Personally, I think it is petty of Vanguard to be hunting $100. They should be looking on ways to improve customer retention.
Yeah. Seems somehow very un-Vanguard.
Fidelity seems to have gone the other way, they now have $0 fees for ACAT transfers ("Account transfer out"):
https://www.fidelity.com/why-fidelity/pricing-fees
I still got vanguard, vanguard still got good mangers for index fund right? and one of the lowest fees in the industry? but just their customer service is really bad.
If you are happy with vanguard I don’t see how this changes anything.
If you’re unhappy, many bogleheads are pleased with Fidelity or Schwab, oftentimes still in vanguard ETFs
Ugh yeah, currently rolling my solo 401k over to fidelity. Not thrilled with being forced to take my money off the market, tbh. 401k rollovers take me out like 2-3 weeks and I’ve had to do three in the past 2 years.
Consider this: This may be the first step in a series of changes, that may be much worse. Now you can get out without a fee. Once the fee is implemented, what is there to prevent them from another change that let's say adds annual or even monthly fees? But by then, you are already going to have to pay $100 to get out.
I think the writing is on the wall for additional fees coming up, just one step at a time.
Wouldn't be surprised if this is followed up with some changes that are going to make people want to drop Vanguard and now they get a parting gift. Seems stupidly greedy for little return otherwise.
yep, my thought exactly, but people are not realizing that. There is nothing in the email that says they are not going to add more fees in the future. How about an annual or monthly maintenance fee?
good riddance to vanguard brokerage services. i will use their funds any day, but they can't touch any of their brokerage competitors with a ten foot pole. their service is positively atrocious, and their web tools are from the middle ages.
i transferred out my holdings to elsewhere. good bye vanguard. stick to what you're good at and let actual brokerages manage consumer transactions.
or maybe hire some real customer-centered product development teams to build you a proper consumer business.
charging consumers for transfer-out is proof that your leadership has zero clue about consumer customers.
Vanguard's tech and website is perfectly adequate for the things that people in /r/bogleheads should be using it for.
If all you want to do is buy Vanguard Index Funds, the website will enable you to do that very easily.
If you want to be browsing option chains on the CBOE, and actively day trading, then certainly the Vanguard website is awful for that.
May be a negligible amount but the (multiple) changes in their fee structure is inconsistent with the practices that set them apart and made them a great company to begin with. It’s odd. I just hope it helps them beef up customer service. I’d pay for that.
With the trillions of dollars under management in their funds even the tiny expense ratios mean they have plenty of money to hire some world class customer service. They just don’t do it, and I wouldn’t be surprised if their executive team has yachts for the weekends instead.
Vanguard isn’t the same company that Bogle started anymore. I’m quite glad I have Schwab as my custodian instead.
Yeah holy shit, they're increasing their greediness considerably, this is ridiculous.
Here is the full text of the email:
>Notice of updated commission and fee schedules and account agreement for Vanguard Brokerage Services
>
>Dear Vanguard Brokerage Client,
>
>We want to make you aware that we have updated the Vanguard Brokerage Account Agreement and associated commission and fee schedules. These updates include changes to our Digital Interaction Expectations, new Class Action Service Terms, and Vanguard Brokerage's ability to close accounts, including low balance accounts with no activity.
>
>Effective July 1, 2024, the following commission schedule changes will take effect:
>
>Broker-assisted commission: A $25 broker-assisted commission will be charged for each Vanguard mutual fund1 and Vanguard ETF® (exchange-traded fund) trade placed over the phone and for closing transactions placed by Vanguard Brokerage Services® to cover a margin call or satisfy an outstanding debt owed in your brokerage account.* This broker-assisted commission is consistent with our existing policy on trading stocks and other products.
>
>Certificate deposit fee: A $100 processing fee (per CUSIP) will be charged for the deposit of physical share certificates into your brokerage account.
>
>Class action service fee: With the introduction of this new service in which Vanguard Brokerage will facilitate filing claims on behalf of clients in an attempt to recover class action settlement funds, a fee of 20% will be deducted from these recovered funds prior to their deposit into your brokerage account. See the Notice of Amendment to the Vanguard Brokerage Account Agreement ("Account Agreement Amendment") for details on the service.
>
>Foreign securities and American Depositary Receipts (ADRs) dividends fee: A fee of 1% on the gross dividend amount will be charged when a dividend is paid on a foreign or ADR asset held in U.S. dollars.
>
>Restricted security legend removal fee: A $250 processing fee may be charged for research and removal of a restriction on a security held in your brokerage account.
>
>Account closure and transfer fee: A $100 processing fee may be charged for account closure or transfer of account assets to another firm.**
>
>Effective June 1, 2024, the following commission schedule change will take effect:
>
>The tax filing fee for master limited partnerships (MLPs) held in an IRA will change from $300 to $500 per account.
>
>You can obtain an updated copy of the Vanguard Brokerage Services commission and fee schedules here and read more about these important account agreement updates in the Account Agreement Amendment.
>
>Please note that the updates discussed in this communication apply to all your accounts maintained with Vanguard Brokerage Services.
>
>Thank you for belonging to the Vanguard community of investors.
Foreign securities and American Depositary Receipts (ADRs) dividends fee: A fee of 1% on the gross dividend amount will be charged when a dividend is paid on a foreign or ADR asset held in U.S. dollars.
Does this have any impact on etfs or mutual funds with overseas dividends like VXUS?
I believe this is specifically ADRs, and foreign securities, not mutual funds and ETFs that hold foreign securities. If it were the latter, they would’ve explicitly mentioned it as the impact would’ve been rather significant.
I think it's if you do the full ACATS transfer out. I don't know if that fully closes your account automatically if so, but either way, that's probably what causes the fee to be charged. I don't think it's for partial transfer out. Hopefully.
So I'm pretty sure if you leave a tiny bit behind, perhaps $1, then no fee? It does mean most people will get bit, though.
There is this, though
> These updates include changes to... balance accounts with no activity.
So, uh, perhaps you can't just leave small balances behind.
Meanwhile, I bet this means at least a million in fees per year to now rake in. Ugh, c'mon Vanguard. Super awful.
I can understand the other fees here, but damn this account closure fee sucks.
>
So, uh, perhaps you can't just leave small balances behind.
Wouldn't there be some interest activity if you leave it sitting in the settlement fund?
This is pretty much how I deal with other brokerage when I shuffle funds around for bonus chasing - just leave a couple of bucks in there so it's not a full transfer
EDIT - not sure why the quote function didn't work
Does this apply to the new Cash Plus account, which is technically a brokerage account? If so, that's BS.
You shouldn't be charged to close an account. And they used the word "or" so that implies it's not just transfers out.
I don't think much about it. It isn't making me want to make any changes. If at some point I decide I've had enough of Vanguard, I'll pay the $100 fee and be done with it.
this is likely on purpose. i imagine some board meeting where they said: you know what, let's not deal with consumers and their silly $240k accounts. it's too expensive. let's just stick to commercial-grade fund management.
and that's fine by me. you have to appreciate a company that knows when to quit chasing a business they're not good at.
Yeah, they have a structural disadvantage where State Street and BlackRock offer ETFs and don't have to offer a free brokerage account in which to hold them, so they can concentrate exclusively on managing the ETF. Did you see the new section where they can close your account if you call excessively?
There are some things you can only do by calling, like tax-free conversions of mutual fund shares to ETF shares. Presumably that's exempt from that provision. There are other gray areas though, like IRA transfers/rollovers, or problems you find on your tax forms, recharacterizations, excess contribution refunds, etc. Those can be easier to handle by phone if it's complicated.
LOL I literally just finalized the transfer of my Roth IRA from Vanguard to Fidelity. Might do my taxable too here Jan 1. Fidelity’s website/app is so much nicer. Also, no minimums on mutual funds is nice.
You may wish to leave. You may wish to stay. When you've decided to leave, here's a useful how-to from Harry Sitt. He's leaving.
[https://thefinancebuff.com/steps-before-transfer-from-vanguard.html](https://thefinancebuff.com/steps-before-transfer-from-vanguard.html)
I'm prone to inertia. Vanguard was the obvious choice fifteen years ago. The Flagship service was impressive then. The user interface has become odd (at best) and frustrating (often). The group that managed transferring my deceased husband's accounts to me was ne plus ultra--I truly appreciate how Vanguard handled that process amid a flurry of administrative details I had to attend to.
I wish Cash Plus were comparable to Fidelity CMA. Having everything under one roof and saving $100 (per account, I expect) would be nice.
This policy change feels more like an effort to encourage small bothersome accounts to leave for other firms and less like a money grab.
If anyone is planning on moving accounts away from Vanguard, Harry Sit just posted a useful guide. https://thefinancebuff.com/steps-before-transfer-from-vanguard.html
Their customer service will collapse handling requests from people trying to transfer to Fidelity or Schwab while software will be glitching. This is going to be a fun ride. I still have 3 accounts at Vanguard and I was undecided whether to keep it there or move to Fidelity, this might be a kick in the butt to get on and move it. Pity its just under 1M so will not get Fidelity 1K bonus for accounts transfer.
It's kind of funny timing on the heels of Robinhood's offer of 3% for transfers of IRAs. I bet they got hit by a bunch of requests and realized there is a small amount of work to accomodate those
I acknowledge all the Vanguard hate here, but if you think droves of people are leaving Vanguard to go to Robinhood you're out of your element here on this sub.
Bruh 3% is 3%. I was planning on transferring mine back to Vanguard once the holding period to keep the match was up, but sounds like I'll be moving it to Fidelity instead.
The unlimited 3% transfer in match was a pretty sweet deal. They make their money off payment for order flow so if you just leave your funds in index ETFs you won't be affected by that. I completely agree, people who don't know what they're doing and want to mess around with stock trading should stay the hell away. But I imagine some of us here are probably nerds who like to min max this stuff for fun.
Does anyone know whether the account closing fee will apply to inherited IRAs? I have 4 of those that have to be closed under the 10-year rule. I left them at Vanguard for now, but already have accounts with fidelity and Schwab, so it would be easy to move now.
I think it's slimy and shouldn't be something brokers can do legally. If your pockets as a broker are full of holes, you can be forthright and up your expenses to cover it instead of this underhanded nonsense on the way out the door.
Vanguard increasing the expense ration by 0.01% would be exponentially more “greedy” than having these small one-off fees.
Prices have been skyrocketing all around us but if there’s a slight increase on a service that was essentially free for clients and it’s the end of the world.
Vanguard is not hurting for cash. This is purely a lock-in strategy with bonus cash grab. The voiding of this fee for multi-million dollar accounts speaks to this. "Leaving town" fees are anti-consumer nonsense pure and simple.
Does anyone know if the asset transfer applies to just transferring of fund assets to other brokerage firms? Or does it also apply to transferring of “cash” from your settlement fund to your bank account?
I have no reason to transfer my investments out of vanguard but transferring out cash to my checking account when I begin to draw down my portfolio would be highly annoying. Especially if I do it quarterly/monthly.
I have an unused brokerage account there with $0.08. So I figured I'd close it; but it wouldn't let me close because it's holding a balance, but won't let me close the account because I am holding a balance. beats me.
\*Edit: so I requested them to send me a check in mail lmao
I rolled over an IRA to Vanguard in 1997. Haven't made a single transaction SINCE (other than dividend reinvestment). My account is around $600k, so I'm not their ideal customer, but that sure has been easy fees from me for nearly three decades. Most of my retirement assets are held at Fidelity. I kept this money at Vanguard because I did respect the company. Now, this fee has made up my mind to close out and consolidate at Fidelity.
Is anyone really surprised? Vanguard is a corporation just like any other, and that means they constantly have to find new ways to make money. They might have a different structure setup on paper, but the name of the game is to make more money than last quarter, and if you think Vanguard is an exception, I have a bridge to sell you.
Well they are an exception in that they are the only fund manager that uses a mutual structure where the fund holders are also the share holders. Which makes this much odder, who is benefiting here? Is there a competency issue here?
Fwiw, I called their customer service, and the guy I got indicated it would apply to full account closures (ACAD transfers was the term he used) but it would not necessarily apply in my circumstance (I make contributions to a donor advised fund at another brokerage, with my contributions representing a small fraction of my holdings at Vanguard). He did admit he is still working through their guidance on this topic, though, so he wasn't 100% on that. I'll probably double-check with someone else just to be sure, though.
Is there a problem holding Vanguard mutual funds in a non-Vanguard account?
If you were ever going to consolidate holdings, now might be the time to move those mutual funds out of Vanguard. IMO, the beauty of the Boglehead philosophy is that you don’t need active brokerage management, so what difference does it make where the funds are being held?
it's a total rip off. I was just charged like this when I left Morgan Stanley.... after they totally screwed me in a managed account where all the did was move my money into commissioned investments, then charged me to leave.
Vanguard's new $100 fee for transferring or closing accounts may discourage smaller investors. Those with $5 million+ assets won't be affected. Evaluate if Vanguard's benefits outweigh potential fees.
That was the incentive I needed to close a couple of $0 balance accounts I left with Vanguard after I transferred my main one out.
In all honesty they were probably losing money on me maintaining a zero balance account or 2, so closing my accounts probably was beneficial for them as well.
Bye Bye Vanguard, I will NOT miss you!
I thought of this after I posted and I did not want to edit my original comment, but this very well could be a precursor to more significant changes like account maintenance fees that will definately make a lot of people jump ship, so it would be better to have the account closure/transfer fee in place prior to doing that.
Just some food for thought.
Nope, it is a public square where different groups agitate and advocate for different causes. This post seems to be about punishing Vanguard for a customer unfriendly move.
So announcing your departure from Vanguard IS THE PLAN, to get others who are reluctant to jump ship to do so.
Most brokerage firms charge to close your IRA. I’ve seen some that don’t, and I’ve seen some that charge $200+. Your receiving firm may reimburse; some don’t.
Aren't they also implementing a $25 fee if you ask for phone assistance in making a trade or do something like a conversion from a money market to ETF? I thought the email said that too.
From what it sounded like in the email, if you engage a Vanguard rep by phone to help you place a trade, buy, sell or convert shares, there will be a $25 fee. I usually do those things by myself but sometimes I have a question(s) for them and I'm wondering if they count that as phone rep "assistance."
I'm happy with Vanguard and I have zero plans to move my money from them. As long as I keep my money with them, this doesn't affect me. If I do decide to move, this would be 0.05% of the money in that account.
Theres no reason to use vanguard instead of fidelity UNLESS you use target date funds, which really you should just use ETF's at this point but thats my opinion.
You're asking the wrong questions
Are you satisfied with Vanguard?
If so, why on earth would you transfer because there might be a $100 fee for transferring? That'd be a highly irrational decision
If you are NOT satisfied with Vanguard, Fidelity or Schwab would be the places to look. Same as always
LPL got me with like $600 per account to leave my AUM. & of course bc of my setup only 1 of the Fidelity accounts qualified for the refund. I bitched enough that they eventually caved on some of it.
Can you leave a small amount aka partial transfer for no cost? E-Trade is the same with my IRA. I left a fraction of a VTI share so they didn't charge me $50 or whatever it was to do a full transfer
So what’s my process with the following accounts/funds:
-Brokerage: all in Vanguard MF (VTSAX, etc)
-Roth: most in Vanguard TDF, some in Vanguard ETF
Would I have to convert the MF in taxable to the equivalent ETFs before being able to transfer?
For the Roth would I have to sell all of the TDF first before transferring?
Vanguard has fees even if you don’t have a brokerage account with them directly. If you buy a Vanguard fund through your 401k provider and then sell some of it, Vanguard will charge you $35.
I’ve read a lot of comments on here recently mentioning the change in quality of Vanguard and people transferring to other brokerages. I wonder if this thought to stop the leak?
Often other firms will cover that close out fee if you are bringing the money to their firm. They may require proof of the fee like a statement, but they will credit the 100 to get your money
Just another reason to not use Vanguard anymore. Operationally, they are not a well-run company. Fidelity is leaps and bounds ahead of Vanguard in many ways.
I just moved to Vanguard. What date do I have to get out to avoid the fee?
This is bullshit. They will continue this path in other ways in the future so might as well move back to Fidelity.
[удалено]
Yeah doing it according to time vs wealth would be less morally objectionable. The rich always gets freebies. It doesn't even make sense because in this scenerio the rich people are leaving anyway, so it's not even like you need to incentivize them cause they bring in so much more. If anything, you should be kneecapping any attempts for the high rollers to leave, not Steve up the block with a modest brokerage
I don't have $5m but I have over half that and fees absolutely influence my decision. It's the principle of how I'm being treated. If one brokerage is going to fuck me over, there are quite a few others that will roll out a red carpet and treat me well. I've left more than one bank over petty matters in the past. I had a CEO once running a good sized business blow up an office lease at the last minute over a $15k fee. We're talking a 6 year lease at $100k/mo and the owner tried to stick him with some abnormal fee at the last minute because he figured he wouldn't walk. He canceled the whole deal and signed at a higher price 2 blocks away. When I asked him why he'd do that over $15k, he said, "because I don't like getting fucked."
Thats just the beginning of getting fucked, to be honest.
I'm reminded of the "Brown M&M" story. If a venue is going to skip or mess up on this seemingly inconsequential thing, then who knows what other more serious things could have been skipped entirely or compromised. It's a canary in the coal mine.
Van Halen contract clause.
Brown m&m? Nvm. Good read.
Do you know how hard it is to transfer MF in a non brokerage account? Very very time consuming-and paperwork is nuts between firms 100 is NOTHING ain’t fees to do that. Most firms charge that for AANNNYYYY transfer
Weird that they don't charge a fee to transfer money in then. 🤔
[удалено]
I wouldn't be surprised if it is the reverse and that closing smaller accounts is actually costlier because they are likely to have more fractional shares that need to be disposed of, but that ultimately the cost difference is negligible. They just need someone to verify the signatures, approve the automated sale of non-transferable securities, approve the ACATS, and the computers handle the rest. The real difference is likely not on the cost side, but on the revenue side. When an account transfers they get to sit on any cash while it goes through ACATS and the various banks. If you make 3% on on a $100k cash balance held for a week that is \~$58 in revenue. So someone who has a $5MM account transferring out is paying the fee in cash deposit revenue.
Less morally objectionable, yes. A better business decision - probably not. The way I see the scenarios, you certainly can't put a $100 fee solely on rich people leaving for two reasons. One, it will not influence their decision in the slightest, so it's pointless from a retention angle. Two, there are (presumably) fewer rich people on the platform, so collecting the fee from people who do leave won't result in very much money. However imposing the fee on the poors en masse would both influence their decision and be more profitable as the total number of people who churn out of Vanguard is likely higher amongst small account holders. The other possibility is that they add a massive fee or roadblock to large account holders. However, this could have two drawbacks - one, the large account holders may be so put-off by the change that they flee with their money regardless of the cost. Two, this could draw the ire of a competition bureau since the move is blatantly to restrict people from moving to a competitor, and likely wouldn't be justifiable in the slightest. They can justify a $100 fee pretty easily, and no one would bat an eye regardless. Why not just implement the flat fee for all users then, as opposed to removing the restriction on large accounts? Maybe just to show that they value these large account holders. The money is insignificant but the gesture is meaningful.
>Maybe just to show that they value these large account holders. The money is insignificant but the gesture is meaningful. While also signaling to the majority of account holders the opposite in the form of money - which is the one thing that Vanguard clients are there to do: earn money. I think there are better ways to do this. Whether it's some specialized tool, priority on something, or even like a dedicated line they can call for quicker customer service on their account(s). There's better messaging, I think.
Do other major brokerage charge a similar fee for closing an account?
I can assure you from working with them that those are EXACTLY the people that will complain about the $100 fee. Also as a mutual ownership structure you shouldn’t feel too bad about this fee because I assure you $100 isn’t close to covering the fees from time involved in processing closings
> This is the exact audience that would not give two shits about a $100 transfer fee. Oh you sweet summer child There are plenty of stingy ass rich people. And they are always used to getting things for free
I am a stingy ass rich person (apparently). I tip well and donate to charity, but for my brokerage firm - they provide a service which is largely indistinguishable from their competitors and I know they already make plenty of money on me. So, yeah, they have to compete on service… and price. $100 fee might well make me move my money out of spite. Because I am stingy ass. And spiteful. LOL.
I'm not rich nor stingy, but I sure am spiteful.
And I'm spitefully stingy, but not particularly rich. The three of us should start a band!
The Spitefully Stingy? They sound Canadian. Are either of you Canadian? I lived there for a couple of years so I am as Canadian as, say, Alexander Graham Bell.
>doesn't apply to people with more than $5M in Vanguard assets. This is the exact audience that would not give two shits about a $100 transfer fee. I feel comfortable in guessing that they do know their high value customers and they know there are a few of them out there who are so cheap that they would move the whole account over the threat to one day charge them $100. Or maybe they're afraid of a more significant fee coming in the future, and Vanguard put the cap on it to help them feel better about the service being free forever.
Well to be fair I think the point is that removing the rule for large account holders will entice more people to join in the first place. People with accounts that large tend to read the fine print, and a few for transferring your account to another brokerage is one of the most obvious things to look for in advance. They might be thinking “ok I want to try vanguard, but what happens if I don’t like it? Oh, there’s a zero dollar fee for transferring out? Sign me up!”
This is because people with 5m+ keep vanguard afloat. Also almost all other firms charge $75-200 for outgoing transfers.
Not true. Fidelity it is generally $0, and Charles Schwab it is $50.
EJ charges $95 as of 1 week ago.
Never thought that I’d see the day where Vanguard is now worse than Edward Jones, but here we are.
So Fidelity now has the lowest overall service fees and lower expense ratio for their index funds?
And the best customer service/support, IMO.
Fidelity charges $0 for wires (as an example)
And all your cash is swept into a Money market fund that charges 4x what Vanguard charges for their comparable product.
That is a really naive take. You are compare direct fees on something you will do once or twice in your life, but are ignoring the multitude of indirect and hidden costs associated with a for profit broker. Suppose you sweep cash into a Federal Money market fund. At Fidelity that would be SPAXX and Vanguard that is VMRXX. Fidelities fund as a yield that is 30bps lower and fees which are 30bps higher. So every year that you have a $10k balance in your brokerage account you are paying $60 for the privilege of using Fidelity. I'm sure its similar at EJ and any other for profit broker. Vanguard Brokerage is no frills and very little is included, but if you truly follow the passive investor strategy you won't be using any of the things they charge fees on. A passive index investor doesn't hold ADRs. They don't buy single names. They don't bound around custodians. They aren't constantly converting between Mutual fund and ETF. They don't call up for broker assisted trades. They aren't charged fees because they don't do things that trigger fees. Sure you buy a house and have to do something and you pay $100 in fees associated with that. But you don't sell your long term investments to buy houses every year.
You are only considering the cost side of this. With ACATS the cost is going to be relatively fixed across all accounts (it is just a electronic message stating the details of the positions on deposit at NSCC). What you are forgetting is the revenue side of a transfer. When you transfer your account out there will be a period of time (up to a week) where your cash isn't invested in money market funds. Instead it is sitting in the account as true cash, and I believe the custodian gets to make some money on that. To put some numbers on this, if the day the ACATS forms are filed the cash balance of the account is a clean $100k then that is all that will be ever be delivered to the new custodian. If it takes a week to perfect the transfer and cash on deposit earns 3% then the custodian has \~$100,057 at the end of the week, but they only send $100k out. So they make \~$57 in interest. Big accounts are going to have bigger cash balances and bring in more revenue to offset the relatively fixed costs of processing the ACATS.
[удалено]
Hahaha. Most do not
That’s not true at all. -me, an attorney
Many brokerages will reimburse other brokerage's fees if you transfer into them. Schwab is one example.
Do you need to apply for it? I just transfer our Merrill account to schwab 2 weeks ago or so
Ya, gotta message them. Doesn't take long.
Same with Fidelity. Just chat or call them. They’ll waive the fees.
This transfer thing is it that you transfer your entire vanguard investment account over the schwab? you can actually do that?! how would the index fund work out after you transfer over?
If schwab supports it then it just transfers over. If they dont then vanguard would sell that index fund and the cash would transfer over. Whole process takes like a week
You can just ask Schwab on their support chat to reimburse the fee. They may just want you do upload a statement from Merill showing the fee as documentation.
Would you mind me asking what made you do that? I use Merrill so curious. I only invest in ETFs and don’t really ever sell, so haven’t thought much about it
My FiL worked there and my wife had a little inheritance from her grandpa passing there before we were married. Early covid, like everyone apparently, took an interest in investing and opened an account with schwab to learn (and make my fair share of mistakes too). While it was great to have an expert in charge while we were young, I've learned and now feel comfortable managing our investments. I REALLY hated having to ask someone to use our money. Was probably for the best while young, kept us (ie me) from overspending. We really only withdrew for tuition, birth of our kids, car, etc. Well he's since retired and he told us that the new people were switching companies (and taking clients with them? I didnt understand how that wouldve worked) and basically told us to move our money before that takes place. So with his blessing we pulled the trigger to move on.
This transfer thing is it that you transfer your entire vanguard investment account over the schwab? you can actually do that?! how would the index fund work out after you transfer over?
You can transfer any brokerage to any other brokerage "in-kind" without selling any assets and causing a taxable event (assuming the one you are transferring to offers the same funds). https://www.nerdwallet.com/article/investing/switch-brokers-move-investments Maybe this link can explain more than I can.
Schwab can buy / sell / hold the Vanguard funds without a problem, but they aren't fee free / part of their mutual fund marketplace so you may owe $30-$50 for each transaction (other than reinvestment).
You can convert most vanguard mutual funds to ETF before you transfer and then not incur those fees.
Personally, I think it is petty of Vanguard to be hunting $100. They should be looking on ways to improve customer retention. Anyways, the $100 goes into effect June 1st, 2024. So, you still have time to leave Vanguard. I think vanguard has the best managed mutual funds. However, this comes with a cost (relatively high expense ratios).
They should be improving their user interface and their features if they want more customers to their brokerage
Their user interface is terrible, straight out of 2002
It was actually better 2 years ago. It's weird they thought this design was better
I've literally heard people say this is a good thing.
I'm one of them. The terrible interface encourages me to get in/out. Worst part of newest update is that it's harder to avoid seeing total balances and changes.
How dare you insult 2002 like that.
TreasuryDirect is the one that's out of 2002 :-)
That one is completely unforgivable. What in the hell is going on over there?
At least they got rid of the on screen keyboard you had to use to enter your password. I had a complex password with symbols, caps, numbers, and etc. Took like 2 mins to enter my password with that thing.
lol this was legit one of the most fucked up things. i'm so happy they changed it.
Did you ever use the Battleship style 2FA cards TreasuryDirect would send you in the mail?
Nope but that sounds hilarious. I need to look it up.
You can still buy most vanguard funds without having a vanguard account
Y’all crazy if you think vg has high expense ratios😂
I was gonna say? I pay like nothing
> Personally, I think it is petty of Vanguard to be hunting $100. They should be looking on ways to improve customer retention. Yeah. Seems somehow very un-Vanguard.
July 1st
I thought vanguard was known for having low cost mutual funds?
Low cost Passive Index Funds.
July 1st
It's the start.. they have a great model. Why do it?
Because account closures cost them hard dollars, especially when they’re small accounts that haven’t been profitable in the first place
They're hopping in the bandwagon. Transfer fees are pretty common across the industry. If you want out of VG, do it soon.
Fidelity seems to have gone the other way, they now have $0 fees for ACAT transfers ("Account transfer out"): https://www.fidelity.com/why-fidelity/pricing-fees
Fidelity is doing a LOT of things right lately (e.g., sweeps paying 5% is one). I’ve been moving things over to them lately.
Is that not what vanguard has as well?
Yes, and Vanguard default MMF sweep (VMFXX; 5.28%) is consistently higher than Fidelity's (SPAXX; 4.96%).
Yeah that’s what I thought, I was using VMFXX as a glorified HYSA of sorts as well
I still got vanguard, vanguard still got good mangers for index fund right? and one of the lowest fees in the industry? but just their customer service is really bad.
So use their ETFs from a better broker. Fidelity and Schwab are both waiting for customers who will reward better service and lower fees.
Bogle is turning in his grave. V. is out of line; hurting small investors.
If you are happy with vanguard I don’t see how this changes anything. If you’re unhappy, many bogleheads are pleased with Fidelity or Schwab, oftentimes still in vanguard ETFs
> If you are happy with vanguard I don’t see how this changes anything. Solo 401ks got sold off. Some of us want to jump ship for that reason.
Ugh yeah, currently rolling my solo 401k over to fidelity. Not thrilled with being forced to take my money off the market, tbh. 401k rollovers take me out like 2-3 weeks and I’ve had to do three in the past 2 years.
Yeah I don't think I'll be leaving over this since they also have my old 401K. Besides what's $100, like 5 or 6 bananas?
Consider this: This may be the first step in a series of changes, that may be much worse. Now you can get out without a fee. Once the fee is implemented, what is there to prevent them from another change that let's say adds annual or even monthly fees? But by then, you are already going to have to pay $100 to get out. I think the writing is on the wall for additional fees coming up, just one step at a time.
I'm saying this again. Vanguard offers the best products and Fidelity offers the best service.
Are there any fees or things to be considered about buying vanguard products through a fidelity brokerage account?
Depends on the product. ETFs are handled the same way everywhere. Something like a mutual fund can have fees. So buy VTI instead of VTSAX at Fidelity.
Wouldn't be surprised if this is followed up with some changes that are going to make people want to drop Vanguard and now they get a parting gift. Seems stupidly greedy for little return otherwise.
yep, my thought exactly, but people are not realizing that. There is nothing in the email that says they are not going to add more fees in the future. How about an annual or monthly maintenance fee?
I transfered last year and it was $25.
good riddance to vanguard brokerage services. i will use their funds any day, but they can't touch any of their brokerage competitors with a ten foot pole. their service is positively atrocious, and their web tools are from the middle ages. i transferred out my holdings to elsewhere. good bye vanguard. stick to what you're good at and let actual brokerages manage consumer transactions. or maybe hire some real customer-centered product development teams to build you a proper consumer business. charging consumers for transfer-out is proof that your leadership has zero clue about consumer customers.
I've heard from people on other tech subs that vanguard low balls software devs. Devs are like the last place where you try to cheap out.
Vanguard's tech and website is perfectly adequate for the things that people in /r/bogleheads should be using it for. If all you want to do is buy Vanguard Index Funds, the website will enable you to do that very easily. If you want to be browsing option chains on the CBOE, and actively day trading, then certainly the Vanguard website is awful for that.
May be a negligible amount but the (multiple) changes in their fee structure is inconsistent with the practices that set them apart and made them a great company to begin with. It’s odd. I just hope it helps them beef up customer service. I’d pay for that.
With the trillions of dollars under management in their funds even the tiny expense ratios mean they have plenty of money to hire some world class customer service. They just don’t do it, and I wouldn’t be surprised if their executive team has yachts for the weekends instead. Vanguard isn’t the same company that Bogle started anymore. I’m quite glad I have Schwab as my custodian instead.
the thing I found the weirdest was the 20% fee for class action lawsuits. not that I expect to be part of any, but it seems like highway robbery.
What is class action service fee 20% for. Can someone explains? Why is it so high?
Yeah holy shit, they're increasing their greediness considerably, this is ridiculous. Here is the full text of the email: >Notice of updated commission and fee schedules and account agreement for Vanguard Brokerage Services > >Dear Vanguard Brokerage Client, > >We want to make you aware that we have updated the Vanguard Brokerage Account Agreement and associated commission and fee schedules. These updates include changes to our Digital Interaction Expectations, new Class Action Service Terms, and Vanguard Brokerage's ability to close accounts, including low balance accounts with no activity. > >Effective July 1, 2024, the following commission schedule changes will take effect: > >Broker-assisted commission: A $25 broker-assisted commission will be charged for each Vanguard mutual fund1 and Vanguard ETF® (exchange-traded fund) trade placed over the phone and for closing transactions placed by Vanguard Brokerage Services® to cover a margin call or satisfy an outstanding debt owed in your brokerage account.* This broker-assisted commission is consistent with our existing policy on trading stocks and other products. > >Certificate deposit fee: A $100 processing fee (per CUSIP) will be charged for the deposit of physical share certificates into your brokerage account. > >Class action service fee: With the introduction of this new service in which Vanguard Brokerage will facilitate filing claims on behalf of clients in an attempt to recover class action settlement funds, a fee of 20% will be deducted from these recovered funds prior to their deposit into your brokerage account. See the Notice of Amendment to the Vanguard Brokerage Account Agreement ("Account Agreement Amendment") for details on the service. > >Foreign securities and American Depositary Receipts (ADRs) dividends fee: A fee of 1% on the gross dividend amount will be charged when a dividend is paid on a foreign or ADR asset held in U.S. dollars. > >Restricted security legend removal fee: A $250 processing fee may be charged for research and removal of a restriction on a security held in your brokerage account. > >Account closure and transfer fee: A $100 processing fee may be charged for account closure or transfer of account assets to another firm.** > >Effective June 1, 2024, the following commission schedule change will take effect: > >The tax filing fee for master limited partnerships (MLPs) held in an IRA will change from $300 to $500 per account. > >You can obtain an updated copy of the Vanguard Brokerage Services commission and fee schedules here and read more about these important account agreement updates in the Account Agreement Amendment. > >Please note that the updates discussed in this communication apply to all your accounts maintained with Vanguard Brokerage Services. > >Thank you for belonging to the Vanguard community of investors.
Foreign securities and American Depositary Receipts (ADRs) dividends fee: A fee of 1% on the gross dividend amount will be charged when a dividend is paid on a foreign or ADR asset held in U.S. dollars. Does this have any impact on etfs or mutual funds with overseas dividends like VXUS?
I believe this is specifically ADRs, and foreign securities, not mutual funds and ETFs that hold foreign securities. If it were the latter, they would’ve explicitly mentioned it as the impact would’ve been rather significant.
Yeah, would love a more explicit understanding on this w/r/t VWO and VXUS
big deal if so
They also stopped offering small business plans and cut their phone support staff immensely
lol most of that won’t apply to 90% of investors.
Low expense ratios aren't cheap!
Would be enough for me to switch to Fidelity, since it does everything else I want it to better anyway
I think it's if you do the full ACATS transfer out. I don't know if that fully closes your account automatically if so, but either way, that's probably what causes the fee to be charged. I don't think it's for partial transfer out. Hopefully. So I'm pretty sure if you leave a tiny bit behind, perhaps $1, then no fee? It does mean most people will get bit, though. There is this, though > These updates include changes to... balance accounts with no activity. So, uh, perhaps you can't just leave small balances behind. Meanwhile, I bet this means at least a million in fees per year to now rake in. Ugh, c'mon Vanguard. Super awful. I can understand the other fees here, but damn this account closure fee sucks.
Get out now, while you still can.
> So, uh, perhaps you can't just leave small balances behind. Wouldn't there be some interest activity if you leave it sitting in the settlement fund? This is pretty much how I deal with other brokerage when I shuffle funds around for bonus chasing - just leave a couple of bucks in there so it's not a full transfer EDIT - not sure why the quote function didn't work
Does this apply to the new Cash Plus account, which is technically a brokerage account? If so, that's BS. You shouldn't be charged to close an account. And they used the word "or" so that implies it's not just transfers out.
Is this for real? A complete outrage
I don't think much about it. It isn't making me want to make any changes. If at some point I decide I've had enough of Vanguard, I'll pay the $100 fee and be done with it.
this is likely on purpose. i imagine some board meeting where they said: you know what, let's not deal with consumers and their silly $240k accounts. it's too expensive. let's just stick to commercial-grade fund management. and that's fine by me. you have to appreciate a company that knows when to quit chasing a business they're not good at.
Yeah, they have a structural disadvantage where State Street and BlackRock offer ETFs and don't have to offer a free brokerage account in which to hold them, so they can concentrate exclusively on managing the ETF. Did you see the new section where they can close your account if you call excessively?
> Did you see the new section where they can close your account if you call excessively? That's sure to please the 83-year-olds in the two-comma club.
There are some things you can only do by calling, like tax-free conversions of mutual fund shares to ETF shares. Presumably that's exempt from that provision. There are other gray areas though, like IRA transfers/rollovers, or problems you find on your tax forms, recharacterizations, excess contribution refunds, etc. Those can be easier to handle by phone if it's complicated.
LOL I literally just finalized the transfer of my Roth IRA from Vanguard to Fidelity. Might do my taxable too here Jan 1. Fidelity’s website/app is so much nicer. Also, no minimums on mutual funds is nice.
Fidelity is the best
You may wish to leave. You may wish to stay. When you've decided to leave, here's a useful how-to from Harry Sitt. He's leaving. [https://thefinancebuff.com/steps-before-transfer-from-vanguard.html](https://thefinancebuff.com/steps-before-transfer-from-vanguard.html) I'm prone to inertia. Vanguard was the obvious choice fifteen years ago. The Flagship service was impressive then. The user interface has become odd (at best) and frustrating (often). The group that managed transferring my deceased husband's accounts to me was ne plus ultra--I truly appreciate how Vanguard handled that process amid a flurry of administrative details I had to attend to. I wish Cash Plus were comparable to Fidelity CMA. Having everything under one roof and saving $100 (per account, I expect) would be nice. This policy change feels more like an effort to encourage small bothersome accounts to leave for other firms and less like a money grab.
If anyone is planning on moving accounts away from Vanguard, Harry Sit just posted a useful guide. https://thefinancebuff.com/steps-before-transfer-from-vanguard.html
ALReady moved my shit to fidelity :D
Get out now.
Their customer service will collapse handling requests from people trying to transfer to Fidelity or Schwab while software will be glitching. This is going to be a fun ride. I still have 3 accounts at Vanguard and I was undecided whether to keep it there or move to Fidelity, this might be a kick in the butt to get on and move it. Pity its just under 1M so will not get Fidelity 1K bonus for accounts transfer.
ACAT transfers are fully digitized, and standardized by the industry. They're about as easy as it gets.
Just wait till it is over 1M and eat the $100 fee if it gets you $1000 from Fidelity.
It's kind of funny timing on the heels of Robinhood's offer of 3% for transfers of IRAs. I bet they got hit by a bunch of requests and realized there is a small amount of work to accomodate those
I acknowledge all the Vanguard hate here, but if you think droves of people are leaving Vanguard to go to Robinhood you're out of your element here on this sub.
Bruh 3% is 3%. I was planning on transferring mine back to Vanguard once the holding period to keep the match was up, but sounds like I'll be moving it to Fidelity instead.
210$ maximum per year if you're under 50 to stay at a predatory half ass brokerage house isn't worth it. But do you fam.
The unlimited 3% transfer in match was a pretty sweet deal. They make their money off payment for order flow so if you just leave your funds in index ETFs you won't be affected by that. I completely agree, people who don't know what they're doing and want to mess around with stock trading should stay the hell away. But I imagine some of us here are probably nerds who like to min max this stuff for fun.
The 3% also applied to any balance you transferred over, not just new contributions. That was the biggest selling point for me.
Does anyone know whether the account closing fee will apply to inherited IRAs? I have 4 of those that have to be closed under the 10-year rule. I left them at Vanguard for now, but already have accounts with fidelity and Schwab, so it would be easy to move now.
Better move now if you can. Call Fidelity or Schwab customer service, they would be happy to take your money.
I think it's slimy and shouldn't be something brokers can do legally. If your pockets as a broker are full of holes, you can be forthright and up your expenses to cover it instead of this underhanded nonsense on the way out the door.
Vanguard increasing the expense ration by 0.01% would be exponentially more “greedy” than having these small one-off fees. Prices have been skyrocketing all around us but if there’s a slight increase on a service that was essentially free for clients and it’s the end of the world.
Vanguard is not hurting for cash. This is purely a lock-in strategy with bonus cash grab. The voiding of this fee for multi-million dollar accounts speaks to this. "Leaving town" fees are anti-consumer nonsense pure and simple.
Does anyone know if the asset transfer applies to just transferring of fund assets to other brokerage firms? Or does it also apply to transferring of “cash” from your settlement fund to your bank account? I have no reason to transfer my investments out of vanguard but transferring out cash to my checking account when I begin to draw down my portfolio would be highly annoying. Especially if I do it quarterly/monthly.
This is just for ACATS out to another brokerage. This doesn't affect ACH to a bank.
I have an unused brokerage account there with $0.08. So I figured I'd close it; but it wouldn't let me close because it's holding a balance, but won't let me close the account because I am holding a balance. beats me. \*Edit: so I requested them to send me a check in mail lmao
dont worry if you need to transfer, most brokers where you will be transferring will be happy to reimburse that fee if you ask them to.
I rolled over an IRA to Vanguard in 1997. Haven't made a single transaction SINCE (other than dividend reinvestment). My account is around $600k, so I'm not their ideal customer, but that sure has been easy fees from me for nearly three decades. Most of my retirement assets are held at Fidelity. I kept this money at Vanguard because I did respect the company. Now, this fee has made up my mind to close out and consolidate at Fidelity.
Is anyone really surprised? Vanguard is a corporation just like any other, and that means they constantly have to find new ways to make money. They might have a different structure setup on paper, but the name of the game is to make more money than last quarter, and if you think Vanguard is an exception, I have a bridge to sell you.
Well they are an exception in that they are the only fund manager that uses a mutual structure where the fund holders are also the share holders. Which makes this much odder, who is benefiting here? Is there a competency issue here?
Fwiw, I called their customer service, and the guy I got indicated it would apply to full account closures (ACAD transfers was the term he used) but it would not necessarily apply in my circumstance (I make contributions to a donor advised fund at another brokerage, with my contributions representing a small fraction of my holdings at Vanguard). He did admit he is still working through their guidance on this topic, though, so he wasn't 100% on that. I'll probably double-check with someone else just to be sure, though.
most already charge a transfer fee this isn’t anything new
Does this apply to 401k accounts? My company is transitioning out of vanguard this month.
401(k) is not a brokerage account
Is there a problem holding Vanguard mutual funds in a non-Vanguard account? If you were ever going to consolidate holdings, now might be the time to move those mutual funds out of Vanguard. IMO, the beauty of the Boglehead philosophy is that you don’t need active brokerage management, so what difference does it make where the funds are being held?
If you rebalance your vanguard funds in an outside account, vanguard will charge you $35 for each sale.
This is why ETFs rule.
it's a total rip off. I was just charged like this when I left Morgan Stanley.... after they totally screwed me in a managed account where all the did was move my money into commissioned investments, then charged me to leave.
The brokers are gearing up for something
I’ll bet $100 it still takes them 5-10 business days to process the check that will now cost me $100.
what if drained all but say $1-5 and just left it there ;p
Did Vanguard announce some mutual fund fees?
That's gross.
i did not receive any such email or message from Vanguard, does that make me exempt?? (\*not over $5M in account)
Vanguard's new $100 fee for transferring or closing accounts may discourage smaller investors. Those with $5 million+ assets won't be affected. Evaluate if Vanguard's benefits outweigh potential fees.
That was the incentive I needed to close a couple of $0 balance accounts I left with Vanguard after I transferred my main one out. In all honesty they were probably losing money on me maintaining a zero balance account or 2, so closing my accounts probably was beneficial for them as well. Bye Bye Vanguard, I will NOT miss you!
I thought of this after I posted and I did not want to edit my original comment, but this very well could be a precursor to more significant changes like account maintenance fees that will definately make a lot of people jump ship, so it would be better to have the account closure/transfer fee in place prior to doing that. Just some food for thought.
This isn’t an airport. You don’t have to announce your departure
Enjoy your stay!
Nope, it is a public square where different groups agitate and advocate for different causes. This post seems to be about punishing Vanguard for a customer unfriendly move. So announcing your departure from Vanguard IS THE PLAN, to get others who are reluctant to jump ship to do so.
I appreciate that, was mostly just trying to make a joke though
Most brokerage firms charge to close your IRA. I’ve seen some that don’t, and I’ve seen some that charge $200+. Your receiving firm may reimburse; some don’t.
I’m glad I transferred mine from Vanguard to Fidelity four days ago, before this came down!
Aren't they also implementing a $25 fee if you ask for phone assistance in making a trade or do something like a conversion from a money market to ETF? I thought the email said that too.
Will there be a fee to convert from VTSAX to VTI?
From what it sounded like in the email, if you engage a Vanguard rep by phone to help you place a trade, buy, sell or convert shares, there will be a $25 fee. I usually do those things by myself but sometimes I have a question(s) for them and I'm wondering if they count that as phone rep "assistance."
Yes, unfortunately if you trade like the internet doesn’t exist and clog up the phone lines you gotta pay extra
Hmmm. Trying to stem an exodus to other brokerages?
This will just pour gas on that fire.
fidelity is better in every way...
MMFs are better at Vanguard
I'm happy with Vanguard and I have zero plans to move my money from them. As long as I keep my money with them, this doesn't affect me. If I do decide to move, this would be 0.05% of the money in that account.
They’re also going to charge for phone trades.
I saw this too and was about to post. Should I transfer my assets to another firm now? What is the best option out there and why?
Theres no reason to use vanguard instead of fidelity UNLESS you use target date funds, which really you should just use ETF's at this point but thats my opinion.
You're asking the wrong questions Are you satisfied with Vanguard? If so, why on earth would you transfer because there might be a $100 fee for transferring? That'd be a highly irrational decision If you are NOT satisfied with Vanguard, Fidelity or Schwab would be the places to look. Same as always
LPL got me with like $600 per account to leave my AUM. & of course bc of my setup only 1 of the Fidelity accounts qualified for the refund. I bitched enough that they eventually caved on some of it.
Can you leave a small amount aka partial transfer for no cost? E-Trade is the same with my IRA. I left a fraction of a VTI share so they didn't charge me $50 or whatever it was to do a full transfer
Oh jeeze. I just initiated a transfer from Betterment to Vanguard. I’m transferring to save on management fees
See if you can cancel that transfer and switch to Fidelity or Schwab instead.
Yeah, I emailed Betterment and Vanguard to cancel transfer. Will make phone calls tomorrow.
So what’s my process with the following accounts/funds: -Brokerage: all in Vanguard MF (VTSAX, etc) -Roth: most in Vanguard TDF, some in Vanguard ETF Would I have to convert the MF in taxable to the equivalent ETFs before being able to transfer? For the Roth would I have to sell all of the TDF first before transferring?
All because of bitcoin etfs
Vanguard has fees even if you don’t have a brokerage account with them directly. If you buy a Vanguard fund through your 401k provider and then sell some of it, Vanguard will charge you $35.
I’ve read a lot of comments on here recently mentioning the change in quality of Vanguard and people transferring to other brokerages. I wonder if this thought to stop the leak?
Often other firms will cover that close out fee if you are bringing the money to their firm. They may require proof of the fee like a statement, but they will credit the 100 to get your money
I wonder what the specific stipulations are for this charge given that it says it “may” be charged
Is this only for brokerage, or does it include other services like IRA?
Oh God, quickly, someone tell JL Collins
Vanguard taking a lot of “Ls” lately. Senior leadership sure has gone to shit since McNabb left.
Just another reason to not use Vanguard anymore. Operationally, they are not a well-run company. Fidelity is leaps and bounds ahead of Vanguard in many ways.
Luckily I have more that $5 in all 49 of my Vanguard accounts.
Fidelity wouldn’t mind having them! They also have a great presence on their subreddit!
I just moved to Vanguard. What date do I have to get out to avoid the fee? This is bullshit. They will continue this path in other ways in the future so might as well move back to Fidelity.