Author Topic: Why would anyone use Vanguard?  (Read 8746 times)

hydra

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Why would anyone use Vanguard?
« on: June 22, 2022, 11:49:05 AM »
Hi, Mustachians.

I am not someone who reviews companies, services, products, or experiences. I just don't. So this is unusual for me. I feel compelled in this case because after my spouse died and I've had to have some dealings with Vanguard to figure out the beneficiary account, I have come to regard Vanguard as the devil's spawn.

I notice in a lot of FIRE forums that people seem to really like Vanguard. In my experience, Vanguard's phone and online support is ridiculously, shockingly bad. Their website would be laughable if it didn't hurt so much to use it. The automated phone software is buggy, and woe to you if you actually make contact with a human, as they more often than not will be ill-informed and unfriendly. I guess Vanguard must compete based on low cost, but haven't other companies caught up to them on low-cost transactions and funds?

I have accounts at both Vanguard and another company (which I won't name, because I don't want you to think I'm advertising for them). After dealing with Vanguard, I almost need to call the other company as a form of self soothing because the other company is that much more kind, prompt, and competent. I do have a lot more money at the other company, so maybe when I call them I get put into a VIP queue and that's why my experience is so much better. Is this a thing?

According to Investopedia, in their 2020 Best Online Brokers reviews, the other company earned higher scores than Vanguard in every category they ranked, which includes Best Overall, Best for Beginners, Best Stock Trading App, Best for Day Trading, Best for International Trading, Best for Low Cost, and Best for ETFs.

So what am I missing? Why would anyone use Vanguard? Is it nostalgia-based loyalty based on some distant past when Vanguard was better on cost?
« Last Edit: June 22, 2022, 11:58:53 AM by hydra »

Watchmaker

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Re: Why would anyone use Vanguard?
« Reply #1 on: June 22, 2022, 12:22:10 PM »
Poor customer service from a financial institution is a special kind of stress-inducing, particularly if they hold a significant portion of your net worth. I'm sorry you've had to go through that.

Speaking only from my own experience, Vanguard has always been fine. But I also haven't asked much of them--I've only had to do very routine things, and only twice had to talk to a human to get something done (which was painless in both cases). Now, I've heard enough other people complain about their customer service that it's clear they do have a problem, but I haven't experienced that much of a difference between them and their competitors.

I don't stick with them out of nostalgia-- I haven't had money long enough to be nostalgic for a broker-- but because I think for what I need from them, they won't be any worse than other options. And I don't use them exclusively--they only manage about 1/3 of my assets.

I also don't find their website to be an issue at all. Can I ask what you don't like about it?

 
« Last Edit: June 22, 2022, 02:37:34 PM by Watchmaker »

big_owl

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Re: Why would anyone use Vanguard?
« Reply #2 on: June 22, 2022, 12:26:37 PM »
I noticed when I reached some level of money under investment at vanguard (can't remember how much) I was able to call a different "special" support number and that my level of service increased quite a bit.  Fwiw.

hydra

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Re: Why would anyone use Vanguard?
« Reply #3 on: June 22, 2022, 12:41:24 PM »
Speaking only from my own experience, Vanguard has always been fine. But I also haven't asked much of them--I've only had to do very routine things, and only twice had to talk to a human to get something done (which was painless in both cases).

Yes, this is a good point. I have always thought their website was kludgy and ugly, but it didn't particularly bother me or cause me any problems. It was only after my spouse passed away last month and I had to deal with Vanguard as a beneficiary when I began to feel the downside of their presence in my life.

Quote
I also don't find their website to be an issue at all. Can I ask what you don't like about it?

What I have with them is a 401k, and my issue is mostly with the login experience. They have different login pages for different type of accounts, and if I google "vanguard login" I invariably get the wrong one. My spouse worked for the same company as I, had the same type of account with a similar balance, and the online experience for him was different than it was for me. Bizarre! Initiating a rollover out from Vanguard into another broker is very painful. The forms aren't online, and no information is available online.

When I received the beneficiary account, I couldn't log in with my existing login. I had to create a whole new login, which for some reason necessitated them temporarily deactivating my own 401k account. The whole thing almost makes me cry. In fact, I should probably just go ahead and cry to get it out of my system.

PDXTabs

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Re: Why would anyone use Vanguard?
« Reply #4 on: June 22, 2022, 12:49:35 PM »
So what am I missing? Why would anyone use Vanguard? Is it nostalgia-based loyalty based on some distant past when Vanguard was better on cost?

Their order execution quality is probably top-notch:
https://investor.vanguard.com/about-us/brokerage-order-execution-quality

But Fidelity and Schwab are probably "good enough" and aren't getting sued by the SEC over execution quality (like Robinhood) https://www.sec.gov/news/press-release/2020-321

I too have been underwhelmed with my Vanguard Roth IRA experience. I actually had to call them the other day about their buggy 2FA and the dude on the phone was 0% surprised. Next month I think I'm going to have some spare cash to throw into a taxable brokerage and ATM I'm thinking Schwab.

FiveSigmas

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Re: Why would anyone use Vanguard?
« Reply #5 on: June 22, 2022, 01:28:59 PM »
One problem with Vanguard is that it really is performing two different roles:
  • It develops and manages a diverse set of ETFs and mutual funds.
  • It offers a brokerage, Vanguard.com, where you can buy and sell said funds (as well as well as stocks, bonds, and 3rd party funds).
Vanguard is still, IMO, excellent at the former (with some very notable exceptions), but it seems to be becoming increasingly worse at the latter.

I haven't used Vanguard customer support recently, but several  threads on Bogleheads seem to confirm your experience that reaching a human is well nigh impossible, and recent IT failures are also a problem. Given the cut-throat nature of the industry these days (witness the recent trend towards 0 fee trades), I kind of wonder whether Vanguard really wants to invest much in its brokerage operations.

I still use Vanguard as a broker, but honestly it's more out of inertia than anything else. Given the right incentives (or a particularly bad experience), I could certainly see myself moving my funds over to someone else.

nalor511

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Re: Why would anyone use Vanguard?
« Reply #6 on: June 22, 2022, 01:33:02 PM »
One problem with Vanguard is that it really is performing two different roles:
  • It develops and manages a diverse set of ETFs and mutual funds.
  • It offers a brokerage, Vanguard.com, where you can buy and sell said funds (as well as well as stocks, bonds, and 3rd party funds).
Vanguard is still, IMO, excellent at the former (with some very notable exceptions), but it seems to be becoming increasingly worse at the latter.

I haven't used Vanguard customer support recently, but several  threads on Bogleheads seem to confirm your experience that reaching a human is well nigh impossible, and recent IT failures are also a problem. Given the cut-throat nature of the industry these days (witness the recent trend towards 0 fee trades), I kind of wonder whether Vanguard really wants to invest much in its brokerage operations.

I still use Vanguard as a broker, but honestly it's more out of inertia than anything else. Given the right incentives (or a particularly bad experience), I could certainly see myself moving my funds over to someone else.

I agree with this entire post, save for the last line. I agree with the statement that people who still use them do so mostly out of intertia. Thankfully I no longer do

hydra

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Re: Why would anyone use Vanguard?
« Reply #7 on: June 22, 2022, 01:45:33 PM »
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It develops and manages a diverse set of ETFs and mutual funds.

Are Vanguard's ETFs and funds measurably better than other similar ETFs and funds? If so, how?

Gronnie

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Re: Why would anyone use Vanguard?
« Reply #8 on: June 22, 2022, 01:51:39 PM »
This is why I left Vanguard and moved everything to Fidelity where our 401k(s) already were.

Just as low of fees and much better website and customer service.

FIREandMONEY

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Re: Why would anyone use Vanguard?
« Reply #9 on: June 22, 2022, 02:16:59 PM »
I'm not super knowledgeable on the subject, but from my understanding most of the "other guys" are publicly traded companies.  Read: They have shareholders.

Their no-fee/low-fee to compete with Vanguard is really great.  For now.  Until shareholders want a greater return and make leadership raise fees.  When will it happen?  Ever?  Next year?  Who knows.

The ownership of Vanguard basically puts you and me and the VG fund-holders as the owners of the company.  I am not sure if it makes the previous scenario impossible from happening, but it certainly makes it less likely IMHO.

Gronnie

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Re: Why would anyone use Vanguard?
« Reply #10 on: June 22, 2022, 02:27:22 PM »
I'm not super knowledgeable on the subject, but from my understanding most of the "other guys" are publicly traded companies.  Read: They have shareholders.

Their no-fee/low-fee to compete with Vanguard is really great.  For now.  Until shareholders want a greater return and make leadership raise fees.  When will it happen?  Ever?  Next year?  Who knows.

The ownership of Vanguard basically puts you and me and the VG fund-holders as the owners of the company.  I am not sure if it makes the previous scenario impossible from happening, but it certainly makes it less likely IMHO.

This isn't really a concern for anything without tax implications.

Money in IRAs and similar - no concern.

In taxable the only concern would be anything you can't transfer in kind.

FiveSigmas

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Re: Why would anyone use Vanguard?
« Reply #11 on: June 22, 2022, 02:32:08 PM »
Quote
It develops and manages a diverse set of ETFs and mutual funds.

Are Vanguard's ETFs and funds measurably better than other similar ETFs and funds? If so, how?

No, I don't think so, but Vanguard's offerings are still excellent, and I see no reason to move away from them. I certainly don't have any desire to take capital gains hit of selling/rebuying.

Vanguard still holds the patent on its unique ETF-as-mutual-fund-class structure, which can lower capital-gains distributions if you invest in mutual funds, but I'm not sure you're any worse off if you just invest in ETFs.

On the flip-side, other fund providers caused a stir by introducing 0 ER funds, while Vanguard's ERs are still merely insanely-low. Vaguard's competitors seem to have had worse tracking error so far, though, and may be ever-so-slightly worse overall. Or not. I certainly can't see any evidence that they're much better, though.

FiveSigmas

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Re: Why would anyone use Vanguard?
« Reply #12 on: June 22, 2022, 02:53:11 PM »
I'm not super knowledgeable on the subject, but from my understanding most of the "other guys" are publicly traded companies.  Read: They have shareholders.

Their no-fee/low-fee to compete with Vanguard is really great.  For now.  Until shareholders want a greater return and make leadership raise fees.  When will it happen?  Ever?  Next year?  Who knows.

The ownership of Vanguard basically puts you and me and the VG fund-holders as the owners of the company.  I am not sure if it makes the previous scenario impossible from happening, but it certainly makes it less likely IMHO.

This isn't really a concern for anything without tax implications.

Money in IRAs and similar - no concern.

In taxable the only concern would be anything you can't transfer in kind.

I think you may be conflating two things: Vanguard's fund structure and Vanguard's corporate structure. The former has tax implications, while the latter does not (at least not directly).

Honestly, I'm not sure that Vanguard's investor ownership is really much more than a marketing bullet-point. Unlike co-ops, you as an investor at Vanguard don't have any voting rights over Vanguard's business operations. Vanguard's managers will do what what's in the best interest for the company, which may or may not be in your best interests.

Sibley

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Re: Why would anyone use Vanguard?
« Reply #13 on: June 22, 2022, 03:08:03 PM »
Why do I use Vanguard? Because the accounts are there, they're on autopilot, and it's a massive pain to move them. So, it's really a different question: why should I not use them?

Yeah, their website sucks. However, I have the same problems using Fidelity's website as I do Vanguard's: I'm not on it often enough to remember how to navigate it. I have the same problems with paperwork with both Vanguard and Fidelity because it's not the company, it's the country.

Now, if the hassle of Vanguard significantly exceeds the hassle of Fidelity, then I'll consider changing things. Until then, why bother?

I would like to know why you're doing so much with these companies though. Investments should be set it up and forget it. If it's just a temporary aberration, then once this batch of setup is done you won't have to worry about it.

hydra

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Re: Why would anyone use Vanguard?
« Reply #14 on: June 22, 2022, 03:26:58 PM »
Quote
I would like to know why you're doing so much with these companies though.

When a spouse dies, there is an onslaught of administrative crap one must deal with. So I've had plenty of experiences with various institutions lately, and the only one that has pissed me off is Vanguard--so much so that I never want to deal with them again if I can avoid it. For me it has become a principle.

I'm not expecting anyone else to make the same decision. But as I've said, I see a lot of devotion to Vanguard, and I honestly was wondering if I might be missing something important and worth considering.

Watchmaker

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Re: Why would anyone use Vanguard?
« Reply #15 on: June 22, 2022, 03:31:15 PM »
I'm not expecting anyone else to make the same decision. But as I've said, I see a lot of devotion to Vanguard, and I honestly was wondering if I might be missing something important and worth considering.

Nope, you're not missing anything. That other company you prefer is a perfectly good option and there's no important reason to stick things out with Vanguard.

nereo

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Re: Why would anyone use Vanguard?
« Reply #16 on: June 22, 2022, 03:42:28 PM »
Vanguard’s service and website are indeed sub par, but I think “Devil’s Spawn” is a bit of a stretch, at least IME.

As with Sibley, my investments are there and on autopilot, which means its easier than changing over.  It has everything I need (investment-wise) at competitive yields (even if they aren’t the absolute lowest in all cases). Plus I do like the client-owned model, and how it was a pioneer in low-cost passive index funds.

FWIW I did have some frustrating months when my accounts got locked while living overseas (I was incorrectly identified as a ‘foreign investor’ and had to get some motorized documents to prove I was in fact a US citizen.

ca-rn

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Re: Why would anyone use Vanguard?
« Reply #17 on: June 22, 2022, 03:42:57 PM »
I use Vanguard because that's where my current 401k is.  Then later, I opened a brokerage and rothIRA account as well.

I don't understand the complaints about their website- it plain, not busy and in my opinion, easy to navigate. 

My first ever 401K was through Fidelity and I remember it being confusing, but this was over 20 years ago and I knew nothing about investing or 401k anyways, it was slow dial up.  I have no distinct memory of Fidelity's website, positive or negative/

I have only needed to call Vanguard no more than a couple of times in the last 2 decades.  I can just remember one call which involved how to roll over all the other 401k's into current 401k and I didn't understand the paperwork.  I remember they were helpful and the rollover went seamlessly.

I did open a CMA with Fidelity after hearing how amazing it is on Bogleheads as a one stop shop.  I funded it and then nothing, I think the website is too busy.  There's lots of financial information/research available but I am just a simple index mutual fund person. 

FiveSigmas

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Re: Why would anyone use Vanguard?
« Reply #18 on: June 22, 2022, 04:06:30 PM »
I did open a CMA with Fidelity after hearing how amazing it is on Bogleheads as a one stop shop.  I funded it and then nothing, I think the website is too busy.  There's lots of financial information/research available but I am just a simple index mutual fund person.

If you think Fidelity is bad, stay well clear of TD Ameritrade. My HSA provider uses them, and logging in to do some boring fund rebalancing still makes me feel like I'm watching an episode of Jim Cramer on meth...

PDXTabs

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Re: Why would anyone use Vanguard?
« Reply #19 on: June 22, 2022, 04:36:00 PM »
I did open a CMA with Fidelity after hearing how amazing it is on Bogleheads as a one stop shop.  I funded it and then nothing, I think the website is too busy.  There's lots of financial information/research available but I am just a simple index mutual fund person.

If you think Fidelity is bad, stay well clear of TD Ameritrade. My HSA provider uses them, and logging in to do some boring fund rebalancing still makes me feel like I'm watching an episode of Jim Cramer on meth...

Transamerica is also worse than Fidelity or Vanguard. But that is who my company uses for their 401k provider.

hydra

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Re: Why would anyone use Vanguard?
« Reply #20 on: June 22, 2022, 04:40:07 PM »
The comments about autopilot are essentially saying, "I don't deal with them, so....they are fine."

What I'm saying is I was forced to deal with them, and it was awful.

Here's a specific example: When I call up their retirement plan participants phone number and they see that I'm calling about my beneficiary account (which is a special account one gets after the death of their loved one), their first default question is "What was the date of your termination or separation from your company?"

Huh? My termination? I'm not dead. I haven't left my company. My spouse is dead, so I guess you could say he is "separated" from the company. When a person separates from their company, the beneficiary doesn't inherit the account. Inheritance means someone has died, right? So how is the phrasing appropriate or humane? When I asked them why they are asking me that question, the answer was "I don't know...it's just the first default question we're supposed to ask according to our script."  The humans are so scripted and clueless, you might as well never get through to them.

I still don't have access to my own 401k account because their systems wigged out due to my spouse and I working for the same company. Not that I particularly need to access it right now, but it is lame that they couldn't handle this edge case.

I could go on. These are just some examples of numerous ways in which they are devil spawn-y. You might never have to deal with them in this way in your lifetime, but your beneficiaries might have to.




nereo

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Re: Why would anyone use Vanguard?
« Reply #21 on: June 22, 2022, 05:16:05 PM »
As I explained above, I have had to “deal with them”. I’m genuinely sorry you’ve had such a crappy time of it, and agree that their client service (particularly for accounts below $100k) is terrible. I just disagree that this or even your experiences constitute a “devils spawn” title. If that’s the standard we are using, what do we label the many, many companies which intentionally defraud and/or defund their clients. The Madoffs and Edward Jones? 

Your experiences are frustrating AF and you have a right to be annoyed. But to answer your thread question more directly - for a brokerage, I put a much higher priority on things which Vanguard has and continues to do well, and a much lower priority on the client service level when dealing with emotional but also legal moments like these. And as others have pointed out, when compared to a lot of their peers vanguard is not alone with these issues.

iluvzbeach

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Re: Why would anyone use Vanguard?
« Reply #22 on: June 22, 2022, 05:29:06 PM »
We have investments with Vanguard and have been happy thus far; however, one thing that really irritates me (so much so that we may move the funds elsewhere) is that we can’t name a beneficiary on our joint account. This makes no sense to me - what a pain it would be for our estate to claim the funds if we both died in some sort of accident? They will allow us to re-title the account in our living trust, but then they want a bunch of paperwork to support that ownership. If I’m going to jump through hoops, we’ll just move the funds somewhere that allows us to name a beneficiary or title in the name of the trust without requiring the docs upfront.

Happy with their fee structure & website, not so much some of their policies.

bacchi

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Re: Why would anyone use Vanguard?
« Reply #23 on: June 22, 2022, 05:37:46 PM »
To contribute to a solo 401k at Fidelity means mailing in a check. Yes, seriously.

Schwab doesn't offer a solo Roth 401k. I also dislike Schwab due to previous customer service problems. Schwab has been disappointing me for years.

The TD account page is a fuckin' mess, as mentioned above.

If I were to establish a solo 401k now, I'd probably go with E-Trade but moving one is a bit of an IRS hassle and there's no reason to move it. When I close it in the next few years and transfer it to an IRA, I'll consider joining  those funds with my Fido or M1 account.

hydra

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Re: Why would anyone use Vanguard?
« Reply #24 on: June 22, 2022, 05:52:50 PM »
Quote
I just disagree that this or even your experiences constitute a “devils spawn” title.

You dislike the hyperbole I chose to use to express my discontent. Got it.

ATtiny85

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Re: Why would anyone use Vanguard?
« Reply #25 on: June 22, 2022, 05:56:26 PM »
I use Vanguard because that's where my current 401k is.  Then later, I opened a brokerage and rothIRA account as well.

I don't understand the complaints about their website- it plain, not busy and in my opinion, easy to navigate. 

My first ever 401K was through Fidelity and I remember it being confusing, but this was over 20 years ago and I knew nothing about investing or 401k anyways, it was slow dial up.  I have no distinct memory of Fidelity's website, positive or negative/

I have only needed to call Vanguard no more than a couple of times in the last 2 decades.  I can just remember one call which involved how to roll over all the other 401k's into current 401k and I didn't understand the paperwork.  I remember they were helpful and the rollover went seamlessly.

I did open a CMA with Fidelity after hearing how amazing it is on Bogleheads as a one stop shop.  I funded it and then nothing, I think the website is too busy.  There's lots of financial information/research available but I am just a simple index mutual fund person.

Yeah, I have Fidelity for 401k and HSA, and also think their website is way too busy. It feels to me like they are trying to act fancy and portray complexity.

I have Vanguard for rollover IRA and taxable. Have no issues with their website. But as has been mentioned, it’s on autopilot. Though it only took a few clicks several years ago to get the rollover going.

dandarc

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Re: Why would anyone use Vanguard?
« Reply #26 on: June 22, 2022, 06:07:54 PM »
Mutual structure is the main reason - nobody is more committed to low costs than Vanguard since it is owned by the investors in its mutual funds. Probably the underlying reason for the website (recently updated BTW - I wouldn't call it better in any important ways but it does look nicer).

I've never had a problem with their phone support on personal accounts - just have to be 100% clear with exactly what you want to achieve, patient with getting to the correct person and then with being walked through the form.

Dicey

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Re: Why would anyone use Vanguard?
« Reply #27 on: June 22, 2022, 06:08:22 PM »
I am so sorry for your sudden loss. Shit, that's tough. I can't answer your question, but I can offer sincere condolences. Under the circumstances, you have a free pass to call them whatever you want. You have every right to be angry.

hydra

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Re: Why would anyone use Vanguard?
« Reply #28 on: June 22, 2022, 07:51:39 PM »
Quote
you have a free pass to call them whatever you want

Thank you! I guess I needed to vent.

Also, I was legit curious why Vanguard is always so highly touted. My main new takeaway is that it's not so much the user experience that people like, but rather some of their funds and the way they structure the company. Thanks, all!

FiveSigmas

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Re: Why would anyone use Vanguard?
« Reply #29 on: June 22, 2022, 07:53:22 PM »
I am so sorry for your sudden loss. Shit, that's tough. I can't answer your question, but I can offer sincere condolences. Under the circumstances, you have a free pass to call them whatever you want. You have every right to be angry.

Leave it to Dicey to pin-point the crucial aspect of this whole thing. My condolences as well...

I don't think you're over-looking anything. In my opinion, you have more than enough reason to kick Vanguard to the curb and consolidate with your other broker if you so choose. In fact, I think portolio simplification is a virtue in and of itself. Thankfully, you can initiate the transfer with your destination broker, avoiding any future interaction with Vanguard (unless you need to convert out of Admiral shares :-/).

BTW: If you do consolidate, call your other broker and see if they'll give you a transfer bonus. It's worth a shot.

Edit: Update hyperlink.
« Last Edit: June 22, 2022, 08:04:01 PM by FiveSigmas »

Paul der Krake

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Re: Why would anyone use Vanguard?
« Reply #30 on: June 22, 2022, 10:13:06 PM »
To contribute to a solo 401k at Fidelity means mailing in a check. Yes, seriously.

Schwab doesn't offer a solo Roth 401k. I also dislike Schwab due to previous customer service problems. Schwab has been disappointing me for years.

The TD account page is a fuckin' mess, as mentioned above.

If I were to establish a solo 401k now, I'd probably go with E-Trade but moving one is a bit of an IRS hassle and there's no reason to move it. When I close it in the next few years and transfer it to an IRA, I'll consider joining  those funds with my Fido or M1 account.
Yeah the check thing is annoying but in practice I've sent a check once a year and called it a day. IMHO of all the annoying shit you gotta do to run a small business it ranks pretty low.

Dicey

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Re: Why would anyone use Vanguard?
« Reply #31 on: June 22, 2022, 10:16:00 PM »
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you have a free pass to call them whatever you want

Thank you! I guess I needed to vent.

Also, I was legit curious why Vanguard is always so highly touted. My main new takeaway is that it's not so much the user experience that people like, but rather some of their funds and the way they structure the company. Thanks, all!
It's also possible that they keep their fees low by having less staff and a clunky website. Spending less on bells and whistles seems to fit their profile.

Tempname23

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Re: Why would anyone use Vanguard?
« Reply #32 on: June 23, 2022, 06:32:26 AM »
I noticed when I reached some level of money under investment at vanguard (can't remember how much) I was able to call a different "special" support number and that my level of service increased quite a bit.  Fwiw.

 I don't think they are giving you a personal rep any more, I used to get the same guy every time, and he was good, I do miss it. I think I linked an E-R thread about Vanguard poor service in a Vanguard questionnaire one time. If you get an email asking about Vanguard service link a thread from E-R so they see what we think.

eyesonthehorizon

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Re: Why would anyone use Vanguard?
« Reply #33 on: June 23, 2022, 06:46:45 AM »
Inheritance means someone has died, right? So how is the phrasing appropriate or humane? When I asked them why they are asking me that question, the answer was "I don't know...it's just the first default question we're supposed to ask according to our script."  The humans are so scripted and clueless, you might as well never get through to them.
I know a little about this, though not Vanguard specifically.

Briefly: all the online brokers have been desperate to hire people lately because the share of the market owned by retail investors has more than doubled in a few years, with a big hike since stimulus payments began. Lots of need for warm bodies vs. a limited pool of people who can pass licensing exams.

I'd also bet nobody you're calling in that department is over 25.

This is because the retirement plan participants groups (for corporate retirement plans) at most firms tend to be staffed with the least knowledgeable people in the industry: retirement plans allow the investor to make comparatively few choices, so the risk of putting young, inexperienced people on the phone is least in that department. Their actual brokers are probably more knowledgeable. At least, I hope they are.

Of course even young, inexperienced people should be able to contextualize & not sound like robots when they're talking to the bereaved, so you have every right to be upset with the level of service. That's just a basic human deficiency.

Mr. Green

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Re: Why would anyone use Vanguard?
« Reply #34 on: June 23, 2022, 07:05:45 AM »
Based on recent threads here and on Bogleheads, I chose to open our daughter's UTMA account with Fidelity rather than Vanguard to give myself another data point in case I would have a bad enough experience with Vanguard in the future that I'd want to switch. Last year my grandfather died and my mom rolled over an Inherited IRA from Thrivent and some stocks from Computershare to Vanguard. The experience was so painful, and took so many months, that she was on the verge of giving up. That really sticks with me. Sure Vanguard seems perfectly fine when I'm asking nothing of them but the last thing I want is for my spouse or beneficiary to have an awful time just trying to process the normal inheritance stuff while also grieving my death.

Phenix

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Re: Why would anyone use Vanguard?
« Reply #35 on: June 23, 2022, 07:42:19 AM »
I'm not sure what has happened with Vanguard, but my parents recently moved two 7-figure 401k accounts to Fidelity. They've always used Fidelity for their IRAs and love speaking with knowledgeable people on the other end of the phone. They had (fairly) simple questions about beneficiaries on their 401k accounts and could not get a straight answer out of Vanguard. They decided to transfer all of their funds to their IRAs at Fidelity because they didn't want my siblings and I to have to deal with Vanguard after they die.

I used to tell people they can't go wrong with either Fidelity or Vanguard, but in light of my parents' experience and others, I have lost confidence in Vanguard's ability to provide decent customer service. As it was mentioned upthread, these financial institutions hold a very large portion of our net worth. It might be better to test the waters with the customer service now than waiting for when you truly need their help and they fall short.

TL/DR; call your financial institution now and see if they can answer they types of questions you or your beneficiaries will probably be asking down the road to assess if you want to keep your assets there.

Sibley

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Re: Why would anyone use Vanguard?
« Reply #36 on: June 23, 2022, 08:13:51 AM »
Quote
I would like to know why you're doing so much with these companies though.

When a spouse dies, there is an onslaught of administrative crap one must deal with. So I've had plenty of experiences with various institutions lately, and the only one that has pissed me off is Vanguard--so much so that I never want to deal with them again if I can avoid it. For me it has become a principle.

I'm not expecting anyone else to make the same decision. But as I've said, I see a lot of devotion to Vanguard, and I honestly was wondering if I might be missing something important and worth considering.

Temporary aberration then. Deal with it, get it back on autopilot, and move on.

I'm sorry for your loss. Do consider if you're somewhat irrational at the moment.

Gronnie

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Re: Why would anyone use Vanguard?
« Reply #37 on: June 23, 2022, 08:46:28 AM »
I'm not super knowledgeable on the subject, but from my understanding most of the "other guys" are publicly traded companies.  Read: They have shareholders.

Their no-fee/low-fee to compete with Vanguard is really great.  For now.  Until shareholders want a greater return and make leadership raise fees.  When will it happen?  Ever?  Next year?  Who knows.

The ownership of Vanguard basically puts you and me and the VG fund-holders as the owners of the company.  I am not sure if it makes the previous scenario impossible from happening, but it certainly makes it less likely IMHO.

This isn't really a concern for anything without tax implications.

Money in IRAs and similar - no concern.

In taxable the only concern would be anything you can't transfer in kind.

I think you may be conflating two things: Vanguard's fund structure and Vanguard's corporate structure. The former has tax implications, while the latter does not (at least not directly).

Honestly, I'm not sure that Vanguard's investor ownership is really much more than a marketing bullet-point. Unlike co-ops, you as an investor at Vanguard don't have any voting rights over Vanguard's business operations. Vanguard's managers will do what what's in the best interest for the company, which may or may not be in your best interests.

The tax implications I was referring to was in response to if competitors raised fees and one wanted to switch brokerages.

FiveSigmas

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Re: Why would anyone use Vanguard?
« Reply #38 on: June 23, 2022, 09:07:32 AM »
The tax implications I was referring to was in response to if competitors raised fees and one wanted to switch brokerages.

Ahh... Gotcha. Sorry for the confusion!

bacchi

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Re: Why would anyone use Vanguard?
« Reply #39 on: June 23, 2022, 10:00:30 AM »
To contribute to a solo 401k at Fidelity means mailing in a check. Yes, seriously.

Schwab doesn't offer a solo Roth 401k. I also dislike Schwab due to previous customer service problems. Schwab has been disappointing me for years.

The TD account page is a fuckin' mess, as mentioned above.

If I were to establish a solo 401k now, I'd probably go with E-Trade but moving one is a bit of an IRS hassle and there's no reason to move it. When I close it in the next few years and transfer it to an IRA, I'll consider joining  those funds with my Fido or M1 account.
Yeah the check thing is annoying but in practice I've sent a check once a year and called it a day. IMHO of all the annoying shit you gotta do to run a small business it ranks pretty low.

Once a year isn't a big deal but I was mailing in a check as I got paid. It got annoying. At the end, I think I used my bank's bill pay to xfer money.

Related, my partner had a SIMPLE plan at Schwab and it meant mailing a check and the allocation form every 2 weeks on payday. It was worth it compared to the previous broker, who was charging front loads, but it was another task my partner, as the manager, had to do.

kina

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Re: Why would anyone use Vanguard?
« Reply #40 on: June 27, 2022, 06:45:53 AM »
As someone who had to deal with financial institutions when my DH died over a year ago, you have my sympathy and opinion that you are not being irrational. My dealings with Fidelity were kind and seamless as I transferred an IRA into my name. I'm sorry you had/have frustration added to an already painful time in your life.

Tempname23

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Re: Why would anyone use Vanguard?
« Reply #41 on: June 27, 2022, 09:08:07 AM »
I did open a CMA with Fidelity after hearing how amazing it is on Bogleheads as a one stop shop.  I funded it and then nothing, I think the website is too busy.  There's lots of financial information/research available but I am just a simple index mutual fund person.

If you think Fidelity is bad, stay well clear of TD Ameritrade. My HSA provider uses them, and logging in to do some boring fund rebalancing still makes me feel like I'm watching an episode of Jim Cramer on meth...

 When I closed my account with TD Ameritrade, they charged me $99. Now I bad mouth them every chance I get.

YttriumNitrate

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Re: Why would anyone use Vanguard?
« Reply #42 on: June 27, 2022, 09:15:24 AM »
I set up my company's 401k through Vanguard a few years ago, and while they were 0.09% less expensive for the various funds, their customer service has been a nightmare at times. Had I the opportunity to do it again, I would have used the slightly more expensive firm.

coppertop

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Re: Why would anyone use Vanguard?
« Reply #43 on: June 28, 2022, 07:50:32 AM »
I am a retired estates and trusts paralegal.  Way back in the day, Vanguard was a dream to work with.  Their operations were based in Valley Forge, PA, and their customer service people were helpful and went above and beyond to make things smooth.  I liked Vanguard so much that I opened my own IRA and taxable accounts there.  At some point after I retired from the law firm, they moved operations elsewhere, and I was surprised and chagrined to find that their customer service declined sharply.  I have not been happy with them for quite awhile, but as someone else observed, inertia has kept me from moving my spouse's and my accounts elsewhere. 

BlueMR2

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Re: Why would anyone use Vanguard?
« Reply #44 on: June 28, 2022, 05:18:15 PM »
I am not someone who reviews companies, services, products, or experiences. I just don't. So this is unusual for me. I feel compelled in this case because after my spouse died and I've had to have some dealings with Vanguard to figure out the beneficiary account, I have come to regard Vanguard as the devil's spawn.

I notice in a lot of FIRE forums that people seem to really like Vanguard. In my experience, Vanguard's phone and online support is ridiculously, shockingly bad. Their website would be laughable if it didn't hurt so much to use it. The automated phone software is buggy, and woe to you if you actually make contact with a human, as they more often than not will be ill-informed and unfriendly. I guess Vanguard must compete based on low cost, but haven't other companies caught up to them on low-cost transactions and funds?

The last time we needed support was a few years ago, but it was an absolutely horrible experience.  They didn't have any interest in helping us.  No idea if it's changed for the better since then.  Fortunately have not needed any help since then.

And no, the other places haven't caught up on cost.  The other places have cut their costs down a fair amount, but still run significantly higher than Vanguard.

BlueHouse

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Re: Why would anyone use Vanguard?
« Reply #45 on: June 28, 2022, 06:29:36 PM »
I haven't noticed any decline in service, but I don't really need much service.
As for WHY I use Vanguard -- I'm a longterm Quicken user and back when I used to have multiple accounts at multiple brokerages, I started requiring that each company I worked with be able to download directly into Quicken so I could do an apples-to-apples comparison.  That limited which brokerages I could use. 
Then when I started consolidating everything, I just decided to stick with Vanguard because I've been completely happy with everything.  Is that nostalgia?  No, I think it's just a good track record. 

DeniseNJ

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Re: Why would anyone use Vanguard?
« Reply #46 on: June 30, 2022, 10:42:35 AM »
Somebody pl help before I lose it. Vanguard used to be so easy peasy but now it's a chore. Current issue: Checking on Dh's acct, as I do, but I can only see what's listed for the 403b, not the transactions. I always had to go to another screen for that but now there is no option for another screen.  When I click it just says it can't show the information now.  This is for a couple of weeks. I can call, but I'd have to put dh on the phone and he's sleeping.  It's just a chore not to be able to just pop online and make sure his contribution went in from his pay. (I do all the financial stuff.)  Is there another log in screen.

iris lily

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Re: Why would anyone use Vanguard?
« Reply #47 on: June 30, 2022, 11:15:33 AM »
I noticed when I reached some level of money under investment at vanguard (can't remember how much) I was able to call a different "special" support number and that my level of service increased quite a bit.  Fwiw.

Right.

When I moved my retirement fund from my employer chosen company to Vanguard,it was enough $ to warrant an upper level manager handling the account.

I don’t do anything with it there, Just let it sit in a money market account. Our true investments are elsewhere. The few times I’ve logged in getting  balance doesn’t seem to be a problem.
« Last Edit: July 16, 2022, 10:04:32 AM by iris lily »

Sibley

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Re: Why would anyone use Vanguard?
« Reply #48 on: June 30, 2022, 07:09:26 PM »
Somebody pl help before I lose it. Vanguard used to be so easy peasy but now it's a chore. Current issue: Checking on Dh's acct, as I do, but I can only see what's listed for the 403b, not the transactions. I always had to go to another screen for that but now there is no option for another screen.  When I click it just says it can't show the information now.  This is for a couple of weeks. I can call, but I'd have to put dh on the phone and he's sleeping.  It's just a chore not to be able to just pop online and make sure his contribution went in from his pay. (I do all the financial stuff.)  Is there another log in screen.

Try clearing all your cookies on your browser. @DeniseNJ

Just Joe

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Re: Why would anyone use Vanguard?
« Reply #49 on: July 05, 2022, 10:46:35 AM »
Try installing a different browser. If you use Chrome, try Firefox or Vivaldi or Brave. Basically it is an opportunity to try a fresh browser configuration on the website you are having trouble with.

I have a friend who couldn't get see credit card statement b/c it was a PDF within the webpage. Switched from Firefox to Chrome and it worked perfectly.

Now friend uses Firefox for everything but that credit card website. I'm encouraging friend to separate their banking from their entertainment or shopping browsing by using different browsers. That's what I do. This one for work, that one for fun and another one for banking.

 

Wow, a phone plan for fifteen bucks!