deikel wrote:I understand that we are in boglehead country here, but the blind touting of Vanguard by some of the posters here is pretty misguided.
You are right that this forum tends
to be pro-Vanguard (and I do believe the tendency
exists with good reason), but there are many, many
members that are in also in the camp where they are grateful for what John Bogle has done (and the impact that Vanguard has had on the investment industry), but in their situation they see no advantage to investing at Vanguard. Also, it has been made quite clear in this forum and in countless threads that Vanguard isn't the best at a lot of things. Perhaps not even most things.
But you had asked a question:
deikel wrote:This must be the 20th post from Laura I come across where she gives the advice to switch accounts to Vanguard - or OK it as a good idea. Although I understand that people on this forum are connected to Bogle and hence Vanguard at least in spirit - it would be good to specify what makes this account better than what the OP currently has.
You've seen Laura's posts. There were a couple
responses. Did you not see mine?
pingo wrote:Great question. Fidelity, TD Ameritrade, Schwab, etc., etc. can all be great places to invest depending on one's objectives and circumstances. For example, I have a friend who has a TD Ameritrade account. Even though a target fund would probably be in his best interest (and he agrees), he really likes TD's platform and he's comfortable with their user interface so he simply does not want to change accounts. As a result, he will be using their commission-free ETFs to have an awesome 3 fund portfolio.
In jetb2's case, He is moving to a plan of passive investing under the following circumstances:
1. No taxable account, which opens up the possibility of using target date/lifecycle/balanced funds for greater simplicity and passivity without compromising tax-efficiency.
2. Acceptable target/lifecycle options in His 401k, which makes using target date funds more compelling.
3. Most new contributions will be outside the 401k, which makes the use of the 401k target funds more acceptable because of their minimal impact on His weighted costs of investing.
4. Vanguard offers the most desirable target funds for indexing-oriented, retail investors.
5. Most non-Vanguard brokerages charge an arm and leg in transaction fees for each new purchase into Vanguard target funds.
I think I addressed the specific reasons why Vanguard was the preferred option in jetb2
's case and in support of Laura's recommendations.
Your original question was a good one, but let me ask you this: do you have a suggestion for jetb2
that also meets or competes with the criteria? I respect your desire to not blindly promote Vanguard at every opportunity, but the recommendations here have to do with obtaining the greatest simplicity, the greatest passivity and reasonably low costs to achieve that goal. Would you prefer jetb2 use Fidelity's retail Freedom Funds instead? I doubt it. Schwab's lifecycle funds? Unlikely. I can imagine scenarios where costs could
dictate excluding target/lifecycle funds, in which case TD Ameritrade would be as good as many other firms. I don't see that as being the case here.
Or, if OP agrees with you that 100% stocks is appropriate due to hubby's stockpile of cash, then I wouldn't see any reason to move from TD Ameritrade, either.
I'll say again
that TD Ameritrade can be a great place to invest, just like Fidelity, Schwab and perhaps others that don't come to mind at the moment. I personally use Vanguard, Schwab and employer sponsored options because that is what my situation warrants. I recommended that my sister use Fidelity for her IRA because of the specifics of her situation. Last week I spent hours and hours and hours
searching through TD Ameritrade's platform to see what the most appropriate options would be for a friend of mine. It came down to using expensive (but otherwise acceptable) NTF index funds, paying $50 transaction fees each time he wants to purchase into a not-so-low cost lifecycle fund, accepting expensive lifecycle funds, or using their commission-free ETFs. Commission-free ETFs was the answer because my friends criteria
mandated staying at TD Ameritrade.