Creating sub-accounts in vanguard

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pclu
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Creating sub-accounts in vanguard

Post by pclu » Sun Mar 01, 2015 2:07 pm

Hello Forum
I am trying to create multiple sub-accounts for specific purposes in vanguard. Some of these are for investments for kids (I am not interested in UGMA ) and some for goals in future.

Is there a way to do this? Does any other brokerage firm offer this service ?

thanks
-- pclu

BanditKing
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Re: Creating sub-accounts in vanguard

Post by BanditKing » Sun Mar 01, 2015 3:01 pm

As I understand, you can simply create additional investment accounts BUT, they all count separately for purposes of qualifying for admiral shares.

On the right side of the overview page is an "open an account" link. From there just create the new account and then rename it something to make it stand out.

I'd LOVE to be able to do this to create separate "buckets" of monies, but have them tallied together for admiral qualification.

SteveKL
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Re: Creating sub-accounts in vanguard

Post by SteveKL » Sun Mar 01, 2015 3:18 pm

BanditKing wrote:I'd LOVE to be able to do this to create separate "buckets" of monies, but have them tallied together for admiral qualification.
It is my understanding that so-called family accounts at VG are consolidated for purposes of qualifying for Admiral Flagship status. The various accounts do need to share a common mailing address. In my case, I have a personal account and a business account, established under separate TINs but with a common address, and they were grouped into Admiral for both accounts.

If in doubt, call VG and ask about the rules.

(Edited to correct "Admiral" to "Flagship", which was my meaning.)
Last edited by SteveKL on Fri Mar 06, 2015 3:13 pm, edited 1 time in total.

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Dale_G
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Re: Creating sub-accounts in vanguard

Post by Dale_G » Sun Mar 01, 2015 3:43 pm

"Family" account totals are used to determine "Voyager", "Voyager Select" and "Flagship" status. Admiral class is based on a particular fund holding in a single account.

Dale
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bru
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Re: Creating sub-accounts in vanguard

Post by bru » Sun Mar 01, 2015 6:14 pm

pclu wrote:Hello Forum
I am trying to create multiple sub-accounts for specific purposes in vanguard. Some of these are for investments for kids (I am not interested in UGMA ) <snip>
- pclu
Curious how you plan to title the accounts for your kids? As I understand you can't title an account in the name of a minor. You would have to do a UGMA/UTMA with your name and the child's name, which you said you don't want. So will you put it in your name alone, knowing that the money is really for your kids?

Planner
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Re: Creating sub-accounts in vanguard

Post by Planner » Mon Apr 06, 2015 12:13 pm

This came up recently for me, so I emailed Vanguard. They said:

"You may certainly have multiple accounts. If you wish to dedicate specific
investments to different goals, you can do so by opening additional funds
within an existing joint account or by opening a separate joint account.
You would not be able to give these funds or accounts unique identifying
names, however."

I wonder what they name second joint taxable accounts? Maybe "Owner 1 and Owner 2 (1)", "Owner 1 and Owner 2 (2)", "... (3)", etc.

Spewin
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Re: Creating sub-accounts in vanguard

Post by Spewin » Mon Apr 06, 2015 12:25 pm

Planner wrote:I wonder what they name second joint taxable accounts? Maybe "Owner 1 and Owner 2 (1)", "Owner 1 and Owner 2 (2)", "... (3)", etc.
I have done this and you are exactly right, except I think they use & rather than "and".

I am always surprised when people mention "sub-accounts" I have never seen such a thing at any institution. People used to talk about them at ING all the time, but again they were just different accounts. It bothers me because the sub-account idea gives people (me included) the wrong idea of what is going on.

Topic Author
pclu
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Re: Creating sub-accounts in vanguard

Post by pclu » Tue Jun 23, 2015 9:32 pm

Not being able to name a account is the real bummer here. My goal is to create purpose specific buckets like "Kid#1 college fund" , "House_Improvement_Fund" , "2015_Savings_Specific_Allocation_Test_Account" etc.. which have specific reasons and intentions for opening them and buying underlying assets in them.

My concern is I will forget the reason behind that account and very soon confuse myself completely.

How do you all manage this situation ? Opening separate accounts is too much paperwork during tax-time and also online maintenance.

thanks

ThisTimeItsDifferent
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Re: Creating sub-accounts in vanguard

Post by ThisTimeItsDifferent » Tue Jun 23, 2015 10:08 pm

When I did a Roth conversion, I requested separate accounts so I could isolate my basis in case of a subsequent re-characterization. Some months later, I did re-characterize, and it turns out that vanguard had created sub accounts instead of separate accounts. If they were separate accounts no pro rata calculation would be needed. They calculated how much I needed to pro rata based on the closing price of the request day, and moved funds from a separate (or so I thought and requested) Roth IRA as of the closing price the following day. Since the Roth accounts fell 5% after the day I requested the re-characterization, they took an excess amount out of that other Roth, converting post tax to pre tax. This occurred because the phone representative did not call it a sub account and said it would be treated as a separate account, but it wasn't. The phone people afterward kept saying that the formula is complicated and eventually told me to stop calling. They never said that they had created sub accounts, even when every time I said I had separate accounts. Finally a few years later, I was able to talk to someone in the re-characterization department who explained what happened. By then it was too late for vanguard to fix it. I like vanguard's mutual ownership model and low prices, but that was poor customer service before and after.

jjface
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Re: Creating sub-accounts in vanguard

Post by jjface » Tue Jun 23, 2015 10:29 pm

1. Why not have one account and track what is what on a spreadsheet?

2. Fidelity lets you name accounts but you have to open a new account for each one. That is what I do.

The Wizard
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Re: Creating sub-accounts in vanguard

Post by The Wizard » Wed Jun 24, 2015 3:05 am

Too many different accounts for different purposes is not a good idea.
It comes down to understanding your income and cash flow situation and Living Beneath Your Means.

Long term retirement account(s) and offspring educational accounts are all that's needed.
Everything else goes into some mix of taxable accounts: checking, savings, mutual funds.

I think what's important, especially in younger years, is not getting overcommitted on a monthly cash flow basis.
When that happens, people are unable to pay off their credit cards in full each month and things go down hill from there.

Arrange your finances to have sufficient "left over" money each month and then you'll find it easier to prioritize discretionary spending...
Attempted new signature...

thelordsmurf
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Re: Creating sub-accounts in vanguard

Post by thelordsmurf » Sun Apr 10, 2016 11:58 am

Hi all,
I was hoping there was a different way as well to earmark some of the investments for different purposes, e.g. Kid #1 college, as well.
If Vanguard doesn't allow the creation of specifically-named subaccounts, is there a way to track it in Excel or something? If I open an fund with 50% money earmarked for college #1 and 50% for college #2, then add $100/month into the account earmarked for college #1 and $75 for #2, what then is the best way to calculate how much was for college #1 and #2 as the market fluctuates? I haven't found a good software answer for that in the forums or elsewhere, and would be very grateful for any advice.
Thanks!

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Kevin M
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Re: Creating sub-accounts in vanguard

Post by Kevin M » Sun Apr 10, 2016 12:48 pm

Creating separate accounts and using a spreadsheet to track them is a simple solution to the problem--as long as you're comfortable with spreadsheets. Just use one column in the sheet to identify the purpose of the account, with the other columns used for account number, fund name, ticker, shares, price, value, etc.

You can easily download all accounts from Vanguard to a CSV file, then import that into a spreadsheet.

I load my Vanguard accounts (I have many of them) into one sheet in a Google Sheets spreadsheet, and then in another sheet use functions like VLOOKUP to pull the number of shares from the sheet with the Vanguard downloaded data. I use the GoogleFinance function to retrieve share price, so value is calculated by the spreadsheet rather than pulled from the downloaded data.

Since share price is what changes most often (daily for mutual funds), I don't need to download from Vanguard very often--only when number of shares of a holding changes significantly. At any rate, it only takes about five minutes to download and import into the spreadsheet.

If you don't have too many funds in your accounts, then simply updating the number of shares manually might be faster for you, and this solution doesn't require any spreadsheet functions to pull number of shares from downloaded data, although I still think using GoogleFinance to pull share price is useful.

I also set up the portfolio spreadsheet to track asset allocation, and make rebalancing fairly easy.

Kevin
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Leeraar
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Re: Creating sub-accounts in vanguard

Post by Leeraar » Sun Apr 10, 2016 3:17 pm

bru wrote:
pclu wrote:Hello Forum
I am trying to create multiple sub-accounts for specific purposes in vanguard. Some of these are for investments for kids (I am not interested in UGMA ) <snip>
- pclu
Curious how you plan to title the accounts for your kids? As I understand you can't title an account in the name of a minor. You would have to do a UGMA/UTMA with your name and the child's name, which you said you don't want. So will you put it in your name alone, knowing that the money is really for your kids?
I had reason to designate a certain amount for one kid. So, I made a new account in my name only with that child as beneficiary. Our other accounts are owned by my wife and myself, with both kids as beneficiaries.

L.
You can get what you want, or you can just get old. (Billy Joel, "Vienna")

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