Fidelity or Vanguard

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hafjell
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Re: Fidelity or Vanguard

Post by hafjell »

BL wrote:If you and your heirs all have good sales resistance, Fidelity may be no problem.
Ditto. I have had good experiences at Fido. I like their money management (free checking and ATMs with a chip card). The website is good. The customer service, from what I've read here, is superior to VG. When I start asking questions on the website, a popup window appears offering to call me. I've used that service a few times, all for non-sales related matters, and it's fast and easy.
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starguru
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Re: Fidelity or Vanguard

Post by starguru »

I thought I remember reading somewhere on bogleheads that Vanguard funds have some secret sauce that results in less taxes for their holders, if the funds are held in a taxable account. I believe it had something to do with how certain payouts to shareholders were classifieds. If true, for large balances, that could be significant.
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goingup
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Re: Fidelity or Vanguard

Post by goingup »

Spirit Rider wrote:
goingup wrote:
sport wrote:Vanguard's main philosophy is low cost products for their customers. I believe the Fidelity has some low cost funds for the sole purpose of competing with Vanguard. I also believe the Fidelity would like to switch their customers to their higher cost products, given the opportunity. I prefer to reward the company that is responsible for the low costs we enjoy with my business. I also find comfort knowing that Vanguard is less likely to take advantage of me in my old age, or of my heirs who may not be investment savvy.
This is exactly my thinking. Vanguard has an integrity and trustworthiness factor that has been, in my mind, unassailable. I'm old enough to remember when Fidelity first lowered their ERs to compete directly with Vanguard. Some people wondered if the Johnson family was concocting a bait and switch trap to lure in customers.
Yeah, and how well did that conspiracy theory work out. Here we are twenty years later and Fidelity is more competitive than ever.

Vanguard has great products, but this consistent mythology that Vanguard is some religion of nobility is tiring.
Well it isn't a myth that Vanguard and Fidelity have different business models. Vanguard is owned by its investors and Fidelity is owned by the Johnson family. It's true that Fidelity has become more competitive than ever. But low costs are part of Vanguard's DNA and that isn't likely to ever change.
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Re: Fidelity or Vanguard

Post by radiowave »

ruralavalon wrote:

Incorrect.

Not only can you purchase Admiral funds at Scottrade, but the minimums imposed by Vanguard are waived by Scottrade. When I moved my accounts from ML, I wanted access to a local office. I went with Scottrade, in part, due to a significant new account $$ bonus and many free trades. Fidelity was my second choice, but I knew I wanted to purchase VG funds and Fidelity, unlike Scottrade, does not offer VG Admiral funds.
Out of curiosity I called the local Scottrade office and apparently, according to the fellow on the phone, you have to be under their active advisor service to get access to the Admiral funds. For self-directed accounts, you can transfer in and sell VG Admiral funds, but not purchase new one. I did not ask how much they charged for the active management service.
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sport
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Re: Fidelity or Vanguard

Post by sport »

goingup wrote:
Spirit Rider wrote:
goingup wrote:
sport wrote:Vanguard's main philosophy is low cost products for their customers. I believe the Fidelity has some low cost funds for the sole purpose of competing with Vanguard. I also believe the Fidelity would like to switch their customers to their higher cost products, given the opportunity. I prefer to reward the company that is responsible for the low costs we enjoy with my business. I also find comfort knowing that Vanguard is less likely to take advantage of me in my old age, or of my heirs who may not be investment savvy.
This is exactly my thinking. Vanguard has an integrity and trustworthiness factor that has been, in my mind, unassailable. I'm old enough to remember when Fidelity first lowered their ERs to compete directly with Vanguard. Some people wondered if the Johnson family was concocting a bait and switch trap to lure in customers.
Yeah, and how well did that conspiracy theory work out. Here we are twenty years later and Fidelity is more competitive than ever.

Vanguard has great products, but this consistent mythology that Vanguard is some religion of nobility is tiring.
Well it isn't a myth that Vanguard and Fidelity have different business models. Vanguard is owned by its investors and Fidelity is owned by the Johnson family. It's true that Fidelity has become more competitive than ever. But low costs are part of Vanguard's DNA and that isn't likely to ever change.
Which brings up an interesting question. What if Fidelity decides not to compete with Vanguard on cost and raises the fees on their index funds substantially? If an investor had a taxable account with sizable unrealized gains, they would be locked in. It would be very unlikely for Vanguard to do this. However, Fidelity could/would do such a thing if they decided it was in their best interest to do that. How much do you want to trust Fidelity?
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fandango
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Re: Fidelity or Vanguard

Post by fandango »

My portfolio was evenly split between Vanguard and Fidelity.

The Fidelity rep was "selling" far to much to my liking. He was always in a panic mode: "bonds are going to be a disaster, move to all stocks now".

Now 90% of my investments are with Vanguard. Very smooth transition. Glad I made the move.
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Re: Fidelity or Vanguard

Post by Spirit Rider »

sport wrote:
goingup wrote:
Spirit Rider wrote:Vanguard has great products, but this consistent mythology that Vanguard is some religion of nobility is tiring.
Well it isn't a myth that Vanguard and Fidelity have different business models. Vanguard is owned by its investors and Fidelity is owned by the Johnson family. It's true that Fidelity has become more competitive than ever. But low costs are part of Vanguard's DNA and that isn't likely to ever change.
Which brings up an interesting question. What if Fidelity decides not to compete with Vanguard on cost and raises the fees on their index funds substantially? If an investor had a taxable account with sizable unrealized gains, they would be locked in. It would be very unlikely for Vanguard to do this. However, Fidelity could/would do such a thing if they decided it was in their best interest to do that. How much do you want to trust Fidelity?
No, it isn't a myth that Vanguard and Fidelity have different business models, but it IS a myth that it matters. The only thing that matters is results. People long argued for the benefits of MUTUAL insurance companies. Premium costs demonstrated the exact opposite. Their bureaucracies ate more than the profits of commercial companies.

This speculation that Fidelity is going to one day raise fees on their index funds is a recurring dream of some Diehards so they will be vindicated in their zealotry. Well, it hasn't happened and isn't going to happen. The marketplace drives the expense ratios not the companies. There are two many index funds and ETFs with low expense ratios to put the genie back in the bottle. It has been Vanguard who has reluctantly followed the lower expense ratios with their own later.

I find it ironic that people who invest in the core beliefs of Capitalism, think that the socialism of one investment institution will somehow triumph over the weight of history. I don't care if the Vanguard bureaucracy bloats or the Johnson's make billions, as long as they both help me make my millions. And if a competitor provides better options, then I might leave them both. This is how the market works. Investing is business and emotions are counterproductive.
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Re: Fidelity or Vanguard

Post by Da5id »

Spirit Rider wrote:I find it ironic that people who invest in the core beliefs of Capitalism, think that the socialism of one investment institution will somehow triumph over the weight of history. I don't care if the Vanguard bureaucracy bloats or the Johnson's make billions, as long as they both help me make my millions. And if a competitor provides better options, then I might leave them both. This is how the market works. Investing is business and emotions are counterproductive.
I don't see this as an issue, though I do have most of my assets at Vanguard. I think Fidelity is a fine place, and Vanguard messed up the cost basis of one of my accounts (they agreed, but estimated 23 days to fix it!?!) which is a strike against them. For OP I think you can do well with either or both of them.

That said, there is a lock in effect in taxable accounts. To switch from Spartan S&P 500 to Vanguard S&P 500 could have a large capital gains cost. I personally don't think Fidelity is at all likely to raise its rates on the commodity like index funds though, so I wouldn't make a decision based on that.
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beyou
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Re: Fidelity or Vanguard

Post by beyou »

I hear rave reviews of Fidelity customer service. They have a branch down the street from my workplace,
but do not use Fidelity as I can not do so due to work related restrictions. That said...

I have Etrade (company stock plan must use Etrade or Schwab brokerage, not Fidelity)
and Vanguard (funds only for me as I can't use their brokerage, but Vanguard brokerage for an aging relative I help with investing).

While Etrade has great service, and friendly local offices, I use Vanguard almost exclusively.
Certain transactions related to my company stock must be done at Etrade, so I have regular interaction,
but much more with Vanguard.

As a person who prefers to do all my business online, both firms are excellent in that regard.
But I would have to pay commissions to Etrade (or Fidelity) to buy Vanguard ETFs.
See no reason, I buy Vanguard ETFs for my relative in her VG brokerage account and the website meets all her needs.
I buy Vanguard funds in a traditional fund only account, and all my needs are met on their website.
I never talk to my Flagship rep, not need for help.

Meanwhile, much like I read above about Fidelity, Etrade calls regularly to try and up-sell me.
Despite specifically asking them to put me on a DO NOT CALL list, they call 2-3x per year to sell the same things.
Funny but often the same person calls, they do not remember my request and reasons, like talking to them for the first time each time.
I prefer a computer, every time. Vanguard's website has done all I needed.

So If I could change from Etrade brokerage to Fidelity brokerage,
I would not bother since I am so happy with Vanguard direct accounts.
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bengal22
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Re: Fidelity or Vanguard

Post by bengal22 »

goingup wrote:
Spirit Rider wrote:
goingup wrote:
sport wrote:Vanguard's main philosophy is low cost products for their customers. I believe the Fidelity has some low cost funds for the sole purpose of competing with Vanguard. I also believe the Fidelity would like to switch their customers to their higher cost products, given the opportunity. I prefer to reward the company that is responsible for the low costs we enjoy with my business. I also find comfort knowing that Vanguard is less likely to take advantage of me in my old age, or of my heirs who may not be investment savvy.
This is exactly my thinking. Vanguard has an integrity and trustworthiness factor that has been, in my mind, unassailable. I'm old enough to remember when Fidelity first lowered their ERs to compete directly with Vanguard. Some people wondered if the Johnson family was concocting a bait and switch trap to lure in customers.
Yeah, and how well did that conspiracy theory work out. Here we are twenty years later and Fidelity is more competitive than ever.

Vanguard has great products, but this consistent mythology that Vanguard is some religion of nobility is tiring.
Well it isn't a myth that Vanguard and Fidelity have different business models. Vanguard is owned by its investors and Fidelity is owned by the Johnson family. It's true that Fidelity has become more competitive than ever. But low costs are part of Vanguard's DNA and that isn't likely to ever change.
The whole buy VAnguard because you will be an owner is absolutely "hooey." They have good funds but their customers reps do not treat you like an owner let alone a valued customer. I use both Vanguard and Fidelity because they have good low cost index funds. Fidelity does not pressure its customer to switch to higher cost funds. Both companies are motivated to increase sales and profit. GM is owned by investors as well but I assume they like to make money as well.
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SpringMan
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Re: Fidelity or Vanguard

Post by SpringMan »

bengal22 wrote: The whole buy VAnguard because you will be an owner is absolutely "hooey." They have good funds but their customers reps do not treat you like an owner let alone a valued customer. I use both Vanguard and Fidelity because they have good low cost index funds. Fidelity does not pressure its customer to switch to higher cost funds. Both companies are motivated to increase sales and profit. GM is owned by investors as well but I assume they like to make money as well.
Vanguard does have a different business model than other investment firms, it is run more like a coop. It is not hooey. GM is owned by its stock holders and is a for profit company. Vanguard is not a publicly (or privately) traded stock. They are are cost based rather than profit based. This is one reason why their customer service is sometimes mediocre and they lack brick and mortar store fronts. Vanguard is not for everybody, nothing wrong with Fidelity Spartan funds. Mr. Bogle has more of my respect than Fidelity's very much richer Johnson family dynasty.
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retiredjg
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Re: Fidelity or Vanguard

Post by retiredjg »

bengal22 wrote:GM is owned by investors as well but I assume they like to make money as well.
Isn't GM owned by its shareholders? Aren't shareholders always interested in profits?

GM sells stock so the company is owned by people who buy GM stock. Vanguard is not a publicly owned company - there is no Vanguard stock. Not the same thing at all. Completely different business model.
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Re: Fidelity or Vanguard

Post by retiredjg »

Some people like Ford. Some like Chevy. Some like Coke and some like Pepsi. I don't care for any of them, but I still have a vehicle to drive and find plenty of things to drink...I'm wondering if this discussion is wandering too far from the original question.
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bru
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Re: Fidelity or Vanguard

Post by bru »

I use both. About 65% of my assets are with Vanguard, 35% with Fidelity. Both have plenty of index funds available. Old 401(k) and inherited IRA were with Fidelity so I just left them there (rolled over the 401(k)). I started to move some of it to Vanguard but got lazy. I also have a few stocks at Fidelity in a brokerage account. They've never tried to sell me anything. I think having assets in a couple of places is generally accepted as good practice.
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Taylor Larimore
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One Fund Company or More?

Post by Taylor Larimore »

I think having assets in a couple of places is generally accepted as good practice.
bru:

I cannot argue in general with your statement, however, I prefer having all my securities in one good company for these reasons:

1. One familiar statement.
2. Less paperwork.
3. Easier tax preparation.
4. Avoidance of low-balance and other small fees.
5. It's much easier to learn only one company's policies, fees, regulations, etc.
6. With larger holdings it may be possible to qualify for lower costs and premium services (Voyager, Admiral, Flagship).
7. Rebalancing and exchanges are easier.
8. Eliminates 3rd party brokerage.
9. A loyal customer is appreciated and usually treated better.
10. Less chance of errors.
11. Knowledge that Vanguard's fine reputation and low-costs are always working for us.
12. More free time for ourselves.
13. In event of death or disability, it will be much easier for others.

Best wishes.
Taylor
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bengal22
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Re: Fidelity or Vanguard

Post by bengal22 »

SpringMan wrote:
bengal22 wrote: The whole buy VAnguard because you will be an owner is absolutely "hooey." They have good funds but their customers reps do not treat you like an owner let alone a valued customer. I use both Vanguard and Fidelity because they have good low cost index funds. Fidelity does not pressure its customer to switch to higher cost funds. Both companies are motivated to increase sales and profit. GM is owned by investors as well but I assume they like to make money as well.
Vanguard does have a different business model than other investment firms, it is run more like a coop. It is not hooey. GM is owned by its stock holders and is a for profit company. Vanguard is not a publicly (or privately) traded stock. They are are cost based rather than profit based. This is one reason why their customer service is sometimes mediocre and they lack brick and mortar store fronts. Vanguard is not for everybody, nothing wrong with Fidelity Spartan funds. Mr. Bogle has more of my respect than Fidelity's very much richer Johnson family dynasty.
Maybe I am wrong but I don't see it that way. I suspect that the powers to be at vanguard have the same motivation as the powers to be at GM: increase revenue, minimize expenses. I see the whole vanguard structure as clever marketing. Not sure how VG big shots get compensated but I assume it's tied to performance and our share of the business is similar to holding a few shares. Regardless of that our choice of funds should have nothing to do with company structure.
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Re: Fidelity or Vanguard

Post by jfave33 »

I think the debate will go on forever. It is like ios vs android.
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Re: Fidelity or Vanguard

Post by whodidntante »

jjface wrote:I think the debate will go on forever. It is like ios vs android.
Agreed. It's close enough that the "right" choice is a matter of personal preference.
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Re: Fidelity or Vanguard

Post by fetch5482 »

Fidelity has a pretty good selection of ETFs due to iShares commission-free trades. I prefer some of them over Vanguard, such as IJS for small-cap value.

On the mutual fund side, I prefer Vanguard -- especially for tilters. While spartan funds are good, there are no decent options for small-cap value there.
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Re: Fidelity or Vanguard

Post by FrugalInvestor »

You'll be much more likely to stay the course with Vanguard.
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Re: Fidelity or Vanguard

Post by quaternion »

IMHO, both Fidelity and Vanguard offer good products at comparable cost, and one can do well with either company. I keep accounts with both of them. Here is my take on their relative advantages:

Pro Vanguard:
  • If you need hand-holding, Vanguard staff will encourage low-cost investing, while Fidelity staff may steer you towards high cost products.
  • If you choose to slice-and-dice, Vanguard has more low-cost options available as mutual funds compared to Fidelity. Fidelity still covers all the bases, but some (e.g., small-cap value, corporate bonds) are only available as ETFs.
  • Vanguard's investor-owned organizational structure inspires more confidence than the continuing beneficence of the Johnson Family (Fidelity's majority owners), but in all likelihood, both companies will need to remain competitive to survive.
  • If you decide you don't like Vanguard, they won't charge you an account closing fee. Fidelity charges ~$50 to close (some) accounts.
Pro Fidelity:
  • Fidelity has more local branches than Vanguard if you like face-to-face contact and/or needs things like medallion guarantees. Some of Fidelity's local branches have free coffee :). I've never been to a Vanguard branch.
  • Fidelity offers a 2% cashback credit card and a nice cash management pseudo-checking account. However, both of these can be duplicated elsewhere at online banks and via Citi doublecash card.
  • Fidelity lets me initiate an ACH transfer and purchase ETFs and mutual funds the same day (before the ACH transfer has posted to my bank account). In my Vanguard brokerage account, mutual fund purchases drawn on a bank account take a couple days (I get the mutual fund price on the day the ACH transfer posts to my bank, usually the day after the order is submitted). I do not know if these policies vary by account and/or asset level, so YMMV.
  • In taxable accounts when avoiding dividend reinvestment (to minimize separate tax lots), Fidelity lets you direct dividends and capital gains from both mutual funds and ETFs to a bank account (see their "Automatic Withdrawal Plan"). With Vanguard, this is only possible for mutual funds, not ETFs.
  • If you call Fidelity at 2am on Christmas morning, you can talk to a real person (who is almost assuredly competent).
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Re: Fidelity or Vanguard

Post by SGM »

I have received wrong information from a retirement expert at Fidelity and cold calls from a sales rep. The customer service I have received at Vanguard has generally been better. Unfortunately my excellent Vanguard personal rep has been promoted, but the new guy seems eager and competent. I received a complete review of all of my assets by Vanguard a few years ago. No pressure was put on me to put more of my assets into Vanguard. The same cannot be said for Fidelity.

I have a low cost brokerage account elsewhere and received cold calls and emails from a personal rep there also, but they were all pleasant enough even though there was a push to move assets to them. Although I did like an invitation to a gala event with well known poet an author that we attended a few years ago. I only once visited a local brick and mortar office of the brokerage house and never at Fidelity.

The only brokerage that I have been annoyed with for pushing products has been Fidelity.
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Re: Fidelity or Vanguard

Post by oldcomputerguy »

neilpilot wrote: Maybe a select list, but based on my holdings at Scottrade they definitely offer VG index in Admiral. My accounts include VFIAX, VSMAX, VSIAX and VFWAX (and maybe others). Correct on mutual funds not included in the free trades, but ETF purchases are.

Scottrade does indeed offer at least some Admiral shares funds. However, it's not an unrestricted offer. I checked out my wife's Scottrade account, and when I queried for VTSAX, I get this:

"VTSAX is an Advisor Class fund, which is available to investors who are working with a Scottrade® Advisor Services Registered Investment Advisor."

So I'm assuming that the typical retail do-it-yourself investor would not be eligible to purchase VTSAX through Scottrade. There may be others, I only checked that one fund.
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Re: Fidelity or Vanguard

Post by neilpilot »

smartinwate wrote:
neilpilot wrote: Maybe a select list, but based on my holdings at Scottrade they definitely offer VG index in Admiral. My accounts include VFIAX, VSMAX, VSIAX and VFWAX (and maybe others). Correct on mutual funds not included in the free trades, but ETF purchases are.

Scottrade does indeed offer at least some Admiral shares funds. However, it's not an unrestricted offer. I checked out my wife's Scottrade account, and when I queried for VTSAX, I get this:

"VTSAX is an Advisor Class fund, which is available to investors who are working with a Scottrade® Advisor Services Registered Investment Advisor."

So I'm assuming that the typical retail do-it-yourself investor would not be eligible to purchase VTSAX through Scottrade. There may be others, I only checked that one fund.
I see the same response re:"working with a Scottrade® Advisor Services Registered Investment Advisor". It surprised me, since I'm a retail DYI investor and do not use an advisor, or pay any type of advisory fee, at Scottrade. I have no idea if their policy has changed re:VG Admiral class funds. All I can say is that I've purchased these funds, starting last September when I opened my accounts, and as recently as my allocation review in 1Q16.
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bru
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Re: Fidelity or Vanguard

Post by bru »

SGM wrote:I received a complete review of all of my assets by Vanguard a few years ago. No pressure was put on me to put more of my assets into Vanguard. The same cannot be said for Fidelity.
I assume you requested the review from Vanguard.

I've been with Fidelity for 20+ years and IIRC one time someone contacted me to ask if there was anything I needed. Never, ever have had anyone try to sell me anything.

As for Vanguard I've been Flagship with them for several years and other than me contacting my rep, who BTW is rarely ever there when I call, I've gotten nothing out of it.
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Re: Fidelity or Vanguard

Post by Leif »

SGM wrote:I have received wrong information from a retirement expert at Fidelity and cold calls from a sales rep. The customer service I have received at Vanguard has generally been better. Unfortunately my excellent Vanguard personal rep has been promoted, but the new guy seems eager and competent. I received a complete review of all of my assets by Vanguard a few years ago. No pressure was put on me to put more of my assets into Vanguard. The same cannot be said for Fidelity.

I have a low cost brokerage account elsewhere and received cold calls and emails from a personal rep there also, but they were all pleasant enough even though there was a push to move assets to them. Although I did like an invitation to a gala event with well known poet an author that we attended a few years ago. I only once visited a local brick and mortar office of the brokerage house and never at Fidelity.

The only brokerage that I have been annoyed with for pushing products has been Fidelity.
My experience it pretty much the exact opposite of yours.

I have accounts at Fidelity and Vanguard. Actually, either has been pushy in having me invest in any particular fund.

I never had a problem with Fidelity customer service. It has always been excellent. I have a couple of stories on that. One time I accidental overdrew my checking account. Fidelity called me and asked if I wanted to cover the check from funds in a different account. After that I was thinking, wow, a normal bank would throw a party at nicking you for overage charges.

Another time I transferred funds from Fidelity to another brokerage. That was because I was starting to use a financial adviser, and he did not offer Fidelity as a custodian. My new custodian total messed up the process. I called Fidelity. They told me don't worry, they would get it straightened out. This is from the company that was losing my money! After that I decided at the VERY FIRST CHANCE I would transfer back to Fidelity. And I did.

Now, lets discuss Vanguard. I recently sent in paperwork to have a distribution from a Roth 401k plan to a Roth IRA. I noticed after they made the transfer that my new IRA lacked the work "Roth" in the title. I thought, that is strange. I asked the rep. Sure enough, the new account was a traditional IRA. They moved my funds from a Roth 401K to a traditional IRA. Imagine if I had not caught that what the discussion would be like with the IRS, a few years later, when I went to make a withdrawal!

Am I done with Vanguard? Not quite yet. Just last Friday I called regarding another issue. They asked me to enter my SS #. I did that --- three times!! finally they said I was being transferred. After that I was disconnected. Then I call again. This time they recognized my SS #. I thinking oh joy! But, I celebrated too soon. I was on hold for 30 minutes. I finally hung up.
Last edited by Leif on Fri May 06, 2016 12:00 am, edited 1 time in total.
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Re: Fidelity or Vanguard

Post by Yesterdaysnews »

Fido has a nice new Visa card that puts 2% of all purchases back into your taxable account. Kinda a nice feature.

Fidelity also makes it easier to sell specific tax lots and other useful tax planning techniques.
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ImNotABot
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Re: Fidelity or Vanguard

Post by ImNotABot »

Well thanks for all the replies.

Im going majority to vanguard, and may keep a little at Fidelity.
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Re: Fidelity or Vanguard

Post by SeeMoe »

Vanguard Funds are investor owned! Don't know about other mutual funds, but it appears The Vanguard Group is a very unique, stand-Alone investment company like none other,..That means a lot to me in regard to trust. Implicit trust!
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Re: Fidelity or Vanguard

Post by Dandy »

Fidelity Spartan funds are excellent. My opinion is that the only reason they offer them is to compete with Vanguard. Fidelity is slicker in a good sense probably a much better web site etc. Vanguard is a more trusted company and offers lots of low cost options outside of what Fidelity offers. I opted to consolidate with Vanguard and left Fidelity.
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Re: Fidelity or Vanguard

Post by Earl Lemongrab »

I am currently using Fidelity. I do like their account aggregation tool. However, whether I keep significant amounts there depends on bonus money. So I'll be moving those assets out (leaving a bit of cash to keep the account open) to another custodian with a bonus offer. That's the beauty of ETFs, you can move 'em around where you want without losing access (like Admiral shares) or being out of the market.

For the record, I haven't had anything AT Vanguard since I discovered the bonus programs. Thousands each year for very little work! But I hold a lot of Vanguard funds through their ETFs.

Earl
Gleevec
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Re: Fidelity or Vanguard

Post by Gleevec »

I never quite understood the "or" aspect of these questions. Between these two (and Schwab) you generally get all the personal finance tools at a good price you need, and there are no account minimums or closing costs I have seen personally. To me, this isnt like the iPhone vs Android debate, where each phone is $500 or whatever to maintain, you can have an account at both Fidelity and Vanguard for free. Sometimes Vanguard is better, sometimes Fidelity, so why not have both and splice and dice to get the best of both worlds?
robertalpert
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Re: Fidelity or Vanguard

Post by robertalpert »

If you prefer Vanguard funds, then definitely go with Vanguard brokerage. If keeping a simply designed portfolio, then Vanguard customer service will be more than adequate.
Lynette
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Re: Fidelity or Vanguard

Post by Lynette »

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Last edited by Lynette on Wed Dec 06, 2017 12:11 pm, edited 1 time in total.
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Youngblood
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Re: Fidelity or Vanguard

Post by Youngblood »

Both here as well.

For me, I enjoy Fido's website, research, bill pay, customer response, advice, a branch I can go to, and some very smart people you can access. They have helped me with problems Not created by them. Made me feel valuable as a customer. I only have a small account with them and keep thinking I should split the accounts more evenly.

I've been with Vanguard the longest and while there have been some paper type problems all of them have been resolved eventually. I don't like their tax forms as much as Fido's but not a big problem.

Decades ago, I put a large amount, percentage wise, into the Vanguard Healthcare fund. The results of which were financially life changing. Hence, the subjective loyalty.

YB
"I made my money by selling too soon." | Bernard M. Baruch
bondsr4me
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Re: Fidelity or Vanguard

Post by bondsr4me »

I currently use VG, Fidelity, Schwab and have a very small balance at TD Ameritrade.

I like them all for certain reasons that suit me.

If I absolutely had to pick just one, it would be Fidelity (with VG and CS a real close tie for 2nd).

Of all the ones listed, Fidelity is the best when it comes to bonds.
They have a lot of inventory, allow you to place limit orders, allow you to buy just one bond for many of the listed bonds,
has a very good bond info screen showing attributes....just all around the best when it comes to bonds (IMHO).

I also like the free trading of some of the etf's they offer. Their ER's are just as good and maybe better than VG/CS.

There customer service is very very good; so is CS; they both offer real-time chat which is a huge plus to me.

So, there you have it....Fidelity if you must choose one only.

Don
Alkan
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Re: Fidelity or Vanguard

Post by Alkan »

Most positions on this question have already been covered in this thread and a number of others on the same topic, but I may have a little to add.
First, I use Vanguard for my taxable and personal retirement accounts, and I've only had positive experiences with them. I'm a huge fan of Vanguard's total market funds, and am satisfied with the online experience. Costumer service has never been short of fantastic, although this might be influenced by having a Flagship account.

My experience with Fidelity started when my father died 5 years ago, and it has been terrible. He had 7-8 different retirement accounts at Fidelity, and I was one of several beneficiaries of the accounts. The number of accounts was on the high side, but in theory it should have been pretty straight forward; accounts are divided among the beneficiaries listed on the accounts, then transferred to accounts in our names, then rolled over into a single traditional or roth inherited IRA. In practice there were significant problems and missteps on the part of Fidelity every step of the way. For about a year I was regularly on the phone with Fidelity for hours at a time (I was also dealing with this for my siblings). These conversations usually involved innumerable transfers and long periods on hold. Often I would fulfill x, y & z requirements, only to be told by someone else that u, v & w needed to be done instead, and that the prior individual who gave me initial instructions had been misinformed. On 2 occasions I went to the local Fidelity branch to try to sort things out and speed up the process. Finally, after a year and a half, I thought everything was done, and was told in person that no accounts remained under my father's name. Then, over a year later, I was informed by the executor of my dad's estate that he was still receiving quarterly account statements from 2 additional Fidelity accounts in my Dad's name. This started off another lengthy process, full of weird Catch-22's that I won't even get into, before these accounts "from the work-place side" of Fidelity were appropriately transferred to the beneficiaries. In the end it was 3 years and 11 months after my father's death before all issues were resolved.

And that's before we get to the investment side of the equation. My father wasn't a boglehead, but he didn't make terrible decisions. No index funds, and definitely a lot of Contrafund, very US-heavy, but nothing unreasonable or age-inappropriate. Around the first time I thought all the issues were resolved, someone at the local branch reached out and offered to set up a complementary meeting with an investment adviser to reallocate the funds that had been transferred and rolled over in-kind. I hadn't gotten around to switching to the normal 3-fund portfolio yet, so I figured that I had nothing to lose by hearing out an adviser. The adviser was very friendly, listened carefully as I outlined my preference for low-fee index fund investing, and my overall investing picture. She then got back to me two days later with a 20 page .pdf full of fancy looking charts and graphs, and, I kid you not, recommendation for splitting the inherited IRAs into 12-14 different funds, with an overall expense ratio of around 1%. All I needed to do was give her the OK, and she'd take care of implementing the plan... So for all of you who are perfectly satisfied with the Spartan funds, just remember that Fidelity will make every effort to exploit your beneficiaries if you choose to have them.

Which brings me to the Spartan funds - I own FSTVX, FSGDX, and FSITX in these inherited accounts. I won't get into every reason why I prefer Vanguard funds, but I don't think people have discussed the large gaps between gross fees and net fees in these funds. FSGDX - net is .12%, but the gross is .28%. FSTVX - the net is .05%, but the gross is .07%. FSITX - net .07%, but .17% gross. I assume that this subsidy will decrease & the net & gross fees will converge as the funds grow, but generally these differences should be a cause for closer scrutiny, and they mean that Fidelity has zero incentive to steer individual investors towards the Spartan funds. I'm also slightly annoyed by FSGDX not covering small-cap international, since it's obviously a cost cutting measure (I keep most of my international allocation in taxable accounts, so it's not much of an issue). In the end, the differences between Vanguard and Fidelity aren't large enough to go through the bother of transferring the Fidelity accounts, but if someone has the choice between starting off at one or the other, I can only recommend Vanguard.
sfnerd
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Re: Fidelity or Vanguard

Post by sfnerd »

radiowave wrote:
ruralavalon wrote:

Incorrect.

Not only can you purchase Admiral funds at Scottrade, but the minimums imposed by Vanguard are waived by Scottrade. When I moved my accounts from ML, I wanted access to a local office. I went with Scottrade, in part, due to a significant new account $$ bonus and many free trades. Fidelity was my second choice, but I knew I wanted to purchase VG funds and Fidelity, unlike Scottrade, does not offer VG Admiral funds.
Out of curiosity I called the local Scottrade office and apparently, according to the fellow on the phone, you have to be under their active advisor service to get access to the Admiral funds. For self-directed accounts, you can transfer in and sell VG Admiral funds, but not purchase new one. I did not ask how much they charged for the active management service.
As of a week ago, many admiral funds are no longer available, as radiowave says. I learned this the hard way yesterday when trying to do my monthly purchase of VCADX. No luck, I can no longer buy it at Scottrade. This led me to face the same question as the OP... where do I put my money?

I have about 1.9 million at Scottrade, so I figured I'd qualify for Vanguard Flagship. This seemed like a great time to move over to Vanguard. I wanted to like VG. So I called and they transferred me to a Flagship specialist.

This specialist informed me that I needed at least a million in VG assets for Flagship, and non VG funds don't count. Ok. I had 890k in VG stuff, and the rest was in other funds with a low basis, that I didn't want to sell right now for tax reasons. Could they make an exception, considering I would hit 1 million in VG assets soon? No, no exceptions, he says. Fine, no problem. Disappointing considering I'd have about 2 million with their company, but no big deal. What happened next was the bad part.

The specialist gave me a hard sell on liquidating my 1 million in IVV and taking a big tax hit in order to get Flagship services. I told him no several times, but he kept pressing. He was super sleazy during the whole process. I really didn't expect this from Vanguard. Just sell part of it, he said. He went on and on, despite having told him at the start of the call that I wanted a firm that would just help me execute my plan, not convince me of anything. Finally I had to tell him that Vanguard just didn't seem like the company for me. Very unfortunate.

:oops:
robertalpert
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Re: Fidelity or Vanguard

Post by robertalpert »

sfnerd wrote:
This specialist informed me that I needed at least a million in VG assets for Flagship, and non VG funds don't count. Ok. I had 890k in VG stuff, and the rest was in other funds with a low basis, that I didn't want to sell right now for tax reasons. Could they make an exception, considering I would hit 1 million in VG assets soon? No, no exceptions, he says. Fine, no problem. Disappointing considering I'd have about 2 million with their company, but no big deal. What happened next was the bad part.

The specialist gave me a hard sell ..........

.......... Just sell part of it, he said.
Sfnerd, Even with low cost basis, Is there a reason you choose not to sell just $2000 of it to qualify for Flagship?
sfnerd
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Re: Fidelity or Vanguard

Post by sfnerd »

robertalpert wrote:
Sfnerd, Even with low cost basis, Is there a reason you choose not to sell just $2000 of it to qualify for Flagship?
I would have to sell 110k to qualify, and at a basis of about 60% of the current value, I'd be looking at a gain of 44k, so at least 9k or so in taxes.
Polymath
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Re: Fidelity or Vanguard

Post by Polymath »

Alkan wrote: The adviser was very friendly, listened carefully as I outlined my preference for low-fee index fund investing, and my overall investing picture. She then got back to me two days later with a 20 page .pdf full of fancy looking charts and graphs, and, I kid you not, recommendation for splitting the inherited IRAs into 12-14 different funds, with an overall expense ratio of around 1%. All I needed to do was give her the OK, and she'd take care of implementing the plan... So for all of you who are perfectly satisfied with the Spartan funds, just remember that Fidelity will make every effort to exploit your beneficiaries if you choose to have them.
Which is a great example reason of why it important to document your investing philosophy and a basic guidance to heirs and any executor of your estate. You can't guarantee what people will do, but without arming them with knowledge the are less likely to do what you view as "right".
invst65
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Re: Fidelity or Vanguard

Post by invst65 »

ImNotABot wrote:Dear Bogleheads,

I have the option to go with either vanguard or fidelity for my IRA and taxable accts.

My investment plan is just for a straightforward 3-fund portfolio.

I understand Fidelity has the Spartan Funds which have same ER as the Admirals from Vanguard.

Doesn anyone have any strong opinions either way? Would be very happy to hear some thoughts.

Thanks
If you are talking about a self-directed IRA plus taxable accounts then how can it be that you only have those two options? There must be many others.

Nevertheless, I have accounts with both, my company 401k and my Roth IRA being with Vanguard, and the rest with Fidelity. If you made me choose only one I'd go with Fidelity, but I like both - Vanguard for low fees and Fidelity for just about everything else.
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TimeRunner
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Re: Fidelity or Vanguard

Post by TimeRunner »

Interesting "Reuters Investigates" article today on Fidelity owners' self-enrichment at the expense of certain active funds investors:
Family First - How the owners of Fidelity get richer at everyday investors’ expense
Lead paragraph: "The billionaire Johnson clan has a private venture capital arm that competes directly for lucrative deals with the Fidelity funds in which millions of Americans put their nest eggs. Corporate governance specialists say the arrangement poses a troubling conflict of interest." Long but interesting read.
One cannot enlighten the unconscious. | "All I need are some tasty waves, a cool buzz, and I'm fine." -Jeff Spicoli
ATLCPA
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Re: Fidelity or Vanguard

Post by ATLCPA »

mervinj7 wrote: For international, the Fidelity fund to use is FSGDX (Spartan Global ex-US). ER is 0.12% and includes emerging markets and Canadian maple products.
Any Canadian bacon in there? :confused
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