Vanguard upgraded my accounts - angry [Brokerage Services]

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
User avatar
Steelersfan
Posts: 4125
Joined: Thu Jun 19, 2008 8:47 pm

Re: Vanguard upgraded my accounts - angry

Post by Steelersfan »

A curiosity question.

If you want to remain on a system like Vanguard's that only deals with mutual funds and is separate from a brokerage account, what financial firms can you look at to see if you like it better?
User avatar
knpstr
Posts: 2894
Joined: Thu Nov 20, 2014 7:57 pm
Location: Michigan

Re: Vanguard upgraded my accounts - angry

Post by knpstr »

celia wrote:
knpstr wrote:What a silly thing to be angry about.
This is not silly. Why would anyone want to give up feature(s) he/she is comfortable with and uses often for features they don't care about?
If you are on the brink of "cursing someone out" over such a thing, that is very silly in my view.
Vanguard made it known they want everyone to switch over anyway, may as well get used to the new setup.

It's like getting angry that Microsoft 10 updated on your machine over night. Sure you may not have wanted it, but life goes on.
Silly to "anger" yourself over such trivial things, in my view.
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius
BigJohn
Posts: 2626
Joined: Wed Apr 02, 2014 11:27 pm

Re: Vanguard upgraded my accounts - angry

Post by BigJohn »

Thanks GreyingDuke and EngCapt, my discussions with VG on this are a 2 - 3 years old and they said that capability was coming. I guess it has arrived and I was unaware.
"The greatest enemy of a good plan is the dream of a perfect plan" - Carl Von Clausewitz
User avatar
nedsaid
Posts: 19249
Joined: Fri Nov 23, 2012 11:33 am

Re: Vanguard upgraded my accounts - angry

Post by nedsaid »

jackhensy wrote:I have a Roth IRA and a taxable account.
All I wanted to do was open up one "separate" brokerage account to trade stocks.

Instead the Vanguard customer rep upgrades all my retirement accounts to brokerage accounts! I called back and almost cursed him out.
They said they cannot change them back to the original accounts because Vanguard is wanting everyone to upgrade their accounts to brokerage accounts.

Is this true?
Welcome to the brave new world where you really don't own anything anymore or make your own decisions. Those better and smarter than you do what is in your best interest and just do it without permission.

Like the evening I naively left my Windows 7 computer on overnight and woke up to a Windows 10 machine. Yes, the world where hell no means maybe and no means yes.

Like the phone company that keeps changing my plan without my permission. Or the credit card company that mails out new terms of service whenever they feel like it.

Doesn't it tick you off? Well it should.
A fool and his money are good for business.
acanthurus
Posts: 418
Joined: Sun Aug 04, 2013 8:02 am

Re: Vanguard upgraded my accounts - angry

Post by acanthurus »

Removed
Last edited by acanthurus on Tue Oct 31, 2017 5:34 pm, edited 1 time in total.
User avatar
LadyGeek
Site Admin
Posts: 95466
Joined: Sat Dec 20, 2008 4:34 pm
Location: Philadelphia
Contact:

Re: Vanguard upgraded my accounts - angry

Post by LadyGeek »

As a reminder, general rants are off-topic. Complaints are fine, but please stay focused on helping the OP and state your concerns in a civil, factual manner.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
boglesmind
Posts: 319
Joined: Sun Jan 05, 2014 12:07 pm

Re: Vanguard upgraded my accounts - angry

Post by boglesmind »

Miriam2 wrote:
celia wrote:
Silence Dogood wrote:So you are saying that if I click on "balances and holdings over time" ... "over time" will only be from the transition date forward (i.e. from now going forward)? I won't see "balances and holdings" starting from 01/03/2011 (when I first contributed to this mutual fund)?
My "Balances over time" screen shows my holdings for the last 10 years but only for the accounts I currently own. Once an account has been deleted from your online account, it won't show up in reports like this. But that won't happen for a year or more (until it is deleted from the system).
"Silence Dogood" - Right now when I click on the mutual fund (within the Roth IRA mutual-fund-only account) is where it shows that it was "opened on 01/03/2011" - I was hoping that it would transfer this mutual fund into the new account along with the history that goes with it.
I believe that date will be the date the holding was started in THAT account. Think of it as you did a rollover from one account to another. It is not a taxable event, but the new account will have new dates.
I think what Silence Dogood is worried about is being able to track his account and mutual fund balances over time so he knows how he's doing :happy

I have the same Q because I really like the Vanguard Balances over Time graphs. I can customize it to change the funds and accounts to pull up difference graphs for all accounts or individual accounts. It's neat. Also I can see my account history as a graph, which I like :wink:
We've had vanguard mutual fund and brokerage accounts for more than 20 years. In 2016, converted / upgraded them all to "brokerage" accounts only. To answer Miriam's question, in our experience
  • 1. full history is retained (cost basis, dates of purchases/re-investments of dividends, capital gains etc).
    2. Performance data is available for a maximum of 10 years for accounts that are still open. This includes "Balances over Time" graphs with the same customization as before (include / excluded certain holdings). Vanguard never provided, in our experience, performance data from the date of opening of an account if it exceeded 10 years. We use Quicken for that.
    3. There were some minor issues (for me) such as having to re-verify bank accounts by deleting them first, adding them and verifying micro deposits. We also had the redo dividend reinvestment choices.
We've worked in multiple companies and have had accounts at multiple brokerages. We learnt early enough not to be bothered by the following inevitable things (such as death and taxes :-))
  • every few years, companies change their email system from whatever to Microsoft Exchange, Lotus Notes, Gmail, totally home-grown system etc
  • even if you are lucky to be able to use the same software, the SW user interface changes often - for the sake of change with no apparent benefit to 90% of the users - MS Word comes to mind.
  • every brokerage has a completely different interface, statement format and does some things better than others (and of course some things worse than others), delivers 1099s early/late.
We roll with the changes and look out for only really critical changes such as merging identically titled Roth IRAs into a single account -- thanks to this forum. I believe that the upgrade allows you to retain the individual identities of selected accounts -- I may be wrong, please check with Vanguard.

Boglesmind
Last edited by boglesmind on Fri Jun 30, 2017 6:51 pm, edited 1 time in total.
User avatar
jhfenton
Posts: 4754
Joined: Sat Feb 07, 2015 10:17 am
Location: Ohio

Re: Vanguard upgraded my accounts - angry

Post by jhfenton »

celia wrote:
FB01 wrote:What is disadvantage if they convert to brokerage account?
In my case, I would have to re-do all my Agent Authorizations and links to our checking accounts. That requires notary signatures and in California, they charge a $10 state fee for each signature being notarized. For me, that would cost over $200 out of pocket.

In addition, the automatic upgrades tend to merge accounts that are titled the same. If you are doing Roth conversions, they may co-mingle your Roths, thus voiding the "separateness" you may need in case recharacterizations are done.

By merging your accounts, they would also mess things up if you have different beneficiaries on your accounts.
If you come through Cincinnati, I'll be happy to notarize anything you want for free. Just bring your ID. :beer

I can see where they might accidentally co-mingle accounts upon conversion, but you can certainly have multiple "upgraded" brokerage accounts of the same type and ownership. I would just be careful and not "ugprade" if you have a "competitive" Roth conversion battle underway with multiple old-style accounts.
sharpjm
Posts: 657
Joined: Fri Feb 20, 2015 1:41 pm

Re: Vanguard upgraded my accounts - angry

Post by sharpjm »

knpstr wrote:
celia wrote:
knpstr wrote:What a silly thing to be angry about.
This is not silly. Why would anyone want to give up feature(s) he/she is comfortable with and uses often for features they don't care about?
If you are on the brink of "cursing someone out" over such a thing, that is very silly in my view.
Vanguard made it known they want everyone to switch over anyway, may as well get used to the new setup.

It's like getting angry that Microsoft 10 updated on your machine over night. Sure you may not have wanted it, but life goes on.
Silly to "anger" yourself over such trivial things, in my view.
+1 To see stuff like this after reading so many threads of collective wisdom is humorous to me. Sounds like people are really struggling to even find many differences between the two. First world problems at its best here.
User avatar
LadyGeek
Site Admin
Posts: 95466
Joined: Sat Dec 20, 2008 4:34 pm
Location: Philadelphia
Contact:

Re: transition to Vanguard brokerage ?

Post by LadyGeek »

I merged RustyShackleford's thread into here, which is a similar discussion - "What are the downsides?"
RustyShackleford wrote:[Thread merged into here, see below (next page). --admin LadyGeek]

I received an email from Vanguard today inviting me to "move to the Vanguard brokerage account". The main text is:
We invite you to transition your Vanguard mutual fund account to the Vanguard Brokerage Account—a simple, more flexible way to manage all your investments in the same account. When you make the move, you'll gain:
• A wider range of investment choices, including not only Vanguard mutual funds but also ETFs (exchange-traded funds), stocks, bonds, and CDs (certificates of deposit).
• Fast, commission-free transactions for all Vanguard mutual funds and ETFs.*
• The ability to easily cancel transactions, gift Vanguard fund shares, and make same-day fund purchases with trade proceeds.

My question: is there any downside to doing this ? FWIW, I don't intend to take advantage of any of these benefits right away (all I hold in my Vanguard mutual fund account is my main domestic equity position in an index fund, and some cash in a money market fund). But I can imagine wanting to hold some other assets there in the future.
The combined thread is now in the Investing - Theory, News & General forum as this has become a general discussion.

Here's a long-running thread: "Vanguard converting mutual fund accounts to brokerage?
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
ftobin
Posts: 1071
Joined: Fri Mar 20, 2009 3:28 pm

Re: Vanguard upgraded my accounts - angry

Post by ftobin »

TomatoTomahto wrote:If our accounts were converted/upgraded, we would be forced to move our holdings to one of the approved brokers. We explained this to Vanguard some years ago, when they first offered the upgrade, and they backed off. We have no button on our screen, or emails encouraging us to convert, as some upthread have said.
Likewise. I'd have to
  • discontinue my 10+ year relationship with Vanguard
  • convert all my admiral shares to investor shares (across 4 accounts)
  • move them to another brokerage
  • never contribute more to them (because mutual fund transaction fees are $$$ compared to ETFs)
  • and start building up my holdings in ETFs vs mutual funds, which I'm not a fan of as long as admiral class exists.
AQ
Posts: 884
Joined: Mon Feb 25, 2008 10:38 pm

How NOT to upgrade?

Post by AQ »

I got the dreaded email inviting me to upgrade to the brokerage account. I have no interests to do it, and in fact fear it complicates my life. How can I stick to my mutual funds as long as possible? Can I simply ignore the invite, or do I need to contact them to actively remove me from their list?
User avatar
LadyGeek
Site Admin
Posts: 95466
Joined: Sat Dec 20, 2008 4:34 pm
Location: Philadelphia
Contact:

Re: Vanguard upgraded my accounts - angry

Post by LadyGeek »

^^^ I merged AQ's post into here, which is a similar discussion.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
User avatar
Sid
Posts: 34
Joined: Mon Mar 05, 2007 11:11 am
Location: Central Texas

Re: Vanguard upgraded my accounts - angry

Post by Sid »

I use Quicken to automatically download account information. I have four VG accounts (with four account numbers) and they all four get downloaded into the a corresponding Quicken account. Will this still work after I upgrade to a Brokerage account that only has one account number?
Sid
boglesmind
Posts: 319
Joined: Sun Jan 05, 2014 12:07 pm

Re: Vanguard upgraded my accounts - angry

Post by boglesmind »

.. duplicate .. deleted
Last edited by boglesmind on Fri Jun 30, 2017 6:52 pm, edited 1 time in total.
User avatar
Doc
Posts: 10606
Joined: Sat Feb 24, 2007 12:10 pm
Location: Two left turns from Larry

Re: Vanguard upgraded my accounts - angry

Post by Doc »

Sid wrote:I use Quicken to automatically download account information. I have four VG accounts (with four account numbers) and they all four get downloaded into the a corresponding Quicken account. Will this still work after I upgrade to a Brokerage account that only has one account number?
Yes but you will likely have to set up the new accounts on Q.

We converted several years ago and already had corresponding mutual/brokerage funds so the transfer was just for the individual assets. History was retained. Direct deposit and bank transfers settings had to be restablised and took some time as Vg got other things changed. (They changed their correspondent bank.) There is no longer a 3 day delay in selling an ETF and buying a mutual fund. Directing dividends is more restricted as others have noted. This is of no consequence for me. One unanticipated benefit it to initiate a bank transfer into the account and being able to buy within minutes. No margin account required.
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.
User avatar
Hopeful
Posts: 30
Joined: Wed Aug 07, 2013 12:04 pm

Re: Vanguard upgraded my accounts - angry

Post by Hopeful »

We currently have a flagship account, and I don't remember ever getting an email or notice to switch to a brokerage account. I am content with the way things are now, and will likely just ignore it until forced.
User avatar
DaleMaley
Posts: 1592
Joined: Thu Mar 01, 2007 7:04 pm
Location: Fairbury, Illinois
Contact:

Re: Vanguard upgraded my accounts - angry

Post by DaleMaley »

My wife's account got upgraded last year, and I bounced a Prime Money Market check I used to pay my property tax......because it was 45 days after the so called upgrade :annoyed

Vanguard forget to tell me that Prime Money Market checks are no good 45 days after the upgrade. Now I online transfer money from the Money Market account to my bank checking account to pay big bills like property tax. The Pros and Cons link above covers the Prime Money market 45 day rule.........
Less flexible checkwriting. With the mutual fund accounts, you could get a separate checkbook for each of your eligible mutual fund accounts. I could get checks that withdrew directly from my Vanguard Limited-Term Muni Bond fund, or Vanguard Total US Bond fund, or any money market fund. But now, you will only get a single checkbook for each brokerage account, and it will only pull from your settlement account (plus another fund as backup).

Vanguard will “do our best to honor any outstanding checks written on a Vanguard mutual fund that are presented for payment within 45 days after you’ve transferred your Vanguard funds into a brokerage account.”
Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees. – Warren Buffett
User avatar
Kenster1
Posts: 3225
Joined: Wed Feb 28, 2007 9:50 pm

Re: Vanguard upgraded my accounts - angry

Post by Kenster1 »

thirdman wrote:My sister who had a Flagship account thru me had less than the one million minimum. When she "upgraded" she found out she was no longer a Flagship client. Furthermore, her Prime Money Market Fund which had less than the $3000 minimum was converted to a Federal Money Market Fund, paying a lower rate. Also her checks were cancelled, and now the minimum check she can write is $250. She had to download a form to fill out and mail in to get checking privileges with her fund.

When she called to inquire, she was told that she could not speak with her former Flagship representative since she was no longer a Flagship client. She was told that she had been "demoted." Also, she found that her hold times were much longer.

The irony is that she "upgraded" to a brokerage account at Vanguard in order to transfer assets in kind from another brokerage firm!
Wow - ouch!
SURGEON GENERAL'S WARNING: Any overconfidence in your investing ability, willingness and need to take risk may be hazardous to your health.
User avatar
flamesabers
Posts: 1848
Joined: Fri Mar 03, 2017 11:05 am
Location: Rochester, MN

Re: How NOT to upgrade?

Post by flamesabers »

AQ wrote:I got the dreaded email inviting me to upgrade to the brokerage account. I have no interests to do it, and in fact fear it complicates my life. How can I stick to my mutual funds as long as possible? Can I simply ignore the invite, or do I need to contact them to actively remove me from their list?
Until there is a deadline for a mandatory upgrade or otherwise a requirement to opt out of a automatic upgrade, I think you can just ignore the invite.
User avatar
zaboomafoozarg
Posts: 2430
Joined: Sun Jun 12, 2011 12:34 pm

Re: Vanguard upgraded my accounts - angry

Post by zaboomafoozarg »

I find that a combined account is simpler than having 2 separate account types for mutual funds and stocks/ETFs. Things are a little different now but I welcomed the change.
User avatar
queso
Posts: 1340
Joined: Thu Jan 07, 2016 2:52 pm

Re: Vanguard upgraded my accounts - angry

Post by queso »

I clicked the upgrade button for each account yesterday. No big deal. Actually, it was almost a big deal when I logged into Personal Capital this morning, saw my net worth and immediately started composing my resignation email. Then I realized my Vanguard accounts were temporarily duplicated due to the upgrade and I hadn't somehow miraculously reached my number overnight. Oh well...back to work I guess. :|
plats
Posts: 512
Joined: Mon Dec 31, 2007 8:46 pm

Re: Vanguard upgraded my accounts - angry

Post by plats »

Sid wrote:I use Quicken to automatically download account information. I have four VG accounts (with four account numbers) and they all four get downloaded into the a corresponding Quicken account. Will this still work after I upgrade to a Brokerage account that only has one account number?
It'll work after some tweaks. You'll have to "Enter transactions: Shares Transferred Between Accounts" to move your funds into the brokerage account. I forget if I had to delete anything after the first download.
MnD
Posts: 5184
Joined: Mon Jan 14, 2008 11:41 am

Re: Vanguard upgraded my accounts - angry

Post by MnD »

Welcome to 1984! (Or maybe 1992) It's all good. :beer
https://aboutschwab.com/about/history
70/30 AA for life, Global market cap equity. Rebalance if fixed income <25% or >35%. Weighted ER< .10%. 5% of annual portfolio balance SWR, Proportional (to AA) withdrawals.
Levett
Posts: 4177
Joined: Fri Feb 23, 2007 1:10 pm
Location: upper Midwest

Re: Vanguard upgraded my accounts - angry

Post by Levett »

" Not really a fan of what Vanguard is doing here."

Nor am I.

Just say, "No."

Sure, VG will ultimately prevail, but it's in their best interest, not mine.

Lev
Topic Author
jackhensy
Posts: 88
Joined: Sat Feb 14, 2015 4:02 pm

Re: Vanguard upgraded my accounts - angry

Post by jackhensy »

It's not just about the upgrade as it is about the "covert manner" in which they converted my accounts.
I innocently wanted a separate brokerage account to trade stocks and they took advantage of the situation.

Vanguard - "A customer wants a separate brokerage account? Great. Lets convert ALL HIS RETIREMENT ACCOUNTS to brokerage accounts since that's what we want our customers to do anyway. And who cares what the customer thinks if he dislikes it because its easier for us here at Vanguard!"
User avatar
zaboomafoozarg
Posts: 2430
Joined: Sun Jun 12, 2011 12:34 pm

Re: Vanguard upgraded my accounts - angry

Post by zaboomafoozarg »

To be fair, they have said they were going to do this update to every account for 2 years now.
User avatar
Doc
Posts: 10606
Joined: Sat Feb 24, 2007 12:10 pm
Location: Two left turns from Larry

Re: Vanguard upgraded my accounts - angry

Post by Doc »

zaboomafoozarg wrote:To be fair, they have said they were going to do this update to every account for 2 years now.
We converted in November 2014 and they were saying that then so it's more than 2 years.

I think they started with investors who already had brokerage accounts so it would be easier to work out any problems. There were a lot of problems.
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.
KyleAAA
Posts: 9496
Joined: Wed Jul 01, 2009 5:35 pm
Contact:

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by KyleAAA »

It amuses me that people here rail against Vanguard doing things like providing an automatic cross-account rebalancing tool because they're afraid it would "increase costs (it wouldn't) while also railing against consolidating all customers onto a single brokerage platform which WOULD materially decrease costs. This is a no-brainer for Vanguard and we will all benefit in the long run from lower costs. And it's not like they haven't been out in the open about it for years now. Yes, your specific situation might make this slightly inconvenient but the needs of the many outweigh the convenience of the few. It's trivial to hold vanguard funds and etfs elsewhere if you need a certain feature.
User avatar
bardenay
Posts: 73
Joined: Fri Jan 25, 2013 8:16 am

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by bardenay »

TBH, I didn't know about this upgrade until I read about it here on the BogleHeads forum two days ago. Coincidentally, I received the "Upgrade Invite" email a day after reading about the upgrade.

I don't have a problem with it. I certainly don't want to stay on a "legacy" system. They have been doing the upgrades for sometime now, so I feel confident they have the process worked out.

I went ahead and initiated the upgrade. The cost basis didn't change on my taxable acct, so that was good. The only thing that I had to change was the setting for dividend reinvestment. It defaulted to sending dividends to the MM acct rather than reinvest them.
bondsr4me
Posts: 2427
Joined: Fri Oct 18, 2013 7:08 am

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by bondsr4me »

KyleAAA wrote:It amuses me that people here rail against Vanguard doing things like providing an automatic cross-account rebalancing tool because they're afraid it would "increase costs (it wouldn't) while also railing against consolidating all customers onto a single brokerage platform which WOULD materially decrease costs. This is a no-brainer for Vanguard and we will all benefit in the long run from lower costs. And it's not like they haven't been out in the open about it for years now. Yes, your specific situation might make this slightly inconvenient but the needs of the many outweigh the convenience of the few. It's trivial to hold vanguard funds and etfs elsewhere if you need a certain feature.

I tend to agree with the above. Consolidating and maintaining accounts onto one platform has to be cheaper than maintaining two platforms.
I like the brokerage account. I hold ETF's more than I do mutual funds, so it suits me just fine. To each his/her own.
I give VG credit for going the brokerage account way.

Have a great weekend BH'ers.

Don
tibbitts
Posts: 23588
Joined: Tue Feb 27, 2007 5:50 pm

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by tibbitts »

I agree with the notion of having one platform to reduce cost.

Except that the dreaded upgrade button appeared in my account a couple of days ago. Ugh. I think there is almost universal agreement that the old platform is greatly superior in every way for mutual fund accounts, so I'm being downgraded. Ugh. I would have preferred VG just stick to mutual funds on its retail side and let resellers deal with everything else. That would have been one platform, too.
ftobin
Posts: 1071
Joined: Fri Mar 20, 2009 3:28 pm

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by ftobin »

I'm curious if they ask questions like if you're a registered rep when you convert. Ordinarily, when a brokerage account is opened, there are a bunch of regulatory questions that don't apply to a mutual fund account. Are these asked when converting?
letsgobobby
Posts: 12073
Joined: Fri Sep 18, 2009 1:10 am

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by letsgobobby »

KyleAAA wrote:It amuses me that people here rail against Vanguard doing things like providing an automatic cross-account rebalancing tool because they're afraid it would "increase costs (it wouldn't) while also railing against consolidating all customers onto a single brokerage platform which WOULD materially decrease costs. This is a no-brainer for Vanguard and we will all benefit in the long run from lower costs. And it's not like they haven't been out in the open about it for years now. Yes, your specific situation might make this slightly inconvenient but the needs of the many outweigh the convenience of the few. It's trivial to hold vanguard funds and etfs elsewhere if you need a certain feature.
ok, but why not smooth out all the bugs? they've had years to get it right. for example, why does everyone need to reset their distribution reinvestment option? why do we need to set up bank accounts again? these should have been easy to fix by this point.
KyleAAA
Posts: 9496
Joined: Wed Jul 01, 2009 5:35 pm
Contact:

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by KyleAAA »

letsgobobby wrote:
KyleAAA wrote:It amuses me that people here rail against Vanguard doing things like providing an automatic cross-account rebalancing tool because they're afraid it would "increase costs (it wouldn't) while also railing against consolidating all customers onto a single brokerage platform which WOULD materially decrease costs. This is a no-brainer for Vanguard and we will all benefit in the long run from lower costs. And it's not like they haven't been out in the open about it for years now. Yes, your specific situation might make this slightly inconvenient but the needs of the many outweigh the convenience of the few. It's trivial to hold vanguard funds and etfs elsewhere if you need a certain feature.
ok, but why not smooth out all the bugs? they've had years to get it right. for example, why does everyone need to reset their distribution reinvestment option? why do we need to set up bank accounts again? these should have been easy to fix by this point.
Hmm, I didn't need to do any of that stuff when I finally converted earlier this year.
User avatar
RustyShackleford
Posts: 1682
Joined: Thu Sep 13, 2007 12:32 pm
Location: NC

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by RustyShackleford »

So I went ahead an "upgraded" my account (from mutual fund to brokerage) on the understanding that "nothing would change" except I'd have more availability of purchasing ETFs and the like.

However, I now see that my "settlement fund" is the Federal Money Market. Formerly, I used Prime Money Market as my cash position, and to accumulate un-reinvested dividends from other funds. I telephoned in and asked to change my settlement fund to Prime and they said it cannot be done. Then the rep gave me some BS about how the Federal has lower ER, so that should mostly cancel out the lower yield; the net ends up being 0.9% versus 1.1% currently. Not the end of the world, but still annoying ("you can keep your doctor"). I guess I'll still be able to manually transfer dividends, that go into Federal, over to Prime.
User avatar
Doc
Posts: 10606
Joined: Sat Feb 24, 2007 12:10 pm
Location: Two left turns from Larry

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by Doc »

RustyShackleford wrote:So I went ahead an "upgraded" my account (from mutual fund to brokerage) on the understanding that "nothing would change" except I'd have more availability of purchasing ETFs and the like.

However, I now see that my "settlement fund" is the Federal Money Market. Formerly, I used Prime Money Market as my cash position, and to accumulate un-reinvested dividends from other funds. I telephoned in and asked to change my settlement fund to Prime and they said it cannot be done. Then the rep gave me some BS about how the Federal has lower ER, so that should mostly cancel out the lower yield; the net ends up being 0.9% versus 1.1% currently. Not the end of the world, but still annoying ("you can keep your doctor"). I guess I'll still be able to manually transfer dividends, that go into Federal, over to Prime.
The change from Prime to Federal as your settlement fund is a result of Federal regulations. It has nothing to do with the upgrade.
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.
User avatar
whodidntante
Posts: 13088
Joined: Thu Jan 21, 2016 10:11 pm
Location: outside the echo chamber

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by whodidntante »

I bet Morgan Stanley wouldn't upgrade your accounts, at least not for free.
User avatar
RustyShackleford
Posts: 1682
Joined: Thu Sep 13, 2007 12:32 pm
Location: NC

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by RustyShackleford »

Doc wrote: The change from Prime to Federal as your settlement fund is a result of Federal regulations. It has nothing to do with the upgrade.
Can you explain ?

Am I correct that my only recourse is to manually move money from Federal to Prime periodically ?

Ah well, distributions for the Federal are about 60% US Gov't Obligations, as opposed to about 20% for Prime, so I guess I'll save a pittance in state taxes.
User avatar
celia
Posts: 16762
Joined: Sun Mar 09, 2008 6:32 am
Location: SoCal

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by celia »

I know people who specify account numbers in their wills or trusts. If their mutual fund account is merged into a brokerage account, that can affect the beneficiary designation if the account owner doesn't take some action to clarify things again. What about account owners who are incompetent to manage their assets? I've been a trustee and had to watch for things like this, but not all trustees are that detailed oriented.

I have a case in which a relative has two brokerage accounts at the same brokerage (not Vanguard). The accounts are separate since one of them is meant to go to a disabled person. The brokerage upgraded all their accounts several years ago and gave all the accounts new numbers. It was several years before I re-read the trust (of the living relative) and noticed the reference to the now non-existent account. But since the trustor was competent to amend the trust, that was done. But in other cases, things may not happen as intended.
Last edited by celia on Fri Jul 21, 2017 3:17 pm, edited 1 time in total.
SleepCity
Posts: 24
Joined: Fri Jul 14, 2017 2:43 pm

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by SleepCity »

Of all the problems in the world, this clearly ranks towards the top!
Seasonal
Posts: 3045
Joined: Sun May 21, 2017 1:49 pm

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by Seasonal »

Reading through this thread, it seems the only problems with upgrading are having to redo linked banks for transferring funds and that account numbers change.

What am I missing?
User avatar
celia
Posts: 16762
Joined: Sun Mar 09, 2008 6:32 am
Location: SoCal

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by celia »

SleepCity wrote:Of all the problems in the world, this clearly ranks towards the top!
You're lucky you're not the disabled person.

(In fairness, the second paragraph of my previous post was added after this quoted post was made, but I wanted to finish making my point.)
User avatar
celia
Posts: 16762
Joined: Sun Mar 09, 2008 6:32 am
Location: SoCal

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by celia »

Seasonal wrote:Reading through this thread, it seems the only problems with upgrading are having to redo linked banks for transferring funds and that account numbers change.

What am I missing?
Agent authorization forms (aka power of attorney for specific accounts)
costs and time incurred by investors to work around Vanguard's changes
unintentional change of beneficiaries can happen
accidental merging of accounts that are meant to be kept separate (especially if Roth conversions are in effect)
some people are employed in the financial industry and they have restrictions on owning brokerage accounts (It's hard to benefit from insider knowledge when you only own mutual funds)
User avatar
flamesabers
Posts: 1848
Joined: Fri Mar 03, 2017 11:05 am
Location: Rochester, MN

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by flamesabers »

Seasonal wrote:What am I missing?
While not necessarily a problem, I think one drawback to upgrading is not getting your tax forms as quickly as you do under the old system. It seems for just about every tax form that Vanguard distributes, the mutual fund accounts always get it sooner then the brokerage accounts.
Engineer250
Posts: 1082
Joined: Wed Jun 22, 2016 1:41 pm

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by Engineer250 »

celia wrote:
Seasonal wrote:Reading through this thread, it seems the only problems with upgrading are having to redo linked banks for transferring funds and that account numbers change.

What am I missing?
Agent authorization forms (aka power of attorney for specific accounts)
costs and time incurred by investors to work around Vanguard's changes
unintentional change of beneficiaries can happen
accidental merging of accounts that are meant to be kept separate (especially if Roth conversions are in effect)
some people are employed in the financial industry and they have restrictions on owning brokerage accounts (It's hard to benefit from insider knowledge when you only own mutual funds)
I got converted last year and none of these issues happened to me. But I don't do a lot of the complex stuff a lot of you guys do with your accounts.

Also, I've mentioned it a few times but when my Prime Money converted to Fed Money across my tIRA and Roth IRA and my spouse's (so 4 accounts total) they left my settlement money in my Roth in the Prime Money as its own mutual fund line item (though obviously fed money is still my settlement account) even though it didn't have the minimum $3k balance (bank error in your favor!). If you can't scrounge up $3k than the difference between the two money market accounts is pretty trivial. I understand people getting angry about stuff they didn't ask for, but I think this thread is making it sound like these problems happened to a lot of people when really it was probably a tiny minority affected.
Where the tides of fortune take us, no man can know.
User avatar
Doc
Posts: 10606
Joined: Sat Feb 24, 2007 12:10 pm
Location: Two left turns from Larry

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by Doc »

RustyShackleford wrote:
Doc wrote: The change from Prime to Federal as your settlement fund is a result of Federal regulations. It has nothing to do with the upgrade.
Can you explain ?

Am I correct that my only recourse is to manually move money from Federal to Prime periodically ?

Ah well, distributions for the Federal are about 60% US Gov't Obligations, as opposed to about 20% for Prime, so I guess I'll save a pittance in state taxes.
SEC requirement.

https://investor.vanguard.com/mutual-fu ... et-reform/
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.
Nummerkins
Posts: 673
Joined: Tue Jun 01, 2010 4:41 pm

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by Nummerkins »

I upgraded last December and only had to reset my dividend elections.

Vanguard is going to upgrade every single account sooner or later. For those of you who have complex setups... deal with it now on YOUR terms. Seriously, I don't get why people say to ignore it. Plenty of platform options out there if you want to bail on Vanguard. Either way you will have some work to do.
Today's high is tomorrow's low.
letsgobobby
Posts: 12073
Joined: Fri Sep 18, 2009 1:10 am

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by letsgobobby »

Nummerkins wrote:I upgraded last December and only had to reset my dividend elections.

Vanguard is going to upgrade every single account sooner or later. For those of you who have complex setups... deal with it now on YOUR terms. Seriously, I don't get why people say to ignore it. Plenty of platform options out there if you want to bail on Vanguard. Either way you will have some work to do.
How should we "deal with it on OUR terms?" What does that mean?
User avatar
zaboomafoozarg
Posts: 2430
Joined: Sun Jun 12, 2011 12:34 pm

Re: Vanguard upgraded my accounts - angry [Brokerage Services]

Post by zaboomafoozarg »

letsgobobby wrote:How should we "deal with it on OUR terms?" What does that mean?
Probably to initiate the account conversion yourself, instead of waiting until Vanguard does it automatically.
Locked