Vanguard upgraded my accounts - angry [Brokerage Services]

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
stlutz
Posts: 5585
Joined: Fri Jan 02, 2009 12:08 am

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

Post by stlutz »

...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
User avatar
zaboomafoozarg
Posts: 2430
Joined: Sun Jun 12, 2011 12:34 pm

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

Post by zaboomafoozarg »

stlutz wrote:
...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
But IIRC they don't give you an option of not converting. I did it manually ASAP but my parents waited until Vanguard was effectively forcing them to convert their account upon logging in. It didn't cause them any issues though (and they didn't have to call up customer service to cuss them out either!)
letsgobobby
Posts: 12073
Joined: Fri Sep 18, 2009 1:10 am

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

Post by letsgobobby »

zaboomafoozarg wrote:
stlutz wrote:
...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
But IIRC they don't give you an option of not converting. I did it manually ASAP but my parents waited until Vanguard was effectively forcing them to convert their account upon logging in. It didn't cause them any issues though (and they didn't have to call up customer service to cuss them out either!)
But what do I gain by doing it on 'my terms?' I want to avoid this as long as possible, let as many bugs as possible be worked out first. Doing it earlier than necessary doesn't seem to change 'the terms' at all.
User avatar
TomatoTomahto
Posts: 17100
Joined: Mon Apr 11, 2011 1:48 pm

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

Post by TomatoTomahto »

letsgobobby wrote:
zaboomafoozarg wrote:
stlutz wrote:
...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
But IIRC they don't give you an option of not converting. I did it manually ASAP but my parents waited until Vanguard was effectively forcing them to convert their account upon logging in. It didn't cause them any issues though (and they didn't have to call up customer service to cuss them out either!)
But what do I gain by doing it on 'my terms?' I want to avoid this as long as possible, let as many bugs as possible be worked out first. Doing it earlier than necessary doesn't seem to change 'the terms' at all.
We have resisted it for ages. They don't even offer us the option to convert any longer, as we made it clear that we would not, could not, should not.
I get the FI part but not the RE part of FIRE.
letsgobobby
Posts: 12073
Joined: Fri Sep 18, 2009 1:10 am

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

Post by letsgobobby »

TomatoTomahto wrote:
letsgobobby wrote:
zaboomafoozarg wrote:
stlutz wrote:
...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
But IIRC they don't give you an option of not converting. I did it manually ASAP but my parents waited until Vanguard was effectively forcing them to convert their account upon logging in. It didn't cause them any issues though (and they didn't have to call up customer service to cuss them out either!)
But what do I gain by doing it on 'my terms?' I want to avoid this as long as possible, let as many bugs as possible be worked out first. Doing it earlier than necessary doesn't seem to change 'the terms' at all.
We have resisted it for ages. They don't even offer us the option to convert any longer, as we made it clear that we would not, could not, should not.
My rep has never asked me, but I still see the upgrade button. I see some advantage to switching, and I'm not opposed to change, but we have a very large number of accounts (more than 20) and cost basis from account to account is quite complex - I don't want to take any chances that something bad happens. When I consistently hear that the transition has gone smoothly with multiple accounts, I'll be willing to give it a shot.
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 »

letsgobobby wrote:I see some advantage to switching, and I'm not opposed to change, but we have a very large number of accounts (more than 20) and cost basis from account to account is quite complex - I don't want to take any chances that something bad happens.
We converted some three years ago.

As far as "switching" there is absolutely no problem with your individual assets being transferred with the proper lot data transferred correctly.

The "problems" are:

1) You cannot direct dividends from Vanguard mutual funds to other mutual funds. Either reinvest or go to your settlement account.

2) You will need to re-establish cash transfers to and from outside financial institutions like your bank or direct deposit type transactions. One should expect this. It is a different account with a different "institution" and different account numbers and different a correspondence bank.

3) Your 1099's will come later but this is the difference between mutual funds and brokerage type assets not the account structure per se.

4) That's all I can think of without much more thought than I am willing to give to it.

These "problems" were a real PITA when we "upgraded" but many of the hoops have been minimized in the last two and a half years.

And you get only one 1099, not one for each asset you own.

Go for it.
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
Kevin M
Posts: 15750
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

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

Post by Kevin M »

zaboomafoozarg wrote: But IIRC they don't give you an option of not converting.
Not only do they give you the option of not converting, but some accounts cannot be converted online, so they actually have a barrier to "upgrading" some accounts easily. If I click the upgrade button on my trust account or inherited IRA account, I'm taken to a screen to download the form to open a brokerage account, and I'm not going to do that extra work unless I absolutely have to. By contrast, I upgraded an IRA online, so I could do online Roth conversions, and it was easy.
<snip> ... but my parents waited until Vanguard was effectively forcing them to convert their account upon logging in.
Really? Are you sure it wasn't just a nag message that popped up when the logged in? Most of my accounts have not been upgraded.

Kevin
If I make a calculation error, #Cruncher probably will let me know.
letsgobobby
Posts: 12073
Joined: Fri Sep 18, 2009 1:10 am

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

Post by letsgobobby »

Doc wrote:
letsgobobby wrote:I see some advantage to switching, and I'm not opposed to change, but we have a very large number of accounts (more than 20) and cost basis from account to account is quite complex - I don't want to take any chances that something bad happens.
We converted some three years ago.

As far as "switching" there is absolutely no problem with your individual assets being transferred with the proper lot data transferred correctly.

The "problems" are:

1) You cannot direct dividends from Vanguard mutual funds to other mutual funds. Either reinvest or go to your settlement account.

2) You will need to re-establish cash transfers to and from outside financial institutions like your bank or direct deposit type transactions. One should expect this. It is a different account with a different "institution" and different account numbers and different a correspondence bank.

3) Your 1099's will come later but this is the difference between mutual funds and brokerage type assets not the account structure per se.

4) That's all I can think of without much more thought than I am willing to give to it.

These "problems" were a real PITA when we "upgraded" but many of the hoops have been minimized in the last two and a half years.

And you get only one 1099, not one for each asset you own.

Go for it.
Thanks Doc, that's an encouraging story.
User avatar
House Blend
Posts: 4877
Joined: Fri May 04, 2007 1:02 pm

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

Post by House Blend »

I agree with stlutz that they can't upgrade without your permission.

What they can do is switch from the carrot model of incentives to the stick. Start turning off features in the non-upgraded accounts, or add account servicing fees.

I will add that I can't think of any carrots being offered to those who only use VG mutual funds. SIPC insurance is IMO a plastic carrot. The fact that you can't Roth convert into a new, non-upgraded mutual fund account is a stick. There are plenty of carrots for those who have non-upgraded brokerage accounts (assuming any still remain).

In any case, for my 84yo mother with late stage Alzheimers, we have DPOA and agent authorization in place. Things will have to start getting really unpleasant at VG before we take the slightest bit of interest in "upgrading" her accounts.
User avatar
Kevin M
Posts: 15750
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

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

Post by Kevin M »

House Blend wrote:I agree with stlutz that they can't upgrade without your permission.
<snip>
There are plenty of carrots for those who have non-upgraded brokerage accounts (assuming any still remain).
I think they have upgraded brokerage accounts without any owner involvement. At first I was thinking, "how would you even tell", but an easy way you tell is that you now have a settlement fund directly in the brokerage account, instead of the brokerage account being linked to a settlement fund in the associated mutual fund account.

All of my brokerage accounts now are like this, and I'm pretty sure I never clicked an upgrade button for any of them--at least not for all of them. The mutual fund accounts that used to be linked to the brokerage accounts via the settlement fund still all have the Upgrade button.

Kevin
If I make a calculation error, #Cruncher probably will let me 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 »

Kevin M wrote:
House Blend wrote:I agree with stlutz that they can't upgrade without your permission.
<snip>
There are plenty of carrots for those who have non-upgraded brokerage accounts (assuming any still remain).
I think they have upgraded brokerage accounts without any owner involvement. At first I was thinking, "how would you even tell", but an easy way you tell is that you now have a settlement fund directly in the brokerage account, instead of the brokerage account being linked to a settlement fund in the associated mutual fund account.

All of my brokerage accounts now are like this, and I'm pretty sure I never clicked an upgrade button for any of them--at least not for all of them. The mutual fund accounts that used to be linked to the brokerage accounts via the settlement fund still all have the Upgrade button.

Kevin
I'm confused. Are there two types of brokerage accounts? An old one and a new one. Or is the non-upgraded account only a mutual fund account with or without an associated brokerage account? Or is there a non-upgraded brokerage account one with the sweep account in a mutual fund account not in the brokerage account itself?

If your "old" brokerage account had the sweep in a mutual fund account and the upgrade only moved or added that sweep account to brokerage I can see why they don't need permission. :?
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
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 »

stlutz wrote:
...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
I completely agree. I don't have a brokerage account as all of my investments are Vanguard Mutual Funds. When I click on the upgrade button, the first thing I'm prompted to do is to open a brokerage account. If I already had a brokerage account, it's probably more of a gray area whether Vanguard can do the upgrade automatically.
House Blend wrote:What they can do is switch from the carrot model of incentives to the stick. Start turning off features in the non-upgraded accounts, or add account servicing fees.
Are you suggesting Vanguard will eventually do this for everyone who hasn't upgraded or just the folks who have a non-upgraded brokerage account? I invest only in Vanguard Mutual Funds, so I never opened a brokerage account with Vanguard.
User avatar
telemark
Posts: 3389
Joined: Sat Aug 11, 2012 6:35 am

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

Post by telemark »

stlutz wrote:
...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
We have one report in this thread of Vanguard accidentally (and irreversibly) making a conversion without the owner's consent, and the original post suggests that opening a new account of any type is enough to trigger a conversion. We don't seem to be at a Wells Fargo type situation, but it's evident that Vanguard is pushing this pretty hard and not being overly scrupulous about getting permission first.
User avatar
House Blend
Posts: 4877
Joined: Fri May 04, 2007 1:02 pm

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

Post by House Blend »

flamesabers wrote:
House Blend wrote:What they can do is switch from the carrot model of incentives to the stick. Start turning off features in the non-upgraded accounts, or add account servicing fees.
Are you suggesting Vanguard will eventually do this for everyone who hasn't upgraded or just the folks who have a non-upgraded brokerage account? I invest only in Vanguard Mutual Funds, so I never opened a brokerage account with Vanguard.
I'm unclear on whether non-upgraded *brokerage* accounts still exist.

If you're asking me to make a prediction about mutual-fund-only accounts, my guess is that they won't actually take large steps in the direction of penalizing the customers who refuse to upgrade. At least not for many more years to come.
User avatar
Kevin M
Posts: 15750
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

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

Post by Kevin M »

Doc wrote: I'm confused. Are there two types of brokerage accounts? An old one and a new one. Or is the non-upgraded account only a mutual fund account with or without an associated brokerage account? Or is there a non-upgraded brokerage account one with the sweep account in a mutual fund account not in the brokerage account itself?
There used to be two types of brokerage accounts (old and new), but now I have only the new (upgraded) type. Currently my only non-upgraded accounts are mutual-fund-only accounts. Yes, before the brokerage accounts were upgraded (without my involvement), the settlement fund was a money market fund in the mutual fund account associated with the brokerage account.

You may recall that when you opened a brokerage account on the old platform, it came with a mutual fund account (that held at least the money market settlement fund, or sweep account as they used to call it). Of course you could also open just a mutual fund account, but that's not the case on the new platform.
If your "old" brokerage account had the sweep in a mutual fund account and the upgrade only moved or added that sweep account to brokerage I can see why they don't need permission. :?
Yeah, apparently. They just add a new federal money market fund to the brokerage account, and leave the money market fund that was the "sweep account" in the mutual fund account. There is no longer any linkage between the brokerage and mutual fund accounts, so, for example, you can't buy mutual fund shares in the mutual fund account with the settlement fund in the upgraded brokerage account.

Kevin
If I make a calculation error, #Cruncher probably will let me 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 »

@kevin

Let me try to get my head around this.

We "upgraded" to the new platform in November 2014. In order to do this all three (his,hers,ours) of our mutual fund accounts had to have an associated brokerage account connected with it. (And all of the accounts had to be done at the same time. We even had to open one additional brokerage account even though we didn't need/want it at the time.) Before the upgrade the sweep account for the brokerage accounts were the MM fund in the associated mutual fund account. The upgrade "button" was on the mutual fund page. After upgrading everything was moves into the brokerage account and the mutual fund account disappeared.

From the discussion here it appears that the upgrade button is now on the brokerage account page not the mutual fund page. And it could mean the "upgrade button" only creates a new sweep MM account on the brokerage platform but leaves the associated mutual fund account unchanged. This is where I get confused. Where is the "upgrade button" now? And can you now have both a mutual fund account and a brokerage account each with their own MM sweep account?

:?
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
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 »

Doc wrote:From the discussion here it appears that the upgrade button is now on the brokerage account page not the mutual fund page. And it could mean the "upgrade button" only creates a new sweep MM account on the brokerage platform but leaves the associated mutual fund account unchanged. This is where I get confused. Where is the "upgrade button" now? And can you now have both a mutual fund account and a brokerage account each with their own MM sweep account?

:?
I have a mutual-funds only account and I see an "upgrade button" for both my taxable mutual funds and Roth IRAs.

I also got a reminder email from Vanguard this morning to upgrade to the new brokerage account. :P
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 »

flamesabers wrote:I have a mutual-funds only account and I see an "upgrade button" for both my taxable mutual funds and Roth IRAs.

I also got a reminder email from Vanguard this morning to upgrade to the new brokerage account.
Maybe that's the confusion. "... email ... to the new brokerage account".

OK thanks, now back to Kevin
Kevin M wrote:They just add a new federal money market fund to the brokerage account, and leave the money market fund that was the "sweep account" in the mutual fund account. There is no longer any linkage between the brokerage and mutual fund accounts, so, for example, you can't buy mutual fund shares in the mutual fund account with the settlement fund in the upgraded brokerage account.
But I can. On the other hand we no longer have any mutual fund only accounts. All the mutual funds got transferred to brokerage when we ungraded and the mutual fund accounts got closed. (We also got two 1099's for several of our mutual funds. One from the "old" mutual fund account and one in the "upgraded" brokerage account omnibus tax statement.)
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.
inbox788
Posts: 8372
Joined: Thu Mar 15, 2012 5:24 pm

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

Post by inbox788 »

telemark wrote:
stlutz wrote:
...instead of waiting until Vanguard does it automatically.
They can't do it automatically. You can't just open brokerage accounts for people w/o their consent.
We have one report in this thread of Vanguard accidentally (and irreversibly) making a conversion without the owner's consent, and the original post suggests that opening a new account of any type is enough to trigger a conversion. We don't seem to be at a Wells Fargo type situation, but it's evident that Vanguard is pushing this pretty hard and not being overly scrupulous about getting permission first.
I think what they're doing is far from the Wells Fargo fiasco and I sympathize with what they're trying to do and why many folks are resistant (myself included). From an investor point of view, many are content with just the mutual funds and don't need the complexity of the brokerage. Meanwhile, Vanguard wants to maintain only one system and transition everyone over to a more feature filled world (i.e. opportunities to make more sales). Originally, the brokerage was the add on, with only a few users, so they went slow. I believe they've crossed over to the majority, and those on funds only are becoming a smaller and smaller minority. Having 2 systems is the worst of both words, requiring more resources, training and maintaining separate accounts and additional databases. Eventually, they will figure out a way to encourage everyone to switch over. First through asking, or implicit permission (hoping you'll click on some broad agreement), which we're already past. Next, they'll neglect the old system, so you'll encounter more glitches and problems, where the simplest solution is to switch over to the brokerage. Next will be outages of the old system and finally, they may even take it off line and require old fashioned mail and phone interactions. Change is inevitable.
User avatar
TomatoTomahto
Posts: 17100
Joined: Mon Apr 11, 2011 1:48 pm

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

Post by TomatoTomahto »

inbox788 wrote:I think what they're doing is far from the Wells Fargo fiasco and I sympathize with what they're trying to do and why many folks are resistant (myself included). From an investor point of view, many are content with just the mutual funds and don't need the complexity of the brokerage. Meanwhile, Vanguard wants to maintain only one system and transition everyone over to a more feature filled world (i.e. opportunities to make more sales). Originally, the brokerage was the add on, with only a few users, so they went slow. I believe they've crossed over to the majority, and those on funds only are becoming a smaller and smaller minority. Having 2 systems is the worst of both words, requiring more resources, training and maintaining separate accounts and additional databases. Eventually, they will figure out a way to encourage everyone to switch over. First through asking, or implicit permission (hoping you'll click on some broad agreement), which we're already past. Next, they'll neglect the old system, so you'll encounter more glitches and problems, where the simplest solution is to switch over to the brokerage. Next will be outages of the old system and finally, they may even take it off line and require old fashioned mail and phone interactions. Change is inevitable.
I get that. How tough would it be to have a switch, in your profile, that doesn't allow you to purchase anything but mutual funds, and that if you reset that switch, that an email will go to MyEmployerEmail? I can deal with whatever other glitches there are.
I get the FI part but not the RE part of FIRE.
FactualFran
Posts: 2751
Joined: Sat Feb 21, 2015 1:29 pm

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

Post by FactualFran »

Doc wrote:From the discussion here it appears that the upgrade button is now on the brokerage account page not the mutual fund page. And it could mean the "upgrade button" only creates a new sweep MM account on the brokerage platform but leaves the associated mutual fund account unchanged. This is where I get confused. Where is the "upgrade button" now? And can you now have both a mutual fund account and a brokerage account each with their own MM sweep account?
If I remember correctly, when the new style brokerage accounts were introduced, there was upgrade button on each Vanguard Mutual Funds "account" and each previously established old style brokerage account. Excluding possible exceptions for some types of brokerage account registrations, old style brokerage accounts have been automatically upgraded to new style brokerage accounts.

Currently, it is very unlikely that there is an upgrade button on a brokerage account, and it is very likely that there is an upgrade button on a Vanguard Mutual Funds "account".

Only brokerage accounts have a sweep account. Vanguard Mutual Funds "accounts" do not have a sweep account, but they could include a money market fund that could have been used as the sweep account by an old style brokerage account.
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 »

FactualFran wrote:Excluding possible exceptions for some types of brokerage account registrations, old style brokerage accounts have been automatically upgraded to new style brokerage accounts.
The question I have is "what is a new style brokerage account"?

1) A brokerage account that does not hold any Vanguard mutual funds other than some kind of MM sweep account.

2) A brokerage account that also holds Vanguard mutual funds.

If it is 1) that means that you have both a "new" style brokerage account and also still have the traditional mutual fund account that only holds Vanguard mutual funds including a 2nd MM sweep account. And that doesn't make any sense to me.

I thought I saw posts that referred to an upgrade button on there brokerage account. I never saw such a button. The button was only on my mutual fund account(s). But this was some two and a half years ago and its quite possible a senior moment year (or two).
Only brokerage accounts have a sweep account. Vanguard Mutual Funds "accounts" do not have a sweep account, but they could include a money market fund that could have been used as the sweep account by an old style brokerage account.
I don't reinvest dividends as a rule. When I had dividends in my mutual fund account they just got "swept" to my MM account. I call that a sweep account but that's just a distinction without meaning. Or at least it was until the recent SEC rules change concerning sweep account and breaking the buck.
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
TomatoTomahto
Posts: 17100
Joined: Mon Apr 11, 2011 1:48 pm

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

Post by TomatoTomahto »

FactualFran wrote:... and it is very likely that there is an upgrade button on a Vanguard Mutual Funds "account".
I haven't seen it, and I logged in today specifically to find it. I did not see one, neithe on my iPad Vanguard app nor on my Web login. I'm not saying it's not there, but I can't find it. Can anyone point me to it?
I get the FI part but not the RE part of FIRE.
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 »

TomatoTomahto wrote:
FactualFran wrote:... and it is very likely that there is an upgrade button on a Vanguard Mutual Funds "account".
I haven't seen it, and I logged in today specifically to find it. I did not see one, neithe on my iPad Vanguard app nor on my Web login. I'm not saying it's not there, but I can't find it. Can anyone point me to it?
I don't think the upgrade button shows up on the app. I only see it on my website browser. It's in the top (tan/brown colored area) portion of each section (Taxable and Retirement) of each account.

Have you received an email invite to do the upgrade? I don't think the upgrade button showed up on my account until after I got the email invite.
User avatar
telemark
Posts: 3389
Joined: Sat Aug 11, 2012 6:35 am

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

Post by telemark »

TomatoTomahto wrote:
FactualFran wrote:... and it is very likely that there is an upgrade button on a Vanguard Mutual Funds "account".
I haven't seen it, and I logged in today specifically to find it. I did not see one, neithe on my iPad Vanguard app nor on my Web login. I'm not saying it's not there, but I can't find it. Can anyone point me to it?
Vanguard has been rolling this out gradually for years, so not everyone sees it at the same time. Here's a thread from 2014. You'll know when yours appears, because Vanguard will email you repeatedly about it.
FactualFran
Posts: 2751
Joined: Sat Feb 21, 2015 1:29 pm

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

Post by FactualFran »

Doc wrote:
FactualFran wrote:Excluding possible exceptions for some types of brokerage account registrations, old style brokerage accounts have been automatically upgraded to new style brokerage accounts.
The question I have is "what is a new style brokerage account"?

1) A brokerage account that does not hold any Vanguard mutual funds other than some kind of MM sweep account.

2) A brokerage account that also holds Vanguard mutual funds.

If it is 1) that means that you have both a "new" style brokerage account and also still have the traditional mutual fund account that only holds Vanguard mutual funds including a 2nd MM sweep account. And that doesn't make any sense to me.
By new style brokerage account I mean the type of brokerage account Vanguard started offering to conform to government regulations about the type of money market allowable as a sweep account. A feature on the new style brokerage account at Vanguard, that was not in the old style brokerage account, was the ability to have Vanguard funds in a Vanguard brokerage account. The new style brokerage account automatically included the Vanguard Federal Money Market fund as the sweep account.

We have different definitions of "sweep account". To me it is an account from and to which the cash in a brokerage account is automatically transferred. When a holding in a brokerage account makes a payment, such as a dividend payment by a stock, the money becomes part of the cash in the brokerage account. That cash is automatically swept to the sweep account.

When a distribution paid by one Vanguard fund directly goes to another Vanguard fund, there is no automatic sweeping involved. With the old style brokerage accounts at Vanguard, the Vanguard mutual fund that a distribution went to could have been a money market fund that was the sweep account of a brokerage account.
Doc wrote: I thought I saw posts that referred to an upgrade button on there brokerage account. I never saw such a button. The button was only on my mutual fund account(s). But this was some two and a half years ago and its quite possible a senior moment year (or two).
I saw an upgrade button on each of the old style brokerage accounts that I had before those accounts were automatically upgraded.
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 »

telemark wrote:You'll know when yours appears, because Vanguard will email you repeatedly about it.
Yeah, Vanguard sent me email #2 this morning. :P
User avatar
TomatoTomahto
Posts: 17100
Joined: Mon Apr 11, 2011 1:48 pm

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

Post by TomatoTomahto »

flamesabers wrote:
TomatoTomahto wrote:
FactualFran wrote:... and it is very likely that there is an upgrade button on a Vanguard Mutual Funds "account".
I haven't seen it, and I logged in today specifically to find it. I did not see one, neithe on my iPad Vanguard app nor on my Web login. I'm not saying it's not there, but I can't find it. Can anyone point me to it?
I don't think the upgrade button shows up on the app. I only see it on my website browser. It's in the top (tan/brown colored area) portion of each section (Taxable and Retirement) of each account.

Have you received an email invite to do the upgrade? I don't think the upgrade button showed up on my account until after I got the email invite.
I definitely don't have it on the web site.

I received an email about upgrading some years ago, when the upgrade first came out. I called my Flagship Representative and got through to him, for once (I don't mind being routed to a sub, btw). I told him that because of my wife's employer's requirements, we had only been grandfathered into a "mutual funds only" account, and if that changed, we would be forced to move our accounts.

That's the last time they asked us about upgrading. I don't know just how long ago that was, but I would guess 2 years ago.
I get the FI part but not the RE part of FIRE.
FactualFran
Posts: 2751
Joined: Sat Feb 21, 2015 1:29 pm

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

Post by FactualFran »

TomatoTomahto wrote:
FactualFran wrote:... and it is very likely that there is an upgrade button on a Vanguard Mutual Funds "account".
I haven't seen it, and I logged in today specifically to find it. I did not see one, neithe on my iPad Vanguard app nor on my Web login. I'm not saying it's not there, but I can't find it. Can anyone point me to it?
It is no longer a button. In a web browser it is a hyperlink with the word "Upgrade" to right of what looks like the image of a file folder. It is below the registration of each Vanguard Mutual Funds account (FactualFran, FactualFran - Traditional IRA, FactualFran - Roth IRA, ...)
FactualFran
Posts: 2751
Joined: Sat Feb 21, 2015 1:29 pm

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

Post by FactualFran »

TomatoTomahto wrote: I received an email about upgrading some years ago, when the upgrade first came out. I called my Flagship Representative and got through to him, for once (I don't mind being routed to a sub, btw). I told him that because of my wife's employer's requirements, we had only been grandfathered into a "mutual funds only" account, and if that changed, we would be forced to move our accounts.
That indicates that the software that sent that email did not know that you may not have a Vanguard brokerage account, while the Vanguard web software does.
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 »

FactualFran wrote:. A feature on the new style brokerage account at Vanguard, that was not in the old style brokerage account, was the ability to have Vanguard funds in a Vanguard brokerage account. The new style brokerage account automatically included the Vanguard Federal Money Market fund as the sweep account.
The change in sweep account from Prime MM to Federal MM is due to a change in SEC regs. It has nothing to do with any "upgrade". Accounts we have at other firms made similar changes. There is a link on Vg's site describing the change. I'm on tablet and can't link it now. Go to Vg and search for "Money market changes".
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.
FactualFran
Posts: 2751
Joined: Sat Feb 21, 2015 1:29 pm

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

Post by FactualFran »

Doc wrote:
FactualFran wrote:. A feature on the new style brokerage account at Vanguard, that was not in the old style brokerage account, was the ability to have Vanguard funds in a Vanguard brokerage account. The new style brokerage account automatically included the Vanguard Federal Money Market fund as the sweep account.
The change in sweep account from Prime MM to Federal MM is due to a change in SEC regs. It has nothing to do with any "upgrade". Accounts we have at other firms made similar changes. There is a link on Vg's site describing the change. I'm on tablet and can't link it now. Go to Vg and search for "Money market changes".
You must have missed the sentence that I wrote immediately before what you quoted: "By new style brokerage account I mean the type of brokerage account Vanguard started offering to conform to government regulations about the type of money market allowable as a sweep account. "

An "upgrade" to a new style Vanguard brokerage account was to an account that conformed to the new government regulations. In addition to conforming to the new government regulations, the new style brokerage account had features that the old style brokerage account did not
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 »

@FactualFran
I upgraded our accounts in 2014. There was no change in our settlement account. It remained as Prime MM but it was then in the brokerage account.

Recently Vg changed the sweep to Federal MM due to change in SEC regs. Schwab and Fidelity made similar changes and those changes were definitely not the result of any Vanguard "upgrade".

The upgrade moves your settlement account to brokerage but the upgrade is not the reason for any change in which particular MM fund is the sweep fund, just it's location.
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
Kevin M
Posts: 15750
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

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

Post by Kevin M »

Doc wrote:@kevin

Let me try to get my head around this.

We "upgraded" to the new platform in November 2014. In order to do this all three (his,hers,ours) of our mutual fund accounts had to have an associated brokerage account connected with it. (And all of the accounts had to be done at the same time.<snip>
That's weird. I've upgraded only one of several mutual fund accounts. There was no requirement to upgrade the others.
Before the upgrade the sweep account for the brokerage accounts were the MM fund in the associated mutual fund account. The upgrade "button" was on the mutual fund page. After upgrading everything was moves into the brokerage account and the mutual fund account disappeared.
Yes, this is the way it works.
From the discussion here it appears that the upgrade button is now on the brokerage account page not the mutual fund page.
There are no upgrade buttons or links on my brokerage accounts, since they've all been upgraded (again, without my involvement).
And it could mean the "upgrade button" only creates a new sweep MM account on the brokerage platform but leaves the associated mutual fund account unchanged.
That's what the upgrade does, but I never clicked an upgrade button or link in my brokerage accounts. The upgrades just happened to the brokerage accounts.
This is where I get confused. Where is the "upgrade button" now?
The button (actually a link, as pointed out) is in the mutual fund accounts.
And can you now have both a mutual fund account and a brokerage account each with their own MM sweep account?
The money market fund that previously was the sweep account for the previously associated brokerage account is still there, but it no longer is a sweep account. When it was a sweep account, it even had a "sweep account" notation under it, but of course it doesn't now. Now it's just a fund like any other fund in the mutual fund account. Nothing gets automatically swept into it, but of course you can set up your mutual fund dividends to be deposited into it if you want.

The term "settlement fund" now is used in the upgraded brokerage accounts.

Kevin
If I make a calculation error, #Cruncher probably will let me know.
User avatar
Kevin M
Posts: 15750
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

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

Post by Kevin M »

Doc wrote:
Kevin M wrote:They just add a new federal money market fund to the brokerage account, and leave the money market fund that was the "sweep account" in the mutual fund account. There is no longer any linkage between the brokerage and mutual fund accounts, so, for example, you can't buy mutual fund shares in the mutual fund account with the settlement fund in the upgraded brokerage account.
But I can. On the other hand we no longer have any mutual fund only accounts.
These two statements contradict each other. If you don't have a mutual fund account, you can't buy mutual funds in a mutual fund account. I worded this carefully--I did not say you could not buy mutual funds in the brokerage account after the upgrade--of course you can, since one of the main features of the upgraded brokerage account is that it lets you hold anything you could hold before in the old-platform mutual fund + brokerage account combo.

What I'm saying is that now, for example, when ETF or stock dividends are swept into the settlement fund in the upgraded brokerage account, I cannot use the cash in the settlement fund to buy mutual fund shares in the mutual fund account that previously was linked to the brokerage account. If I could, I would at least exchange from the federal MM fund to Prime MM fund for the higher interest rate. This is only an issue in IRA accounts, since in a taxable account I just transfer the cash to an externally linked bank account.
All the mutual funds got transferred to brokerage when we ungraded and the mutual fund accounts got closed.
Yes, this is the way it works if you upgrade the mutual fund account and brokerage account at the same time. If you didn't, and the brokerage account got upgraded automatically, as in my case, I think when you upgrade the mutual fund account you may be able to select the brokerage account that was previously linked to it as the account into which to move your mutual funds. However, I can't test this (or don't want to), because as I've said, when I click the upgrade link in one of my mutual fund accounts, I'm just taken through screens that end up telling me I have to download a form and mail it to upgrade:
Download your account form

Certain accounts can't be moved into brokerage accountd online. Instead, you'll need to complete an application and mail it to us. To do so, simply follow these steps:

Select Continue to go to Get literature.
Select View and Print to download the appropriate form.
Complete the application before printing it, and then mail it to us.
(The typo, "accountd", is Vanguard's)

This may be because the accounts I start testing the upgrade on are inherited IRAs or trust accounts. I was able to upgrade my contributory IRA mutual fund account online.

Kevin
If I make a calculation error, #Cruncher probably will let me 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 »

@Kevin
Before trying to wade through all of Kevin's comments we need to agree on some definition of terms.

"'Upgraded" brokerage account: To me "upgraded" means that you now hold your Vangaurd mutual funds in a brokerage account. Any assets in the "paired" mutual fund account have been transferred to the brokerage account. The change in sweep account is a result of new SEC rules. It has nothing to do with any "upgrade" although for some it may have occurred concurrently.
Vanguard wrote:Money market reform: What you need to know
We've changed our money market fund lineup to comply with Securities and Exchange Commission (SEC) rules. We don't expect a significant impact on our management of these funds.
https://investor.vanguard.com/mutual-fu ... et-reform/

"Sweep" account: This is a money market account in which any cash generated by the account gets automatically deposited. In a non-upgraded brokerage account any cash generated got "swept" to the MM account in the mutual fund account. The MM fund in the mutual fund account was the "sweep" account. (If you didn't have an associated brokerage account there was no cash to sweep since all the income was generated from Vanguard mutual fund dividends that could be directed wherever you choose including the MM (or sweep) fund so it may not have been labeled "sweep".)
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
Kevin M
Posts: 15750
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

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

Post by Kevin M »

Doc wrote:@Kevin
Before trying to wade through all of Kevin's comments we need to agree on some definition of terms.

"'Upgraded" brokerage account: To me "upgraded" means that you now hold your Vangaurd mutual funds in a brokerage account. Any assets in the "paired" mutual fund account have been transferred to the brokerage account.
You can define it this way if you want, but it leaves out the case of a brokerage account being "upgraded" without the previously associated mutual fund account being upgraded. There is definitely a difference in the brokerage account after it is upgraded, as I have explained--there are things you can do that you couldn't do before in the brokerage account, and things you can't do that you could do before.

So I'd say that you can upgrade your mutual fund account to the new platform, in which case your mutual funds are moved into a brokerage account. Or, your brokerage account could have been upgraded without your involvement by Vanguard (without touching your previously associated mutual fund account). Or, you could have upgraded both mutual fund and associated brokerage account at the same time, if you did it before Vanguard upgraded the brokerage account for you.
The change in sweep account is a result of new SEC rules. It has nothing to do with any "upgrade" although for some it may have occurred concurrently.
The change from Prime MM to Federal MM was due to the SEC rules. The change from a sweep account in the previously associated mutual fund account to a separate settlement fund in the brokerage account is due to the "upgrade" to the new platform.

Previously, on the old platform you could use a different money market fund as your sweep account. At one point I switched mine to a tax-exempt MM fund, and then later switched it back to Prime MM. You cannot use one of these other MM funds as your settlement fund on the new platform.
"Sweep" account: This is a money market account in which any cash generated by the account gets automatically deposited. In a non-upgraded brokerage account any cash generated got "swept" to the MM account in the mutual fund account. The MM fund in the mutual fund account was the "sweep" account. (If you didn't have an associated brokerage account there was no cash to sweep since all the income was generated from Vanguard mutual fund dividends that could be directed wherever you choose including the MM (or sweep) fund so it may not have been labeled "sweep".)
All of this is true. An easy way to differentiate old platform from new platform is that on the new platform there is no longer anything referred to as a sweep account--it's now called a settlement fund.

I was going to say that it wasn't really a sweep "account", but a sweep fund, but on the old platform every mutual fund is/was designated by the fund ID concatenated with the base account number, separated by a dash, so I guess you could think of each as a separate account. But it's really "Fund & account", as indicated in the column header. The new-platform terminology of "settlement fund" seems more accurate.

Kevin
If I make a calculation error, #Cruncher probably will let me 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 »

Kevin M wrote:You can define it this way if you want, but it leaves out the case of a brokerage account being "upgraded" without the previously associated mutual fund account being upgraded. There is definitely a difference in the brokerage account after it is upgraded, as I have explained--there are things you can do that you couldn't do before in the brokerage account, and things you can't do that you could do before.

So I'd say that you can upgrade your mutual fund account to the new platform, in which case your mutual funds are moved into a brokerage account. Or, your brokerage account could have been upgraded without your involvement by Vanguard (without touching your previously associated mutual fund account). Or, you could have upgraded both mutual fund and associated brokerage account at the same time, if you did it before Vanguard upgraded the brokerage account for you.
I don't know what "upgrade" means.

We "upgraded" our mutual fund accounts to brokerage accounts in 2014. At that time we had to upgrade all three of our accounts and also first add a brokerage account to pair with the one account that didn't have an associated brokerage account already. It was all or nothing. After the upgrade all three of our accounts had Prime MM as the settlement or sweep account just as before. (Some of these restrictions have been reduced since then .)

In September 2016 we were notified of a change in our settlement account because of new SEC regs - our settlement fund was now going to be Federal MM. All the money in our settlement account was then swept out to buy Prime MM which makes no sense because it was already there as far as I was concerned. I did nothing to effect this change. No buttons to push. Nada. Shortly thereafter $0.07 showed up in the Federal MM settlement account - a dividend from Prime MM. I didn't then and don't now consider this as any kind of an upgrade. A few days later I sold the Prime MM fund. I didn't exchange it just sold it. The money showed up next day in my settlement account which was now Federal MM.

Perhaps since then, Vanguard has placed a "button" on the brokerage page to get everyone to move the balance in their original MM fund to Federal since the original MM fund was no longer eligible as a sweep (settlement) account. Maybe this is where I am getting confused because I never saw any "button" no matter what it may be called now. :?:
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
telemark
Posts: 3389
Joined: Sat Aug 11, 2012 6:35 am

Re: Vanguard upgraded my accounts - angry

Post by telemark »

Steelersfan wrote: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?
As far as I can tell, the answer is none. Once upon a time, if you wanted to own Vanguard funds you could just buy them directly from Vanguard, no brokerage needed, but that time is now past and if you want to buy Vanguard funds you must have a brokerage account with someone.

So to turn the question around: if you must have a brokerage account somewhere, whether or not you think you need one, what is the best place to open it? Who offers the best brokerage service?
BD w/ Kung-Fu Grip
Posts: 66
Joined: Wed Mar 29, 2017 1:20 pm

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

Post by BD w/ Kung-Fu Grip »

flamesabers wrote:
telemark wrote:You'll know when yours appears, because Vanguard will email you repeatedly about it.
Yeah, Vanguard sent me email #2 this morning. :P
I've had three, and the nag message every login. But my employer-sponsored SIMPLE account can't be migrated, apparently. I'm resisting because I don't want to be stuck using both platforms.
User avatar
Kevin M
Posts: 15750
Joined: Mon Jun 29, 2009 3:24 pm
Contact:

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

Post by Kevin M »

Doc wrote: I don't know what "upgrade" means.

We "upgraded" our mutual fund accounts to brokerage accounts in 2014. At that time we had to upgrade all three of our accounts and also first add a brokerage account to pair with the one account that didn't have an associated brokerage account already. It was all or nothing. After the upgrade all three of our accounts had Prime MM as the settlement or sweep account just as before. (Some of these restrictions have been reduced since then .)
These were upgrades (using the Vanguard term) of mutual fund accounts. You could say that the two associated brokerage accounts were upgraded at the same time (unless Vanguard had already upgraded them, but it doesn't sound like it). If you hadn't upgraded the mutual fund accounts, you probably would have eventually seen the brokerage accounts upgraded without your consent or involvement (as I have).

Since your third mutual fund account did not have an associated brokerage account, a new brokerage account had to be created to hold the mutual funds from the previous mutual fund (only) account.

Before the upgrade Prime MM in the mutual fund account was the "sweep account" for the associated brokerage account (if there was one). After the upgrade Prime MM was the "settlement fund" for the brokerage account. However, for the mutual fund + brokerage accounts that I upgraded myself, I ended up with the original Prime MM fund in the mutual funds section, and a new Prime MM fund as the settlement fund. I search and found a post where I mentioned this: Vanguard Account Upgrade BROKEN; wrong MMF - Bogleheads.org.
In September 2016 we were notified of a change in our settlement account because of new SEC regs - our settlement fund was now going to be Federal MM. All the money in our settlement account was then swept out to buy Prime MM which makes no sense because it was already there as far as I was concerned. I did nothing to effect this change. No buttons to push. Nada. Shortly thereafter $0.07 showed up in the Federal MM settlement account - a dividend from Prime MM. I didn't then and don't now consider this as any kind of an upgrade. A few days later I sold the Prime MM fund. I didn't exchange it just sold it. The money showed up next day in my settlement account which was now Federal MM.
I agree that this was not an upgrade, since your accounts had already been upgraded. This was just switching the settlement fund to Federal MM to adhere to the SEC regulations.

We seem to have had different experiences with how Prime MM was handled. As mentioned above, for the accounts I upgraded myself, I ended up with two Prime MM funds: the original one in the mutual funds section of the brokerage account, and a new one as the settlement fund, which as you know, appears in its own section.

For my brokerage accounts that were upgraded without my consent or involvement, I can't remember for sure if the settlement funds were originally Prime MM, or if there were Federal MM funds from the beginning. I think it was the former, and then the settlement fund was switched from Prime to Federal later. Either way, the brokerage account upgrade was defined by de-linking from the previously associated mutual fund account (so Prime MM in the MF account no longer was designated as a sweep account), and a separate settlement fund appearing in the brokerage account.

I still have a Prime MM fund in each mutual fund account that was previously associated with a brokerage account. I'm pretty sure that after the brokerage account (only) upgrades, I had a new Prime MM fund as the settlement fund in the upgraded brokerage account, in addition to the original Prime MM fund in the previously associated mutual fund account.
Perhaps since then, Vanguard has placed a "button" on the brokerage page to get everyone to move the balance in their original MM fund to Federal since the original MM fund was no longer eligible as a sweep (settlement) account. Maybe this is where I am getting confused because I never saw any "button" no matter what it may be called now. :?:
I think there was a button at one point, but as I've said, since then my brokerage accounts were upgraded without my involvement. If my memory is correct, the upgrade did not initially use Federal MM as the settlement fund--that switch came later.

Kevin
If I make a calculation error, #Cruncher probably will let me 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 »

Kevin M wrote:These were upgrades (using the Vanguard term) of mutual fund accounts. You could say that the two associated brokerage accounts were upgraded at the same time (unless Vanguard had already upgraded them, but it doesn't sound like it). If you hadn't upgraded the mutual fund accounts, you probably would have eventually seen the brokerage accounts upgraded without your consent or involvement (as I have).
When we "upgraded" out mutual funds they disappeared completely. All the assets were transferred to the brokerage account. The original Prime MM (sweep)account in the mutual account became the settlement (sweep) fund in the brokerage account. There was no "upgrade" of the brokerage accounts themselves except for the settlement fund being included. And since one of the three brokerage accounts didn't previously exist how could it be upgraded? Actually I guess this is not correct since I had to open a new brokerage account first but I assumed that was just a paperwork issue.

What I have trouble grasping is what the brokerage account upgrade is. Is it just that the settlement fund in the same account or is it that the settlement fund was changed to Federal MM?
Kevin M wrote:As mentioned above, for the accounts I upgraded myself, I ended up with two Prime MM funds: the original one in the mutual funds section of the brokerage account, and a new one as the settlement fund, which as you know, appears in its own section.
In reviewing the transactions when the settlement fund was changed I saw that indeed there were two Prime MM funds, one as a settlement fund and one as a standalone. Both had the same amount of dollars which in total was twice as much as I had the previous day. Two days later I was back to one Prime MM and a Federal MM in the settlement fund with a $0.07 balance from a swept dividend. There was never any paperwork involved in this two for one deal.
Kevin M wrote:For my brokerage accounts that were upgraded without my consent or involvement, I can't remember for sure if the settlement funds were originally Prime MM, or if there were Federal MM funds from the beginning.
Did this "upgrade" just result in a new zero balance MM fund in the settlement section? If so I don't see that they needed your permission. If they also moved assets without your permission that is a different thing entirely.
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.
gkaplan
Posts: 7034
Joined: Sat Mar 03, 2007 7:34 pm
Location: Portland, Oregon

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

Post by gkaplan »

BD w/ Kung-Fu Grip wrote:
flamesabers wrote:
telemark wrote:You'll know when yours appears, because Vanguard will email you repeatedly about it.
Yeah, Vanguard sent me email #2 this morning. :P
I've had three, and the nag message every login. But my employer-sponsored SIMPLE account can't be migrated, apparently. I'm resisting because I don't want to be stuck using both platforms.

I've never had a "nag message" when I have logged into my account.
Gordon
FactualFran
Posts: 2751
Joined: Sat Feb 21, 2015 1:29 pm

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

Post by FactualFran »

Doc wrote: When we "upgraded" out mutual funds they disappeared completely. All the assets were transferred to the brokerage account. The original Prime MM (sweep)account in the mutual account became the settlement (sweep) fund in the brokerage account. There was no "upgrade" of the brokerage accounts themselves except for the settlement fund being included. And since one of the three brokerage accounts didn't previously exist how could it be upgraded? Actually I guess this is not correct since I had to open a new brokerage account first but I assumed that was just a paperwork issue
A change from a Vanguard Mutual Funds account to a (new style) Vanguard Brokerage account was an upgrade from an account that could hold only Vanguard mutual funds to an account that could also hold other types of investments, such as stocks and bonds.

A change from a old style Vanguard Brokerage account to a new style Vanguard Brokerage account was an upgrade from an account that could not hold Vanguard mutual funds to one that could in addition holding to the other types of investments, such as stocks and bonds.
richardglm
Posts: 284
Joined: Sun Jan 04, 2015 8:42 pm

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

Post by richardglm »

A lot of misinformation in this thread.

Moving from Prime MM to Federal MM for brokerage settlement has absolutely nothing to do with brokerage account upgrade. Period. It is only a coincidence they are rolling it out at the same time. And you are still allowed to use Prime MM. It just can't be used for buying and selling stocks and ETFs.

Brokerage account upgrade (by which I mean the "new" style brokerage account that can hold Vanguard mutual funds) is a change not driven by any government regulations.

Many of the old problems with the upgrade process have been worked out. You apparently do not need to re-link external bank accounts anymore. Dividends and capital gains can be redirected to external bank account now. The only feature still missing from the upgraded platform is ability to direct dividends from one fund to another (the only options are: reinvest, send to settlement fund, send to external bank, or send a physical check)

If you don't have an old-style brokerage account already, then waiting a few extra weeks for the 1099 might be an annoyance. But your options for switching away from Vanguard are limited. Schwab and Fidelity would have the same problem. I'm not sure it's a problem worth being angry over.

As far as I can tell, if you have an old-style brokerage account already, there is little reason not to upgrade. You have to wait for the brokerage 1099 anyway in the spring.

Now a legitimate reason to be upset would be if 1. you did not have a brokerage account before upgrade and 2. if your job or other personal circumstances restricted your ability to have a brokerage account at Vanguard (certain executive or political positions, etc) then that is a major problem.
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 »

richardglm wrote:A lot of misinformation in this thread. ... ... ....
Good summary.
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.
teacher
Posts: 1165
Joined: Sun Oct 05, 2008 5:45 pm
Location: California

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

Post by teacher »

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!
Doesn't sound like the Vanguard we know and love. Thanks for the heads-up, thirdman.
DrivingFun
Posts: 313
Joined: Wed Sep 19, 2007 6:12 pm

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

Post by DrivingFun »

I just got an email from Vanguard to upgrade my account. It also states "Transition your Vanguard account by October 6, 2017", what exactly going to happen on the 6th of October if I don't upgrade?

Currently I have a single web login that has taxable, roth, traditional, and 529 all linked to it (can view them all on one page). My dividends are always reinvested. I don't utilize any money market funds, I purchase directly from linked bank accounts. I don't utilize check writing (although I do hold one bond fund in taxable).

If/when my account is transitioned, am I going to lose any of my current functionality?
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 »

ChosenGSR wrote: Thu Aug 24, 2017 2:24 pm I just got an email from Vanguard to upgrade my account. It also states "Transition your Vanguard account by October 6, 2017", what exactly going to happen on the 6th of October if I don't upgrade?
I'm curious to know as well. I'm not finding anything on Vanguard's website to suggest a mandatory upgrade is going to be implemented on October 6.
User avatar
Teetlebaum
Posts: 461
Joined: Tue Apr 10, 2007 4:27 pm

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

Post by Teetlebaum »

I just got this email today:
You'll soon receive an email from us asking you to transition your current Vanguard account to a Vanguard Brokerage Account at no additional cost.

We're transitioning most of our accounts to the new account structure to significantly streamline our operations and help us continue to lower the cost of investing.

You don't need to take any action today. We simply want to inform you of the upcoming invitation.

Thank you for your consideration.
I wonder what "most of our accounts" means.
Locked