Vanguard is pushing Personal Advisory Services

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Dead Man Walking
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Vanguard is pushing Personal Advisory Services

Post by Dead Man Walking »

I’ve been a Vanguard client for 40 years and don’t recall Vanguard trying to sell me anything until recently. Today I received an email telling me that since I am a valued client Vanguard is offering estate planning via their Personal Advisors. In the early years of my relationship with Vanguard, I would receive information about new Vanguard funds with my snail mailed statements. Of course, Vanguard didn’t offer personal advisory services back then; however, their telephone representatives were competent and could help clients invest in their low cost mutual funds. The recent push for Personal Advisory Services may be linked to their push to convert to the brokerage platform. It’s easier to sell a variety of investment products via the brokerage platform. Perhaps Vanguard is hoping to achieve better customer service via the Personal Advisory Services platform. I’m not a fan of the new direction that Vanguard seems to be taking.

DMW
livesoft
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Re: Vanguard is pushing Personal Advisory Services

Post by livesoft »

OK, but perhaps many people of our age might have spouses and Vanguard may have noticed that PAS is what a surviving spouse wants?

Also as we age, we have more experience and have learned quite a lot, so what seemed "competent" to us 35 years ago, is no longer competent anymore. It is fun to talk to a young person who was just like we were 35 years ago.

Full disclosure: Vanguard client for 38 years. Curmudgeon for 3 years.
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typical.investor
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Re: Vanguard is pushing Personal Advisory Services

Post by typical.investor »

Dead Man Walking wrote: Tue Sep 29, 2020 9:15 pm I’ve been a Vanguard client for 40 years and don’t recall Vanguard trying to sell me anything until recently. Today I received an email telling me that since I am a valued client Vanguard is offering estate planning via their Personal Advisors. In the early years of my relationship with Vanguard, I would receive information about new Vanguard funds with my snail mailed statements. Of course, Vanguard didn’t offer personal advisory services back then; however, their telephone representatives were competent and could help clients invest in their low cost mutual funds. The recent push for Personal Advisory Services may be linked to their push to convert to the brokerage platform. It’s easier to sell a variety of investment products via the brokerage platform. Perhaps Vanguard is hoping to achieve better customer service via the Personal Advisory Services platform. I’m not a fan of the new direction that Vanguard seems to be taking.

DMW
Vanguard funds are at cost, but Personal Advisory Services aren’t.

Give me one reason why a Vanguard executive wouldn’t want to increase their bonus by cutting customer support costs while getting more of a bonus for increasing PAS revenue.

Costs can only be cut so far ... and if you are a hungry executive ...
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Re: Vanguard is pushing Personal Advisory Services

Post by brad.clarkston »

The horror an e-mail, they've gone over to the dark side.
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Nate79
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Re: Vanguard is pushing Personal Advisory Services

Post by Nate79 »

:moneybag :moneybag :moneybag :moneybag
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Brianmcg321
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Re: Vanguard is pushing Personal Advisory Services

Post by Brianmcg321 »

I’ve noticed the larger my account gets, the more service they want to provide.
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000
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Re: Vanguard is pushing Personal Advisory Services

Post by 000 »

I was able to stop all Vanguard marketing communication by sending a message requesting so in the secure message center.
RickyAZ
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Re: Vanguard is pushing Personal Advisory Services

Post by RickyAZ »

Been pushing it since Buckley took over. This is what he wants
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Prokofiev
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Re: Vanguard is pushing Personal Advisory Services

Post by Prokofiev »

brad.clarkston wrote: Tue Sep 29, 2020 9:36 pm The horror an e-mail, they've gone over to the dark side.
Actually I've received 2! calls from my Flagship rep suggesting I get a PAS account (yes, I still have a dedicated rep).
He had looked thru my portfolio and noted all my recent trades. He asked that now that I'm retired, don't I have
something better to do than manage my account? Why not let the VG professionals take charge? I told him that I
have done a lot of trading since we are stuck at home and it is something I enjoy. I also pointed out the money made
on those trades and why I made each one. In the end it was definitely a sell job on his part. Not over the top, high pressure
selling, but I was surprised that VG has gone done this path. First time in over 40 years.

Interestingly, he had analyzed my holdings and pointed out that I had a portfolio tilt to small and value. Also 33% in foreign equities.
These were a drag on my 5yr performance (really 10yr). While I had done well, I would have been better served by 100% Total Market.
Of course all that is true, but it sounded like a sales pitch. Believe it or not we talked for over 30 minutes about portfolio
construction as I tried to defend my choices.
Last edited by Prokofiev on Tue Sep 29, 2020 10:14 pm, edited 1 time in total.
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stan1
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Re: Vanguard is pushing Personal Advisory Services

Post by stan1 »

Prokofiev wrote: Tue Sep 29, 2020 9:59 pm (yes, I still have a dedicated rep).
Since most of us no longer have named Flagship reps including many who are above $2-3M, why do you think you still have a named rep? Assets, age, frequent usage, they know you have a lot of assets outside Vanguard still, luck, chance, combination of these?
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Prokofiev
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Re: Vanguard is pushing Personal Advisory Services

Post by Prokofiev »

stan1 wrote: Tue Sep 29, 2020 10:06 pm
Prokofiev wrote: Tue Sep 29, 2020 9:59 pm (yes, I still have a dedicated rep).
Since most of us no longer have named Flagship reps including many who are above $2-3M, why do you think you still have a named rep? Assets, age, frequent usage, they know you have a lot of assets outside Vanguard still, luck, chance, combination of these?
I asked that exact question. He gave a vague answer about total assets and being an important client. I felt so important!

He didn't really answer the question or give me the threshold amount (if there is one). My account is linked to two other
accounts that I have control of, so combined it is a substantial amount. Maybe that is important. It has nothing to do with
frequency of usage since I almost never call them . . .
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Cheez-It Guy
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Re: Vanguard is pushing Personal Advisory Services

Post by Cheez-It Guy »

We also still have a dedicated rep without obscenely high balances. Moderate usage for very specific questions (more pre-Boglegeads), but perhaps the commonality is the linked accounts. Total of 5 logins / social security numbers linked at Vanguard for asset aggregation, so perhaps this checks a box for "legacy" that they want to give a little extra attention to. For now. . .
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telemark
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Re: Vanguard is pushing Personal Advisory Services

Post by telemark »

000 wrote: Tue Sep 29, 2020 9:46 pm I was able to stop all Vanguard marketing communication by sending a message requesting so in the secure message center.
Now that you mention it, I did something similar a few months back, at the suggestion of someone on the forum. It's been quiet since then :)
Last edited by telemark on Wed Sep 30, 2020 8:02 am, edited 1 time in total.
Small Law Survivor
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Re: Vanguard is pushing Personal Advisory Services

Post by Small Law Survivor »

I have a named V. rep. She calls me up a few times a year out of the blue, just to talk, seemingly for nothing. The most recent call was to ask me if I had any questions about the upcoming change to Vanguard's money market. This is a new rep, but I've had a named rep for several years.
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dru808
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Re: Vanguard is pushing Personal Advisory Services

Post by dru808 »

This was a single email, or a rep repeatedly bugging you? 🤔
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TropikThunder
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Re: Vanguard is pushing Personal Advisory Services

Post by TropikThunder »

Small Law Survivor wrote: Tue Sep 29, 2020 10:32 pm I have a named V. rep. She calls me up a few times a year out of the blue, just to talk, seemingly for nothing.
If she's bored or lonely, maybe she could jump in the general CSR queue for a bit?
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Re: Vanguard is pushing Personal Advisory Services

Post by TropikThunder »

I'm always amused when someone reacts with dismay that a company does something different than what they did 35 years ago. :P
nzahir
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Re: Vanguard is pushing Personal Advisory Services

Post by nzahir »

Small Law Survivor wrote: Tue Sep 29, 2020 10:32 pm I have a named V. rep. She calls me up a few times a year out of the blue, just to talk, seemingly for nothing. The most recent call was to ask me if I had any questions about the upcoming change to Vanguard's money market. This is a new rep, but I've had a named rep for several years.
It is probably part of the job, they may have numbers to hit?
They may get paid on new assets (transfers from outside or bank transfers) or managed numbers
Also if they check in, you may have had a question that you forgot or didn't know who to ask, so they may be able to help you there.
Even if there is no new assets coming in, if they can show you something of value, it may keep you there

I think most here do not need much financial advice, but trust me, most Americans do. Most Americans just invest in stocks and have no idea you can invest in an index fund
tj
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Re: Vanguard is pushing Personal Advisory Services

Post by tj »

I called this morning to transfer my SIMPLE IRA into a Rollover IRA.

It took a whopping 3 minutes.

They didn't ask about any other assets or try to upsell me.
marcopolo
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Re: Vanguard is pushing Personal Advisory Services

Post by marcopolo »

Oh oh. What fear tactic will people use now to scare others away from those horrible profit making companies like Fidelity and Schwab?!?
Once in a while you get shown the light, in the strangest of places if you look at it right.
000
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Re: Vanguard is pushing Personal Advisory Services

Post by 000 »

marcopolo wrote: Tue Sep 29, 2020 11:36 pm Oh oh. What fear tactic will people use now to scare others away from those horrible profit making companies like Fidelity and Schwab?!?
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SxSW
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Re: Vanguard is pushing Personal Advisory Services

Post by SxSW »

TropikThunder wrote: Tue Sep 29, 2020 11:03 pm
Small Law Survivor wrote: Tue Sep 29, 2020 10:32 pm I have a named V. rep. She calls me up a few times a year out of the blue, just to talk, seemingly for nothing.
If she's bored or lonely, maybe she could jump in the general CSR queue for a bit?
And take a pay cut?
teniralc
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Re: Vanguard is pushing Personal Advisory Services

Post by teniralc »

Dead Man Walking wrote: Tue Sep 29, 2020 9:15 pm I’ve been a Vanguard client for 40 years and don’t recall Vanguard trying to sell me anything until recently. Today I received an email telling me that since I am a valued client Vanguard is offering estate planning via their Personal Advisors. In the early years of my relationship with Vanguard, I would receive information about new Vanguard funds with my snail mailed statements. Of course, Vanguard didn’t offer personal advisory services back then; however, their telephone representatives were competent and could help clients invest in their low cost mutual funds. The recent push for Personal Advisory Services may be linked to their push to convert to the brokerage platform. It’s easier to sell a variety of investment products via the brokerage platform. Perhaps Vanguard is hoping to achieve better customer service via the Personal Advisory Services platform. I’m not a fan of the new direction that Vanguard seems to be taking.

DMW
I started using the PAS services at Vanguard this year. I have found the advice and conversations with my advisor quite informative. I have another appointment next week to talk about a few more things. I can stop this service at any point but so far it has met or exceeded my expectations. I think that the older I get, the more I realize that I want things in place for my wife who has no interest in our finances, even though I continue to try to have her work with me on all this. Plus, as life events come upon us, good and bad (we've had a very difficult 2019, even before 2020 happened), I am finding that this service is giving me a bit more focus on overall goals and planning. Again, I'll see if I stay with it, but I went into it with an open mind and so far have been happy.
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Re: Vanguard is pushing Personal Advisory Services

Post by Whakamole »

Prokofiev wrote: Tue Sep 29, 2020 10:23 pm I asked that exact question. He gave a vague answer about total assets and being an important client. I felt so important!
You are sure this was Vanguard and not Edward Jones?
merganser
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Re: Vanguard is pushing Personal Advisory Services

Post by merganser »

"I started using the PAS services at Vanguard this year. I have found the advice and conversations with my advisor quite informative. I have another appointment next week to talk about a few more things. I can stop this service at any point but so far it has met or exceeded my expectations. I think that the older I get, the more I realize that I want things in place for my wife who has no interest in our finances, even though I continue to try to have her work with me on all this. Plus, as life events come upon us, good and bad (we've had a very difficult 2019, even before 2020 happened), I am finding that this service is giving me a bit more focus on overall goals and planning. Again, I'll see if I stay with it, but I went into it with an open mind and so far have been happy."


I totally agree with the above statement. I want my wife upon my death to be able to call PAS for advice. My wife has zero interest in investing.
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Re: Vanguard is pushing Personal Advisory Services

Post by Broken Man 1999 »

TropikThunder wrote: Tue Sep 29, 2020 11:04 pm I'm always amused when someone reacts with dismay that a company does something different than what they did 35 years ago. :P
So true!

For my part, I'm very glad of Vanguard's moves over the years. I like being able to have a brokerage account so I can hold other investments besides mutual funds in one account, rather than having two accounts. Simplifies management, that is always welcome for me.

Despite Mr Bogle turning down the chance to roll out ETFs, the subsequent Vanguard management teams have certainly made up for the lost business opportunity despite other providers being spotted a lead.

Businesses must evolve to have continued relevance to customers. Those who don't, run the risk of fading.

Even with Vanguard's warts, the funds flows data is very clear, Vanguard hasn't suffered for the changes they have made after the "Bogle Era."

I do not long for the "good old days" at all. I am very satisfied living in the present.

Broken Man 1999
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nedsaid
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Re: Vanguard is pushing Personal Advisory Services

Post by nedsaid »

livesoft wrote: Tue Sep 29, 2020 9:21 pm OK, but perhaps many people of our age might have spouses and Vanguard may have noticed that PAS is what a surviving spouse wants?

Also as we age, we have more experience and have learned quite a lot, so what seemed "competent" to us 35 years ago, is no longer competent anymore. It is fun to talk to a young person who was just like we were 35 years ago.

Full disclosure: Vanguard client for 38 years. Curmudgeon for 3 years.
Yes, we do seem to have our share of curmudgeons around here. :wink: I find myself getting to be more like those old fogies who would gather at donut shops and complain about their property taxes. But yes, we all get older.
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nedsaid
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Re: Vanguard is pushing Personal Advisory Services

Post by nedsaid »

Gasp! Vanguard is practicing capitalism. We also find Vanguard encouraging people to go to the Brokerage platform to save costs. We also caught Vanguard doing the upsell, the pitch for PAS is the equivalent of the pretty waitress showing you the dessert tray after the meal. I am shocked, just shocked that capitalism and marketing is going on in there.

All kidding aside, Vanguard is responding to consumer demand. Lots of people want advice and Vanguard notices people doing wacky stuff with their portfolios. Some of it is self interest, some if it is responding to the marketplace, some of it is genuine concern for clients. What you find is business is business, I get someone else to do something I don't want to deal with myself and someone else makes a buck. Good business is win/win for everybody.

I have been test driving an Advisory service at another firm to see how it goes. It is fun to analyze what they are doing and I have learned some things. I learned why investment firms want their products on a brokerage platform and I learned how ETFs save money for both the investor and the investment firm. I also am learning how this advisory process works. So far, so good.
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Re: Vanguard is pushing Personal Advisory Services

Post by nisiprius »

Curmudgeon here. A few weeks ago Vanguard sent me a mail piece promoting PAS. As nearly as I can recall, this is the first time Vanguard has ever sent me junk mail. I don't like it. I'm not going to bloviate about how I'd rather they shaved 0.00001% more off the expense ratios, but I do not like it.

I do feel that Vanguard is undergoing "mean reversion" in its practices and becoming more like other brokerages. I had that same feeling about TIAA-CREF in the late 1990s, about the time they lost their tax-exempt status, and about the time they started an ad campaign about "the power of .ORG" to play up the fact that they might not be tax-exempt but were still a non-profit. I think I was right about TIAA, I hope I am wrong about Vanguard.
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Re: Vanguard is pushing Personal Advisory Services

Post by rlangford »

nedsaid wrote: Wed Sep 30, 2020 9:43 am
I have been test driving an Advisory service at another firm to see how it goes. It is fun to analyze what they are doing and I have learned some things. I learned why investment firms want their products on a brokerage platform and I learned how ETFs save money for both the investor and the investment firm. I also am learning how this advisory process works. So far, so good.
Maybe someday you can tell us what you learned.
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bertilak
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Re: Vanguard is pushing Personal Advisory Services

Post by bertilak »

Cheez-It Guy wrote: Tue Sep 29, 2020 10:28 pm We also still have a dedicated rep without obscenely high balances. Moderate usage for very specific questions (more pre-Boglegeads), but perhaps the commonality is the linked accounts. Total of 5 logins / social security numbers linked at Vanguard for asset aggregation, so perhaps this checks a box for "legacy" that they want to give a little extra attention to. For now. . .
I too have several linked accounts that have granted me limited agent access -- three different people totaling 5 different accounts (4 and 6) if you count my wife. Among those agent access accounts at least one is unlimited. My dedicated flagship rep is gone.

Perhaps a dedicated rep is only for "Flagship Select."

Anyone who is a lowly Flagship (not Select) and and has a dedicated rep please raise your hand!

EDIT: I just remembered there are two additional accounts: UTMAs for grandkids. It is really starting to add up.
Last edited by bertilak on Wed Sep 30, 2020 10:08 am, edited 2 times in total.
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Big Dog
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Re: Vanguard is pushing Personal Advisory Services

Post by Big Dog »

stan1 wrote: Tue Sep 29, 2020 10:06 pm
Prokofiev wrote: Tue Sep 29, 2020 9:59 pm (yes, I still have a dedicated rep).
Since most of us no longer have named Flagship reps including many who are above $2-3M, why do you think you still have a named rep? Assets, age, frequent usage, they know you have a lot of assets outside Vanguard still, luck, chance, combination of these?
I finally received a letter (on Monday) that my Flag Rep was being replaced by a "team" .....no biggie, since I actually spoke to the Flag Rep maybe once every 2-3 years. (As a buy-and-hold investor, there is/was no need.)

But wrt initial post, if I go first, I could see da' wife using PAS. Much cheaper than an investment management company. (Also considering Rick Ferri's hourly consulting as a two-fund portfolio family wouldn't want to get into 30% international per PAS.)
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Re: Vanguard is pushing Personal Advisory Services

Post by AerialWombat »

Mutual or not, the fact of the matter is that Vanguard is a business. Businesses should solicit for new revenue opportunities. I’m glad to finally see them do more marketing. It’s beneficial for the long-term survival of the company.

Nobody should be surprised to see a business trying to get more business. It’s what they do.
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nedsaid
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Re: Vanguard is pushing Personal Advisory Services

Post by nedsaid »

rlangford wrote: Wed Sep 30, 2020 10:00 am
nedsaid wrote: Wed Sep 30, 2020 9:43 am
I have been test driving an Advisory service at another firm to see how it goes. It is fun to analyze what they are doing and I have learned some things. I learned why investment firms want their products on a brokerage platform and I learned how ETFs save money for both the investor and the investment firm. I also am learning how this advisory process works. So far, so good.
Maybe someday you can tell us what you learned.
Moving clients to the brokerage platform outsources certain functions to the brokerage firm. The investment company focuses on managing money, someone else sends the statements and maintains client accounts.

ETFs are put on the brokerage platform, since the investment company doesn't have to maintain individual client accounts and send statements, investment management can be offered to investors at a lower cost. T Rowe Price recently rolled out ETF versions of popular funds, each with a lower expense ratio of 10 to 12 basis points or 0.10% to 0.12% a year. My Advisory service recently replaced Y Shares of a retail fund with a very similar ETF saving 6 basis points.

Advisory services will put you in the cheaper Institutional, Y Class, or Advisor class shares. These shares are less expensive than what are available to the retail investor. In my case, the management fee includes everything including the underlying expense ratios of the ETFs and Mutual Funds, so the cheaper funds don't save me any money. But most people pay the advisory fee plus the underlying expense ratios of the investments. So for people in an Assets Under Management arrangement, the cheaper share classes makes up for a part of the advisor fee.

Most of what they have done so far is simply rebalancing the portfolio. They made a couple of mildly strategic moves. My portfolio there is analogous to their Conservative Target Risk retail fund. About 45% stocks, 5% Liquid Alts, 50% bonds and cash.
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nedsaid
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Re: Vanguard is pushing Personal Advisory Services

Post by nedsaid »

nisiprius wrote: Wed Sep 30, 2020 10:00 am Curmudgeon here. A few weeks ago Vanguard sent me a mail piece promoting PAS. As nearly as I can recall, this is the first time Vanguard has ever sent me junk mail. I don't like it. I'm not going to bloviate about how I'd rather they shaved 0.00001% more off the expense ratios, but I do not like it.

I do feel that Vanguard is undergoing "mean reversion" in its practices and becoming more like other brokerages. I had that same feeling about TIAA-CREF in the late 1990s, about the time they lost their tax-exempt status, and about the time they started an ad campaign about "the power of .ORG" to play up the fact that they might not be tax-exempt but were still a non-profit. I think I was right about TIAA, I hope I am wrong about Vanguard.
You remind me of the guy who runs for Mayor of New York City every four years. His whole platform is
"the rent is just too damned high." Perhaps I can join you in a coffee shop some day and commiserate about our property taxes. Or as Alice Roosevelt Longworth once said, "If you have nothing nice to say, you can sit down here right next to me!"
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bertilak
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Re: Vanguard is pushing Personal Advisory Services

Post by bertilak »

Big Dog wrote: Wed Sep 30, 2020 10:04 am I finally received a letter (on Monday) that my Flag Rep was being replaced by a "team" ...
Last time I called that Flagship phone number I specifically asked the rep if he was in a special Flagship pool or a general Vanguard pool. His response was not encouraging, something along the lines of "I like to think we ALL can serve you well." He pointedly ignored the gist of my question (what constituters "all"). I tried to draw him out but he had a non-responsive answer to every follow-on question.

I agree with your point about wife using PAS. I have a statement in my IPS telling my wife if it all seems like too much to deal with, call Vanguard and sign up with PAS.
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Cheez-It Guy
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Re: Vanguard is pushing Personal Advisory Services

Post by Cheez-It Guy »

bertilak wrote: Wed Sep 30, 2020 10:03 am
Cheez-It Guy wrote: Tue Sep 29, 2020 10:28 pm We also still have a dedicated rep without obscenely high balances. Moderate usage for very specific questions (more pre-Boglegeads), but perhaps the commonality is the linked accounts. Total of 5 logins / social security numbers linked at Vanguard for asset aggregation, so perhaps this checks a box for "legacy" that they want to give a little extra attention to. For now. . .
I too have several linked accounts that have granted me limited agent access -- three different people totaling 5 different accounts (4 and 6) if you count my wife. Among those agent access accounts at least one is unlimited. My dedicated flagship rep is gone.

Perhaps a dedicated rep is only for "Flagship Select."

Anyone who is a lowly Flagship (not Select) and and has a dedicated rep please raise your hand!

EDIT: I just remembered there are two additional accounts: UTMAs for grandkids. It is really starting to add up.
FYI, even collectively, we do not meet Flagship Select requirements. I was not referring to agent access to accounts, which we also have established in some cases, but rather to aggregation of assets for various service level thresholds that generally requires account holders to receive mail at a common address. It is a linkage Vanguard does on the back end, and there is nowhere it is visible in user screens. We have 5 individuals all with their own logins and accounts which are aggregated in this manner and who are able to receive mail at the same PO Box.
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Re: Vanguard is pushing Personal Advisory Services

Post by peppers »

There must be something in the water.

Earlier this week I received an e-mail from the Fidelity office manager introducing another account representative and a request to set up a conference call or zoom chat regarding my financial well being and to see if anything needs to be addressed.

Today I received the Vanguard e-mail regarding Estate planning through their Personal Advisory Services.

My insurance agent sent an e-mail asking for a sit down review of all things financial and see if there were any issues.

The financial sharks must smell blood money in the water.
"..the cavalry ain't comin' kid, you're on your own..."
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Dead Man Walking
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Re: Vanguard is pushing Personal Advisory Services

Post by Dead Man Walking »

I am going to request a session with a personal advisor out of curiosity. From what I have read, a salaried personal advisor will suggest a portfolio that fits my risk level using the 4 total market ETFs covering domestic and international equities and bonds offered by Vanguard. I’m curious to see if he suggests selling the active Vanguard mutual funds in my portfolio. The quarterly rebalancing service is a plus.

As to the comments above about Vanguard practicing capitalism, Vanguard is owned by the mutual fund shareholders. As owners of the company, are we going to reap capital gains? No, we are not, the company isn’t organized in a way that our ownership “shares” can be bought or sold. Are the salaried advisors going to receive bonuses? I bet the executives of the company will be compensated, but we will never know because the compensation of Vanguard executives is never revealed. If I’m wrong about their compensation being secret, please provide a link to where I can find it.

I have no problem with Vanguard trying to remain competitive. However, I believe that the main problem that the company is experiencing is asset bloat. Due to this asset bloat, their customer service has suffered. PAS is an attempt to provide a respectable level of customer service by having the investor pay for it. I can’t believe that they are offering estate planning.

DMW
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nedsaid
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Re: Vanguard is pushing Personal Advisory Services

Post by nedsaid »

Dead Man Walking wrote: Wed Sep 30, 2020 2:31 pm I am going to request a session with a personal advisor out of curiosity. From what I have read, a salaried personal advisor will suggest a portfolio that fits my risk level using the 4 total market ETFs covering domestic and international equities and bonds offered by Vanguard. I’m curious to see if he suggests selling the active Vanguard mutual funds in my portfolio. The quarterly rebalancing service is a plus.

As to the comments above about Vanguard practicing capitalism, Vanguard is owned by the mutual fund shareholders. As owners of the company, are we going to reap capital gains? No, we are not, the company isn’t organized in a way that our ownership “shares” can be bought or sold. Are the salaried advisors going to receive bonuses? I bet the executives of the company will be compensated, but we will never know because the compensation of Vanguard executives is never revealed. If I’m wrong about their compensation being secret, please provide a link to where I can find it.

I have no problem with Vanguard trying to remain competitive. However, I believe that the main problem that the company is experiencing is asset bloat. Due to this asset bloat, their customer service has suffered. PAS is an attempt to provide a respectable level of customer service by having the investor pay for it. I can’t believe that they are offering estate planning.

DMW
The problem is that shareholder ownership of Vanguard doesn't translate into shareholder voice into how Vanguard is operated. As far as I know, the compensation of Vanguard management is a closely held secret and "ownership" has no say. Pretty much, Senior Management can reap the rewards of ownership as if they owned the company themselves despite how Vanguard is organized. Vanguard really does have a profit motive in an indirect way. Not saying this is necessarily bad, it is just that Vanguard isn't as pure as the wind driven snow.
A fool and his money are good for business.
Faith20879
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Re: Vanguard is pushing Personal Advisory Services

Post by Faith20879 »

Dead Man Walking wrote: Tue Sep 29, 2020 9:15 pm Today I received an email ...
"Pushing?" By your definition, I'd been over the cliff already. T Rowe Price sends me a couple of such invitations every month.

Delete! Delete! Deletel ! :D :D :D
Notsobad
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Re: Vanguard is pushing Personal Advisory Services

Post by Notsobad »

Got my call today. He suggested I talk with an advisor and consider management to take advantage of tax loss harvesting (which I don’t do) and consider estate implications.

I told him I was unsure that the added benefits of an advisor’s intervention might not overcome the fee.

I would be willing to pay a flat fee, but percentage fees seem unfair to me. Maybe 50M takes more work, but does it take 5 x more work to manage 5M compared to 1M? If the portfolio is structured well initially, it should take the same or less work as the balance goes up I think.
marcopolo
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Re: Vanguard is pushing Personal Advisory Services

Post by marcopolo »

Investor: Boy, Vanguard customer service is really bad, their platforms are antiquated, and they keep screwing up my cost basis info. I am thinking about switching to Fidelity/Schwab

Echo Chamber: Yeah, but those profit making companies are way too expensive.

Investor: They have funds that are about the same or cheaper than Vanguard.

Echo Chamber: Yeah, but those profit making companies just use those as loss leaders, once they get you they will try to upsell you to more expensive products/services.

Investor: Now, I am getting unsolicited calls from Vanguard trying to upsell me to more expensive services

Echo Chamber: What's the big deal just ignore them, it's only natural they try to make more profit.

:oops:
Once in a while you get shown the light, in the strangest of places if you look at it right.
drzzzzz
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Re: Vanguard is pushing Personal Advisory Services

Post by drzzzzz »

marcopolo wrote: Wed Sep 30, 2020 7:15 pm Investor: Boy, Vanguard customer service is really bad, their platforms are antiquated, and they keep screwing up my cost basis info. I am thinking about switching to Fidelity/Schwab

Echo Chamber: Yeah, but those profit making companies are way too expensive.

Investor: They have funds that are about the same or cheaper than Vanguard.

Echo Chamber: Yeah, but those profit making companies just use those as loss leaders, once they get you they will try to upsell you to more expensive products/services.

Investor: Now, I am getting unsolicited calls from Vanguard trying to upsell me to more expensive services

Echo Chamber: What's the big deal just ignore them, it's only natural they try to make more profit.

:oops:
great post - i guess they forgot to give you the kool-aid
Carol88888
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Re: Vanguard is pushing Personal Advisory Services

Post by Carol88888 »

nedsaid wrote: Wed Sep 30, 2020 9:43 am Gasp! Vanguard is practicing capitalism. We also find Vanguard encouraging people to go to the Brokerage platform to save costs. We also caught Vanguard doing the upsell, the pitch for PAS is the equivalent of the pretty waitress showing you the dessert tray after the meal. I am shocked, just shocked that capitalism and marketing is going on in there.

All kidding aside, Vanguard is responding to consumer demand. Lots of people want advice and Vanguard notices people doing wacky stuff with their portfolios. Some of it is self interest, some if it is responding to the marketplace, some of it is genuine concern for clients. What you find is business is business, I get someone else to do something I don't want to deal with myself and someone else makes a buck. Good business is win/win for everybody.

I have been test driving an Advisory service at another firm to see how it goes. It is fun to analyze what they are doing and I have learned some things. I learned why investment firms want their products on a brokerage platform and I learned how ETFs save money for both the investor and the investment firm. I also am learning how this advisory process works. So far, so good.
How do ETFs save money for both the investor and the investment firm? I thought it had to be one or the other.
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nedsaid
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Re: Vanguard is pushing Personal Advisory Services

Post by nedsaid »

Carol88888 wrote: Wed Sep 30, 2020 11:18 pm
How do ETFs save money for both the investor and the investment firm? I thought it had to be one or the other.
ETFs save money for the investment firm because they have to be held in Brokerage accounts. The brokerage firm and not the investment firm has to do the accounting for customer accounts and sends out the statements. In effect, the investment firm outsources certain functions to its brokerage platform. T Rowe Price has offered active ETFs that a similar to popular mutual funds. These ETFs are 10 to 12 basis points cheaper than the mutual funds. Not sure how much of the savings are passed on to the investors in ETFs.

The investor saves money because they can buy essentially the same product cheaper in ETF form than Mutual Fund form. ETFs have a small disadvantage compared to mutual funds in that they trade at a Premium or Discount to Net Asset Value and also there is a small bid/ask spread. The lower expense ratios will more than offset the trading costs of Premium/Discount and bid/ask spreads. You can now buy or sell most ETFs with zero commission and can also reinvest dividends at no charge.
Last edited by nedsaid on Sun Oct 04, 2020 12:38 pm, edited 1 time in total.
A fool and his money are good for business.
criticalmass
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Re: Vanguard is pushing Personal Advisory Services

Post by criticalmass »

Dead Man Walking wrote: Tue Sep 29, 2020 9:15 pm I’ve been a Vanguard client for 40 years and don’t recall Vanguard trying to sell me anything until recently. Today I received an email telling me that since I am a valued client Vanguard is offering estate planning via their Personal Advisors. In the early years of my relationship with Vanguard, I would receive information about new Vanguard funds with my snail mailed statements. Of course, Vanguard didn’t offer personal advisory services back then; however, their telephone representatives were competent and could help clients invest in their low cost mutual funds. The recent push for Personal Advisory Services may be linked to their push to convert to the brokerage platform. It’s easier to sell a variety of investment products via the brokerage platform. Perhaps Vanguard is hoping to achieve better customer service via the Personal Advisory Services platform. I’m not a fan of the new direction that Vanguard seems to be taking.

DMW
You can push them back and decline to accept Personal Advisory Services. It is a choice they are offering now. It has nothing to do with the platform.
Rob1
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Re: Vanguard is pushing Personal Advisory Services

Post by Rob1 »

Advice is now a core focus for Vanguard. Tim Buckley, Vanguard’s CEO, in a blog post last year:

“Now more than ever, we see investors’ long-term success tied not only to the funds they use but also to the advice they receive. For more than 40 years, we’ve been champions in the mutual fund industry for accessibility, affordability, and alignment with clients’ interests. This has enabled investors to keep more of what they earn and to more easily reach their financial goals. We aim to do the same for financial advice.”

Source:
https://investornews.vanguard/behind-ou ... -everyone/

Tim also talked about this in this Vanguard podcast:
https://investornews.vanguard/a-convers ... m-buckley/
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patrick013
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Re: Vanguard is pushing Personal Advisory Services

Post by patrick013 »

Has anyone tried their "Digital Advisor" ? I don't think it
does estate planning but it would be interesting what
cost/benefit it might provide.
age in bonds, buy-and-hold, 10 year business cycle
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Dead Man Walking
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Re: Vanguard is pushing Personal Advisory Services

Post by Dead Man Walking »

Rob1 wrote: Thu Oct 01, 2020 1:03 am Advice is now a core focus for Vanguard. Tim Buckley, Vanguard’s CEO, in a blog post last year:

“Now more than ever, we see investors’ long-term success tied not only to the funds they use but also to the advice they receive. For more than 40 years, we’ve been champions in the mutual fund industry for accessibility, affordability, and alignment with clients’ interests. This has enabled investors to keep more of what they earn and to more easily reach their financial goals. We aim to do the same for financial advice.”

Source:
https://investornews.vanguard/behind-ou ... -everyone/

Tim also talked about this in this Vanguard podcast:
https://investornews.vanguard/a-convers ... m-buckley/
You have effectively explained what Vanguard’s new direction actually is. My original post didn’t explicitly define their new direction. That was a failure to communicate on my part. Thanks for clarifying my point.

DMW
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