Vanguard Financial Plan requires Brokerage Account? Bait and switch?

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RandalThor
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Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by RandalThor » Fri Jun 14, 2019 9:39 pm

I need some help / thoughts on how to address this with Vanguard.

I was taking advantage of a complimentary financial plan review / update from Vanguard. After I pulled all the details together for them, had an initial intake call with a representative and then had the first adviser call to discuss goals, background, etc., at the end of this call, the adviser mentioned he could have the plan put together today, if not in the next day or two.

BUT...

He goes on to say at the end of the call that he won't be able to provide the plan until I convert my account to a Brokerage account. He explains how they are looking out for their investors as they want to drive costs down and this account allows folks to leverage ETFs, etc.

I mentioned this was news to me that a Brokerage account was required in order to receive a financial plan. As this was not needed a couple years ago when they provided a similar review for me. He mentioned this was new direction from their leadership.

I then asked if his plan would only provide recommendations based on ETFs and if I was expected to convert all the mutual funds to ETFs. He said no, but we could consider doing that if we chose to do so.

So I am at a loss as to why the type of of account I have would be some dependency all of a sudden for a financial plan review.

A few reactions:
- My initial feeling I had was this was some kind of bait and switch. I don't like this feeling and the way they are proposing this feels like they are forcing me into something that I may not necessarily want, and feels like they are taking advantage of me at the last minute. It doesn't feel right. I shouldn't feel this way with a company I have trusted for so many years.
- Now I am not sure if I have objections to the Brokerage account or not, but from some of the reading I've done here is there are a few things that you lose by converting from MF's on old platform to ETF's in a Brokerage account (i.e. dividends not going straight to bank account but only to a sweep account; ability to do auto-exchanges to between MF's like money market to stock funds, etc.). Maybe there are others...
- I shouldn't be forced into changing account types to receive a service they have offered, especially when there was no mention of this requirement beforehand, and I have already spent time working on this; I have also had no inclination to move to ETF's, but might consider later, but have not been worried about that at all

I feel like I need to file some complaint, but not sure if I am making a mountain out of a mole hill.

What are you thoughts/reactions to all this? Does this seem like the Vanguard we all know? What would you suggest? :?

Thanks.

Rand

arf30
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by arf30 » Fri Jun 14, 2019 9:46 pm

Vanguard still has MF accounts??

AlohaJoe
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by AlohaJoe » Fri Jun 14, 2019 9:55 pm

RandalThor wrote:
Fri Jun 14, 2019 9:39 pm
- My initial feeling I had was this was some kind of bait and switch.
Vanguard hasn't had the Vanguard Financial Plan since 2015.

viewtopic.php?t=160360

It has been managed by Vanguard PAS for the past 4 years. As the Vanguard website says, "Financial advice from a Certified Financial Planner™ professional through Vanguard Personal Advisor Services®"

https://investor.vanguard.com/investing ... s/flagship
I shouldn't be forced into changing account types to receive a service they have offered
Why not? Is there some law of the universe saying that? Companies can do whatever they want, within legal limits. Every company I've ever worked with limits the kinds of services legacy customers have access to.

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RandalThor
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by RandalThor » Fri Jun 14, 2019 10:08 pm

AlohaJoe wrote:
Fri Jun 14, 2019 9:55 pm
RandalThor wrote:
Fri Jun 14, 2019 9:39 pm
- My initial feeling I had was this was some kind of bait and switch.
Vanguard hasn't had the Vanguard Financial Plan since 2015.

viewtopic.php?t=160360

It has been managed by Vanguard PAS for the past 4 years. As the Vanguard website says, "Financial advice from a Certified Financial Planner™ professional through Vanguard Personal Advisor Services®"

https://investor.vanguard.com/investing ... s/flagship
I shouldn't be forced into changing account types to receive a service they have offered
Why not? Is there some law of the universe saying that? Companies can do whatever they want, within legal limits. Every company I've ever worked with limits the kinds of services legacy customers have access to.
Thanks but I think this doesn't really answer my question or concerns. I understand that PAS was doing the financial plan / review. They have provided this to me previously, and offered the service again. To only at the last minute mention the account needed to be converted. It was a very strange end to the call. "Ok, all set, I'll complete the plan, but wait, you need to sign all these papers and convert your account over before I can give you your plan." Out of left field...

Fclevz
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Fclevz » Fri Jun 14, 2019 10:19 pm

Vanguard has been transitioning to brokerage accounts since, I believe, 2013 (did mine in 2015).
Maybe they’re just getting frustrated with the slow progress.
Someday they’re going to shut down the legacy fund-only accounts and it may wind up being a choice to convert or leave Vanguard.

mhalley
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by mhalley » Fri Jun 14, 2019 10:33 pm

At this point I wish vanguard would just make an announcement,” you have until one year from now to convert to brokerage account or we will do it for you.”
Until then they should put an * footnote on their pas materials noting it requires a brokerage account.

dru808
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by dru808 » Sat Jun 15, 2019 1:28 am

What’s the big deal with the brokerage account, are there some sinister shenanigans going on with the switch to brokerage accounts? I just switched over a couple weeks ago after who knows how long they were asking? Hadn’t logged in for 4 years until a couple weeks ago.

I just thought it was the direction they wanted to go and having everyone on the same “page” would just make it easier.

BigPrince
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by BigPrince » Sat Jun 15, 2019 1:43 am

RandalThor wrote:
Fri Jun 14, 2019 9:39 pm
snip
Policies change. Watch when they stop offering complimentary advice. Good luck.

sixty40
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by sixty40 » Sat Jun 15, 2019 3:03 am

RandalThor wrote:
Fri Jun 14, 2019 10:08 pm
AlohaJoe wrote:
Fri Jun 14, 2019 9:55 pm
RandalThor wrote:
Fri Jun 14, 2019 9:39 pm
- My initial feeling I had was this was some kind of bait and switch.
Vanguard hasn't had the Vanguard Financial Plan since 2015.

viewtopic.php?t=160360

It has been managed by Vanguard PAS for the past 4 years. As the Vanguard website says, "Financial advice from a Certified Financial Planner™ professional through Vanguard Personal Advisor Services®"

https://investor.vanguard.com/investing ... s/flagship
I shouldn't be forced into changing account types to receive a service they have offered
Why not? Is there some law of the universe saying that? Companies can do whatever they want, within legal limits. Every company I've ever worked with limits the kinds of services legacy customers have access to.
Thanks but I think this doesn't really answer my question or concerns. I understand that PAS was doing the financial plan / review. They have provided this to me previously, and offered the service again. To only at the last minute mention the account needed to be converted. It was a very strange end to the call. "Ok, all set, I'll complete the plan, but wait, you need to sign all these papers and convert your account over before I can give you your plan." Out of left field...
It does seem a little odd the way VG handled it, VG probably should have been more up front in the beginning with it. I would be a little skeptical too. I had both a mutual fund acct and brokerage acct for years, and just recently converted my MF acct to brokerage, so now I just have one brokerage acct, everything seems fine. Overall I am fine with converting, just have to take the plunge and do it.

Emilyjane
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Emilyjane » Sat Jun 15, 2019 4:51 am

Only change I’ve noticed since converting to brokerage account a few years ago is change in ease of doing Roth conversions. Have to go to full site instead of using app, and have to choose number of shares instead of specific dollar amount.

My husband still has MF account, so he can still do in app, and just pick an amount, like $20,000. I have to do actual math, and there is some guesswork, since closing price unknown at the time transaction is placed. Not sure why that aspect is worse when they want to encourage customers to convert?

Rep could not explain reason for this when I called. Maybe someone here understands? Minor nuisance.
"Real knowledge is to know the extent of one's ignorance", Confucius

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CAsage
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by CAsage » Sat Jun 15, 2019 7:55 am

I'm really not sure why this is perceived as so bad... I switched over to a Vanguard brokerage fund several years ago, still have all my assets in mutual funds, no issues. Yes, they want to standardize to minimize costs - but we LIKE that about them, right? I suspect they are trying to do it with any other change that crops up... I would never access my Vanguard account on an app, but that's just my paranoia speaking.
Salvia Clevelandii "Winifred Gilman" my favorite. YMMV; not a professional advisor.

UpperNwGuy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by UpperNwGuy » Sat Jun 15, 2019 8:03 am

The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.

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TomatoTomahto
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by TomatoTomahto » Sat Jun 15, 2019 8:11 am

UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
For some of us, switching would mean having to close our Vanguard accounts and moving elsewhere.

Some employers, especially in the financial services industry, only allow MF-only accounts or brokerage accounts at specified brokers. In our case, we’d have to move to Fidelity; not a fate worse than death, but I’m happy where we are.
Okay, I get it; I won't be political or controversial. The Earth is flat.

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 8:16 am

UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?

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HueyLD
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by HueyLD » Sat Jun 15, 2019 8:22 am

TomatoTomahto wrote:
Sat Jun 15, 2019 8:11 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
For some of us, switching would mean having to close our Vanguard accounts and moving elsewhere.

Some employers, especially in the financial services industry, only allow MF-only accounts or brokerage accounts at specified brokers. In our case, we’d have to move to Fidelity; not a fate worse than death, but I’m happy where we are.
Have you asked VG directly if you can retain MF only accounts due to employment restrictions? If you are lucky, they may have some non-published rules that allow you to retain MF only accounts.

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HueyLD
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by HueyLD » Sat Jun 15, 2019 8:22 am

catalina355 wrote:
Sat Jun 15, 2019 8:16 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?
No and no.

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 8:28 am

HueyLD wrote:
Sat Jun 15, 2019 8:22 am
catalina355 wrote:
Sat Jun 15, 2019 8:16 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?
No and no.
I thought so. Pretty basic functionality that Vanguard has not provided in 5+ years.

I’m not moving from the “dying mutual fund platform”.

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TomatoTomahto
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by TomatoTomahto » Sat Jun 15, 2019 8:32 am

HueyLD wrote:
Sat Jun 15, 2019 8:22 am
TomatoTomahto wrote:
Sat Jun 15, 2019 8:11 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
For some of us, switching would mean having to close our Vanguard accounts and moving elsewhere.

Some employers, especially in the financial services industry, only allow MF-only accounts or brokerage accounts at specified brokers. In our case, we’d have to move to Fidelity; not a fate worse than death, but I’m happy where we are.
Have you asked VG directly if you can retain MF only accounts due to employment restrictions? If you are lucky, they may have some non-published rules that allow you to retain MF only accounts.
Yes, we did that years ago, and our account is flagged as not eligible for conversion. They even stopped asking us if we wanted to upgrade :D

My post was mainly directed to those who questioned why anyone would object to a brokerage account.
Okay, I get it; I won't be political or controversial. The Earth is flat.

Broken Man 1999
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Broken Man 1999 » Sat Jun 15, 2019 8:35 am

catalina355 wrote:
Sat Jun 15, 2019 8:16 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?
Yes. My wife has an automatic transfer from her bond mutual fund deposited into her credit union account monthly. Taxes are also removed. Works like clockwork.

You second question answer is I don't know, as we don't exchange between our bond funds, they are the only mutual funds we have.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven than I shall not go. " -Mark Twain

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 8:37 am

Broken Man 1999 wrote:
Sat Jun 15, 2019 8:35 am
catalina355 wrote:
Sat Jun 15, 2019 8:16 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?
Yes. My wife has an automatic transfer from her bond mutual fund deposited into her credit union account monthly. Taxes are also removed. Works like clockwork.

You second question answer is I don't know, as we don't exchange between our bond funds, they are the only mutual funds we have.

Broken Man 1999
Why would taxes be removed?

What about dividends from mutual funds automatically deposited to a money market fund of your choice?

Broken Man 1999
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Broken Man 1999 » Sat Jun 15, 2019 8:50 am

catalina355 wrote:
Sat Jun 15, 2019 8:37 am
Broken Man 1999 wrote:
Sat Jun 15, 2019 8:35 am
catalina355 wrote:
Sat Jun 15, 2019 8:16 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?
Yes. My wife has an automatic transfer from her bond mutual fund deposited into her credit union account monthly. Taxes are also removed. Works like clockwork.

You second question answer is I don't know, as we don't exchange between our bond funds, they are the only mutual funds we have.

Broken Man 1999
Why would taxes be removed?

What about dividends from mutual funds automatically deposited to a money market fund of your choice?
Taxes are removed at our request. Other than SS, every dollar we spend comes from our IRAs. So, it is easy to pay the taxes on an as-we-go basis.

Dividends are deposited to our settlement account, Vanguard Federal Money Market, it is our only MM fund, so my answer is yes. When Vanguard changed settlement fund to Vanguard Federal Money Market, we closed all our Prime MM funds. So we have one choice, as we desired. So, I don't know if one can select another MM fund or not.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven than I shall not go. " -Mark Twain

AlohaJoe
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by AlohaJoe » Sat Jun 15, 2019 8:54 am

catalina355 wrote:
Sat Jun 15, 2019 8:16 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?
If you sign up for Vanguard PAS I believe all of the above is possible with their brokerage system. But Vanguard requires you to sign up for PAS, they don't give it away for free. Vanguard Advisor Services has $115 billion in AUM. At 0.30% that's $3.5 billion a year in revenue.

Given that competitors which offer it for free, like M1Finance, aren't exactly taking the world by storm -- there seems to be little competitive pressure for Vanguard to give it away and give up some portion of that $3 billion a year.

inverter
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by inverter » Sat Jun 15, 2019 9:04 am

IT Consultant here... I bet this isn’t a sinister plan to get people to switch, but simply based on the fact that the PAS software is built on the brokerage platform and since PAS is how doing the review, they need to be able to see your accounts that way.

Danw
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Danw » Sat Jun 15, 2019 9:22 am

If we have a joint mutual fund account with a transfer on death beneficiary, will the TOD beneficiary remain if I update to the new brokerage platform?

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Cheez-It Guy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Cheez-It Guy » Sat Jun 15, 2019 9:31 am

AlohaJoe wrote:
Sat Jun 15, 2019 8:54 am
catalina355 wrote:
Sat Jun 15, 2019 8:16 am
UpperNwGuy wrote:
Sat Jun 15, 2019 8:03 am
The Vanguard brokerage accounts are fine, and everybody will have one sooner or later. I don’t understand why so many bogleheads cling so desparately to the dying mutual fund accounts. You can either rip the bandaid off quickly and get it over with, or you can pull it off slowly and enjoy the painfulness of the process.
Can you do an automated monthly transfer from a mutual fund to an external bank using the brokerage platform? I recall this was not possible in the past. Also automated transfers between mutual funds?
If you sign up for Vanguard PAS I believe all of the above is possible with their brokerage system. But Vanguard requires you to sign up for PAS, they don't give it away for free. Vanguard Advisor Services has $115 billion in AUM. At 0.30% that's $3.5 billion a year in revenue.

Given that competitors which offer it for free, like M1Finance, aren't exactly taking the world by storm -- there seems to be little competitive pressure for Vanguard to give it away and give up some portion of that $3 billion a year.
Respectfully, your calculation is off by a factor of 10. 0.30% of $115 billion is $0.345 billion, or $345 million.

NotWhoYouThink
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by NotWhoYouThink » Sat Jun 15, 2019 9:34 am

Looks to me like you are making a mountain out of a mole hill. My local bank has changed account options, my cell provider has changed plan options, my credit cards have all made various changes. The financial industry was not cast in bronze the day you opened your Vanguard account. Change happened in the financial industry as in the rest of the world.

A small number of clients can't have brokerage accounts as a previous poster has mentioned because of specific conflict of interest regulations for financial industry employees. For the rest of us this should be about as momentous as going from a legacy cell phone plan to an unlimited plan.

yousha
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by yousha » Sat Jun 15, 2019 9:39 am

My thought is that if a client has had the old platform for many years and feels comfortable with it then so be it!

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 9:41 am

NotWhoYouThink wrote:
Sat Jun 15, 2019 9:34 am
Looks to me like you are making a mountain out of a mole hill. My local bank has changed account options, my cell provider has changed plan options, my credit cards have all made various changes. The financial industry was not cast in bronze the day you opened your Vanguard account. Change happened in the financial industry as in the rest of the world.

A small number of clients can't have brokerage accounts as a previous poster has mentioned because of specific conflict of interest regulations for financial industry employees. For the rest of us this should be about as momentous as going from a legacy cell phone plan to an unlimited plan.
If something as simple as automated transfers to a bank account is not available without paying for PAS, I respectfully don’t think I’m making a mountain out of a molehill.

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Cheez-It Guy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Cheez-It Guy » Sat Jun 15, 2019 9:45 am

catalina355 wrote:
Sat Jun 15, 2019 9:41 am
NotWhoYouThink wrote:
Sat Jun 15, 2019 9:34 am
Looks to me like you are making a mountain out of a mole hill. My local bank has changed account options, my cell provider has changed plan options, my credit cards have all made various changes. The financial industry was not cast in bronze the day you opened your Vanguard account. Change happened in the financial industry as in the rest of the world.

A small number of clients can't have brokerage accounts as a previous poster has mentioned because of specific conflict of interest regulations for financial industry employees. For the rest of us this should be about as momentous as going from a legacy cell phone plan to an unlimited plan.
If something as simple as automated transfers to a bank account is not available without paying for PAS, I respectfully don’t think I’m making a mountain out of a molehill.
Vanguard Brokerage Accounts DO support automatic withdrawals to an bank account from a mutual fund of your choosing. No PAS needed.

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 9:47 am

Cheez-It Guy wrote:
Sat Jun 15, 2019 9:45 am
catalina355 wrote:
Sat Jun 15, 2019 9:41 am
NotWhoYouThink wrote:
Sat Jun 15, 2019 9:34 am
Looks to me like you are making a mountain out of a mole hill. My local bank has changed account options, my cell provider has changed plan options, my credit cards have all made various changes. The financial industry was not cast in bronze the day you opened your Vanguard account. Change happened in the financial industry as in the rest of the world.

A small number of clients can't have brokerage accounts as a previous poster has mentioned because of specific conflict of interest regulations for financial industry employees. For the rest of us this should be about as momentous as going from a legacy cell phone plan to an unlimited plan.
If something as simple as automated transfers to a bank account is not available without paying for PAS, I respectfully don’t think I’m making a mountain out of a molehill.
Vanguard Brokerage Accounts DO support automatic withdrawals to an bank account from a mutual fund of your choosing. No PAS needed.
Good to know.

So far replies have said not available at all, have to pay for PAS and supported. 🙂

Do you know if dividends can only go to settlement account or if you can direct them automatically to another mutual fund?

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Cheez-It Guy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Cheez-It Guy » Sat Jun 15, 2019 9:55 am

Options for dividends on the Vanguard Brokerage Account include the following:

1. Reinvest
2. Transfer to Settlement Fund
3. Transfer to Bank Account
4. Send me a Check

So no automatic transfer to OTHER mutual funds, but can be reinvested in the fund that issued the dividend or automatically redeemed to a bank account.

You cannot do automatic mutual fund exchanges on the new platform, except if you consider exchanging from the sweep account (VMFXX - Federal Money Market) to any mutual fund you choose. This can be automated (and I have one set up to invest weekly), but Vanguard considers this an Automatic Investment rather than an Automatic Exchange. You still CAN do one-off manual exchanges between any two Vanguard mutual funds (at the end of the business day the order was received, or the end of the next business day if submitted after hours, on the weekend, or on a holiday), which is much more common for my purposes. Not sure why they don’t allow automatic exchanges anymore if they allow manual, but I guess they have their reasons.

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 10:03 am

Cheez-It Guy wrote:
Sat Jun 15, 2019 9:55 am
Options for dividends on the Vanguard Brokerage Account include the following:

1. Reinvest
2. Transfer to Settlement Fund
3. Transfer to Bank Account
4. Send me a Check

So no automatic transfer to OTHER mutual funds, but can be reinvested in the fund that issued the dividend or automatically redeemed to a bank account.

You cannot do automatic mutual fund exchanges on the new platform, except if you consider exchanging from the sweep account (VMFXX - Federal Money Market) to and mutual fund you choose. This can be automated (and I do one every week), but Vanguard considers this an Automatic Investment rather than an Automatic Exchange. You CAN do one-off manual exchanges between any two Vanguard mutual funds, which is much more common for my purposes.
This is very helpful Cheez-It.

You mean you do a weekly automated transfer from settlement account to a mutual fund? Do you do total balance at the time of transfer?

If you could not do manual one-off transfers between mutual funds it would be quite useless. Good to know one can.

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Cheez-It Guy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Cheez-It Guy » Sat Jun 15, 2019 10:17 am

Yes, that’s correct. I do automatic weekly transfers from my settlement fund to a mutual fund in my taxable account (currently to VTSAX). Why would someone do this? I am still actively working and I have my salary set up for direct deposit to my Vanguard Brokerage Account (to the settlement fund). This gives me a cash buffer. I am also paid on a somewhat strange schedule — exactly every 4 weeks (28 days) rather than monthly, so I actually get paid 13 times per year. I then invest these funds weekly at a comfortable level. I know that lump sum is better than DCA over time, but I am still investing within a month of receipt, and this setup allows me to skip future weeks or even months in the schedule without disabling the automatic investment in order to allow my cash to build up for a purchase or to ride out short-term market turbulence (but I rarely skip weeks in recent years).

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 10:21 am

Cheez-It Guy wrote:
Sat Jun 15, 2019 10:17 am
Yes, that’s correct. I do automatic weekly transfers from my settlement fund to a mutual fund in my taxable account (currently to VTSAX). Why would someone do this? I am still actively working and I have my salary set up for direct deposit to my Vanguard Brokerage Account (to the settlement fund). This gives me a cash buffer. I am also paid on a somewhat strange schedule — exactly every 4 weeks (28 days) rather than monthly, so I actually get paid 13 times per year. I then invest these funds weekly at a comfortable level. I know that lump sum is better than DCA over time, but I am still investing within a month of receipt, and this setup allows me to skip future weeks or even months in the schedule without disabling the automatic investment in order to allow my cash to build up for a purchase or to ride out short-term market turbulence (but I rarely skip weeks in recent years).
Do you have the automated transfer for a set dollar amount or can you have the complete balance at time of transfer transferred?

I would do it so all dividends were transferred automatically to another fund. So I would not know the exact amount.

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Cheez-It Guy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Cheez-It Guy » Sat Jun 15, 2019 10:31 am

My weekly transfers are for a fixed dollar amount (by design). I just checked options for adding a new automatic investment, and unfortunately there is no listed option to either automatically invest or withdraw the full balance of the settlement fund in each cycle. It looks like fixed dollar amounts only.

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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by TomatoTomahto » Sat Jun 15, 2019 10:40 am

NotWhoYouThink wrote:
Sat Jun 15, 2019 9:34 am
A small number of clients can't have brokerage accounts as a previous poster has mentioned because of specific conflict of interest regulations for financial industry employees. For the rest of us this should be about as momentous as going from a legacy cell phone plan to an unlimited plan.
In our case, rather than conflict of interest, it’s because of compliance issues around insider trading. We (family included) have to have stock purchases/sales preapproved (valid for one day), and the employer wants to limit how many brokerages they require feeds to monitor. Broad based index funds are exempt, individual stocks are monitored, and for the most part options, futures, etc are difficult to get approved.
Okay, I get it; I won't be political or controversial. The Earth is flat.

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Stewie
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Stewie » Sat Jun 15, 2019 10:43 am

You can transfer the balance of the sweep account to the fund of your choosing by entering a number you know will exceed the balance of the settlement fund, like 99,999.99. That's how I automatically invest 100% of my employer direct deposit plus any interest it has earned every two weeks.

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 10:48 am

Cheez-It Guy wrote:
Sat Jun 15, 2019 10:31 am
My weekly transfers are for a fixed dollar amount (by design). I just checked options for adding a new automatic investment, and unfortunately there is no listed option to either automatically invest or withdraw the full balance of the settlement fund in each cycle. It looks like fixed dollar amounts only.
Thank you for checking 🙂

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catalina355
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by catalina355 » Sat Jun 15, 2019 10:51 am

Stewie wrote:
Sat Jun 15, 2019 10:43 am
You can transfer the balance of the sweep account to the fund of your choosing by entering a number you know will exceed the balance of the settlement fund, like 99,999.99. That's how I automatically invest 100% of my employer direct deposit plus any interest it has earned every two weeks.
Clever. And Vanguard transfers the actual balance instead of failing? That would be a good workaround.

Not having the same useful features on the new platform is simply poor design. It’s not that complicated.

I wonder if Vanguard built the platform themselves or its COTS.

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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Vernn » Sat Jun 15, 2019 10:57 am

I asked for a financial review last week. I was told that I would have to talk to a PAS representative and hear the pitch. I completed the investor profile, chatted with PAS rep and last night was emailed there opinion and asset allocation. I am on the MF platform. Its's 28 pages and essentially what everyone said more Int'l stock and Int'l bonds. :wink:

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Stewie
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Stewie » Sat Jun 15, 2019 10:58 am

catalina355 wrote:
Sat Jun 15, 2019 10:51 am
Clever. And Vanguard transfers the actual balance instead of failing? That would be a good workaround.
Yes, it will transfer the available balance rather than failing. I actually found this information on their site when I set it up, so I was confident it would work (and it does). However, I haven't been able to find that information again to link it here.

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Cheez-It Guy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Cheez-It Guy » Sat Jun 15, 2019 11:21 am

Thanks, Stewie. I may have some occasion to use this.

Quincy62
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Quincy62 » Sat Jun 15, 2019 11:54 am

Make sure your brokerage account is not a margin brokerage acct. It may invest an amount up to your margin limit.

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Cheez-It Guy
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by Cheez-It Guy » Sat Jun 15, 2019 12:27 pm

Mine is not a margin account, but good suggestion / warning.

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celia
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by celia » Sat Jun 15, 2019 1:16 pm

Danw wrote:
Sat Jun 15, 2019 9:22 am
If we have a joint mutual fund account with a transfer on death beneficiary, will the TOD beneficiary remain if I update to the new brokerage platform?
When you upgrade to the new platform, your account is rolled over to a new brokerage account number unless the account was already a brokerage account. Even if you were rolling an account over to another account on the same platform (say a taxable account to a trust [taxable] account, you still have to set up all the settings for the new account again.

In other words, moving your account to a new account anywhere (even at a new custodian) means you still have to set up the new account settings to specify your beneficiary, automatic investments/ withdrawals, re-investment options, default sales (to be FIFO, LIFO, specific lot) and other settings.

NOTE: Whenever you roll over a taxable account, you should print out the cost basis of everything being rolled over to make sure it gets into the new account correctly.

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RandalThor
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Re: Vanguard Financial Plan requires Brokerage Account? Bait and switch?

Post by RandalThor » Sun Jun 16, 2019 10:20 pm

Vernn wrote:
Sat Jun 15, 2019 10:57 am
I asked for a financial review last week. I was told that I would have to talk to a PAS representative and hear the pitch. I completed the investor profile, chatted with PAS rep and last night was emailed there opinion and asset allocation. I am on the MF platform. Its's 28 pages and essentially what everyone said more Int'l stock and Int'l bonds. :wink:
Thanks for the note Vernn. Interesting to hear some different messaging going on. I'll see what they have to say about this.

Appreciate all the input from everyone. Some good thoughts. :beer

Rand

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