Vanguard: Transition to our new investment platform

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abuss368
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Re: Vanguard: Transition to our new investment platform

Post by abuss368 » Thu Oct 03, 2019 8:31 pm

FlyingMoose wrote:
Sun Apr 01, 2018 4:10 pm
My big complaint is that the brokerage 1099s aren’t available until mid-February so I can’t file my taxes early.
I did read this. With the mutual fund accounts, the 1099 tax forms are available rather quickly.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

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Re: Vanguard: Transition to our new investment platform

Post by abuss368 » Thu Oct 03, 2019 8:34 pm

Monster99 wrote:
Sat Sep 29, 2018 7:05 am
The statements are different - the one thing that I dislike is that the December statement is not a total summary of the year, as the old mutual fund format.
That has been my complaint! I have written on many threads that this has prevented us from changing. If they could make that change it probably would be fine to convert.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

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abuss368
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Re: Vanguard: Transition to our new investment platform

Post by abuss368 » Thu Oct 03, 2019 8:36 pm

retired@50 wrote:
Thu Oct 03, 2019 5:40 pm
My understanding of the situation is that old account holders who are not on the brokerage platform, but are still on the mutual fund account platform are being urged to switch to the brokerage platform. This was based on a telephone conversation with my Vanguard rep at the time. He claims that they actually have to hire / maintain more I.T. staff to keep both platforms up and running. I'm intending to switch in 2020, but not sooner. The potential upside is that on the brokerage platform, you can hold ETFs, if that appeals to you. One downside (in my book) is that once you're on the brokerage platform, you'll get a 1099-B statement instead of a 1099-DIV. From what I understand, the 1099-B statement comes out in late Feb. or March, while the 1099-DIV statement arrives in late January. For folks who like to file taxes early, the 1099-B will slow them down by 4 to 6 weeks.

Regards...
Form 1009-B is for any investment sales - reports gains and losses.
Form 1099-Div - is for any dividends paid for the year.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

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Re: Vanguard: Transition to our new investment platform

Post by beyou » Thu Oct 03, 2019 8:38 pm

abuss368 wrote:
Thu Oct 03, 2019 8:31 pm
FlyingMoose wrote:
Sun Apr 01, 2018 4:10 pm
My big complaint is that the brokerage 1099s aren’t available until mid-February so I can’t file my taxes early.
I did read this. With the mutual fund accounts, the 1099 tax forms are available rather quickly.
I agree but there is always something that holds things up.
I once filed early, then got a correction from someone and had to amend.

Note that this late delivery is ALL brokers, not just Vanguard.
They have to collect data from many sources, compile it for you.
Vanguard as a fund only account, has only one source of data to send you, their own data.
I am usually waiting on Etrade, documents from my employer, wife's employer etc, so the early receipt of
my older fund accounts does not allow me to file early anyway.

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abuss368
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Re: Vanguard: Transition to our new investment platform

Post by abuss368 » Thu Oct 03, 2019 8:41 pm

beyou wrote:
Thu Oct 03, 2019 8:38 pm
abuss368 wrote:
Thu Oct 03, 2019 8:31 pm
FlyingMoose wrote:
Sun Apr 01, 2018 4:10 pm
My big complaint is that the brokerage 1099s aren’t available until mid-February so I can’t file my taxes early.
I did read this. With the mutual fund accounts, the 1099 tax forms are available rather quickly.
I agree but there is always something that holds things up.
I once filed early, then got a correction from someone and had to amend.

Note that this late delivery is ALL brokers, not just Vanguard.
They have to collect data from many sources, compile it for you.
Vanguard as a fund only account, has only one source of data to send you, their own data.
I am usually waiting on Etrade, documents from my employer, wife's employer etc, so the early receipt of
my older fund accounts does not allow me to file early anyway.
Exactly. I have never received a corrected form for our Vanguard mutual fund accounts. Years ago when we traded stocks with other brokerage homes, we received 1 - 3 corrected forms each year. It resulted in a lot of paperwork and tax documents.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

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Re: Vanguard: Transition to our new investment platform

Post by abuss368 » Thu Oct 03, 2019 8:42 pm

We were receiving the messages when logging in for a while but simply ignored them. It appears to have stopped.
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beyou
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Re: Vanguard: Transition to our new investment platform

Post by beyou » Thu Oct 03, 2019 8:44 pm

Woodthrush wrote:
Thu Oct 03, 2019 5:30 pm
I just received one of these emails from Vanguard today (10-3-19), which is interesting since my husband and I have both had accounts with Vanguard for many years and I don't recall them sending us an email about this before. They didn't send one to my husband, only to me. It seems like SIPC protection would be the only reason we would want to switch. In checking into SIPC to see what would actually be protected I came across a Motley Fool article that listed some things that are NOT covered and I was surprised to read this:

"Brokerage firm failures where customer assets were not the subject of theft or unauthorized trading."

So does this mean that if Vanguard were to fail and there was no theft or unauthorized trading that SIPC wouldn't protect the client's assets? When they are referring to "theft" do they mean by the broker or by an outside party that fraudulently accesses someone's account? The latter is a bigger concern given all the security breaches at major institutions in recent years. I read that Schwabb will protect clients from any fraudulent theft from their accounts, whereas Vanguard doesn't offer any such guarantee. I would much rather stay with Vanguard, but we want our retirement savings to be protected from any fraud. I would welcome other's thoughts on this issue.
Old platform is very widespread from a legal standpoint. Basically almost all fund mangers sell direct to consumers without a brokerage account historically. The protections are explained here :

https://www.kiplinger.com/article/inves ... ected.html
Long story but many protections, read if interested.

New platform at Vanguard is simply a brokerage account that is protected by SIPC insurance.
https://www.sipc.org/for-investors/what-sipc-protects

"Protects against the loss of cash and securities – held by a customer at a financially-troubled SIPC-member brokerage firm. "

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Re: Vanguard: Transition to our new investment platform

Post by heartwood » Thu Oct 03, 2019 8:56 pm

retired@50 wrote:
Thu Oct 03, 2019 5:40 pm
My understanding of the situation is that old account holders who are not on the brokerage platform, but are still on the mutual fund account platform are being urged to switch to the brokerage platform. This was based on a telephone conversation with my Vanguard rep at the time. He claims that they actually have to hire / maintain more I.T. staff to keep both platforms up and running. I'm intending to switch in 2020, but not sooner. The potential upside is that on the brokerage platform, you can hold ETFs, if that appeals to you. One downside (in my book) is that once you're on the brokerage platform, you'll get a 1099-B statement instead of a 1099-DIV. From what I understand, the 1099-B statement comes out in late Feb. or March, while the 1099-DIV statement arrives in late January. For folks who like to file taxes early, the 1099-B will slow them down by 4 to 6 weeks.

Regards...
If you do plan to migrate over in 2020 be aware that in the year you switch you get two sets of 1099s. One for the period in the mutual fund platform, the other for after you switch to the brokerage platform. So double the documents. You might transition this year and start 2020 fresh.
In 2019 we got our 1099-Bs in late January, pretty much the same time we get out mortgage and other forms.

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Re: Vanguard: Transition to our new investment platform

Post by Gnirk » Thu Oct 03, 2019 9:26 pm

If you have trading authority for other family members accounts under the current platform, that doesn’t transition to the new brokerage platform and you will need to complete all the forms again and submit them, Also, my daughters accounts are currently included as part of our family accounts so they don’t pay account fees. Not sure if that will continue if we transition to the new platform.

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Re: Vanguard: Transition to our new investment platform

Post by Jerry55 » Tue Oct 08, 2019 5:13 pm

So, I have 2 mutual funds here, Wellesley ROTH IRA and Wellington (Taxable). I've had these since 2011 and I never plan to take distributions from the ROTH Acct. But, in Sept. I decided to have Vanguard start sending my distributions from Wellington, instead of reinvesting (Dividends and Cap. Gains) to my Checking account. Wellington is the only acct that sends 1099s.

Should I transfer BOTH to the new platform, or just Wellington ? Will they send Div and CG to the Brokerage Acct and I, in turn, have to go and have it sent to my checking account manually , or would they do it automatically.
Also, I'll have to call. I read somewhere that, if both mutual funds have different beneficiaries, it'll be consolidated into ONE.
In other words, if Joe and Sue are the beneficiaries of each mutual fund, only one can be named to inherit the account, which leaves me in a quandary.

Or, should I just migrate them both and be done with it ??? Thanks in advance ~
Retired CSRS on 12/19/2012 @ age 57 w/39 years | Good Bye Tension, Hello Pension !!!

KC123
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Re: Vanguard: Transition to our new investment platform

Post by KC123 » Sun Nov 17, 2019 10:37 am

There is another subtle difference in the two platforms, in a Brokerage Account (BA) the perspective of all transactions is from the Settlement Account (SA). In a sense there are two transactions for each event, for example, a positive transaction of a dividend into the SA, and a negative transaction (reinvestment) from the SA into the mutual fund. In MF accounts the perspective is from (each) account (a dividend is a positive payment into the account).

This is most apparent in the data that is in the transaction downloads.

I have both separate MFs and a BA (for one Inherited IRA I added recently). I do my own tracking by downloading the CSV files and use MS Excel (with VBA coding) to track my investments. The MFs have been mostly consistent in how they represent each transaction and coding transaction type recognition has been straight forward. I select all my MF Accounts in one download and I let each transaction act on one balance (as if it was all one account) and all is great (I see the total balance change by dividends (positive) and cap gains (positive or negative), etc.

The BA transaction download is from the SA perspective (as far as I know there is no way to download the individual MFs in a BA). This means that almost all events result in two transactions (as described above) with a net change of zero. So if you try to treat this like a regular account you’ll get many transactions and no change in balance and no idea of where your investments are! ... So, just ignore half the transaction and you're in. Yes, but transaction data in the BA CSV file is full of crap. There are dozens of zero value transactions, a host of different ways of doing the same thing and writing the VBA code to recognize the transaction type is a headache and seems to need an update every quarter.

I have been keeping up with it for my one BA (with one fund associated) but the thought of all my MFs being added to this BA and having to deal with an order of magnitude increase in transactions has kept me from accepting the pressure to switch my accounts over.

I imagine Quicken/Mint/etc. has some communication channel with the major banks and investment houses to keep the interface up to date (or maybe there is just better data in the OFX files than the CSVs). Maybe others can comment on how well their commercial software keeps up with their vanguard MF and BA accounts. Any glitches? mis-matched balances, unrecognized transactions, etc.?

Anyway the pressure to switch to BA has started to increase again but I think I'll avoid changing until they actually start charging for legacy accounts.

If you use the CSV download to track your MFs today, be aware that the BA accounts are significantly different and will require some real work to integrate the change in file data organization after a switch to BAs.

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Re: Vanguard: Transition to our new investment platform

Post by mailman781 » Sun Nov 17, 2019 2:56 pm

3-20Characters wrote:
Fri Sep 28, 2018 6:09 am
I got this notice years ago. Thinking it was the writing on the wall, I converted our SEP and Roth accounts but failed to do so for taxable—just out of laziness. Vanguard sent me several follow up notices which I ignored and I have not heard from them since. I only hold Vanguard mutual funds at Vanguard and have no need for ETFs there. OTOH, it’s no big deal if my account was converted because it doesn’t effect me one way or the other.

Sounds like they really want us to do this to streamline their platform and make it more consistent but can’t legally take the action themselves and so are imploring their customers instead. In a way, I feel like doing it just to make it easier on their systems people. :D
Count me among those that received this notice several years ago. I contacted my Vanguard rep. I told him I only used Vanguard funds, and did not want to make the change to a brokerage account. He said that was just fine and I did not have to make the change. I have not heard anything about it since, until I read this thread.

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Re: Vanguard: Transition to our new investment platform

Post by mailman781 » Sun Nov 17, 2019 3:16 pm

So if a person moves to a brokerage account, does that mean that when the RMD is withdrawn it will have to go into the cash settlement account first and then they will have to transfer the money to their checking account?

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Re: Vanguard: Transition to our new investment platform

Post by FrugalInvestor » Sun Nov 17, 2019 3:24 pm

Monster99 wrote:
Sat Sep 29, 2018 7:05 am
FrugalInvestor wrote:
Fri Sep 28, 2018 11:17 am
I also received something similar years ago. As I recall I converted but was very unhappy with the format of the new statements. They too much more paper and were somewhat convoluted compared to the old ones. I called, told the rep. that I disliked the new format and asked if I could change back. I told him that I hold and will only hold mutual funds and had no use for a brokerage account.

At that time I was told that I could go back with the understanding that I wouldn't be able to convert to a brokerage account in the future. I agreed, was moved back, and have had no messages since.

I wouldn't be surprised to learn that what I did is no longer possible but it would be interesting if someone would call and inquire. I'd also be interested to know if the statement formats are still substantially different between the old mutual fund only accounts and the new brokerage accounts and what others here think of the differences.
The statements are different - the one thing that I dislike is that the December statement is not a total summary of the year, as the old mutual fund format.
This is the main thing I didn't like.

I only keep the year-end statement for my records and have them going back to the 1980s. Having to keep every month to have all transactions, etc. would be a huge increase in stored paper (more than I have room for in my safe). Plus, it's just wasteful. I only have my year-end statement mailed, file it and I'm done. I like easy.

After making the change and going back a number of years ago I've received no further requests to change.
IGNORE the noise! | Our life is frittered away by detail... simplify, simplify. - Henry David Thoreau

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Re: Vanguard: Transition to our new investment platform

Post by Doom&Gloom » Sun Nov 17, 2019 4:34 pm

mailman781 wrote:
Sun Nov 17, 2019 3:16 pm
So if a person moves to a brokerage account, does that mean that when the RMD is withdrawn it will have to go into the cash settlement account first and then they will have to transfer the money to their checking account?
I don't think so. I transitioned my Rollover IRA after my RMD this year. The brokerage site shows my current settings for my automatic RMD to be distributed proportionally from all funds. I have only MFs (and my MM settlement fund) in my account.

edit: I don't know if VG will move those funds into the settlement fund first. My guess is that they probably will.

KC123
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Re: Vanguard: Transition to our new investment platform

Post by KC123 » Tue Nov 19, 2019 3:42 pm

mailman781 wrote:
Sun Nov 17, 2019 3:16 pm
So if a person moves to a brokerage account, does that mean that when the RMD is withdrawn it will have to go into the cash settlement account first and then they will have to transfer the money to their checking account?
Yes, but it is all automatic if you set it up properly. I have an inherited IRA with an RMD in a brokerage account. I received two notifications, one on last Friday (15th) and one on Monday (18th). The first was a sell order for the RMD amount. The second was a transfer order to my local bank account. So for a brief moment the funds were in the Settlement account but I took no actions to initiate either transaction beyond previously setting up an automatic RMD transer to my bank account. I never could see the balance in the SA, since it was out before it settled.

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