[WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

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evancox10
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Re: Will VG come back to its original purpose?

Post by evancox10 »

Some examples:
It’s currently impossible to use the website to open a joint account under “Community Property” registration. Even if you find the buried manual account opening form, the online fill in the blank process redirects you to the broken automatic flow. No PDF form available to do what you want, have to call in.

Several times seen pending transactions with the completely wrong information. Like the Share Qty was swapped with the $ amount.

On the first couple days of the month, the Performance table shows incorrect information and has two rows for the previous month.

New money for me is going to Fidelity. May or may not move the rest of my old accounts.
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Re: Will VG come back to its original purpose?

Post by nisiprius »

“There’s a theory, and I’m not the only one to come up with it, that they’d rather move people onto the personal advisory service," said Allan Roth...
Allan Roth is a Good Guy, but I don't understand how moving people onto PAS could fix anything. I assume that PAS accounts are still on the same platform and produce the same statements, go through the same data processing, etc. I doubt that PAS advisors have any special access to the back office or any special skill at resolving glitches in transfers, money market yield calculations, etc. If you are on PAS do they waive all the junk fees, mail you printed statements for free, etc?
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Re: Will VG come back to its original purpose?

Post by tibbitts »

I'm confused by the term "original purpose"; what is the original purpose Vanguard might return to?
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Re: Will VG come back to its original purpose?

Post by jebmke »

tibbitts wrote: Tue Jul 09, 2024 4:14 pm
I'm confused by the term "original purpose"; what is the original purpose Vanguard might return to?
Me too. There are more broad index funds with lower costs than there were when I started with them in the 1980s.
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Re: Will VG come back to its original purpose?

Post by rkhusky »

Wasn’t the original purpose to buy/sell Vanguard mutual funds? It doesn’t appear that Vanguard is moving back to that restriction.
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Re: Will VG come back to its original purpose?

Post by LadyGeek »

This thread is now in the Investing - Theory, News & General forum (general discussion).
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SimpleGift
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Re: Will VG come back to its original purpose?

Post by SimpleGift »

In one sentence, my sense is that Jack Bogle's original purpose in creating Vanguard was to establish a mutual fund company that would operate in the best interests of its shareholders, rather than for the profit of external managers. Obviously, he was successful in his "Vanguard Experiment," and the company today certainly still embodies this original aim.

However, it’s been the implementation of this purpose that seems to have fallen short in recent years, with declining customer service and satisfaction. Most of us Vanguard customers have and still are benefiting from Mr. Bogle’s original inspiration — but just through gritted teeth at times in our interactions with the company's customer service.
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Re: Will VG come back to its original purpose?

Post by jjj_22 »

They’re clearly not a good brokerage platform, but I don’t think they ever set out to be that anyway. Having a brokerage attached to their business was just kind of an add-on thing that happened from their mutual fund business.

But they still have great low cost funds that you can hold anywhere.

The fact that people feel attached to Vanguard as a place to hold their accounts just because they’re fond of the fund offerings IMO doesn’t make much sense.
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Re: Will VG come back to its original purpose?

Post by edge »

Was the customer service ever great? And was the goal to have gold plated customer service?

I just don’t remember that or see things that way.

Imo VG won originally because they were very differentiated based on expenses and solid broad market index funds and it was difficult to get that combination anywhere else. Those aren’t differentiators any longer but their actual funds are still very good.
SimpleGift wrote: Tue Jul 09, 2024 5:11 pm In one sentence, my sense is that Jack Bogle's original purpose in creating Vanguard was to establish a mutual fund company that would operate in the best interests of its shareholders, rather than for the profit of external managers. Obviously, he was successful in his "Vanguard Experiment," and the company today certainly still embodies this original aim.

However, it’s been the implementation of this purpose that seems to have fallen short in recent years, with declining customer service and satisfaction. Most of us Vanguard customers have and still are benefiting from Mr. Bogle’s original inspiration — but just through gritted teeth at times in our interactions with the company's customer service.
Last edited by edge on Tue Jul 09, 2024 5:57 pm, edited 1 time in total.
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Re: Will VG come back to its original purpose?

Post by Feldman »

Reminder that holding Vanguard funds for free anywhere wasn't possible until comparatively recently when brokers dropped commissions on ETFs to zero in rapid succession, with Vanguard themselves being among the first to do so (perhaps because of imminent announcements from competitors, but whatever

Vanguard Commission-Free ETF Press Release

July 2, 2018
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Re: Will VG come back to its original purpose?

Post by Gaston »

SimpleGift wrote: Tue Jul 09, 2024 5:11 pm In one sentence, my sense is that Jack Bogle's original purpose in creating Vanguard was to establish a mutual fund company that would operate in the best interests of its shareholders, rather than for the profit of external managers.
Agree. Many of us think that Jack’s greatest innovation was the introduction of the first low cost (though not as low cost as today) retail index fund.

But in the opinion of Gus Sauter, Vanguard’s former Chief Investment Officer, Jack’s greatest innovation was structuring Vanguard as a shareholder-owned entity. This structure not only eliminated a lot of cost, but aligned the interests of the owners to the fund investors.
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Re: Will VG come back to its original purpose?

Post by WhitePuma »

I found this part especially interesting:

“Vanguard ranked last out of eight major brokerages for customer satisfaction with website performance and mobile apps in a recent survey of 2,700 investors conducted by Investor’s Business Daily, which is published by The Wall Street Journal’s parent company, Dow Jones.”

So they want people to do stuff online (instead of by phone), and then proceed to provide a horrible web/app experience.
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Re: Will VG come back to its original purpose?

Post by Geologist »

The OP posted a naked link, which is advised against in the forum guidelines. I have looked at the article. The word “purpose”, to say nothing of “original purpose”, which is the OP’s thread title, does not appear in the article.

Instead, it is an article about customer service and how this is something the new CEO should fix. This is all well and good, but has nothing to do with Vanguard’s “original purpose”.

Of course, there are already threads about the new CEO and what he should do (including improve customer service) and Vanguard customer service, so I’m not sure what value is served by another.

Just to comment on the original purpose concept: Vanguard is now 50 years old and times change so Vanguard has to change too. (Should Western Union go back to sending telegrams or American Express go back to freight forwarding just because that was those companies’ original purposes. That’s silly.)
stan1
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Re: Will VG come back to its original purpose?

Post by stan1 »

No, Vanguard is not going to go back to the 1970s. They are a business and will position themselves for the future not the past. If Vanguard no longer meets your needs you should attempt to find a business that does, if one exists.

That said, I think they are following through exactly on what Jack Bogle promised: low cost investing. It's just that some people don't like the consequences of doing business with a low cost company.

I'm fine with the new Vanguard website. I've learned how to use it, and accepted that some features I seldom (or never) used are no longer available.
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Re: Will VG come back to its original purpose?

Post by Florida Orange »

stan1 wrote: Tue Jul 09, 2024 6:17 pm No, Vanguard is not going to go back to the 1970s. They are a business and will position themselves for the future not the past. If Vanguard no longer meets your needs you should attempt to find a business that does, if one exists.

That said, I think they are following through exactly on what Jack Bogle promised: low cost investing. It's just that some people don't like the consequences of doing business with a low cost company.

I'm fine with the new Vanguard website. I've learned how to use it, and accepted that some features I seldom (or never) used are no longer available.
Customer service costs money. One can not expect stellar customer service from a company with very low expense ratios. It's not for everybody, but if you want to keep more of your money, Vanguard is still a very good company. I don't think Vanguard has deviated from it's original purpose.
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Re: Will VG come back to its original purpose?

Post by Elric »

Gaston wrote: Tue Jul 09, 2024 6:00 pm But in the opinion of Gus Sauter, Vanguard’s former Chief Investment Officer, Jack’s greatest innovation was structuring Vanguard as a shareholder-owned entity. This structure not only eliminated a lot of cost, but aligned the interests of the owners to the fund investors.
Except that he didn't. Maybe that was his intent, but that's not how its worked out. Vanguard is owned by its funds. Yes, those funds are owned by investors, but as an investor you have LESS insight into and LESS authority over Vanguard itself than do the shareholders of a for profit company. It does eliminate the need to provide profits to external owners. How that cost savings is divided up among lowered costs to investors, efficient and/or inefficient internal operations, and internal compensation is unknown.

Disclosure: I own shares in Vanguard funds, but haven't had an account at Vanguard for about 8 years.
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Re: Will VG come back to its original purpose?

Post by pennsylvania211 »

Elric wrote: Tue Jul 09, 2024 7:34 pm Except that he didn't. Maybe that was his intent, but that's not how its worked out. Vanguard is owned by its funds. Yes, those funds are owned by investors, but as an investor you have LESS insight into and LESS authority over Vanguard itself than do the shareholders of a for profit company. It does eliminate the need to provide profits to external owners. How that cost savings is divided up among lowered costs to investors, efficient and/or inefficient internal operations, and internal compensation is unknown.

Disclosure: I own shares in Vanguard funds, but haven't had an account at Vanguard for about 8 years.
+1. We only know expense ratios of the funds. Not anything about how revenues are divvied up within Vanguard. For such a large company, Vanguard's employees and board operate in incredible secrecy.
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Re: Will VG come back to its original purpose?

Post by Rex66 »

Elric wrote: Tue Jul 09, 2024 7:34 pm
Gaston wrote: Tue Jul 09, 2024 6:00 pm But in the opinion of Gus Sauter, Vanguard’s former Chief Investment Officer, Jack’s greatest innovation was structuring Vanguard as a shareholder-owned entity. This structure not only eliminated a lot of cost, but aligned the interests of the owners to the fund investors.
Except that he didn't. Maybe that was his intent, but that's not how its worked out. Vanguard is owned by its funds. Yes, those funds are owned by investors, but as an investor you have LESS insight into and LESS authority over Vanguard itself than do the shareholders of a for profit company. It does eliminate the need to provide profits to external owners. How that cost savings is divided up among lowered costs to investors, efficient and/or inefficient internal operations, and internal compensation is unknown.

Disclosure: I own shares in Vanguard funds, but haven't had an account at Vanguard for about 8 years.
Yep there is no “real ownership” by using vanguard. I should point out that all of the major whole life insurance companies are also mutual but that hasn’t worked out well for those clients. They have higher priced term and pushed into WL. Vanguard is fine but being mutual is near meaningless.
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Re: Will VG come back to its original purpose?

Post by DrDoodle »

edge wrote: Tue Jul 09, 2024 5:56 pmWas the customer service ever great?
Well,they used to provide some actual benefits to higher-value customers; no longer. The web site and the app used to be straightforward to use; now they're confusing, constrained, and hard to use. I prefer to be a self-serve customer, but the online stuff is so terrible that I often have to message/call, which is a whole other level of frustration.
edge wrote: Tue Jul 09, 2024 5:56 pmAnd was the goal to have gold plated customer service?
Gold plated is a lot (too much) to expect, and surely was never the goal. But "reasonably competent" is a sensible goal, and they aren't even hitting that.

I recently discovered that Vanguard considers me an "ultra high net worth customer." What does that get me? I never have to wait on hold to talk to someone, so I guess that's a win compared to what "regular" customers get? But the person that I speak to is consistently inexperienced, poorly trained, and unmotivated to figure out stuff. I have a "relationship manager," of course, who is totally useless at best, and wastes my time with inaccurate/incomplete information at worst.

There's only two reasons that I haven't moved everything to Schwab or Fidelity: (1) inertia, aka busy with other stuff, and (2) I like that Vanguard sweeps balance into money market; as far as I know Schwab and Fidelity will leave it rotting at close to 0% interest unless you pro-actively invest it. Of course, this only matters because of the unusually high money market rates; if they return to their historic nearly-zero-percent rate then this doesn't matter very much.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by Iorek »

I laughed at the VG spokesman claiming that they have high levels of satisfaction on their internal surveys. I filled one out recently and I was clear that I still like the funds but the fact that they don’t seem to want to serve retail customers and the terrible phone service means I no longer recommend them to people.
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Re: Will VG come back to its original purpose?

Post by Harmanic »

tibbitts wrote: Tue Jul 09, 2024 4:14 pm
I'm confused by the term "original purpose"; what is the original purpose Vanguard might return to?
The original purpose was to circumvent Wellington Management's restrictions on John Bogle managing mutual funds.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by Dottie57 »

When Vanguard first started in 1970’s their funds were actively managed with high ERs. I believe their funds also had upfront loads. The revolution was to eliminate loads and high ERs and mve the index funds. Pretty radical stuff back then.
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Re: Will VG come back to its original purpose?

Post by Curly »

I moved my funds to Fidelity and couldn't be happier with the service when I have needed something taken care of or have a question. We recently set up a family trust and had some back-and-forth with forms and related questions. All reps from Fidelity responded quickly and provided their email and direct phone number. We are not wealthy, so the amount of assets at Fido surely isn't what led to any special treatment.

Re: your concern about sweep interest, at Fidelity the "Core" account is the default sweep. Our accounts have SPAXX as the sweep or holding account for all cash. It's ~%5 now, not as much as VMFXX or VUSXX, but close enough for the trade-off of having frustration-free investment accounts. (We also have an E-Trade account so for larger amounts of cash we have VUSXX there, with the higher rate compared to SPAXX.)
DrDoodle wrote: Tue Jul 09, 2024 7:49 pm

I recently discovered that Vanguard considers me an "ultra high net worth customer." What does that get me? I never have to wait on hold to talk to someone, so I guess that's a win compared to what "regular" customers get? But the person that I speak to is consistently inexperienced, poorly trained, and unmotivated to figure out stuff. I have a "relationship manager," of course, who is totally useless at best, and wastes my time with inaccurate/incomplete information at worst.

There's only two reasons that I haven't moved everything to Schwab or Fidelity: (1) inertia, aka busy with other stuff, and (2) I like that Vanguard sweeps balance into money market; as far as I know Schwab and Fidelity will leave it rotting at close to 0% interest unless you pro-actively invest it. Of course, this only matters because of the unusually high money market rates; if they return to their historic nearly-zero-percent rate then this doesn't matter very much.
*corrected typo
Last edited by Curly on Tue Jul 09, 2024 9:46 pm, edited 1 time in total.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by wwhan »

I could easily move to Scwab or Fidelity, if I wanted better customer service, since they both have offices in my little town, which I could easily walk to.

I stay with Vanguard, because it works well enough, even though website is not as good as it used to be. I rarely ever contact Vanguard. The last ime was a couple of years ago and it worked out fine.

I do everything online, which is pretty easy.

I use Fidelity on line for my 401K, but they are always contacting me to offer help that I don't need.
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Re: Will VG come back to its original purpose?

Post by nhs76 »

evancox10 wrote: Tue Jul 09, 2024 3:50 pm It’s currently impossible to use the website to open a joint account under “Community Property” registration. Even if you find the buried manual account opening form, the online fill in the blank process redirects you to the broken automatic flow. No PDF form available to do what you want, have to call in.
At least VG (and Schwab) have a Community Property With Right of Survivorship option for taxable; I don't think Fidelity does. But you're right, it did take a telephone call to VG to set ours up properly.
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Re: Will VG come back to its original purpose?

Post by DrDoodle »

Curly wrote: Tue Jul 09, 2024 8:48 pm I moved my funds to Fidelity and couldn't be happier with the service when I have needed something taken care of or have a question. We recently set up a family trust and had some back-and-forth with forms and related questions. All reps from Fidelity responded quickly and provided their email and direct phone number. We are not wealthy, so the amount of assets at Fido surely isn't what lead to any special treatment.

Re: your concern about sweep interest, at Fidelity the "Core" account is the default sweep. Our accounts have SPAXX as the sweep or holding account for all cash. It's ~%5 now, not as much as VMFXX or VUSXX, but close enough for the trade-off of having frustration-free investment accounts. (We also have an E-Trade account so for larger amounts of cash we have VUSXX there, with the higher rate compared to SPAXX.)
Thanks Curly, that's good to know about Fidelity's sweep. Interesting comparison point about the family trust. We recently set one up ourselves, and my Vanguard relationship manager was absolutely worthless at helping us to retitle our account. Took two weeks from the when I first reached out to her for assistance, thanks to her slow and unhelpful responses and Vanguard's clunky web site and processes.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by AlwaysLearningMore »

Sorry, seems implausible to think VG Diehards will have any real sway with new CEO, no matter how sincere the "message." VG has brought in someone with experience in doling out financial advice -- for a fee.
Last edited by AlwaysLearningMore on Tue Jul 09, 2024 10:21 pm, edited 1 time in total.
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Re: Will VG come back to its original purpose?

Post by Curly »

I knew the family trust was going to happen soon, and after the last train wreck with VG customer service I knew I wouldn't have the patience to work the necessary process to take care of all the accounts and beneficiary updates. Good to hear you finally got where you needed to be.
 
DrDoodle wrote: Tue Jul 09, 2024 9:31 pm
Thanks Curly, that's good to know about Fidelity's sweep. Interesting comparison point about the family trust. We recently set one up ourselves, and my Vanguard relationship manager was absolutely worthless at helping us to retitle our account. Took two weeks from the when I first reached out to her for assistance, thanks to her slow and unhelpful responses and Vanguard's clunky web site and processes.
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Re: Will VG come back to its original purpose?

Post by talzara »

DrDoodle wrote: Tue Jul 09, 2024 7:49 pm I recently discovered that Vanguard considers me an "ultra high net worth customer." What does that get me? I never have to wait on hold to talk to someone, so I guess that's a win compared to what "regular" customers get? But the person that I speak to is consistently inexperienced, poorly trained, and unmotivated to figure out stuff. I have a "relationship manager," of course, who is totally useless at best, and wastes my time with inaccurate/incomplete information at worst.
In the financial industry, ultra high net worth starts at $30 million.

If you have $30 million, then you should be able to buy Institutional class shares. The minimum investment in Total Stock Market Institutional shares is only $5 million.
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Re: Will VG come back to its original purpose?

Post by Mel Lindauer »

nisiprius wrote: Tue Jul 09, 2024 4:08 pm
“There’s a theory, and I’m not the only one to come up with it, that they’d rather move people onto the personal advisory service," said Allan Roth...
Allan Roth is a Good Guy, but I don't understand how moving people onto PAS could fix anything. I assume that PAS accounts are still on the same platform and produce the same statements, go through the same data processing, etc. I doubt that PAS advisors have any special access to the back office or any special skill at resolving glitches in transfers, money market yield calculations, etc. If you are on PAS do they waive all the junk fees, mail you printed statements for free, etc?
My reading was that Allan was saying that he felt Vanguard would rather spend the money on getting more clients on their revenue-producing PAS than spend it on fixing the website. Obviously, as you pointed out, that wouldn't fix the website problem but would produce more income for Vanguard'
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Re: Will VG come back to its original purpose?

Post by Walkure »

evancox10 wrote: Tue Jul 09, 2024 3:50 pm Some examples:
It’s currently impossible to use the website to open a joint account under “Community Property” registration. Even if you find the buried manual account opening form, the online fill in the blank process redirects you to the broken automatic flow. No PDF form available to do what you want, have to call in.

Several times seen pending transactions with the completely wrong information. Like the Share Qty was swapped with the $ amount.

On the first couple days of the month, the Performance table shows incorrect information and has two rows for the previous month.

New money for me is going to Fidelity. May or may not move the rest of my old accounts.
This is what I find perplexing. If Vanguard really wanted to be low cost, they'd hire a better web development team. There's no way operating call centers staffed with live humans manually opening accounts and performing basic brokerage functions is cheaper than just implementing it correctly on the website so the customers can service themselves.
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Re: Will VG come back to its original purpose?

Post by DrDoodle »

talzara wrote: Tue Jul 09, 2024 10:03 pmIn the financial industry, ultra high net worth starts at $30 million.
Vanguard seems to apply the term to customers with quite a bit less than that, probably just as a way of making higher-value customers feels special. The feeling of being special constituting the only special treatment provided.
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Re: Will VG come back to its original purpose?

Post by peterw »

DrDoodle wrote: Tue Jul 09, 2024 7:49 pm
edge wrote: Tue Jul 09, 2024 5:56 pmWas the customer service ever great?
Well,they used to provide some actual benefits to higher-value customers; no longer. The web site and the app used to be straightforward to use; now they're confusing, constrained, and hard to use. I prefer to be a self-serve customer, but the online stuff is so terrible that I often have to message/call, which is a whole other level of frustration.
edge wrote: Tue Jul 09, 2024 5:56 pmAnd was the goal to have gold plated customer service?
... as far as I know Schwab and Fidelity will leave it rotting at close to 0% interest unless you pro-actively invest it. Of course, this only matters because of the unusually high money market rates; if they return to their historic nearly-zero-percent rate then this doesn't matter very much.
Fidelity sweeps into SPAXX which has paid 5%+ on uninvested MM funds in the high-interest environment of late. (Schwab does not. I believe they use the funds as floating pools of leverage to make money for the firm.)
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Re: Will VG come back to its original purpose?

Post by Northern Flicker »

nisiprius wrote: Tue Jul 09, 2024 4:08 pm
“There’s a theory, and I’m not the only one to come up with it, that they’d rather move people onto the personal advisory service," said Allan Roth...
Allan Roth is a Good Guy, but I don't understand how moving people onto PAS could fix anything. I assume that PAS accounts are still on the same platform and produce the same statements, go through the same data processing, etc. I doubt that PAS advisors have any special access to the back office or any special skill at resolving glitches in transfers, money market yield calculations, etc. If you are on PAS do they waive all the junk fees, mail you printed statements for free, etc?
VPAS customers get printed statement at no extra charge (not free, but included with the AUM advising fee of .3%).

If Vanguard were to move to a model where DIY accounts were not acceptable, and were to become a de facto advisor, it would be the height of irony.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by nisiprius »

Vanguard's new CEO, Salim Ramji wrote:Hello. I'm Salim Ramji, Vanguard's new CEO. It's my first week here, but already Vanguard feels like home. It's our unique structure and our client focused mission that make Vanguard like nowhere else. And I'm excited for where we are headed. As the world continues to change and our clients are faced with new challenges, our work serving you is more important than ever.

To ensure we are ready to meet this moment, I have three areas of focus: First, continue delivering for our clients, earning your trust every single day. Second, stewarding the company's culture. We will never deviate from Jack Bogle's original focus on taking a stand for investors and giving our clients the best chance of investment success. And finally, ensuring we anticipate your needs and continue to evolve our capabilities to serve you well. Thank you for your trust in Vanguard. I look forward to our work together.
The new CEO's message to me disappointed me. It basically amounted to zero. It was pure corporate-speak. Nothing to dislike, nothing to like, no information. Clamming up while uttering words at a time when words were expected.

He said "I'm excited for where we are headed." (He actually didn't sound very excited?) That suggests he has some idea where they are headed. He didn't share that vision with us.

Like a well-trained presenter, he knew that he had to make exactly three points, but I couldn't figure out what he meant by any of them.

"Continue delivering" implies that they're doing an OK job now, but he didn't say what he thought they were doing well. Or hint at what might be improved, not even language like "even better."

I'm pleased enough that he referenced Bogle, but it's absolutely par for the course for an incoming CEO to say they love the old culture and nothing will change. It tells us nothing at all except that he knows "how to play the game."

He says he hopes to "anticipate your needs and continue to evolve our capabilities to serve you well." Again, this implies that he is anticipating needs and that Vanguard is going to "evolve"--without a hint of the direction.

None of this is unusual or alarming, but it's disappointing. He chose not to reveal anything, nor put any stakes in the ground. It appears to have been crafted with the single goal of not saying anything that could backfire.

Now if he had said "Junk fees do not help investors have the best chance of investment success. They are not in line with our mission statement. No customers have demanded them. Therefore, I am announcing today that we are rolling back all of the junk fees we have instituted recently," that might have been a good idea, that might have been a terrible idea, but it would have told us something.
Last edited by nisiprius on Wed Jul 10, 2024 10:36 am, edited 1 time in total.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by HueyLD »

Nisi took the words out of my mouth. Thank YOU!
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by Info_Hound »

Ditto Nisi's take on the new CEO's message. Corporate speak with no real meat for the read.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by stan1 »

nisiprius wrote: Wed Jul 10, 2024 6:04 am Now if he had said "Junk fees do not help investors have the best chance of investment success. They are not in line with our mission statement. No customers have demanded them. Therefore, I am announcing today that we are rolling back all of the junk fees we have instituted recently," that might have been a good idea, that might have been a terrible idea, but it would have told us something.
He's a CEO not a politician. I don't recall being asked to vote for him, so he's serving at the pleasure of the Board of Directors and the self-licking ice cream cone that is Vanguard's ownership and governance (which he might not even fully understand yet).
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Re: Will VG come back to its original purpose?

Post by backpacker61 »

jjj_22 wrote: Tue Jul 09, 2024 5:21 pm But they still have great low cost funds that you can hold anywhere.

The fact that people feel attached to Vanguard as a place to hold their accounts just because they’re fond of the fund offerings IMO doesn’t make much sense.
I could be wrong (often am!), but I think some of their Admiral Class mutual funds for Tax Exempt bonds can't generally be held at many brokerages.
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Re: Will VG come back to its original purpose?

Post by Curly »

I agree, and that is what I had thought after reading Allan Roth's article (and others). Either it would be a push to PAS or at the very least, the Robo Advisor. Enough so that I did discuss this with our daughter, so she might have the heads-up that she would get some pressure to go to the Robo Advisor. She is a young investor with relatively low assets at VG and I would guess that her account currently is a net loss for VG.


Mel Lindauer wrote: Tue Jul 09, 2024 10:09 pm
nisiprius wrote: Tue Jul 09, 2024 4:08 pm
“There’s a theory, and I’m not the only one to come up with it, that they’d rather move people onto the personal advisory service," said Allan Roth...
Allan Roth is a Good Guy, but I don't understand how moving people onto PAS could fix anything. I assume that PAS accounts are still on the same platform and produce the same statements, go through the same data processing, etc. I doubt that PAS advisors have any special access to the back office or any special skill at resolving glitches in transfers, money market yield calculations, etc. If you are on PAS do they waive all the junk fees, mail you printed statements for free, etc?
My reading was that Allan was saying that he felt Vanguard would rather spend the money on getting more clients on their revenue-producing PAS than spend it on fixing the website. Obviously, as you pointed out, that wouldn't fix the website problem but would produce more income for Vanguard'
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by yankees60 »

nisiprius wrote: Wed Jul 10, 2024 6:04 am
Vanguard's new CEO, Salim Ramji wrote:Hello. I'm Salim Ramji, Vanguard's new CEO. It's my first week here, but already Vanguard feels like home. It's our unique structure and our client focused mission that make Vanguard like nowhere else. And I'm excited for where we are headed. As the world continues to change and our clients are faced with new challenges, our work serving you is more important than ever.

To ensure we are ready to meet this moment, I have three areas of focus: First, continue delivering for our clients, earning your trust every single day. Second, stewarding the company's culture. We will never deviate from Jack Bogle's original focus on taking a stand for investors and giving our clients the best chance of investment success. And finally, ensuring we anticipate your needs and continue to evolve our capabilities to serve you well. Thank you for your trust in Vanguard. I look forward to our work together.
The new CEO's message to me disappointed me. It basically amounted to zero. It was pure corporate-speak. Nothing to dislike, nothing to like, no information. Clamming up while uttering words at a time when words were expected.

He said "I'm excited for where we are headed." (He actually didn't sound very excited?) That suggests he has some idea where they are headed. He didn't share that vision with us.

Like a well-trained presenter, he knew that he had to make exactly three points, but I couldn't figure out what he meant by any of them.

"Continue delivering" implies that they're doing an OK job now, but he didn't say what he thought they were doing well. Or hint at what might be improved, not even language like "even better."

I'm pleased enough that he referenced Bogle, but it's absolutely par for the course for an incoming CEO to say they love the old culture and nothing will change. It tells us nothing at all except that he knows "how to play the game."

He says he hopes to "anticipate your needs and continue to evolve our capabilities to serve you well." Again, this implies that he is anticipating needs and that Vanguard is going to "evolve"--without a hint of the direction.

None of this is unusual or alarming, but it's disappointing. He chose not to reveal anything, nor put any stakes in the ground. It appears to have been crafted with the single goal of not saying anything that could backfire.

Now if he had said "Junk fees do not help investors have the best chance of investment success. They are not in line with our mission statement. No customers have demanded them. Therefore, I am announcing today that we are rolling back all of the junk fees we have instituted recently," that might have been a good idea, that might have been a terrible idea, but it would have told us something.
Devastating analysis! Well done!
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by Rocinante Rider »

nisiprius wrote: Wed Jul 10, 2024 6:04 am The new CEO's message...basically amounted to zero.
So far, so good for me, but I'm not among those looking for potentially costly changes. After 40+ years with Vanguard, I remain 100% satisfied. The website easily meets all of my needs, I've personally never had a problem with phone support, the new fees don't affect or concern me, and I've saved literally millions over the decades by using Vanguard's index funds. If the new CEO changes nothing, I won't mind. On the other hand, I also won't complain if he can get my aggregate expense ratio even lower than 0.05%. The new fees might already help to do that.
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Re: Will VG come back to its original purpose?

Post by yankees60 »

Curly wrote: Wed Jul 10, 2024 11:09 am I agree, and that is what I had thought after reading Allan Roth's article (and others). Either it would be a push to PAS or at the very least, the Robo Advisor. Enough so that I did discuss this with our daughter, so she might have the heads-up that she would get some pressure to go to the Robo Advisor. She is a young investor with relatively low assets at VG and I would guess that her account currently is a net loss for VG.


Mel Lindauer wrote: Tue Jul 09, 2024 10:09 pm
nisiprius wrote: Tue Jul 09, 2024 4:08 pm
“There’s a theory, and I’m not the only one to come up with it, that they’d rather move people onto the personal advisory service," said Allan Roth...
Allan Roth is a Good Guy, but I don't understand how moving people onto PAS could fix anything. I assume that PAS accounts are still on the same platform and produce the same statements, go through the same data processing, etc. I doubt that PAS advisors have any special access to the back office or any special skill at resolving glitches in transfers, money market yield calculations, etc. If you are on PAS do they waive all the junk fees, mail you printed statements for free, etc?
My reading was that Allan was saying that he felt Vanguard would rather spend the money on getting more clients on their revenue-producing PAS than spend it on fixing the website. Obviously, as you pointed out, that wouldn't fix the website problem but would produce more income for Vanguard'
Where was the Allan Roth article? I only saw him being quoted at the end of the Wall Street Journal article.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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Re: Will VG come back to its original purpose?

Post by Curly »

Hello Vinny,

Sorry to say, I don't recall where I read the article (or it could have been an interview?).

yankees60 wrote: Wed Jul 10, 2024 11:44 am
Where was the Allan Roth article? I only saw him being quoted at the end of the Wall Street Journal article.
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Re: Will VG come back to its original purpose?

Post by Dude2 »

Florida Orange wrote: Tue Jul 09, 2024 6:41 pm
stan1 wrote: Tue Jul 09, 2024 6:17 pm No, Vanguard is not going to go back to the 1970s. They are a business and will position themselves for the future not the past. If Vanguard no longer meets your needs you should attempt to find a business that does, if one exists.

That said, I think they are following through exactly on what Jack Bogle promised: low cost investing. It's just that some people don't like the consequences of doing business with a low cost company.

I'm fine with the new Vanguard website. I've learned how to use it, and accepted that some features I seldom (or never) used are no longer available.
Customer service costs money. One can not expect stellar customer service from a company with very low expense ratios. It's not for everybody, but if you want to keep more of your money, Vanguard is still a very good company. I don't think Vanguard has deviated from it's original purpose.
Thanks, that's exactly it.

I'm a Vanguard fan mostly because they aren't trying to kill me with marketing. I believe they still do have my best interest in mind.
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Re: Will VG come back to its original purpose?

Post by bondsr4me »

Dude2 wrote: Wed Jul 10, 2024 11:54 am
Florida Orange wrote: Tue Jul 09, 2024 6:41 pm
stan1 wrote: Tue Jul 09, 2024 6:17 pm No, Vanguard is not going to go back to the 1970s. They are a business and will position themselves for the future not the past. If Vanguard no longer meets your needs you should attempt to find a business that does, if one exists.

That said, I think they are following through exactly on what Jack Bogle promised: low cost investing. It's just that some people don't like the consequences of doing business with a low cost company.

I'm fine with the new Vanguard website. I've learned how to use it, and accepted that some features I seldom (or never) used are no longer available.
Customer service costs money. One can not expect stellar customer service from a company with very low expense ratios. It's not for everybody, but if you want to keep more of your money, Vanguard is still a very good company. I don't think Vanguard has deviated from it's original purpose.
Thanks, that's exactly it.

I'm a Vanguard fan mostly because they aren't trying to kill me with marketing. I believe they still do have my best interest in mind.
:sharebeer

agree with the above.....although VG certainly doesn't seem to promulgate it.
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Re: Will VG come back to its original purpose?

Post by yankees60 »

Curly wrote: Wed Jul 10, 2024 11:48 am Hello Vinny,

Sorry to say, I don't recall where I read the article (or it could have been an interview?).

yankees60 wrote: Wed Jul 10, 2024 11:44 am
Where was the Allan Roth article? I only saw him being quoted at the end of the Wall Street Journal article.
Okay. Thanks. I wanted to make sure it had not been referenced in this topic earlier and somehow I missed it.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by afan »

Knock wood and accepting all the complaints, I have been with V for decades and remain completely satisfied.

I liked the old website and I like the new one. They are different but I do not see one as better than the other. It is easy for me to find what I want to know and easy to do what I want to do. I can go years without selling anything. Almost all my purchases are on autopilot. Most of the time when I login it is just to make sure the money is still there rather than to enter a transaction.

I estimate I may contact V once evey few years, by telephone or message my rep. Either way, I get what I need with little hassle.

If V convinces people to join PAS and uses the revenue to further lower prices, then I will be happy.

If V spends a lot of money on fixing something that is not broken, then I would rather see them further cut costs.

If I want more handholding, I can go to Schwab and pay for it with the annoying cash management. Or go to Fidelity and deal with their annoying pitches for active management.

V stopped pitching PAS to me ages ago. They just invest my money and pay a high rate on my settlement fund. Which is all I want my company to do.
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Re: [WSJ article: Vanguard’s Die-Hard Customers Have a Message for New CEO]

Post by anagram »

Rocinante Rider wrote: Wed Jul 10, 2024 11:43 am
nisiprius wrote: Wed Jul 10, 2024 6:04 am The new CEO's message...basically amounted to zero.
So far, so good for me, but I'm not among those looking for potentially costly changes. After 40+ years with Vanguard, I remain 100% satisfied. The website easily meets all of my needs, I've personally never had a problem with phone support, the new fees don't affect or concern me, and I've saved literally millions over the decades by using Vanguard's index funds. If the new CEO changes nothing, I won't mind. On the other hand, I also won't complain if he can get my aggregate expense ratio even lower than 0.05%. The new fees might already help to do that.
Simple arithmetic tells you the new fees won't reduce the ERs. How many people would need to leave Vanguard at $100 a pop? And those fees likely don't cover admin costs. So your ER will not change.

I'm glad the website works for you. I had a "simple" admin task and the website could not do it. The back end was stuck and needed manual intervention. The website does not work well for lots of people.
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