Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

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ARBear
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Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by ARBear » Thu Jul 07, 2016 9:44 am

Hi All:

Last year there were posts where people debated the advantages and disadvantages of Vanguard's Personal Advisors Services. I would like to hear from anyone who can talk about personal experience with Vanguard's Personal Advisors Services, particularly those with assets just under $1 million, and anyone who is elderly (or helps elderly relatives with their investments) who uses this service.

I have read that if you have assets under $1 million you might end up talking to different advisors on the phone. Has this been your experience? Did they offer multiple options, or did they just want to stick you in a target date fund? Have you had good experiences with the Vanguard folks you talked to over the phone? Did they do a good job of taking taxes into consideration? What do you like -- what don't you like about the service? Please tell me the good, the bad, the ugly.

Here's why:

My elderly relative's broker at Wells Fargo recently retired. She and the Wells Fargo broker who inherited her account did not see eye to eye (for example, he kept referring to her assets as my "inheritance" since my sibling and I will be the ones who inherit her assets if there is anything left. Really, really poor taste on his part.) We live in the Midwest where there aren't many options. She had already left Morgan Stanley for churning. We wouldn't go to Merrill Lynch even if we could (there aren't any in our area anymore). We interviewed some independent firms, but they had some really kooky ideas about investing, (i.e. put it all in bonds, who cares about taxes!)

We ended up at Arvest, which is the banking firm owned by the Walton family of Wal-Mart fame. We thought we liked the young advisor, but now we don't think it's going to work out. The advisor invested $80k in a CD when we had agreed to $50k (my relative likes to keep a small cash cushion). When I emailed her about it, the advisor said, "Well, she said she wasn't going to need the cash anytime soon..." I have emailed her and told her that she has to obtain my relative's consent before investing any money, and in this case, she had not gotten her permission to invest $80k. I'm steaming to say the least. She was also pushing a bizarre Wells Fargo Command Asset small/mid cap blend fund that charged a $750 yearly fee on top of 1.5% that would need to be in an entirely separate account. When I asked about the symbol so I could track it, she said it didn't have a symbol. If I can't track it, I don't like it, and I don't want my relative paying crazy fees.

So now I'm considering what options I and my relative have left. The closest Garrett Planning Network advisors are two to three hours away. Edward Jones is probably the last brick and mortar brokerage firm I would even think about, though not ideal for obvious reasons. Vanguard is obviously an option, but I think for my relative it might be hard to trust someone over the phone. She's used to sitting in an office getting to know the broker and them getting to know her. Her portfolio is far too complicated for me to manage and I would be terrified to make a mistake that would cost her her hard earned money, so that's why I still want to use an advisory service. Since my tiny nest egg is with Vanguard, and they have the best investment philosophy in the industry, I'm thinking they may be a good option, but I wanted to hear what the Bogleheads had to say first. If you have any other suggestions, let me know.

azanon
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by azanon » Thu Jul 07, 2016 10:14 am

I don't have any experience using VPAS, but based upon your story, I think that is the ideal option.

The only issue that concerns me is the description that her finances are complex. If they're complex, I would say simplify them. I've seen portfolios like that - cd's at a few banks, perhaps treauries through treasury direct, a scattering of individual stocks, and any number of other hodgepodge investments. For someone at her age, I'd probably go with an all-in-one for each account type (so one for taxable, one for 401(K), one for Roth, etc.). Complex doesn't equal better.

Engineer250
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Engineer250 » Thu Jul 07, 2016 11:27 am

Just a suggestion to inquire about, but maybe the Vanguard investor would be willing to occasionally video Skype with your relative instead of just a phonecall. It is afterall the 21st century and such technology is available. So long as both sides have a good connection it might be more personable to your relative.
Where the tides of fortune take us, no man can know.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by xenial » Thu Jul 07, 2016 11:47 am

Engineer250 wrote:Just a suggestion to inquire about, but maybe the Vanguard investor would be willing to occasionally video Skype with your relative instead of just a phonecall. It is afterall the 21st century and such technology is available. So long as both sides have a good connection it might be more personable to your relative.
This is apparently possible: Partner with a Vanguard advisor
Enjoy convenient access to a Vanguard advisor

Once you're enrolled, you can call or email a Vanguard advisor at your convenience. And with our easy-to-use videoconferencing service, you can also video chat with an advisor from the comfort of your own home. Simply schedule an appointment online, anytime.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by miles monroe » Thu Jul 07, 2016 11:49 am

let me tell you why i wouldn't use vanguard PAS; if my understanding is incorrect i know someone will correct me.

PAS charges 0.3 as their fee. i have never heard anyone mention a cap or maximum. on a $1 million portfolio thats $3,000 a year. seems to me one can use a fee only financial planner for a whole less than that -- and get advice as often or seldom as needed.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by prudent » Thu Jul 07, 2016 12:33 pm

miles monroe wrote:let me tell you why i wouldn't use vanguard PAS; if my understanding is incorrect i know someone will correct me.

PAS charges 0.3 as their fee. i have never heard anyone mention a cap or maximum. on a $1 million portfolio thats $3,000 a year. seems to me one can use a fee only financial planner for a whole less than that -- and get advice as often or seldom as needed.
I have found a reluctance for fee-only planners to do on an hourly basis what someone would want from an advisor who is actually babysitting the investments. One fee-only planner that I used a couple years ago for a specific situation would not do some trivial advising for a very basic trust (4 funds and fixed distributions) on an hourly basis. Three others I called who said they will work on an hourly basis also would not do it for that trust. It seems that fee-only + hourly engagements might be doable for specific "one-off" situations, but for something ongoing (like PAS would be), it may be hard to find a fee-only hourly advisor who would work that way.

I finally did find one - a Boglehead-ish CFP actually - who agreed to consult on an hourly basis but made it clear he is not monitoring anything and will never do anything proactively. I have to call. Billing in 15 min. increments after a 1-hour minimum.

So if those are the typical rules of engagement, a fee-only + hourly person might not be the right choice for the situation in the OP if they want someone to manage rather than simply get involved when asked a question.

azanon
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by azanon » Thu Jul 07, 2016 12:42 pm

miles monroe wrote:let me tell you why i wouldn't use vanguard PAS; if my understanding is incorrect i know someone will correct me.

PAS charges 0.3 as their fee. i have never heard anyone mention a cap or maximum. on a $1 million portfolio thats $3,000 a year. seems to me one can use a fee only financial planner for a whole less than that -- and get advice as often or seldom as needed.
No correction here, but that's actually fairly cheap, at just about any portfolio amount (though I'd back off this statement once one got north of 10 million). Now don't get me wrong, it's not cheap enough for me as Betterment is my current favorite advisor at half that cost, but Betterment would require a bit more hands on oversight than VPAS, and probably not ideal for the OP.

More typical is 0.75 or even higher + probably other fees as well.

kenner
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by kenner » Thu Jul 07, 2016 1:24 pm

ARBear wrote:Hi All:

I have read that if you have assets under $1 million you might end up talking to different advisors on the phone. Has this been your experience?

This has not been my experience, although with a portfolio in excess of $1 million. I recommend that you call VPAS and ask them about your concerns.

VPAS does a complete evaluation of a potential investor's entire financial circumstances (current holdings, investment goals, age, tax situation, etc.) and makes tailor-made recommendations based on the individual's desires, needs and risk tolerance.

Advisors are available via telephone, email and, perhaps most important in your situation, video conference.


Did they offer multiple options, or did they just want to stick you in a target date fund?

They seem to generally offer a multi-fund portfolio (TSM, TISM, TBM and tax-exempt bonds depending on the individual's tax situation). I believe they prefer this type of portfolio in order to maximize rebalancing and tax-loss harvesting opportunities.


Have you had good experiences with the Vanguard folks you talked to over the phone?

Yes.

Did they do a good job of taking taxes into consideration?

Yes.

What do you like -- what don't you like about the service? Please tell me the good, the bad, the ugly.
The personal attention is top-notch.

Plus, they will establish a solid investment portfolio for your relative and, at any time, you can choose to manage the portfolio yourself with no additional charges from VPAS.

VPAS will provide essentially the same advice you'd eventually receive on this forum, but for many investors there is probably no substitute for the live, real-time give and take that a qualified VPAS advisor can provide, especially initially.


goingup
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by goingup » Thu Jul 07, 2016 3:19 pm

ARBear wrote:Hi All:
She's used to sitting in an office getting to know the broker and them getting to know her. Her portfolio is far too complicated for me to manage and I would be terrified to make a mistake that would cost her her hard earned money, so that's why I still want to use an advisory service.
If she wants to sit face to face with a broker that limits you quite a bit. I don't think PAS would be a good fit in that regard. Their approach is also very cookie-cutter from what I have read.

No Fidelity or Schwab offices near you? I'd probably go back to Wells Fargo before I'd try Ed Jones. Wherever you land just be clear on what type of portfolio you want and limit the turnover.

If it were my elderly relative, I might just consider putting everything in Wellesley or Target Income, along with a ladder of CDs from the local credit union. Face to face meetings may become less compelling to your relative as time passes.

victork
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by victork » Thu Jul 07, 2016 4:43 pm

There are a couple of options to consider.
First, someone can use Vanguard funds whether they make their own investment decisions, get advice from Vanguard, or get advice from a 3rd party.
I'll suggest making a serious effort to find a fee-only advisor in your area -- you can always pay him/her for the time spent in "house calls."
It sounds like your relative is making the decisions right now; just make sure that he/she makes a well-informed decision.

Personally, I had Vanguard make a portfolio recommendation for me 12 years ago, and I've been managing it myself since then. I recall that there were a couple of different portfolio suggestions for me to choose from. In my case, there was no charge. But whatever you pay will be well compensated, I'm sure.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by brennok » Thu Jul 07, 2016 10:28 pm

I am in the same boat and considering VPAS for my mother's account. I do worry if it will be a right fit though I have a feeling it will be more for me than her since I think she wants to be hands off.

Unfortunately Fidelity isn't close and convenient, but I think having someone to sit face to face with may be beneficial for her. There is a Schwab location which is a little more convenient so I may need to research their rates and maybe schedule a meeting with both.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by rolandtorres » Thu Jul 07, 2016 11:38 pm

You need to be Voyager Select status to always get to talk to and email the same VPAS advisor. Phone calls are pleasant and they also do a Adobe Connect web conference where the advisor can guide you through their recommendation and also turn on their own webcam (not sure if you can do 2-way video chat).

Our recommendation differed from BH 3-fund orthodoxy in that it included initial 100% stock holding for our retirement goal, actively managed funds, munis for other shorter term goal. Tax efficiency was considered but they clearly arent a substitute for a wealth mgmt firm with CPA on staff.

They provide the AA scheduled plan so you can literally enact it yourself or let them do it every 6mo.

Im not sure how fast the email response is but scheduling 15-30min mtg in advance was generally about 2-3 wks out. One time i called and was able to be connected right away but that was returning a call from the advisor.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by jjface » Fri Jul 08, 2016 12:40 am

My view is that elderly people and those who don't want to learn much about investinf should stick to 1 fund and not worry about meetings and managers picking a range of funds they don't understand.

Vanguard wellesley or a suitable target retirement/lifestrategy fund comes to mind. Coupled with CDs that the elderly investor can be more hands on with if they want to go to a branch or something at the local credit union.

Why make it more complicated?

I wouldn't be so afraid of managing it yourself. There is far more that could go wrong with an advisor in my opinion - you've already highlighted several instances when you had to step in. You have her best interests at heart. Consider doing the VPAS and being on the calls with her - after a while you will probably realise you could do it yourself and VPAS makes it easy to do so.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by carolinaman » Fri Jul 08, 2016 6:36 am

jjface wrote:My view is that elderly people and those who don't want to learn much about investinf should stick to 1 fund and not worry about meetings and managers picking a range of funds they don't understand.

Vanguard wellesley or a suitable target retirement/lifestrategy fund comes to mind. Coupled with CDs that the elderly investor can be more hands on with if they want to go to a branch or something at the local credit union.

Why make it more complicated?

I wouldn't be so afraid of managing it yourself. There is far more that could go wrong with an advisor in my opinion - you've already highlighted several instances when you had to step in. You have her best interests at heart. Consider doing the VPAS and being on the calls with her - after a while you will probably realise you could do it yourself and VPAS makes it easy to do so.
I agree with this post. Advisers often concoct overly complex portfolios that are difficult for most people to understand. Part of their intent is to make investing seem more complicated than it should be. Often their investments have higher expenses, and coupled with the adviser fees, most of these portfolios under perform a simple 2 or 3 fund portfolio using low cost index funds.

Chances are the first thing Vanguard will do is to recommend simplified portfolio, which is likely appropriate. She could go with Vanguard initially and once you are comfortable with everything, you could help her manage things herself. Choosing an appropriate Vanguard LifeStrategy fund combined with CDs could be a great choice for her. One potential obstacle for simplification would be any taxable assets that have accumulated large capital gains. If this applies, then she will need a strategy to minimize taxes on these investments, and it may take her several years to complete the simplification.

kenner
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by kenner » Fri Jul 08, 2016 9:04 am

ARBear wrote:
Her portfolio is far too complicated for me to manage and I would be terrified to make a mistake that would cost her her hard earned money, so that's why I still want to use an advisory service.
I believe this a very strong reason to enlist the help of the Certified Financial Planners (the highest qualifications in the investing expertise world) at VPAS. The CFPs, if provided all relevant information, can unwind and optimize a complicated existing portfolio in a professional and unemotional manner.*

The CFP team has frequent meetings where the group discusses relevant current topics in order to maximize advice to clients.

In my own experience, an invaluable function of VPAS is the ability of its advisors to hand-hold its clients in order to "talk them down from the ledges" when markets seem to be crashing. Panicking is usually a major psychological mistake for investors.

Depending on your relative's tax situation, an all-in-one fund would probably be fine if she can stay the course on her own through thick and thin. Not every investor can do that - and not every relative who is trying to be of help wants to accept that emotional responsibility.

*Note there may be certain types of investments, such as annuities, that VPAS may not take responsibility for.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by dbr » Fri Jul 08, 2016 9:15 am

A huge advantage of VPAS is that there is no chance of falling afoul of a salesman selling your mother things she should not buy, including paying a too high fee for advice and management.* Being sure that you are avoiding that problem anywhere else is dicey indeed. I am also confident their advice will do no harm, which is a significant risk anywhere else.

*Whether or not 0.3% per annum is too high is arguable. I think it is too high, but different people have different and justifiable needs.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by elbryn1000 » Fri Jul 08, 2016 9:31 am

I helped my parents consolidate my father's retirement portfolio (taxable, roth ira, ira, 401k rollover) when he was diagnosed with early onset alzheimers a few years ago. Dad was the primary finance person in the house so the process took some time but luckily he was already a semi boglehead. we had to close a local bank account that had gotten some 401k rollover money that mom had implemented because she didnt want to bother us (fees + many funds + hard to figure out asset allocation) but vanguard made the transition relatively easy. it was important at the time that we had an intermediary adviser as dad still wanted to make financial decisions and we needed the buffer. since then he's lost that desire as things progressed but it's made sense to keep on.

i wasnt present and am not present from the phone/video conversations point of view but i'm relatively happy with the results so far. it's not a three fund portfolio but it approximates to the relative 55/45 split that makes sense given their scenario in indexes. the bond portion is split into multiple funds comprising domestic + international as is the equity side. i was able to get access to view the funds from my vanguard account and track it whenever i track my portfolio. the re-balancing has stayed true and i see the emails for scheduled calls.

overall it's been a good thing. low cost compared to regular advisers. sticks to the tenets that dad mostly followed before and gives mom ease of mind that someone is taking care of it. i get to keep an eye out as well. the next step is when mom retires in a year and a half and we look to further consolidate. i suspect i'll be pushing to utilize the same service unless things drastically change. stability for her as she doesnt want to delve too far into the financial stuff is very important.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by dbr » Fri Jul 08, 2016 9:39 am

elbryn1000 wrote: it's not a three fund portfolio but it approximates to the relative 55/45 split that makes sense given their scenario in indexes. the bond portion is split into multiple funds comprising domestic + international as is the equity side.
It seems to be a common report that Vanguard gives everyone the same cookie-cutter asset allocation only individualized by stock/bond ratio. They now believe in carrying international bonds and adding corporate bonds besides total bond. Those additions seem unnecessary but also probably meet the criterion of do no harm.

It would be interesting to hear if they ever suggest munis in taxable accounts or brokered CDs.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by kenner » Fri Jul 08, 2016 9:54 am

dbr wrote: It seems to be a common report that Vanguard gives everyone the same cookie-cutter asset allocation only individualized by stock/bond ratio. They now believe in carrying international bonds and adding corporate bonds besides total bond. Those additions seem unnecessary but also probably meet the criterion of do no harm.

It would be interesting to hear if they ever suggest munis in taxable accounts or brokered CDs.
VPAS does indeed advise tax-exempt bond funds when appropriate for the investor.

Not sure about brokered CD recommendations.

As a baseline, VPAS does seem to recommend the same funds that the majority of Bogleheads endorse - TSM (US), TISM, TBM, etc. Recommended portfolios are customized to meet the investor's specific needs from that starting point.

I suspect that the portfolio complexity ARBear refers to is probably due to switching from one advisor to another over the years. New advisor/salesmen likely recommend new investments in order to maximize their own commissions at the expense of the investor. It is a type of "churning" that is so costly to investors.

ARBear
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by ARBear » Fri Jul 08, 2016 10:51 am

THANK YOU to everyone who responded - I appreciate all of your feedback.

I do have a follow-up question that perhaps I should ask elsewhere on the board, but thought I'd try here first:

In this situation, the taxable account is a mix of individual stocks, a handful of different stock and bond funds, a CD, some cash for emergencies, and an annuity; the ROTH is five or six individual stocks with Vanguard Wellesley, American Balanced Fund, and American EuroPacific fund. Overall, it's a 50/50 portfolio right now. I don't have the account information with me, or else I'd more specific. She has, fortunately for her, had a lot of gains. to show you how little I know about taxes (next to nothing): Is it possible to make significant portfolio changes without incurring tons of taxes? Slowly, over time? Or, I would hope, the Vanguard folks would help put together a strategy?

To Kenner: I would love to find a CFP who isn't connected to a brokerage, but unfortunately there aren't any in the area. It was a CFP at Morgan Stanley who churned her account. Now, at Arvest, it's a CFP who admitted "it made her head hurt" when looking at my relative's portfolio. I wish we could go back to the drawing board and start over. If I knew how to minimize taxes, we would simplify and go Vanguard. The current CFP did not have any recommendations for minimizing taxes, probably because she knows I would push for VG funds if anything was sold. And yes, you're absolutely right: The convoluted portfolio is the result of moving from one firm to another.

To miles monroe: I hear you. But at least if we're going to have to pay a fee, I think Vanguard is fair compared to other folks. In my mind, the fee gives me peace of mind that helping my relative make decisions does not fall entirely on my shoulders.

To goingup: Fidelity isn't close; it appears there is a Charles Schwab advisor an hour away.

To brennok: Glad to know I'm not the only one in the same boat.

To rolandtorres: Her portfolio would qualify her for Voyager Select services.

To elbryn1000: Thank you for letting me know how it's worked out for you and your family.

Thank you again to everyone for your thoughts.

I think overall I would feel better if she with Vanguard in case something would happen to her. If something happened to me, my spouse would step in to help her, but if something happened to him, there would not be anyone else (at least not anyone with an interest in investing) who would be able to assist her. I wouldn't worry about wolves at Vanguard like I would with other firms.

I'm going to call Vanguard and try to talk to someone about VPAS and then talk to my relative and see if she is interested or not. I think the greatest challenge for her would be the idea of handing her money over to a firm where there isn't a personal relationship like in the past.

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Mel Lindauer » Fri Jul 08, 2016 11:18 am

jjface wrote:My view is that elderly people and those who don't want to learn much about investinf should stick to 1 fund and not worry about meetings and managers picking a range of funds they don't understand.

Vanguard wellesley or a suitable target retirement/lifestrategy fund comes to mind. Coupled with CDs that the elderly investor can be more hands on with if they want to go to a branch or something at the local credit union.

Why make it more complicated?

I wouldn't be so afraid of managing it yourself. There is far more that could go wrong with an advisor in my opinion - you've already highlighted several instances when you had to step in. You have her best interests at heart. Consider doing the VPAS and being on the calls with her - after a while you will probably realise you could do it yourself and VPAS makes it easy to do so.
I agree with this recommendation to simplify things by using a Target Retirement or LifeStrategy fund. These funds offer a low-cost, nicely diversified portfolio in a single fund that automatically rebalances for you. No need to complicate things (that's what Wall Street does to make investors think investing has to be complicated so they can earn their high fees).

Simplify and get on with life.
Best Regards - Mel | | Semper Fi

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by kenner » Fri Jul 08, 2016 11:43 am

Mel Lindauer wrote:
jjface wrote:My view is that elderly people and those who don't want to learn much about investinf should stick to 1 fund and not worry about meetings and managers picking a range of funds they don't understand.

Vanguard wellesley or a suitable target retirement/lifestrategy fund comes to mind. Coupled with CDs that the elderly investor can be more hands on with if they want to go to a branch or something at the local credit union.

Why make it more complicated?

I wouldn't be so afraid of managing it yourself. There is far more that could go wrong with an advisor in my opinion - you've already highlighted several instances when you had to step in. You have her best interests at heart. Consider doing the VPAS and being on the calls with her - after a while you will probably realise you could do it yourself and VPAS makes it easy to do so.
I agree with this recommendation to simplify things by using a Target Retirement or LifeStrategy fund. These funds offer a low-cost, nicely diversified portfolio in a single fund that automatically rebalances for you. No need to complicate things (that's what Wall Street does to make investors think investing has to be complicated so they can earn their high fees).

Simplify and get on with life.
What should OP do about concerns regarding the tax consequences involved in unwinding the relative's complex portfolio that contains significant taxable investments including individual stocks, stock mutual funds and bond mutual funds where, as OP states, the relative has enjoyed "a lot of gains"?

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Lafder » Fri Jul 08, 2016 12:26 pm

ARBear,
I have not used VG's PAS, I am too cheap and think I can do it on my own!

But I did help an elderly relative move her holdings from multiple places to VG.

What I wanted to share is that wihtout paying for PAS, VG did a wonderful job on the phone, and were amazingly willing to spend hours answering my relative's questions with me on speaker phone, as well as in 3 way conversations when we were not in the same place. The rep helped get all of the paperwork needed to get the money transferred, and had it sent to my relative with return envelopes. They were very very helpful.

The amount being moved was mid 6 figures.

It was truly a hassle to figure it all out between annuities and different accounts at different banks and companies............

My relative is capable on the computer. So now she does transfers online. But calls if she has any questions.

Your relative should try a phone call and see how comfortable they are with that. You can do a 3 way call if they are comfortable. VG can call you in.

At the time my relative was moving $ , VG offered a free financial plan with the transfer. Based on what she said, they recommended all LIfe Strategy Moderate Growth. That was not "diverse" enough for my relative, and she ended up picking about 2 funds: Wellesley,and Moderate Growth,then the next year, she wanted more aggressive and added Life Strategy Growth, and then added Balanced Fund (I think based on performance).

I agree it would be good to simplify. VG can help with that as the money is brought over. Or possibly keep the same holdings and transfer in kind.

lafder

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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Mel Lindauer » Fri Jul 08, 2016 12:33 pm

kenner wrote:
Mel Lindauer wrote:
jjface wrote:My view is that elderly people and those who don't want to learn much about investinf should stick to 1 fund and not worry about meetings and managers picking a range of funds they don't understand.

Vanguard wellesley or a suitable target retirement/lifestrategy fund comes to mind. Coupled with CDs that the elderly investor can be more hands on with if they want to go to a branch or something at the local credit union.

Why make it more complicated?

I wouldn't be so afraid of managing it yourself. There is far more that could go wrong with an advisor in my opinion - you've already highlighted several instances when you had to step in. You have her best interests at heart. Consider doing the VPAS and being on the calls with her - after a while you will probably realise you could do it yourself and VPAS makes it easy to do so.
I agree with this recommendation to simplify things by using a Target Retirement or LifeStrategy fund. These funds offer a low-cost, nicely diversified portfolio in a single fund that automatically rebalances for you. No need to complicate things (that's what Wall Street does to make investors think investing has to be complicated so they can earn their high fees).

Simplify and get on with life.
What should OP do about concerns regarding the tax consequences involved in unwinding the relative's complex portfolio that contains significant taxable investments including individual stocks, stock mutual funds and bond mutual funds where, as OP states, the relative has enjoyed "a lot of gains"?
A number of points:
1. She's elderly, possibly has little or no income, so she's likely in a low or no tax bracket, which means she could avoid taxes on some or all of her gains.
2. She may well have losses that could help offset her gains.
3. Cash and CDs don't have gains. Those taxes have been paid annually. Same probably goes of her bonds.
4. There are no tax consequences for changes in a Roth.
5. The cost savings by moving to a low cost provider like Vanguard could help offset any tax consequences.
6. Changes made inside an annuity aren't taxable. And if she needs income, she could annuitize the annuity.
7. She could possibly pay Vanguard a one-time fee or may even qualify for a free consultation.

One doesn't simply have to accept a bad situation. There are options to be explored.
Best Regards - Mel | | Semper Fi

kenner
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by kenner » Fri Jul 08, 2016 12:48 pm

Thanks, Mel.

Great, helpful information.

jnet2000
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by jnet2000 » Fri Jul 08, 2016 1:52 pm

We love VPAS. Our original CFP took a leave of absence and our new assigned CFP is just as wonderful as she was.

My wife and I are very frugal but we both find what we pay for their service to be well worth it. Yes, I could manage the portfolio myself as I did for many, many years however they have done much more.

The great thing about VPAS is that they can try it and if they aren't happy leave without many issues. A close friend of ours just moved from Wells Fargo Advisers over to VPAS and he has been very happy.
"You really don't need leverage in this world much. If you're smart, you're going to make a lot of money without borrowing" Warren Buffet

ARBear
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by ARBear » Mon Jul 11, 2016 12:18 pm

A big thank you to Kenner, Mel, and everyone else who answered my questions. People like you are one of the many reasons I'm glad to call myself a Boglehead! Thank you, thank you!

Jun
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Jun » Fri Jan 27, 2017 2:22 pm

I've had the PAS for over a year. I'm feeling conflicted about whether to stay in or cancel.

When I first started out in late 2015, I was very happy with the advisor they assigned to me. She did all the standard analysis and fund allocation, etc., and reviewed the portfolio every quarter. She even went above and beyond her responsibility to give me some advice about a chunk of money that I decided to manage myself.

In the middle of 2016, she was promoted to another department and I was re-assigned to a male advisor. He is very friendly but more like a sales type, although he does have a CFP qualification. I am not entirely convinced of his competence. From our conversations and exchanges, he freely mixes the different types of percentages as if they were the same. For example, the market indexing moving up or down 1% is not the same as my stock fund allocation being skewed from planned balance by 1%. I have the impression that he doesn't know more than the standard, basic script or even what I know. Plus, at one time he forgot to re-balance my allocation after making a contribution to one stock fund. Why should I pay him to do what I can do myself, perhaps better?

OTOH, he did talk me out of selling a portion of my stock funds right before the election last November, when I was in a bit of panic. Having a gatekeeper to dampen the occasional panic-sell tendency seems to be useful from time to time. The psychological benefit might just be worth the expense.

I called Vanguard to ask about switching to a more knowledgeable and meticulous advisor, but was told this cannot be done. That's another factor against continuing with PAS. My impression is that they kind of skimp on advisor quality for the low cost.

Dan999
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Dan999 » Wed Feb 01, 2017 11:10 am

I had a preliminary discussion with VPAS.
For someone in their 70's they were suggesting stocks of 40 to 50%. Too aggressive for me.
They would split the money between:
Vanguard Total Stock Market
a Vanguard bond fund
Vanguard International Stock Fund.
Vanguard International Bond Fund

This sounds very close to the Boglehead 3 fund portfolio, with the addition of the International Bond Fund.
They offered help with the RMD which I do not need and help with taxable vs non taxable funds, which I also don't need.
I guess the biggest benefit to me would to make me stay the course during volatile times. I will have to do better at this.

So I said thanks anyway, not at this time.
But it was interesting that they were keeping it very simple and using the Boglehead 3 funds as a basis.
No need to pay the .3% fee when you get it here for free.
Dan999

dougp29
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by dougp29 » Wed Feb 01, 2017 12:58 pm

My sister detests having to deal with investing. She doesn't like doing any research or making decisions. A couple of years ago she moved all of her 401k to Vanguard and started using one of their advisers. She has a little less than a million in her account. She's very pleased with her adviser. She has one adviser. Her adviser helps her sleep at night. The adviser is doing for her what I do for myself with Vanguard: using index funds, picking an allocation, and sticking to it. For her the tradeoff for the fee is peace of mind.

enki
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by enki » Wed Feb 01, 2017 6:05 pm

Question: I read somewhere that VPAS would be able to put people into Admiral funds even if they don't necessarily meet the normal investment requirements? Is this accurate? If so, for investors who meet the $50k VPAS minimum across all of their VG accounts but might not have a whole lot in each one, especially if those balances are spread across multiple accounts (tIRA, rIRA, taxable), the added discount of Admiral shares could help offset some of the cost of VPAS. Obviously this wouldn't help people with large accounts, but people just starting out could see a benefit.

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foosball
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by foosball » Wed Feb 01, 2017 10:13 pm

A WSJ article today about Betterment mentioned that Vanguard's VPAS was the largest hybrid service in the industry with $52B in assets under management. The title of the article is "Robo Advisory Firm Adds the Human Touch."

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Sandtrap
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Sandtrap » Wed Feb 01, 2017 11:01 pm

Dan999 wrote:I had a preliminary discussion with VPAS.
For someone in their 70's they were suggesting stocks of 40 to 50%. Too aggressive for me.
They would split the money between:
Vanguard Total Stock Market
a Vanguard bond fund
Vanguard International Stock Fund.
Vanguard International Bond Fund

This sounds very close to the Boglehead 3 fund portfolio, with the addition of the International Bond Fund.
They offered help with the RMD which I do not need and help with taxable vs non taxable funds, which I also don't need.
I guess the biggest benefit to me would to make me stay the course during volatile times. I will have to do better at this.

So I said thanks anyway, not at this time.
But it was interesting that they were keeping it very simple and using the Boglehead 3 funds as a basis.
No need to pay the .3% fee when you get it here for free.
Dan999
Same experience with me on Jan 24, 2017. I was constantly reminded how busy their schedule was and to schedule the next appt. call at that very moment or it would take a long time to get another. And, the presentation was as "canned" as other presentations I've had from various financial entities. I felt they were operating on volume. Similar to "drive thru window" living wills. Same portfolio as above. I had to push for a 50/50 allocation but was told that they knew best. I think that the PAS fee and commitment is not worth what I can do better myself and pay more attention to since I am my own best advocate. I am a retired businessman with a degree in finance/economics, geeky and OCD. So for me, PAS doesn't work. But, for someone who needs a more involved and personal and responsive portfolio mgt, they might be better off paying a little more for someone that pays attention and listens and perhaps can be visited in person such as a Schwab office or such. Of course this is just IMHO. YMMV. Again, the PAS service might work for many long term or even as "training wheels", albeit at somewhat of a "robotic" level. Just not for me. I hope this helps others to share this experience.

inbox788
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by inbox788 » Thu Feb 02, 2017 1:03 pm

They're in the news today, not in a good way.
Vanguard apologizes to 17,000 millionaires
Updated: FEBRUARY 2, 2017 — 12:44 PM EST
http://www.philly.com/philly/blogs/inq- ... ients.html

Anyone here get the email? Sadly I don't qualify. I'm not one of the 17,000 Flagship clients yet. Maybe someday.

They only have about 100 staffers, which means each one has to manage about 170 clients, so that gives you an idea of how much personal time you're likely to get. Don't forget, they have to spend a lot of time in the back office managing accounts and regulations, so the face time (client contact time) each advisor gets is quite limited. On the other hand UBS and other brokerages are managing about $100M/advisor, so around the same scale, but with more complex products at much higher fee structure.

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Sandtrap
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Re: Vanguard Personal Advisor Services Experiences: Tell Me About Your Experience

Post by Sandtrap » Thu Feb 02, 2017 8:47 pm

inbox788 wrote:They're in the news today, not in a good way.
Vanguard apologizes to 17,000 millionaires
Updated: FEBRUARY 2, 2017 — 12:44 PM EST
http://www.philly.com/philly/blogs/inq- ... ients.html

Anyone here get the email? Sadly I don't qualify. I'm not one of the 17,000 Flagship clients yet. Maybe someday.

They only have about 100 staffers, which means each one has to manage about 170 clients, so that gives you an idea of how much personal time you're likely to get. Don't forget, they have to spend a lot of time in the back office managing accounts and regulations, so the face time (client contact time) each advisor gets is quite limited. On the other hand UBS and other brokerages are managing about $100M/advisor, so around the same scale, but with more complex products at much higher fee structure.
Didn't get that email from Vanguard. I didn't realize how overwhelmed an advisor was. Though the call wait times are getting really really long.
Thanks for sharing.

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