Any downside to buying vanguard mutual funds through 3rd party brokers?

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Cyanide123
Posts: 105
Joined: Sun May 05, 2019 9:14 am

Any downside to buying vanguard mutual funds through 3rd party brokers?

Post by Cyanide123 » Sat Jul 13, 2019 10:37 pm

Title says it all.

Is there any downside to buying vanguard mutual funds through places like etrade or jp Morgan you invest or other brokers instead of buying through vanguard directly?

The two mentioned above at least have no trading cost or fees associated with buying and selling, just like buying directly from vanguard. But they have much better interfaces, and mobile apps.

Any disadvantages I don't know of?

lack_ey
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Joined: Wed Nov 19, 2014 11:55 pm

Re: Any downside to buying vanguard mutual funds through 3rd party brokers?

Post by lack_ey » Sat Jul 13, 2019 10:49 pm

It used to be that it was rare to be able to get admiral shares at other brokerages, but I haven't checked how that is now and especially after the changes with the share classes.

Also, a number of the Vanguard funds (many or all of which you may not care about) may not be available on other platforms.

Topic Author
Cyanide123
Posts: 105
Joined: Sun May 05, 2019 9:14 am

Re: Any downside to buying vanguard mutual funds through 3rd party brokers?

Post by Cyanide123 » Sat Jul 13, 2019 11:05 pm

lack_ey wrote:
Sat Jul 13, 2019 10:49 pm
It used to be that it was rare to be able to get admiral shares at other brokerages, but I haven't checked how that is now and especially after the changes with the share classes.

Also, a number of the Vanguard funds (many or all of which you may not care about) may not be available on other platforms.
The funds I've checked look like they are available at both you invest and etrade. Looked at Ally invest as well, but they charged $$$ per transaction. Etrade, you invest, seem to have already the popular funds including the Target retirement funds and admiral shares.

Any other downsides?

retiredjg
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Joined: Thu Jan 10, 2008 12:56 pm

Re: Any downside to buying vanguard mutual funds through 3rd party brokers?

Post by retiredjg » Sun Jul 14, 2019 8:55 am

The problem with this is that it might be temporary. You have to realize that whatever broker does this is losing money and they may decide to cancel their "loss leader" at any time.

We've seen at least one brokerage that offered commission free Vanguard funds (or maybe it was ETFs?) and then quit a few years later. You need to evaluate how that works for you, especially if there is an account closing fee when/if you decide to move to another brokerage if that happens.

Another downside was that only Investor shares were available, not Admiral shares. Vanguard has recently changed their minimums for Admiral shares and some or all of that issue may now be gone.

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