Vanguard Review 2017
Vanguard Investment brokerage firm review. Fees & commissions, advantages & disadvantages, minimum requirements & promotion offers for opening a new online account with the online discount stock broker.
- Stocks & ETFs: $7 for the first 25 trades, $20 for subsequent trades for accounts with < $50,000
- Options: Standart Service $20 + $1 per contract, Voyager Services $7 +
$1 per contract, Voyager Select, Flagship, and Flagship Select Services $2 + $1 per contract
- Mutual Funds: Standard - $35 Voyager® and Voyager Select® - $20 Flagship - $8 Vanguard Mutual Funds - Free
Minimum to open: $1,000 for a cash account.
Open an account: Open an account with Vanguard.
The modern age offers many options for IRA management. Vanguard provides one such option, offering brokerage or mutual-fund
only accounts. Vanguard’s key advantage is the low costs, no-fee for investment in a majority of their mutual funds for IRA or
brokerage accounts. Vanguard has one of the lowest expense ratios for investing (0.19%) as compared to the industry average (1.08%). A small amount of the funds have
steep fees when selling a fund held for less than 3 months.
The fee is intended to discourage short-term/speculative investing and helps control costs.
Vanguard Investment Commissions & Fees Review
Costs can accumulate quickly in a Vanguard account if the investor is an active trader. Unless investing larger sums of money,
the fees for trades of stocks and options are higher than those of Vanguard’s competitors.
Vanguard charges $7 a trade for the first 25 trades each year for an investor with holdings valuing under $50,000.
Any trades after hitting this limit will incur a charge of $20.
Thus, for a person picking and holding companies for the long-term, Vanguard is a solid choice. An active trader can quickly
exceed 25 trades in one month. In this case, there are many other investment companies which would better serve such a
trader’s needs. For instance, Scottrade
charges only $7 per trade on stocks, regardless of size or number of trades.
The fact that Vanguard provides 67 commission-free ETFs with no early redemption fees is a big advantages
over some other discount brokers that do not provide commission-free ETFs. Although funds have the lowest
expense ratios, they are all proprietary. There is no diversification in ETFs providers.
For example, TD Ameritrade
offers a great selection of independently picked by Morningstar Associates 101 commission-free exchange-traded funds
from major thirteen ETF providers such as iShares, VanEck, Pimco, PowerShares, Vanguard, SPDR and others.
In 2015, Forbes ranked TD Ameritrade's selection of commission-free ETFs as the best for investors who are
looking for the most liquid and lowest-cost ETFs.
Vanguard mutual funds are commission-free. The broker offers a tired commission for all other mutual funds depending
on the value of the investment holdings. A minimum of $50,000 is required to qualify for a lower $20 fee in contrast to
a $35 fee charged on a standart account. Yet again, Scottrade charges only $17 on mutual funds regardless of the value
of the account, provides over 2,600 commission-free NTF funds, and unlike Vanguard, offers
fees-free IRA accounts.
There is a yearly fee of $20 for investors with holdings less than $10,000. The fee is waived if enrolled in electronic
account management (a paperless account). The typical minimum fund investment is $3,000, but they offer a few funds for $1,000.
Most other companies offer much lower minimums or even no minimums to invest in mutual funds.
Vanguard vs. Major Competitors Comparison
|Options Pricing Per Contract
|Mutual Funds Pricing
Vanguard Review For Assets $50,000+
Vanguard has a graduated system of member levels (Voyager Services, Voyager Select Services, and Flagship Services) in which the fees and trade costs decline
greatly as the value of the investment holdings increases.
Additional benefits include discounted analysis from a Certified Financial Planner who will help the investor develop an investment strategy tailored to the investor’s needs and goals.
Vanguard Customer Service Review
Vanguard does not offer appointments in-person, whereas some of firm's close competitors,
Scottrade and Etrade, provide free in-person meetings and guidance, live workshop on investing.
Scottrade goes even further by offering a free personalized portfolio review service with investment
experts, which is often offered for free by other big name investment firms only to high net worth investors.
Vanguard compensates for this short-coming by offering phone consultation and video-conferencing, allowing those
seeking a person-to-person connection the reassurance of an advisor guiding them through the investment process.
Vanguard Trading Tools Review
For those looking for a platform from which to personally manage their IRA, Vanguard has numerous online guides and interactive
calculators as well as research tools and articles on the markets and investment strategies. Their mutual fund recommendation
calculators have slider and radio button inputs allowing a user to select their exact financial situation, needs, risk, and goals.
Given this information, the system will then show a user recommendations and options as well as communicate the possible
gains and risks of an investment.
There are also calculators that help project costs and plan for distribution based on the user’s age and expected needs.
This information guides the individual to plan for their future and increase their understanding of how accessing their IRA
will affect their holdings and financial stability.
The convenience of using sliders as part of the user-interface allows the user to tweak their responses and fine-tune their
decision-making for an individualized investment profile.
- Low-cost Vanguard mutual funds
- 67 commission-free Vanguard ETFs
- Phone consultations and video-conferencing
- Very high stock and ETFs trading commissions after executing first 25 trades per year
- High base options trading commissions
- High minimums for fund investments ($1,000, $3,000, $10,000)
- No in-branch appointments, guidance and advice offered
- Extremely expensive brokerage for active traders
- Poor customer service
- Slow process of opening an account
- Poor trading tools
- Annual fees for IRA accounts
Vanguard Review Summary
For high-net-worth investors Vanguard offers an appealing reduction in pricing. Clients who are set on investing mostly in
mutual funds will benefit from Vanguards low cost mutual funds offerings. All others should look for other,
better suited options for their investments.
Vanguard Promotional Offer For A New Account
None at this time.
Current new brokerage account promotions »
Vanguard Commissions and Fees
|Stocks and ETFs
||$7 for the first 25 trades, $20 for subsequent trades for account with less than $50,000.
||$7 for account with $50,000–$500,000 invested in Vanguard products (Voyager Services®).
||By phone trades $25.
||$2 for account with $500,000–$1,000,000 invested in Vanguard products (Voyager Select Services®). By phone trades $2.
||Free for first 25 trades, $2 for subsequent trades for account with $1 million-$10 million (Flagship Services™)
||Free for first 500 trades, $2 for subsequent trades for account with over $10 million (Flagship Select Services™)
Standard Service $20 + $1 per contract
Voyager Services $7 + $1 per contract
Voyager Select, Flagship, and Flagship Select Services $2 + $1 per contract
|Mutual funds|| Vanguard mutual funds - free. All others: Standard - $35; Voyager® and Voyager Select® - $20; Flagship - $8|
|U.S. Treasury|| Free for new and existing issues.|
|U.S. government agency securities, corporate bonds, and CDs
New issues free. Standard and Voyager $2 per $1,000 face amount ($250 maximum).
Voyager Select, Flagship, and Flagship Select $1 per $1,000 face amount ($250 maximum)
|Mortgage-backed securities & commercial papers|| $50 per transaction.|
|UITs||Selling UITs $35 per transaction.|
Firstrade IRA & Account Fees
|IRA Setup Fee||$0|
|Annual IRA Fee||$20, $0 with conditions*|
|IRA Termination Fee||$0|
|Full Account Transfer Out||visit vanguard.com|
|Partial Account Transfer Out||visit vanguard.com|
|Outgoing Wire Fees (Domestic)||visit vanguard.com|
|Outgoing Wire Fees (International)||visit vanguard.com|
|AllVanguard fees »|
* - $20 annual fee applies to each Vanguard fund in an account with a balance of less than $10,000 (if not signed up for electronic statements);
$25 SIMPLE IRA annual account service fee for each Vanguard fund in an account. This fee is waived if you are a Voyager, Voyager Select, or Flagship client;
$15 403(b)(7) annual account service fee for each Vanguard fund in the plan;
$20 Individual 401(k)/Individual Roth 401(k) plans annual fee for each Vanguard fund in an Individual 401(k) account;
$20 529 Plan annual fee if your 529 account balance falls below $3,000. This fee cannot be waived.
Open Vanguard Account