Review of Vanguard brokerage account. Investment fees and commissions, cons and pros, minimum requirements and promotion offers for opening a new online broker account.

Rating:  Vanguard brokerage company rating

  • Stocks & ETFs: $0
  • Options: $1 per contract
  • Mutual Funds: $20
  • Minimum to open: $0

Overview of Vanguard

Although Vanguard is one of the largest broker-dealers in the world measured by client assets (over $8 trillion at last count), it doesn’t always perform spectacularly well in important areas. Be sure to read over the following review before opening an account.

Bulls Point Out...

Extensive portfolio management: Hands-off investors will find good resources here.

Considerable history: This is the company that pioneered index investing.

Large selection of account types: Taxable and tax-deferred.

Bears Point Out...

Customer service: Problems abound.

Limited selection of tradable products: Vanguard has shuttered its OTC service.

Weak software: This broker isn’t intended for frequent trading.

Investment System

Vanguard Investments Rating

At Vanguard, it’s possible to open a brokerage account in either self-directed or managed version. The latter setup is available in several packages, one of which is a robo service.

The automated account system delivers the least number of tradable instruments. These are a small selection of Vanguard ETFs. More Vanguard ETFs will be available in a traditional package. Also available in an old-school package will be bonds, mutual funds, and stocks.

Vanguard’s investment-advisory program includes lots of services, including:

  • Estate planning
  • Wealth management
  • Retirement planning
  • Real-time goal tracking
  • Ongoing portfolio advice
  • Personalized financial plan
  • Investment coaching
  • Real human advisor

Vanguard realizes that not everyone needs or wants such services, which is why it offers self-directed accounts. Available asset classes include:

  • Equities
  • Options
  • Funds (mutual, exchange-traded, and closed-end)
  • Bonds and other fixed-income securities

Unfortunately, Vanguard’s over-the-counter stock service has been discontinued, except for Y-shares of good quality with market caps above $300 million.

There are a wide variety of tax structures that Vanguard accounts can be opened under. On the taxable side of things, there are individual and joint accounts, organizational accounts, and business accounts.

On the tax-advantaged side of things, there are 529 savings plans, custodial accounts, and retirement accounts, including self-employed 401k plans and business IRAs.

Vanguard Review

Customer Service

Vanguard Investments Rating

Vanguard’s customer service has declined quite a bit in recent years, with more customer complaints mounting. Wait times over the phone are long, and although Vanguard does have a call-back service, some customers have reported never being called back.

The customer support number is 877-662-7447. It’s up and running from 8:00 in the morning until 8:00 in the evening, EST. Some departments, such as one for nonprofit organizations, have curtailed times and different phone numbers.

The website is another route to get a hold of someone. There is a new online chat tool that starts in robo format and switches to a human service if needed. This is a promising change as it took us just a few minutes to get a human rep online.

The Vanguard site also has an internal messaging widget. It can be used to send documents (in digital format, of course) to the broker. The icon for this tool is a small envelope that appears in the upper-right corner of the dashboard.

There are a lot of self-help resources on the site. Look for the “Support” and “Profile & account settings” links in the very upper-right corner of the site.

Fees and Minimums

Vanguard Investments Rating

Like most other brokerage firms in the United States, Vanguard has dropped its equity commission for self-directed accounts all the way to $0, at least for online trades. Using a live rep over the phone carries a $25 surcharge.

Many mutual funds at Vanguard have no trading fee, either, and of course Vanguard funds do not. There are some fund families that will have a $20 commission for an online trade. Large accounts ($1 million or more) get this trading fee waived at least 25 times per year.

Option trades have a $1 fee per contract, and once again, large accounts are able to avoid the fee. Bonds are anywhere from $0 to $35 per trade.

Vanguard is one of the few firms in the industry that still charges an annual account fee. But it can be avoided in one of several ways. The simplest is to sign up for e-delivery of account documents. The annual fee is $20.

Retirement accounts have a variety of fees that vary by account type. For example, a 403(b) plan costs $5 per month, per participant.

For obvious reasons, managed accounts will have an extra fee that self-directed accounts don’t have. The advisory fee varies by the package chosen. The robo service, known as the Digital Advisor, costs 0.20% annually and requires a $3,000 deposit to get going (a 401(k) account, for whatever reason, requires just $5).

Old-school advisory accounts have a variety of fees and minimums. A wealth management package requires $5 million and has the following fee schedule:

Debit Balance Margin Interest Rates
under $19,999 13.75%
$20,000 – $49,999 13.25%
$50,000 – $99,999 12.75%
$100,000–$249,999 12.25%
$250,000–$499,999 11.75%
$500,000–$999,999 10.5%
above $1,000,000 call


Vanguard Investments Rating

Vanguard offers both cash and margin trading. Once an account has margin privileges, it cannot be downgraded to cash status on the website. Apparently, a phone call or online chat will be required.

As for the cost of borrowing, Vanguard has competitive, but not spectacular, rates. They range from 9% to 12.25%, depending on the debit balance.

Vanguard’s software doesn’t display margin details for specific securities, which means day trading, shorting, and other advanced forms of trading aren’t ideal.

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Vanguard Investments Rating

Vanguard has updated its website recently, although it remains difficult to navigate. We recommend using the search bar in the top-right of the site. The links at the top help some, although the site is not intuitively arranged.

Vanguard Review

Entering a stock symbol or company name in the search field generates a list of choices. Clicking on the correct one produces a brief overview of the stock in question with trade buttons. The stock’s profile doesn’t have a trade button, although there’s a column of links on the right-hand side. One of the links is a trade link. Click on this to pull up the order ticket.

Although the trade ticket is rather simple, there are discrete choices for sell short and buy to cover. Order types include stop and stop limit, which is the most complex that this ticket can be. Real-time security data appears just to the right of the ticket, and the information can be refreshed, which is really helpful. Balance details, including total buying power, is displayed just below the quote box.

Charts on the Vanguard site start in a very simplified form; there is a small chart on the profile with no tools at all. Clicking on the chart tab pulls up a somewhat better chart with up to 50 years of price data. There are a few tools and 4 plot styles here.

There are no other features to mention in this category. The Vanguard site does not have a trade bar or browser platform.

Mobile App

Vanguard Investments Rating

Although Vanguard’s website is bad, its mobile app is even worse. Only recently have stock profiles been added. These include key stats like market cap and average volume. Major stocks have analyst recommendations. While those may sound useful, they’re not useful at all if a trade can’t be placed. That’s right, this mobile app has no trade ticket for stocks or options. And only Vanguard funds can be traded on it (non-Vanguard funds don’t even have profiles).

Vanguard app Review

Charts on the app have one year of price history at a maximum. There are no tools of any kind, and a graph cannot be displayed horizontally.

Supplementary Services

Vanguard Investments Rating

Extended Hours: Besides the regular day session, Vanguard also has a late-night session. There is no pre-market trading.

Initial Public Offerings: Not available.

Individual Retirement Accounts: Vanguard has several IRAs. Small businesses can open SEP and SIMPLE plans. A qualified retirement plan (QRP) can be rolled over. Some business IRAs will have fees for holding Vanguard mutual funds, although these can be waived in the same manners available for the company’s annual account fee.

Fractional-share Trading: Vanguard ETFs can be traded in whole dollars.

DRIP Service: Free of charge.

Recurring Mutual Fund Purchases: Vanguard permits automatic purchases of Vanguard mutual funds.


Mutual Fund Investors: With Vanguard’s mutual fund screener, we counted 6,969 mutual funds. This is a decent list, although only half this number has no transaction fees. Firstrade has many more funds with no transaction fees on any of them.

Long-Term Investors and Retirement Savers: Although Vanguard does have some account fees, these can be avoided in various ways. With lifecycle mutual funds, investment-advisory service, and lots of tax-deferred accounts, Vanguard would be a decent pick. But Charles Schwab is better.

Beginners: We can definitely recommend a managed account with Vanguard for new investors.

Active Stock and ETF Trading: With only rudimentary software, Vanguard is not a good broker for frequent equity trading. Webull is.

Small Accounts: Despite changes to its pricing schedule, Vanguard is still best for large accounts. Firstrade is ideal for small traders.

Vanguard Review Judgment

Despite its size, Vanguard fails to deliver in many areas. Although its greatest strength seems to lie in portfolio management, the lack of branch locations makes it questionable here, too.

Vanguard Promotion

None at this time.

Charles Schwab Promotion

Satisfaction guarantee and $0-fee trades at from Charles Schwab.

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Webull Promotion

Grab your last chance to get up to 75 free stocks when you deposit at Webull!

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Vanguard Commissions

Stocks and ETFs $0
Options $1 per contract
Mutual funds $20
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.
UITsSelling UITs $35 per transaction.

Vanguard IRA & Account Fees

IRA Setup Fee$0
Annual IRA Fee$20, $0 with conditions*
IRA Termination Fee$0
Full Account Transfer Out$0
Partial Account Transfer Out$0
Outgoing Wire Fees (Domestic)$0
Outgoing Wire Fees (International)$0
All Vanguard fees »