Vanguard brokerage fees email

[bizlady]

Received the following email yesterday from Vanguard. Particularly do not understand the last note on the bottom. So does this mean if we buy cd's or exchange Vanguard funds or switch funds, that are within the brokerage account, or they mature and go to the brokerage account- we get charged a fee?


the email:
Notice of updated commission and fee schedules and account agreement for Vanguard Brokerage Services
Dear Vanguard Brokerage Client,

We want to make you aware that we have updated the Vanguard Brokerage Account Agreement and associated commission and fee schedules. These updates include changes to our Digital Interaction Expectations, new Class Action Service Terms, and Vanguard Brokerage's ability to close accounts, including low balance accounts with no activity.

Effective July 1, 2024, the following commission schedule changes will take effect:

Broker-assisted commission: A $25 broker-assisted commission will be charged for each Vanguard mutual fund1 and Vanguard ETF® (exchange-traded fund) trade placed over the phone and for closing transactions placed by Vanguard Brokerage Services® to cover a margin call or satisfy an outstanding debt owed in your brokerage account.* This broker-assisted commission is consistent with our existing policy on trading stocks and other products.
Certificate deposit fee: A $100 processing fee (per CUSIP) will be charged for the deposit of physical share certificates into your brokerage account.
Class action service fee: With the introduction of this new service in which Vanguard Brokerage will facilitate filing claims on behalf of clients in an attempt to recover class action settlement funds, a fee of 20% will be deducted from these recovered funds prior to their deposit into your brokerage account. See the Notice of Amendment to the Vanguard Brokerage Account Agreement ("Account Agreement Amendment") for details on the service.
Foreign securities and American Depositary Receipts (ADRs) dividends fee: A fee of 1% on the gross dividend amount will be charged when a dividend is paid on a foreign or ADR asset held in U.S. dollars.
Restricted security legend removal fee: A $250 processing fee may be charged for research and removal of a restriction on a security held in your brokerage account.
Account closure and transfer fee: A $100 processing fee may be charged for account closure or transfer of account assets to another firm.**
Effective June 1, 2024, the following commission schedule change will take effect:

The tax filing fee for master limited partnerships (MLPs) held in an IRA will change from $300 to $500 per account.
You can obtain an updated copy of the Vanguard Brokerage Services commission and fee schedules here and read more about these important account agreement updates in the Account Agreement Amendment.

Please note that the updates discussed in this communication apply to all your accounts maintained with Vanguard Brokerage Services.

Thank you for belonging to the Vanguard community of investors.


*Broker-assisted commissions will not be charged for brokerage accounts enrolled in a Vanguard-affiliated advisory service or for clients with $1 million or more in qualifying Vanguard assets.

**The fee will not be assessed for clients who hold at least $5 million in qualifying Vanguard assets.

1 For Vanguard mutual fund exchanges, the commission will be charged on the "from" side of the transaction based on the total number of trades placed. For some mutual fund transactions, the commission will be deducted as a separate sweep from your settlement fund. It will not apply to some complex Vanguard mutual fund transactions, including those across registration types.

 

[disneysteve]

Why does your title say Amazon? Did you mean to type Vanguard?

This doesn't say anything at all about CDs and it says they will charge the $25 commission only for trades placed by phone. I don't know about you but I do everything 100% online. This notice makes no mention of any sort of fees for online transactions.

 

[bizlady]

Why does your title say Amazon? Did you mean to type Vanguard?

This doesn't say anything at all about CDs and it says they will charge the $25 commission only for trades placed by phone. I don't know about you but I do everything 100% online. This notice makes no mention of any sort of fees for online transactions.

Senior moment on the "Amazon" now corrected!

 

[MarieIG]

Rob Berger's comments and analysis on Vanguard's fees.

 

[tulak]

It makes me wonder if they’re seeing a large number of accounts leaving?

This might push me to consolidate some accounts.

 

[RetMD21]

Thanks, the Rob Berger video clarifies that this doesn't affect me. Vanguard wants the lower cost customers who do things online and don't take up staff time. It works for me.

 

[disneysteve]

Thanks, the Rob Berger video clarifies that this doesn't affect me. Vanguard wants the lower cost customers who do things online and don't take up staff time. It works for me.

Exactly. As I said, I do all of my business online. I haven't called a broker to make a transaction since probably the early to mid 1990s. Anyone still insisting on having a human make their trades for them ought to be paying something for that service.

The account closure fee doesn't bother me as I don't intend to ever close my accounts, though I suppose after my wife and I are gone, there's a chance our daughter could want to move the money, though I doubt it since she also invests with Vanguard.

 

[kevink]

Well as Rob Berger points out the $25 broker assisted trade fee just punishes those who can least afford it and the $100 account transfer/closure fee is pretty offensive too given that Vanguard in recent years has done everything it could to motivate its customers to transfer their Vanguard mutual funds and ETFs to brokerages with actual customer service and websites that have been updated within the past decade (i.e. Fidelity, Schwab).

Vanguard needs to replace whoever is in charge of their PR efforts. Of late they seem to have adopted the motto many of us who worked at AT&T back in their monopoly days had printed as truth-in-advertising bumper stickers: "We Don't Care - We Don't Have To."

 

[jazz4cash]

It feels like the changes in fees are not as bad as they seem initially, BUT Vanguard has a way of communicating that is especially irritating. I agree their PR is terrible.

 

[disneysteve]

Well as Rob Berger points out the $25 broker assisted trade fee just punishes those who can least afford it

I disagree. He says that it would hurt people like the elderly who aren't comfortable with technology. Sorry but if I wasn't comfortable using technology, I doubt I would ever open an account with what is essentially an online-only firm. I'd instead go with somebody like Schwab that has a local physical office where I could walk in and sit down with "my" broker like we all did 40 years ago before the internet. So if you're the type that doesn't want to do things online and wants to talk to a person for every transaction, Vanguard is not a company I would recommend for you even if there was no fee at all for that service.

I think this video does make a good point that these fees aren't going to affect most customers. They certainly aren't going to affect us and we have well over $2 million with Vanguard.

 

[kevink]

I disagree. He says that it would hurt people like the elderly who aren't comfortable with technology. Sorry but if I wasn't comfortable using technology, I doubt I would ever open an account with what is essentially an online-only firm. I'd instead go with somebody like Schwab that has a local physical office where I could walk in and sit down with "my" broker like we all did 40 years ago before the internet. So if you're the type that doesn't want to do things online and wants to talk to a person for every transaction, Vanguard is not a company I would recommend for you even if there was no fee at all for that service.

I think this video does make a good point that these fees aren't going to affect most customers. They certainly aren't going to affect us and we have well over $2 million with Vanguard.

We'll you're not disagreeing with Berger's contention that it will hurt the elderly and other phone users - in it will. And many of those folks have been loyal Vanguard customers for decades.

And yeah, Vanguard has the dubious distinction of being an online-only firm with the worst customer service and website experience, while Schab and Fido that DO have actual brick-and-mortar offices are far better to deal with online or on the phone. Vanguard has no excuse for doing the "one job" they've chosen so poorly..

I still hold mostly Vanguard funds and ETF's but moved them to Schwab and Fidelity years ago. Vanguard has morphed into a company Jack Bogle would hardly have been able to recognize. It's sad.

 

[TheWizard]

I disagree. He says that it would hurt people like the elderly who aren't comfortable with technology. Sorry but if I wasn't comfortable using technology, I doubt I would ever open an account with what is essentially an online-only firm. I'd instead go with somebody like Schwab that has a local physical office where I could walk in and sit down with "my" broker like we all did 40 years ago before the internet. So if you're the type that doesn't want to do things online and wants to talk to a person for every transaction, Vanguard is not a company I would recommend for you even if there was no fee at all for that service...

Well, the "elderly" need to get their stuff together and get with the plan.
This coming from a non-elderly 74 yo retiree...

 

[disneysteve]

We'll you're not disagreeing with Berger's contention that it will hurt the elderly and other phone users - in it will.

Agreed. I just don't think an online bank or brokerage is the right place for someone who prefers to speak to a person anytime they need something done. I love Ally but I'd never recommend it for someone who told me they didn't want to do everything themselves online. I'd send them to a local bricks and mortar bank. The same with Vanguard, or any other online firm.

 

[TheWizard]

Agreed. I just don't think an online bank or brokerage is the right place for someone who prefers to speak to a person anytime they need something done. I love Ally but I'd never recommend it for someone who told me they didn't want to do everything themselves online. I'd send them to a local bricks and mortar bank. The same with Vanguard, or any other online firm.

We're in the smartphone generation now, DS.
No need to speak to a person for routine transactions...

 

[Badger]

Well, the "elderly" need to get their stuff together and get with the plan.
This coming from a non-elderly 74 yo retiree...

This seems a little harsh. Many people have opened accounts when they were younger but time and mental decline for some is an issue as they age. What was easy to navigate before may now be more difficult, frustrating, and challenging. The result is they are afraid to make any changes on their own and they may not know or trust help that is offered with all the scams that even educated investors fall for.

 

[disneysteve]

This seems a little harsh. Many people have opened accounts when they were younger but time and mental decline for some is an issue as they age. What was easy to navigate before may now be more difficult, frustrating, and challenging. The result is they are afraid to make any changes on their own and they may not know or trust help that is offered with all the scams that even educated investors fall for.

That’s a good point for sure. My apologies if my comment was overly harsh.

My mom is 93 and has a Vanguard account, but I opened it and I handle all of her transactions. There’s no way she could do it herself.

 

[RetMD21]

We'll you're not disagreeing with Berger's contention that it will hurt the elderly and other phone users - in it will. And many of those folks have been loyal Vanguard customers for decades.

And yeah, Vanguard has the dubious distinction of being an online-only firm with the worst customer service and website experience, while Schab and Fido that DO have actual brick-and-mortar offices are far better to deal with online or on the phone. Vanguard has no excuse for doing the "one job" they've chosen so poorly..

I still hold mostly Vanguard funds and ETF's but moved them to Schwab and Fidelity years ago. Vanguard has morphed into a company Jack Bogle would hardly have been able to recognize. It's sad.

The job Vanguard has chosen to do is low cost and web based. There are a lot of alternatives for people who have other needs. Schwab and Fidelity have physical locations but I think some people are better off at Raymond James or even Edward Jones. Not only do they have physical locations but they are everywhere and your advisor will know you. It's the way to go to get hand holding.

 

[foxfirev5]

While I don't like where VG is going I guess I'll stick around even if they don't really care. DM has had her $$ there for decades. A change would be stressful for a 94 yo. Just switching her over to the brokerage platform was a major hassle. DW and I likewise have significant accounts just to avoid having all our eggs in the Fido basket.

 

[Midpack]

Vanguard wants the lower cost customers who do things online and don't take up staff time. It works for me.

Exactly. As I said, I do all of my business online. I haven't called a broker to make a transaction since probably the early to mid 1990s. Anyone still insisting on having a human make their trades for them ought to be paying something for that service.

+1. Not unreasonable IMO. VG has real low fee competition, so they have to trim costs. Just because someone wants to talk/transact with a human does not mean they're entitled forever for free. It's not unreasonable to add fees for yesterday's service. Not harsh, business reality.

 

[Trailwalker]

The $100 transfer fee is annoying, especially if it's for each account. It's a dumb idea unless they are trying to lose people who are already on the fence about staying.

 

[Gumby]

I've been with Vanguard for 40 years. Never had any problem with them. I have deliberately kept my financial affairs simple and standard so that I don't need any handholding. In fact, I'm gradually rolling over my far flung 401k and 457 accounts to them, so I'll have everything in one place.

 

[disneysteve]

I've been with Vanguard for 40 years. Never had any problem with them. I have deliberately kept my financial affairs simple and standard so that I don't need any handholding. In fact, I'm gradually rolling over my far flung 401k and 457 accounts to them, so I'll have everything in one place.

About 2/3 of our portfolio is at Vanguard and I wish it were more. I've always been very happy with them. I love their website, way more than Schwab's or TD Ameritrade's before the merger (or Scottrade's before that). And the very few times I've had to call for something, I've always found the customer service to be excellent. Is it the right choice for everyone? Of course not. But for us, it's been great. None of these new fees will impact us at all so it's much ado about nothing personally.

 

[VanWinkle]

Just more ammo for the Vanguard haters in the world...... It won't affect me or my numerous accounts at Vanguard(including one just moved from Fidelity to Vanguard) YMMV

 

[Chuckanut]

It sounds to me likenVanguard has identified their high cost costumers and I’d going to charge them more, while leaving their lower cost customers alone.

 

[scfr]

I'm one who has decided to leave Vanguard. First they sold their Solo 401k business. Now fees on ADRs, which I own. When I received the email, I jumped off the fence and shopped around.