Vanguard is practically a household name in the investment world.
Vanguard is known for low cost index fund deals and offers online brokerage accounts to help you build your wealth. Opening a Vanguard brokerage account online is an easy way to start trading.
Regardless of whether you are new to investing or an experienced market player, Vanguard could be a great option for building a portfolio.
However, before you invest in a broker, it is helpful to know what to expect. Our review of Vanguard brokerage accounts and services will help you decide if it’s right for you.
Avant-garde is good for …
- Beginners who want to invest easily
- Investors looking for inexpensive trading options
- People who want to include index funds in their investment strategy
- Investors who don’t want to pay transfer fees to withdraw money from another brokerage account
Advantages and disadvantages of Vanguard brokerage
Types of accounts offered
Vanguard offers both individual and shared brokerage accounts.
So if you want to open a brokerage account on your own, you can do so. Or you can open a mediation with a spouse if you have similar investment objectives.
You can open an account with $ 0. However, it is important to note that there may be different minimum requirements to start investing.
At the very least, you may need $ 1,000 to $ 3,000 to buy stocks.
This is important if you have a limited amount of money to start building a portfolio.
Age and college savings
In this Vanguard brokerage review, it should also be noted that you can open other account types.
These are all tax-privileged accounts. Other ways to build with Vanguard are:
In this review of Vanguard brokerage, we will now focus on single and shared brokerage accounts.
Are there different account levels?
Vanguard has different client levels, which vary depending on the size of the asset. In general, different types of services become available as your portfolio grows.
Avant-garde client levels
|basic||Up to $ 50,000||Basic investment services|
|Voyager||$ 50,000 to $ 500,000||
|Voyager Select||$ 500,000 to $ 1 million|
|flagship||$ 1 to $ 5 million||
|Select flagship||More than $ 5 million||
In most cases, the increasing status of the customer level means more exclusive access to professionals who can offer more in-depth financial advice and guidance.
So if you don’t have a large investment portfolio, you won’t miss much.
Building a diversified portfolio is important for risk management.
The more diverse your portfolio, the better your investments can be isolated from the volatility in the stock markets.
When choosing an online broker, it is important to consider the full range of investments to ensure that you can create a portfolio that suits your needs.
Vanguard makes this easy for brokerage account investors.
You can invest in various securities, including:
- Vanguard mutual fund
- Vanguard Exchange Traded Funds (ETFs)
- Mutual funds from other companies
- ETFs from other companies
- Individual stocks
- Deposit certificates
- tie up
- Financial investments, including money market funds
As you can see, there isn’t much you can’t invest in through a Vanguard brokerage account.
Keep in mind that some investments are riskier than others when building your portfolio.
Vanguard also offers managed portfolios if you want more professionalism when investing.
Managed portfolios are offered through Vanguard Personal Advisor Services. You will need at least $ 50,000 investable assets to set up a managed portfolio account.
Personal Advisor Services assigns you a personal money manager.
They ask you questions about your goals, review your current investments, and help you design a new portfolio management plan.
The annual cost of using Personal Advisor Services is 0.30% of your assets under management for accounts with a balance of $ 5 million or less.
For accounts with assets of USD 25 million or more, the fee drops to only 0.05%.
Account fees and trading costs
When investing in a brokerage account, it is important to keep an eye on the fees.
The more trading fees or commissions you pay, the less of your investment income you can keep.
Likewise, when investing in mutual funds or ETFs, you must pay attention to individual cost ratios.
Vanguard is one of many brokers that have switched to a $ 0 trading fee model in recent years. And overall, they have some of the lowest brokerage fees to invest.
How the fees are distributed:
Trading fees for Vanguard brokerage
|Investment opportunities||Trading fee|
|Individual stocks||$ 0 for online trades; Up to $ 25 per trade over the phone|
|Vanguard mutual fund||$ 0 for online and phone trades|
|Mutual funds from other companies||$ 0 for online trades; Up to $ 50 per trade over the phone|
|Avant-garde ETFs||$ 0 for online and phone trades|
|ETFs from other companies||$ 0 for online trades; Up to $ 25 per trade over the phone|
|Options||$ 0 + $ 1 contract fee for investors with assets of less than $ 1 million; $ 0 for the first 25 trades for balances between $ 1 and $ 5 million, then $ 0 + $ 1 contract fee; $ 0 for the first 100 trades for balances over $ 5 million, then $ 0 + $ 1 contract fee|
Again, there is no minimum to open, but Vanguard charges an annual fee of $ 20 for all brokerage accounts.
This fee can be waived if:
- You keep a total of $ 10,000 or more in your account
- or sign up for electronic explanations and communications
Based on the fee chart, the smartest way to save money is online trading. Keep in mind that there may be individual fees
associated with different investments.
This includes the expense ratio for individual funds and ETFs. This means the annual cost of owning the fee, expressed as a percentage.
On the bright side, Vanguard has a reputation for offering funds with cost ratios well below the industry average.
This is another important point to know when making comparisons between Vanguard and another broker like TD Ameritrade or ETrade.
Are tax losses and automatic rebalancing included?
Harvesting tax losses and automatic realignment will help you manage your investments more efficiently.
By harvesting tax losses, you sell losers in your portfolio to offset capital gains. This helps ensure that your asset allocation still meets your goals.
Unfortunately, Vanguard does not currently offer these features as a standard offering for its brokerage accounts.
With Vanguard Personal Advisor Services, you can perform portfolio rebalancing, which may be subject to a charge depending on the size of your asset.
If you want to keep your portfolio management simple, it can be a disadvantage not to generate or offset any tax losses.
These are strategies that you can implement yourself with some basic investment knowledge.
Online and mobile experience
Vanguard offers both online and mobile access to its brokerage accounts.
The layouts are straightforward and simple for a user-friendly experience. Information is easily accessible through a drop-down menu that takes you where you need to go.
No one is overly conspicuous. As an investor, you get a personalized dashboard with your investment accounts so you can track performance in one place.
Overall, however, Vanguard is doing well so that you can easily see where you have invested and how those investments are impacting.
Research and investment tools
Vanguard offers a variety of research and investment tools to help you make the right decisions for your portfolio.
The list of tools available includes:
- An individual stock screener tool
- Mutual funds and ETF screeners
- Online Fixed Income Trade Desk (if you are interested in fixed income investments such as bonds)
You can also:
- View individual stock and mutual fund profiles
- Create an watchlist of securities that you want to keep an eye on
- Use Vanguard’s portfolio analysis tool to see how your portfolio is developing.
There are also articles and calculators to help you shape your wealth creation plan.
Should You Invest With Vanguard Brokerage?
As this Vanguard Brokerage Review shows, there is a lot to like if you invest with this platform.
The main attractions are the low-cost mutual funds and ETFs, with which investors can quickly build diversified portfolios.
You can access managed portfolios if you have enough assets. If you don’t, you can still open your account with $ 0.
Overall, Vanguard is one of the better brokers in terms of cost, choice and service.
However, before deciding where to invest, it’s important that you do your homework and compare it to other broker options.