Vanguard is like if Blackrock partnered with the Department of Motor Vehicles as a brokerage to hold its funds. It still has great investment products but their brokerage platform and customer service is like dealing with a mediocre, badly organized and indifferent government bureaucracy. Vanguard should split into two separate entities: one to manage and implement investment products and one to implemement brokerage / account administration functions. The second entity should then figure out how to charge a fair fee and implement a competent service organization.
@slovokia when we transferred our Roth i401(k) from TD Ameritrade to Vanguard it was not a pleasant experience. When I first contacted Vanguard the person I spoke with said she would be my point of contact and would walk me smoothly through the process. Never was able to speak with her again. Had many multiple opportunities because they kept effing up the process.
Thank you, Rob! I have past experience with Ascensus and thought it was awful. Almost zero transparency! My old 401k was with Ascensus and AB (active management) and I fought for years to get better options. Now with Fidelity and so much happier. I'd advise jumping ship for those affected.
You are pronouncing it correctly - they are a plan administrator. These plans are a nightmare to administer with all the DOL and IRS requirements, so probably smart for Vanguard to get out of this business.
It doesn't work for Vanguard because most administrators use high fee mutual funds in the options, hence the $20 fee for using Vanguard funds. Number one reason for not leaving funds in 401K after leaving employer.
Hi Rob- My wife and I just watched your video. We are both retired and have Roth IRA acounts with Vanguard. She has a substantial TSP account that we have discussed rolling over to Vanguard for management assistance. After watching a couple of your videos we are taking a step back to reavaluate that decision! Thanks for your information!
Vanguard taught me that a 0.02% management fee is much better than a 0.03% fee. Now the website makes it difficult to avoid accidentally signing up for a 0.3% robo-advisor fee.
Good discussion. I have a solo 401k with VG, got the "letter", and did my investigation and concur with your findings. Fidelity charges zero fees. Like you, I had an abysmal experience with VG in the 2000s and I'm now done with VG. Thankfully, there are competitive alternatives available today.
Mr Berger @6:54 you NAILED it. Vanguard was my first choice but their customer service was rude, snobbish and condescending. I took my money elsewhere and I am very happy
Rob is so good, you are going to see some fraudsters posting here asking for help. And then other scammers reply saying they know the magic person who can bring great wealth. Or crypto scammers. One just posted and I reported it. You can see it on the set up. One person asks a softball question like I need somebody to help me. And then the fraudsters respond… Beware
@@VashtiPerry exactly. I think people don't fully realize this is hand of international organized crime. Nor do they fully understand that these criminals will try to steal every dime you have, and every dime that your family and friends have. And I’m sure they don’t stop there. If they can get into your computer… Now we have a whole host of other crimes like blackmail, identity fraud, taking out loans in your or others’ names, mortgaging your house, you name it. They do it because it works often enough. And when it does, it can be highly profitable.
IIRC you could also just convert/roll your Vanguard Simple IRA to a Vanguard traditional IRA if you've had it for two (?) years. Having fewer consolidated accounts is often a good idea.
My former employer had a 401(k) set up with Vanguard. When I left the company, I asked to have my funds rolled into an individual IRA. It turned out that the management/servicing of the 401(k) program was through Ascensus. At that time, even though they were managing these funds on behalf of Vanguard, they could not directly roll into my Vanguard IRA. They had to send me a check, which I then had to deposit into my IRA. It was a pain in the butt, more bookkeeping come tax time, and their customer service was not helpful. This really sounded suspicious and rubbed me the wrong way.
Last year vanguard announced that it was moving out of ESG funds, in addition to the financial hit vanguard was also having a legal trouble in relation to the ESG funds, I know an Australian court last year found them guilty of fraud. I wonder if this fallout is due to them trying to pivot too hard into selling politics as a financial service. Instead of selling a financial service.
Hi Rob, thanks for posting this video. I am disappointed in Vanguard’s decision to effectively “fire” my SIMPLE-IRA. I will be moving my account to Charles Schwab, where I already have another IRA. 0:17
🎯 Key Takeaways for quick navigation: 00:00 *📰 Vanguard is selling 280,000 small business retirement plans, including solo 401ks, to a company called Ascensus.* 02:22 *💼 Consider moving your plan if Vanguard's service quality or fees are concerns. Fidelity and Schwab offer viable alternatives without fees.* 05:46 *🛒 Vanguard's exit from small business retirement plans suggests they're no longer competing with full-service platforms like Fidelity or Schwab.* Made with HARPA AI
Thanks for the update Rob. I heard about this on Google News a while ago but didn't really understand 10 years ago 50% Fidelity 50% Vanguard was never user-friendly today about 10% in Vanguard money markets
The primary reason I remain with Vanguard is because it is the ONLY Investment firm that is not a Stock Company (Schwab) or owned privately (Fidelity.) If your personal financial goals include buying and holding low cost, broadly diversified investments, index funds, and a management system that rewards owners instead of stock holders or personal family members...why leave Vanguard? I do not own any of the "investments" that Vanguard is selling and I bet 99% of those who read Bob's newsletter or watch his video don't either. For me, this a "nothing Burger!" By the way, Ascensus is a huge third party administrator. A number of employers I have worked for in the past used them.
Vanguard is owned by its investors, but I don't ever recall being surveyed for my opinion with changes like this. I dont know how much management values the owners of Vanguard.
I didn't leave Vanguard, they kicked my 401k out! Ascensus is too hard to use as both the employee and employer. I'll be moving my 401k elsewhere. What a hassle.
@4:00 20 buck _per fund_ can add up. My IRA is invested in 10 different funds. So that would be $200 in annual fees, _plus_ the 20 buck account holder fee? _That's_ a lot of fees ... just to have the account.
The account holder fee is waived if you agree to accept your account reporting digitally instead of through the mail. It's more a service charge for postage delivery than an account fee
Hi, I am in an entirely different league and experience level than you are. Just retired. But I learn a few things (often many things) from listening to your UA-cam videos. Thank you.
ASCENSUS IS TERRIBLE. If I ever have an employer that uses them in the future I'm putting absolutely nothing into it. Don't even want the match. I went through so much Hell because of them.
Thanks Rob - I'm another naively burned small business accounts accounts holder at Vanguard, and suddenly found 2/3 of all my retirement accounts at Ascensus. I wish I'd come across your video months ago. I went to a great deal of trouble to get my retirement accounts to Vanguard in the first place based on their philosophy and reputation, and now feel distinctly burned by their decision here. But here's my conundrum now: My Roth 401K and my individual 401K are now with Ascensus, but the underlying investments are still Vanguard's instruments, which are performing well. This makes the decision to move to Fidelity or Schwab much trickier. Thoughts?
I'm in your boat. Not sure how the Roth 401k would transition to Fidelity (they don't do Roth's but I don't contribute to mine) so that may not be an option, in which case the decision is Schwab. Fidelity's total stock market index is equal to Vanguard's over the past 10 years (in fact a bit cheaper) so maybe try and find similar funds with Fidelity or Schwab. That's what I'll do.
Vanguard investor since 1999, Recently, I've been pondering retirement. I've also invested $800K on S&P 500 so i could secure my financial future. i need an approach to invest in Coin that will align with my risk tolerance and financial goals
Agreed! this is why I work with one. My $520k portfolio is well-matched for every market season yielding 85% rise from early last year to date. I and my advsor are working on more figures for this year. IMO, financial advisors are the most sought-after professionals after doctors.
I have been a Vanguard investor for a long time. They have gone downhill since Jack Bogle retired. I am unsure of Vanguard's motives after they required corporations to go Woke and pulled that stunt with the fee structure which caused large migration from one fund to another and triggered arbitrary huge capital gains for its investors staying behind in the original find. Jack Bogle would never have made this change in that manner.
@@randychestnut6591Asking for good governance from the places where I invest is not “going woke.” Anyone who cares about their investment in Tesla has reason to be activist when the board wants to award the CEO $47 billion despite profits drastically falling.
Before I stopped dca-ing into my Vanguard account, it was 220k and has now depleted to 175k in the past year due to rebalancing I did out of fear uncertainty and doubt.
What are best alternatives to take in other to secure a financially free retirement and achieve ultimate peace? I don’t want to fail after 42 years of working hard.
If you want to rebuild your retirement by yourself, without the help of a partner, I will tell you it is near impossible. Even NewRetirement and co can’t do the job of an FA with expertise, a large following/client base and experience. Hire one and begin to develop a rapport.
Sorry to hear this. Sounds like you would benefit from going back to DCA-ing and not trying to time the market. Check out the Bogleheads method online if you haven't yet. Good luck!
Pulled all the money out of my vanguard because I couldn’t get anyone on the phone for a 7 figure account. They never tried to retain assets or ask me why.
Vanguard used to assign an account rep to higher balance account holders. I appreciated the thought. Then the assigned person got replaced so often it undermined the thought of having a person you would have a personal relationship with. Then all of that went away. Maybe if I had more $$'s on deposit I would still have the service. Who knows.
Per my phone call with Vanguard, you can transfer to an IRA at Vanguard and can initiate that process over the phone. These small business plans have administrative burdens to comply with, so they are expensive for investment companies to offer. If you no longer need to make contributions to your SIMPLE IRA or solo-401(k), etc., you no longer need an account with those administrative burdens, you just need an account to hold the money. Transferring to an IRA at Vanguard might be the easiest option to avoid the transfer to Acensus and associated fees.
@@karrrot Your question about 59 and 1/2 is a good one, but I don't understand the second part. I am over 59 & 1/2 but I said IF you no longer need to make contributions to your SIMPLE or solo 401K plan,... if you are under 59 &1/2 I suppose you could formally terminate the plan and then be eligible to transfer your balance to an IRA at Vanguard. That might be your solution, but I can't give you tax or legal advice.
Or have all three- Fidelity, Schwab and Vanguard :) Customer service is pretty much non existent at Vanguard; things are great until you need to speak with a human :)
The arrangement sounds a bit convoluted with Ascensus providing administrative, custodial, and recordkeeping services while not being a broker-dealer. I just can't see people who go to Vanguard in the first place suddenly wanting to pay fees. Not sure why the agremeent didn't include removing fees. $20-$25 per Vanguard mutual fund per account and per participant in custodial. Who is gonna want to pay $60-$75 for a simple 3 fund portfolio per person per account type per year? I don't see how Ascensus is a winner in this deal, given the numbers that are surely going to jump ship to Fidelity, schwab or somewhere else. Would love to see the business projections for this acquisition that made this a winner for Ascensus.
I set up a traditional and Roth solo 401k at vanguard last year and it was immediately apparent that it sucked. Severely limited investment choices, and yes separate login so I couldn’t integrate it with the rest of our vanguard accounts. I switched to E*trade almost immediately. It was the only commercial no-fee provider I found (Schwab had cancelled its Roth soloK at the time) that offered a self directed solo 401k with both traditional and Roth options. And all my other etrate accounts (Roth IRA, trad IRA, brokerage account and high yield savings) are integrated with my solo 401ks in one login.
My customer service experience with Ascensus as an employee is that they can't answer any questions, even basic, about my ESOP (Employee Stock Option Plan).
but what if you have a roth individual 401k along with traditional 401k. Sounds like Fidelity does not handle that so not everyone can move to Fidelity.
Question: My Vanguard Solo 401K has just transferred to Ascensus. Is it too late to transfer it to Fidelity or to Schwab? Thanks for your anticipated reply.
I just received the email from Vanguard about their new commission fees. When I take my RMD this year and want to reinvest it in my taxable account; are they going to charge me a fee?
From what I can tell, an Ascensus SIMPLE IRA allows only investments in a select list of Vanguard funds (50 or so?). No EFT's, stocks, or funds from other companies.
Ha! I jumped completely out of Vanguard 2 years ago because I didn't like what they were doing or their investment priorities. That little voice earned its pay.
Vanguard seems to slim their product range in Europe as well. Vanguard Germany recently completly closed their brokerage and robo investment offering. They offered that service for a little under 2 years.
I mentioned this in a previous post asking for advice. I called and found out all accounts labeled "brokerage" and with an 8 digit account # will remain with Vanguard. I had the funds my one nonconforming Simple IRA transferred to another account. Done.
Schwab does not offer SIMPLE IRAs where the entire employer plan isn't being held with them. I only started with Vanguard for mine precisely because Schwab didn't offer them. I'm looking at moving to E-Trade. I already have accounts at Fidelity, but I don't know for sure if they actually offer them, while I do know E-Trade does.
I'm moving my SEP to Fidelity's and keeping the same fund. I called them and they offer Vanguard VTSAX so should be ok with no worries on taxes or fees I have to pay to do this. I may move everything over to Fidelity so I can have it all under one.
I like Vanguard, but fail to understand how an customer owned company that doesn't have a stock or have to pay a dividend, has such a pathetic user interface and cannot destroy a BlackRock or State Street, then does shady things such as 'sell' IRA's.
We took our funds out of the 401's both the trad and the roth 401k and just had Vanguard put them into the Roth, SeP, and brokerage accounts, we have no idea who that other company is nor why Vanguard did that stuff.
I'm moving my Simple IRA to another of Vanguard's accounts before they make money off of my ass, and that's happening tomorrow as scheduled. Thanks for the video. I recommend the Vanguard Target Retirement Funds. Its too bad Vanguard isn't very sophisticated and couldn't directly contact those 280,000 customers they were about to screw out of money.
I just yesterday got a letter from vanguard announcing this sale of my Solo 401k. Thanks for alerting me and information on where else I can move it. Currently talking to Schwab to see if I can move it there.
The thing about Fidelity's accounts that have those expenses, they're all managed accounts. That means someone is picking your investments, doing your rebalancing, adjusting for business cycles, all for you. You literally set it and forget it. In contrast, at Vanguard you're doing all your own strategy and execution. At Fidelity that's free too, but for most people who work full time, and NOT in finance, it pays to not be doing it all yourself around your actual job. But yeah, if you want to do it all yourself, it probably doesn't much matter whether you choose Vanguard, Schwab, Fidelity, etc. They all have some types of no fee offerings.
Rob, have looked at Strive Asset Management? I like putting performance over politics when it comes to my money and would love to hear your analysis on this firm and how it compares to Vanguard, Blackrock, State Street, Fidelity, and the others.
For structure, train them to lay out clear and conceivable objectives, have some viewpoint on this reality, take out sensible issues, and make monetary projections. Be keen, coordinate your advancement, look for course, and go through research. With great standards and backing, your business can prosper and win in an environment of detached progress.
I tried to move an IRA into Vanguard. Talked to 3 different people and got 3 different answers on how to do it. Very Hard to get in touch with a customer rep at vanguard. Got frustrated and moved it to Fidelity wo any fuss there.
Yes Fidelity actually answers phone, and returns calls. bent over backwards helping transferring in a small HSA (only high 4 figures) I do have a mid 6:figure IRA, and my wife has a low 6 figures one. When she retires we will surely transfer her HSA there as well
It's crucial for small business owners to stay informed about changes to their retirement plans. Considering alternatives like Fidelity and Schwab, which offer competitive options without fees, could be a smart move. 💼
I am not affected by theses changes. But I’m sticking with Vanguard for all the rest of my Roth, IRA and brokerage accounts. I do not see this as a negative to Vanguard.
Same here. Rob seems really down on Vanguard lately. I have had nothing but very positive experiences. With both the web site and customer service. No complaints at all.
@@9rows I had a 401(k) with Vanguard until early this year. I still have a brokerage account. These appeared as different entities within Vanguard, having different customer services. I have good experiences with the brokerage side.
Same here. I've used Fidelity at work and they are fine, but I'm sticking with Vanguard who is owned by share holders and have overall lower costs at the expense of having less fancy website features. I like keeping it simple and Vanguard Advisory Services are far lower at 0.3% if by chance you want a dedicated advisor with access to Vanguard's great managed funds.
I was not familiar with Ascensus either although it sounded familiar and I just realized why....I was looking at 529 plans and noticed they are the fund managers for a bunch of state funds.
Vanguard cleaned out my 401k without notifying me! All money transferred to Ascensus with no info on where it went, account #, etc. wtf?! Scared the crap out of me and they will hear about it when their office. opens on Monday
One more recent change at Vanguard. Near the end of last year Vanguard eliminated their Coverdell education savings plans. We had to roll my son's plan into a regular 529 plan.
Hello! First of all, thank you for your channel & videos, they are extremely helpful & informative. I was hoping you could elaborate on your "freeloader" approach...what specifically you mean when you say that you get benefits and services without paying the high fees. Have you made a video specifically on this topic, or could you provide more details as to exactly what you mean?
Do you get the feeling that Vanguard is trying exit the brokerage business entirely and focus on selling their mutual funds and ETFs on other platforms?
Hi Rob I have a question I’ve been trying to solve. That is regarding solo 401(k). There are several bloggers and UA-camrs stating that a person can have a solo 401(k) if they have part-time employees that work less than 500 hours per year there’s more to the rule than that. But that’s the basics. I think they are crossing that information from traditional 401(k) and implying that that could be a rule for a solo 401(k). The IRS website says you cannot have any common law employees meaning anyone on a W-2. Except for a partner or a spouse. I’m going to reach out to my CPA.but this question does a fact, my spouses solo 401(k). Any thoughts?
Do you have a video on the following topic? My wife's employer changed a few years ago and we moved the funds in her previous 401(k) to consolidate under her new employer's plan. The old plan charge a considerable "fee" to allow the money to be moved. This didn't seem right. This video made me wonder if such as thing would happen in this Vanguard case. Thanks.
My guess is they just don't see the financial benefit of keeping these small plans so they're selling them off and focusing on larger customers. There will likely be some layoffs at Vanguard too for people that were focused on these plans. Seems like what a lot of corporations do when things are about to get rocky. They cut the stuff around the edges that isn't a big chunk of their business and the staff that goes with it and focus on their bread and butter.
My Vanguard 401(k) is at Ascensus. Or my Ascensus 401(k) is at Vanguard. Not sure which. I can log into either website using the same login credentials. Doesn't even matter which website I use. The UI is the same.
Vanguard stopped servicing some IRA annuity accounts back in 2020 - Those accounts invested in Vanguard funds but held by Transamerica - It was a messy move - if I remember.
Troubling if Vanguard has done business with Transamerica. My late mother had a small life insurance policy that originally was with Sun Life as I remember - the policy apparently got sold a couple times,ended up as Transamerica. I am listed as beneficiary. Transamerica has refused to pay. I think their business model is to try not to pay. Piratical in my opinion. Another similar small policy was with Prudential which promptly and courteously paid with a minimum of documentation asked for. Transamerica asked for much more docu and personal information and did not pay. I believe that I e- mailed them her death certificate.
@@davidpowell3347 Perhaps, you can get Fidelity - or similar company - involved to make a transfer to them if they offer similar policies. They have clout to get it done.
@@davidpowell3347 Does a company such as Fidelity offer similar contracts? Ask Fidelity to transfer those policies from Transamerica to Fidelity. They have the clout to get it done without all the stalling tactics. Perhaps worth a try.
Totally agree that Vanguard hasn't kept up feature wise... Cash management, fractional share purchases, auto investment of stocks/ETFs, large selection of Bonds, auto roll on Treasuries, check writing are many things Fidelity does that Vanguard either doesn't do or doesn't do well. It's true that Fidelity mutual funds are more expensive. However, with the advent of ETFs, you can keep costs low by purchasing Vamguard (or other company's) ETFs.
Selling???? The Vanguard Group is mostly a service company for the accounts that hold Vanguard funds and Brokerage accounts.... So... Is Vanguard selling the servicing to the other company and getting a profit, or are they just transferring the accounts to them for them to service? The letter said Ascensus is acquiring the accounts, not that they bought them. So, maybe Vanguard decided that those accounts have higher service costs and so are transferring them....and those higher costs is why Ascensus is charging fees... Also, the Vanguard funds themselves have lower fees, so would the cost to invest at, say, Fidelity be more than Vanguard, because the service costs to the funds are higher to begin with? Fidelity has stockholders that they have to pay, but Vanguard does not. It doesn't really make sense, though as service is what Vanguard does.
There are companies that buy up small business 401k plans and then add lots of fees and penalties while making it difficult to access them or move your account. This is my experience, but not with any of the company’s mentioned in this video.
If everyone did low cost index fund investing at Fidelity and didn't fall into the trap of actively managed mutual funds, I wonder if Fidelity would run into similar troubles.
What do you mean when you said they have given up on cash management? Don't their money market accounts pay higher yields than anything offered by their competition?
Vanguard is like if Blackrock partnered with the Department of Motor Vehicles as a brokerage to hold its funds. It still has great investment products but their brokerage platform and customer service is like dealing with a mediocre, badly organized and indifferent government bureaucracy. Vanguard should split into two separate entities: one to manage and implement investment products and one to implemement brokerage / account administration functions. The second entity should then figure out how to charge a fair fee and implement a competent service organization.
@slovokia when we transferred our Roth i401(k) from TD Ameritrade to Vanguard it was not a pleasant experience. When I first contacted Vanguard the person I spoke with said she would be my point of contact and would walk me smoothly through the process. Never was able to speak with her again. Had many multiple opportunities because they kept effing up the process.
Great idea. Perhaps a third entity to create and manage the products (offered on all platforms).
You are a good man Rob. Thanks for looking out for our best interest.
Thank you, Rob! I have past experience with Ascensus and thought it was awful. Almost zero transparency! My old 401k was with Ascensus and AB (active management) and I fought for years to get better options. Now with Fidelity and so much happier. I'd advise jumping ship for those affected.
You are pronouncing it correctly - they are a plan administrator. These plans are a nightmare to administer with all the DOL and IRS requirements, so probably smart for Vanguard to get out of this business.
It doesn't work for Vanguard because most administrators use high fee mutual funds in the options, hence the $20 fee for using Vanguard funds. Number one reason for not leaving funds in 401K after leaving employer.
Hi Rob-
My wife and I just watched your video. We are both retired and have Roth IRA acounts with Vanguard. She has a substantial TSP account that we have discussed rolling over to Vanguard for management assistance. After watching a couple of your videos we are taking a step back to reavaluate that decision! Thanks for your information!
Vanguard taught me that a 0.02% management fee is much better than a 0.03% fee. Now the website makes it difficult to avoid accidentally signing up for a 0.3% robo-advisor fee.
Good discussion. I have a solo 401k with VG, got the "letter", and did my investigation and concur with your findings. Fidelity charges zero fees. Like you, I had an abysmal experience with VG in the 2000s and I'm now done with VG. Thankfully, there are competitive alternatives available today.
I hope Vanguard is making adjustments to stay true to Bogel's ideas.
There’s more to this.
It appears more like Vanguard is trying to increase revenue by any means that goes against Bogle's ideas. Not impressed by Vanguard's CEO.
Vanguard has many well managed funds.
@@larryjones3017 And ETFs.
As a long time Vanguard shareholder and Bogle fan, I can say that they gave up on following his approach years ago (sadly)!
I am just learning about this the hard way because I woke up and my plan is GONE. They didnt communicate with me about where that money went...
They did make quite a few announcements. Maybe update your communication preferences and contact info.
Vanguard is back in the Cash Management business. They now have Cash Plus accounts that pay a decent rate of return and provide FDIC insurance.
Thanks for saying this. I was confused when he said this as I have the Cash plus account as of 2024
Mr Berger @6:54 you NAILED it. Vanguard was my first choice but their customer service was rude, snobbish and condescending. I took my money elsewhere and I am very happy
Just moved all my Vanguard Ira funds to Fidelity as service and support has degraded for years.
I called Vanguard due to an issue they were having sending me emails, they have outsourced some of their customer service outside the USA.
Fidelity Investor since 1995. Very happy.
Fidelity has been good for me. They are offering ROTH IRA 's now.
Runs ring's around Vanguard. Stick to mutual funds Vanguard. What a terrible online platform.
Fidelity is excellent
I switched to Fidelity recently. Much better than Vanguard.
Do you have a business plan there like a Solo 401k?
Rob is so good, you are going to see some fraudsters posting here asking for help. And then other scammers reply saying they know the magic person who can bring great wealth. Or crypto scammers. One just posted and I reported it.
You can see it on the set up. One person asks a softball question like I need somebody to help me. And then the fraudsters respond…
Beware
Yes, I cannot stand those bots. They create whole threads of comments just to seem legitimate and some people fall for them. It's really sad
@@VashtiPerry exactly. I think people don't fully realize this is hand of international organized crime. Nor do they fully understand that these criminals will try to steal every dime you have, and every dime that your family and friends have. And I’m sure they don’t stop there. If they can get into your computer… Now we have a whole host of other crimes like blackmail, identity fraud, taking out loans in your or others’ names, mortgaging your house, you name it.
They do it because it works often enough. And when it does, it can be highly profitable.
I always reply with “SCAM ALERT” and then report them.
wait Steven Brady you mean we don't give you $100,000 and you will double it in a month?
@@hockey1freakyou mean Stephen Andrew Brady? They always have a middle name :)
HI Rob. Yes, you pronounced it correctly. They are the recordkeeper for our Company's 401k plan which is branded as Vanguard.
IIRC you could also just convert/roll your Vanguard Simple IRA to a Vanguard traditional IRA if you've had it for two (?) years. Having fewer consolidated accounts is often a good idea.
My former employer had a 401(k) set up with Vanguard. When I left the company, I asked to have my funds rolled into an individual IRA. It turned out that the management/servicing of the 401(k) program was through Ascensus. At that time, even though they were managing these funds on behalf of Vanguard, they could not directly roll into my Vanguard IRA. They had to send me a check, which I then had to deposit into my IRA. It was a pain in the butt, more bookkeeping come tax time, and their customer service was not helpful. This really sounded suspicious and rubbed me the wrong way.
Last year vanguard announced that it was moving out of ESG funds, in addition to the financial hit vanguard was also having a legal trouble in relation to the ESG funds, I know an Australian court last year found them guilty of fraud.
I wonder if this fallout is due to them trying to pivot too hard into selling politics as a financial service. Instead of selling a financial service.
Hi Rob, thanks for posting this video. I am disappointed in Vanguard’s decision to effectively “fire” my SIMPLE-IRA. I will be moving my account to Charles Schwab, where I already have another IRA. 0:17
🎯 Key Takeaways for quick navigation:
00:00 *📰 Vanguard is selling 280,000 small business retirement plans, including solo 401ks, to a company called Ascensus.*
02:22 *💼 Consider moving your plan if Vanguard's service quality or fees are concerns. Fidelity and Schwab offer viable alternatives without fees.*
05:46 *🛒 Vanguard's exit from small business retirement plans suggests they're no longer competing with full-service platforms like Fidelity or Schwab.*
Made with HARPA AI
Vanguard is making more significant changes starting 6/1/24, including for closing accounts. Any chance you can do a video on these changes?
Thanks for the update Rob. I heard about this on Google News a while ago but didn't really understand 10 years ago 50% Fidelity 50% Vanguard was never user-friendly today about 10% in Vanguard money markets
Great info, Rob.
Look at that subscriber number - should hit 200k by next month!👏👏
Ever since Bogle died, they have been going downhill.
Agreed!!! Even before he passed away they started deviating from the Bogle philosophy
The primary reason I remain with Vanguard is because it is the ONLY Investment firm that is not a Stock Company (Schwab) or owned privately (Fidelity.) If your personal financial goals include buying and holding low cost, broadly diversified investments, index funds, and a management system that rewards owners instead of stock holders or personal family members...why leave Vanguard? I do not own any of the "investments" that Vanguard is selling and I bet 99% of those who read Bob's newsletter or watch his video don't either. For me, this a "nothing Burger!"
By the way, Ascensus is a huge third party administrator. A number of employers I have worked for in the past used them.
Vanguard is owned by its investors, but I don't ever recall being surveyed for my opinion with changes like this. I dont know how much management values the owners of Vanguard.
I didn't leave Vanguard, they kicked my 401k out! Ascensus is too hard to use as both the employee and employer. I'll be moving my 401k elsewhere. What a hassle.
Thanks so much for this overview. My small biz 401k got it's notice from Vanguard so now I have ideas on where to transfer. Much appreciation to you!
Maybe when you get to a gigantic size, niche areas just become insignificant to your overall operation and are just not worth the hassle.
@4:00 20 buck _per fund_ can add up. My IRA is invested in 10 different funds. So that would be $200 in annual fees, _plus_ the 20 buck account holder fee? _That's_ a lot of fees ... just to have the account.
The account holder fee is waived if you agree to accept your account reporting digitally instead of through the mail. It's more a service charge for postage delivery than an account fee
@@rayzerot wrong. We're talking about Ascensus. It doesn't say that anywhere.
Vanguard: "Diversifying your portfolio is good for you."
Ascensus: "Diversifying your portfolio is good for US."
That is not a lot of fees for a 401k.
@@briangasser973 I mean... it is when the alternative is $0 fees.
Hi, I am in an entirely different league and experience level than you are. Just retired. But I learn a few things (often many things) from listening to your UA-cam videos. Thank you.
ASCENSUS IS TERRIBLE.
If I ever have an employer that uses them in the future I'm putting absolutely nothing into it. Don't even want the match. I went through so much Hell because of them.
Ascensus is located 30 min drive from Vanguard headquarters. Both are close to Philadelphia.
I think Vanguard is closer to Pittsburg than Philadelphia.
Glad I transfer all my assets from Vanguard to Fidelity. I’m sticking with Fidelity, Charles Schwab, and Merrill.
Thanks Rob - I'm another naively burned small business accounts accounts holder at Vanguard, and suddenly found 2/3 of all my retirement accounts at Ascensus. I wish I'd come across your video months ago. I went to a great deal of trouble to get my retirement accounts to Vanguard in the first place based on their philosophy and reputation, and now feel distinctly burned by their decision here. But here's my conundrum now: My Roth 401K and my individual 401K are now with Ascensus, but the underlying investments are still Vanguard's instruments, which are performing well. This makes the decision to move to Fidelity or Schwab much trickier. Thoughts?
I'm in your boat. Not sure how the Roth 401k would transition to Fidelity (they don't do Roth's but I don't contribute to mine) so that may not be an option, in which case the decision is Schwab. Fidelity's total stock market index is equal to Vanguard's over the past 10 years (in fact a bit cheaper) so maybe try and find similar funds with Fidelity or Schwab. That's what I'll do.
I hope Fidelity and the other firms dont start doing the same thing.
Vanguard investor since 1999, Recently, I've been pondering retirement. I've also invested $800K on S&P 500 so i could secure my financial future. i need an approach to invest in Coin that will align with my risk tolerance and financial goals
Agreed! this is why I work with one. My $520k portfolio is well-matched for every market season yielding 85% rise from early last year to date. I and my advsor are working on more figures for this year. IMO, financial advisors are the most sought-after professionals after doctors.
I have been a Vanguard investor for a long time. They have gone downhill since Jack Bogle retired. I am unsure of Vanguard's motives after they required corporations to go Woke and pulled that stunt with the fee structure which caused large migration from one fund to another and triggered arbitrary huge capital gains for its investors staying behind in the original find. Jack Bogle would never have made this change in that manner.
@@randychestnut6591Asking for good governance from the places where I invest is not “going woke.” Anyone who cares about their investment in Tesla has reason to be activist when the board wants to award the CEO $47 billion despite profits drastically falling.
I don’t need Vanguard ever since I started scamming people in the comments section of YT videos.😅
Before I stopped dca-ing into my Vanguard account, it was 220k and has now depleted to 175k in the past year due to rebalancing I did out of fear uncertainty and doubt.
What are best alternatives to take in other to secure a financially free retirement and achieve ultimate peace? I don’t want to fail after 42 years of working hard.
If you want to rebuild your retirement by yourself, without the help of a partner, I will tell you it is near impossible. Even NewRetirement and co can’t do the job of an FA with expertise, a large following/client base and experience. Hire one and begin to develop a rapport.
Sorry to hear this. Sounds like you would benefit from going back to DCA-ing and not trying to time the market. Check out the Bogleheads method online if you haven't yet. Good luck!
Rebalancing isn’t always the best strategy. Run the scenarios through portfolio visualizer.
Pulled all the money out of my vanguard because I couldn’t get anyone on the phone for a 7 figure account. They never tried to retain assets or ask me why.
Vanguard used to assign an account rep to higher balance account holders. I appreciated the thought. Then the assigned person got replaced so often it undermined the thought of having a person you would have a personal relationship with. Then all of that went away. Maybe if I had more $$'s on deposit I would still have the service. Who knows.
Per my phone call with Vanguard, you can transfer to an IRA at Vanguard and can initiate that process over the phone. These small business plans have administrative burdens to comply with, so they are expensive for investment companies to offer. If you no longer need to make contributions to your SIMPLE IRA or solo-401(k), etc., you no longer need an account with those administrative burdens, you just need an account to hold the money. Transferring to an IRA at Vanguard might be the easiest option to avoid the transfer to Acensus and associated fees.
this is only for 59 1/2 or older? unless the funds were sourced from a rollover or employer plan
@@karrrot Your question about 59 and 1/2 is a good one, but I don't understand the second part. I am over 59 & 1/2 but I said IF you no longer need to make contributions to your SIMPLE or solo 401K plan,... if you are under 59 &1/2 I suppose you could formally terminate the plan and then be eligible to transfer your balance to an IRA at Vanguard. That might be your solution, but I can't give you tax or legal advice.
Or have all three- Fidelity, Schwab and Vanguard :) Customer service is pretty much non existent at Vanguard; things are great until you need to speak with a human :)
The arrangement sounds a bit convoluted with Ascensus providing administrative, custodial, and recordkeeping services while not being a broker-dealer. I just can't see people who go to Vanguard in the first place suddenly wanting to pay fees. Not sure why the agremeent didn't include removing fees. $20-$25 per Vanguard mutual fund per account and per participant in custodial. Who is gonna want to pay $60-$75 for a simple 3 fund portfolio per person per account type per year? I don't see how Ascensus is a winner in this deal, given the numbers that are surely going to jump ship to Fidelity, schwab or somewhere else. Would love to see the business projections for this acquisition that made this a winner for Ascensus.
This pissed us off. We were doing a Simple IRA through VG. We’ve set up a 401k so all isn’t lost. Now we have a higher contribution limit.
Figures 🤦♀️🤦♀️🤦♀️🤦♀️ for sure its going to include me. Really appreciate the heads up on this Rob!
I set up a traditional and Roth solo 401k at vanguard last year and it was immediately apparent that it sucked. Severely limited investment choices, and yes separate login so I couldn’t integrate it with the rest of our vanguard accounts. I switched to E*trade almost immediately. It was the only commercial no-fee provider I found (Schwab had cancelled its Roth soloK at the time) that offered a self directed solo 401k with both traditional and Roth options. And all my other etrate accounts (Roth IRA, trad IRA, brokerage account and high yield savings) are integrated with my solo 401ks in one login.
try t rowe price
Ascensus has been managing 529 plan in colorado along with Vanguard.
This will be good news for the Holders of these plans. I can not image that Ascensus customer service can be any worse than what Vanguard has become.
Oh yeah, how about if they will move all customers services to India?
@@user00165they will be using AI services for that.
My customer service experience with Ascensus as an employee is that they can't answer any questions, even basic, about my ESOP (Employee Stock Option Plan).
Everyone who's impacted by this should move their money to Fidelity.
but what if you have a roth individual 401k along with traditional 401k. Sounds like Fidelity does not handle that so not everyone can move to Fidelity.
Ascensus has been around awhile, one of the largest TPAs in the US
Question: My Vanguard Solo 401K has just transferred to Ascensus.
Is it too late to transfer it to Fidelity or to Schwab?
Thanks for your anticipated reply.
E-trade does Roth 401k. No fees.
If your feature is low fees, how is that putting them out of business? Won't everyone want to go with them?
I just received the email from Vanguard about their new commission fees. When I take my RMD this year and want to reinvest it in my taxable account; are they going to charge me a fee?
It seems unethical to me. If you open an account with Vanguard then sell it to a third party. I don’t know it just seems slimy to me,
Vangaurd is leaving that business. Doesn't sound slimy at all. That part of the business is going defunct, so they are selling it off.
From what I can tell, an Ascensus SIMPLE IRA allows only investments in a select list of Vanguard funds (50 or so?). No EFT's, stocks, or funds from other companies.
Ha! I jumped completely out of Vanguard 2 years ago because I didn't like what they were doing or their investment priorities. That little voice earned its pay.
Vanguard seems to slim their product range in Europe as well. Vanguard Germany recently completly closed their brokerage and robo investment offering. They offered that service for a little under 2 years.
I mentioned this in a previous post asking for advice. I called and found out all accounts labeled "brokerage" and with an 8 digit account # will remain with Vanguard.
I had the funds my one nonconforming Simple IRA transferred to another account. Done.
Schwab does not offer SIMPLE IRAs where the entire employer plan isn't being held with them. I only started with Vanguard for mine precisely because Schwab didn't offer them. I'm looking at moving to E-Trade. I already have accounts at Fidelity, but I don't know for sure if they actually offer them, while I do know E-Trade does.
I'm moving my SEP to Fidelity's and keeping the same fund. I called them and they offer Vanguard VTSAX so should be ok with no worries on taxes or fees I have to pay to do this. I may move everything over to Fidelity so I can have it all under one.
Vanguard actually does have cash management via their new Cash Plus accounts.
I like Vanguard, but fail to understand how an customer owned company that doesn't have a stock or have to pay a dividend, has such a pathetic user interface and cannot destroy a BlackRock or State Street, then does shady things such as 'sell' IRA's.
The dividend is paid into the business to reduce fees.
Or at least that's how I understand it.
We took our funds out of the 401's both the trad and the roth 401k and just had Vanguard put them into the Roth, SeP, and brokerage accounts, we have no idea who that other company is nor why Vanguard did that stuff.
Thanks for the update Rob! Very useful info.
I'm moving my Simple IRA to another of Vanguard's accounts before they make money off of my ass, and that's happening tomorrow as scheduled. Thanks for the video. I recommend the Vanguard Target Retirement Funds. Its too bad Vanguard isn't very sophisticated and couldn't directly contact those 280,000 customers they were about to screw out of money.
I worked for a small company that had a 401(k) plan at Ascensus. They are fine. I have nothing bad to say about them.
I just yesterday got a letter from vanguard announcing this sale of my Solo 401k.
Thanks for alerting me and information on where else I can move it.
Currently talking to Schwab to see if I can move it there.
Just dishing out BANGERS!
I don’t think it’s just small employers, I work for a company with over 30K employees, and our plans will move to Fidelity in July.
The thing about Fidelity's accounts that have those expenses, they're all managed accounts. That means someone is picking your investments, doing your rebalancing, adjusting for business cycles, all for you. You literally set it and forget it. In contrast, at Vanguard you're doing all your own strategy and execution. At Fidelity that's free too, but for most people who work full time, and NOT in finance, it pays to not be doing it all yourself around your actual job. But yeah, if you want to do it all yourself, it probably doesn't much matter whether you choose Vanguard, Schwab, Fidelity, etc. They all have some types of no fee offerings.
Rob, have looked at Strive Asset Management? I like putting performance over politics when it comes to my money and would love to hear your analysis on this firm and how it compares to Vanguard, Blackrock, State Street, Fidelity, and the others.
It's happening before the 3rd quarter. VG confirmed account transfers to Ascencus are scheduled for July 17-19th.
Vanguard also transferred management of 403(b) accounts to Ascensus.
For structure, train them to lay out clear and conceivable objectives, have some viewpoint on this reality, take out sensible issues, and make monetary projections. Be keen, coordinate your advancement, look for course, and go through research. With great standards and backing, your business can prosper and win in an environment of detached progress.
I tried to move an IRA into Vanguard. Talked to 3 different people and got 3 different answers on how to do it. Very Hard to get in touch with a customer rep at vanguard. Got frustrated and moved it to Fidelity wo any fuss there.
Yes Fidelity actually answers phone, and returns calls. bent over backwards helping transferring in a small HSA (only high 4 figures) I do have a mid 6:figure IRA, and my wife has a low 6 figures one. When she retires we will surely transfer her HSA there as well
My guess is they are streamlining business operations to reduce costs. I have to imagine it costs a little more to run smaller plans.
It's crucial for small business owners to stay informed about changes to their retirement plans. Considering alternatives like Fidelity and Schwab, which offer competitive options without fees, could be a smart move. 💼
I am not affected by theses changes. But I’m sticking with Vanguard for all the rest of my Roth, IRA and brokerage accounts. I do not see this as a negative to Vanguard.
This is where I am at the moment.
Same here. Rob seems really down on Vanguard lately. I have had nothing but very positive experiences. With both the web site and customer service. No complaints at all.
Vanguard has my IRA and getting RMDs and sending out Qualified Charitable Distributions works a treat! Some things could be easier but I’m okay.
@@9rows I had a 401(k) with Vanguard until early this year. I still have a brokerage account. These appeared as different entities within Vanguard, having different customer services. I have good experiences with the brokerage side.
Same here. I've used Fidelity at work and they are fine, but I'm sticking with Vanguard who is owned by share holders and have overall lower costs at the expense of having less fancy website features. I like keeping it simple and Vanguard Advisory Services are far lower at 0.3% if by chance you want a dedicated advisor with access to Vanguard's great managed funds.
I was not familiar with Ascensus either although it sounded familiar and I just realized why....I was looking at 529 plans and noticed they are the fund managers for a bunch of state funds.
Vanguard cleaned out my 401k without notifying me! All money transferred to Ascensus with no info on where it went, account #, etc. wtf?! Scared the crap out of me and they will hear about it when their office. opens on Monday
This is very helpful. I just found your channel. Thank you 😊
One more recent change at Vanguard. Near the end of last year Vanguard eliminated their Coverdell education savings plans. We had to roll my son's plan into a regular 529 plan.
Hello! First of all, thank you for your channel & videos, they are extremely helpful & informative. I was hoping you could elaborate on your "freeloader" approach...what specifically you mean when you say that you get benefits and services without paying the high fees. Have you made a video specifically on this topic, or could you provide more details as to exactly what you mean?
Do you get the feeling that Vanguard is trying exit the brokerage business entirely and focus on selling their mutual funds and ETFs on other platforms?
good question
Hi Rob
I have a question I’ve been trying to solve. That is regarding solo 401(k). There are several bloggers and UA-camrs stating that a person can have a solo 401(k) if they have part-time employees that work less than 500 hours per year there’s more to the rule than that. But that’s the basics. I think they are crossing that information from traditional 401(k) and implying that that could be a rule for a solo 401(k). The IRS website says you cannot have any common law employees meaning anyone on a W-2. Except for a partner or a spouse. I’m going to reach out to my CPA.but this question does a fact, my spouses solo 401(k). Any thoughts?
Do you have a video on the following topic? My wife's employer changed a few years ago and we moved the funds in her previous 401(k) to consolidate under her new employer's plan. The old plan charge a considerable "fee" to allow the money to be moved. This didn't seem right. This video made me wonder if such as thing would happen in this Vanguard case. Thanks.
They sold my annuity to Transamerica. Shortly after the transfer was made, Transamerica raised the annuity to the maximum allowed.
Ascensus Trust is where I had to send a rollover check when I was moving money into my Vanguard 403b
My guess is they just don't see the financial benefit of keeping these small plans so they're selling them off and focusing on larger customers. There will likely be some layoffs at Vanguard too for people that were focused on these plans. Seems like what a lot of corporations do when things are about to get rocky. They cut the stuff around the edges that isn't a big chunk of their business and the staff that goes with it and focus on their bread and butter.
I wonder if any of the workers in their overseas call centers who read from a script cannot comprehend English will be laid off.
@@smallcoffee75 I doubt it. :(
My Vanguard 401(k) is at Ascensus. Or my Ascensus 401(k) is at Vanguard. Not sure which. I can log into either website using the same login credentials.
Doesn't even matter which website I use. The UI is the same.
Yikes. Another thing to keep in mind. Good to know about Vanguard. Thanks!!
Vanguard stopped servicing some IRA annuity accounts back in 2020 - Those accounts invested in Vanguard funds but held by Transamerica - It was a messy move - if I remember.
Troubling if Vanguard has done business with Transamerica. My late mother had a small life insurance policy that originally was with Sun Life as I remember - the policy apparently got sold a couple times,ended up as Transamerica. I am listed as beneficiary. Transamerica has refused to pay. I think their business model is to try not to pay. Piratical in my opinion. Another similar small policy was with Prudential which promptly and courteously paid with a minimum of documentation asked for. Transamerica asked for much more docu and personal information and did not pay. I believe that I e- mailed them her death certificate.
@@davidpowell3347 Perhaps, you can get Fidelity - or similar company - involved to make a transfer to them if they offer similar policies. They have clout to get it done.
@@davidpowell3347 Does a company such as Fidelity offer similar contracts? Ask Fidelity to transfer those policies from Transamerica to Fidelity. They have the clout to get it done without all the stalling tactics. Perhaps worth a try.
Totally agree that Vanguard hasn't kept up feature wise... Cash management, fractional share purchases, auto investment of stocks/ETFs, large selection of Bonds, auto roll on Treasuries, check writing are many things Fidelity does that Vanguard either doesn't do or doesn't do well.
It's true that Fidelity mutual funds are more expensive. However, with the advent of ETFs, you can keep costs low by purchasing Vamguard (or other company's) ETFs.
Good to know. I'll roll my 401k next week.
Selling???? The Vanguard Group is mostly a service company for the accounts that hold Vanguard funds and Brokerage accounts....
So... Is Vanguard selling the servicing to the other company and getting a profit, or are they just transferring the accounts to them for them to service? The letter said Ascensus is acquiring the accounts, not that they bought them.
So, maybe Vanguard decided that those accounts have higher service costs and so are transferring them....and those higher costs is why Ascensus is charging fees...
Also, the Vanguard funds themselves have lower fees, so would the cost to invest at, say, Fidelity be more than Vanguard, because the service costs to the funds are higher to begin with? Fidelity has stockholders that they have to pay, but Vanguard does not.
It doesn't really make sense, though as service is what Vanguard does.
$20 isn't bad compared to a brokerage that charges fees on the fund value that exceed it annually.
There are companies that buy up small business 401k plans and then add lots of fees and penalties while making it difficult to access them or move your account. This is my experience, but not with any of the company’s mentioned in this video.
They did this to my ESA Coverdell savings (education) account last year. They eliminated these accounts which a had to move to Schwab.
If everyone did low cost index fund investing at Fidelity and didn't fall into the trap of actively managed mutual funds, I wonder if Fidelity would run into similar troubles.
how would this effect a VOO, vanguard S&P 500 investment, is it a bad idea to keep a VOO or other vanguard ETF?
Huh...now that Jack is gone, I wonder if Vanguard is becoming the Boeing amongst the brokerage firms.
What do you mean when you said they have given up on cash management? Don't their money market accounts pay higher yields than anything offered by their competition?