Vanguard Review 2021 – ETF & Mutual Funds

By | May 11, 2021

Vanguard is a US-based stockbroker established in 1975. The company is regulated by the SEC & FINRA. It offers trade-in ETF and Mutual Fund in a selected number of options. Read the full Vanguard Review below.

It has a long operating history which makes it safer to trade with.

Vanguard Review

Account Opening

Account opening at Vanguard is an easy and fully digital process. Although, it requires 2-3 days for verification which makes it slow in comparison to its competitors.

It is a US-based broker and its primary target is US clients only. It operates in other countries of the world with some other subsidiaries & partners.

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Minimum Deposit

The minimum deposit at Vanguard is $0. But it charges some amount if you trade on margin or use Robo services.

Vanguard minimum deposit by account type

Trading PreferencesMinimum Deposit
Trading at Standard (basic) accounts$0
Margin account $2000
Vanguard Personal Advisor Services$50,000

Account Types

Account TypesAbout Accounts
Individual Brokerage AccountAccount is owned and used by a single individual
Joint Brokerage AccountAccount is owned and used by two or more individuals
Business AccountsAccount is owned and used by a legal entity
Roth / Traditional / Rollover IRA AccountsIndividual retirement accounts
Education Savings AccountAccount is for educational purpose savings
Trust AccountAccount is in the name of an already established trust
Vanguard Personal Advisor ServicesAccount is managed by Vanguard’s technological (robo) and personal advisors

Fees

Vanguard has low nontrading fees, no inactivity fee & withdrawal is also free. It offers free ETF trading plus bonds and funds are also free to some extent. 

Vanguard fee snapshot 

AssetsFee Terms
US stockAsset invested under $50k: $7 for first 25 trades per year, $20 thereafter
Mutual fund$20 per trade if investment is less than $500k, but Vanguard funds and 3000 other funds are free
Inactivity feeNo inactivity fee

Vanguard trading fees

Services Stock commission per tradeETF commission per trade Non-free mutual fund commission per trade Treasury bond commission Options commission per trade 
Standard(Under $50k)$7 for first 25 trades per year, $20 thereafter$0USD20$0$7 + $1 per options contract
Voyager Services ($50k-$500k)$7.0$0USD20$0$7 + $1 per options contract
Voyager Select Services($500k-$1 million)$2.0$0USD8$0$2 + $1 per options contract
Flagship Services($1 million – $5 million)$0 for first 25 trades per year, $2 thereafterUSD0$0 for first 25 trades per year, $8 thereafterUSD0$0 for fist 25 trades per year, $2 + $1 per options contract thereafter
Flagship Select Services(Over $5 million)$0 for first 100 trades per year, $2 thereafterUSD0$0 for first 100 trades per year, $8 thereafterUSD0$0 for first 25 trades per year, $2 + $1 per options contract thereafter

Vanguard annual margin rate tiers

Transaction ValueRateBase Rate
$1,000,000 or more4.75%Base rate – 1.25%
$500,000 – $999,9995.25%Base rate – 0.75%
$250,000 – $499,9996.50%Base rate + 0.50%
$100,000 – $249,9997.00%Base rate + 1.00%
$50,000 – $99,9997.50%Base rate + 1.50%
$20,000 – $49,9998.00%Base rate + 2.00%
Under $19,9998.50%Base rate + 2.50%

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Deposit & Withdrawal

Vanguard does not charge any deposit fee. Clients can use ACH, bank & check for transfers. Electronic wallets are not supported by Vanguard.

The process of withdrawing is the same as the deposit but it charges $10 for a wire transfer from US clients. 

Trading Platform 

Vanguard has two types of trading platforms: web trading and mobile trading. It does not provide a desktop platform. Vanguard has a two-step login feature, which makes it secure. 

It has an average search function, along with that it is hard to navigate. Some options are difficult to find & have average customizability.

Products Offered

Vanguard gives access to a no. of tradable options, but it does not allow trade in forex & futures. The products offered to cover only the US market. 

Vanguard product selection 

Stock markets (#)4
ETFs (#)2,300
Fund providers (#)290
Bonds (#)13,400

Vanguard personal advice service

You can make use of this service if you do not have much idea about the market. In this, you will get recommendations from experts and Robo advisory services about the portfolio to invest in. 

You have to give them your financial goals, after which they regularly give recommendations to manage your account and stocks to invest in.

The minimum investment is $50,000 and has an annual 0.30% fee.

Education 

Vanguard offers education materials in many format this includes :

  • Demo Account 
  • Platform tutorial video 
  • Articles
  • Webinars
  • Talking green podcast 
  • In-person events

Customer Service

You can connect to Vanguard via phone & email only. There is no live chat available and the service is only available on weekdays. You can not contact them every time. So this is a drawback here in comparison to its competitors. 

Pros/Cons

ProsCons
Some ETFs and mutual funds are free to tradeOnly the US market covered
No inactivity feeHigh financing rates (margin rates)
No minimum depositOptions and bond trading are not available
Free withdrawal (via ACH)$10 for wire transfer withdrawals
Personal advice serviceSome features are hard to find

Safety

Vanguard customers are protected under the SIPC customer protection scheme. SIPC protects investors against loss of cash and securities in case the broker goes devastated.

The limit for SIPC protection is $500,000, where $250,000 is reserved for cash. The company is regulated by the SEC & FINRA. It also has a long track record which makes it safe.


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Bottom Line

Vanguard is one of the biggest US stock brokers. 

It offers free trade in ETF & Mutual funds. It also does not have any inactivity fee. Account opening is fully digital. The trading platform is user-friendly. 

Although it has drawbacks as it does not have 24/7 customer support. Portfolio assets are limited only to the US market & financing rates are also high.

But as it charges no inactivity fee and is easy to use, feel free to try this. 


vanguard

9

Account

9.4/10

Trading Platform

9.0/10

Products Offered

8.8/10

Customer Service

8.9/10

Pros

  • No inactivity fee
  • Personal advice service

Cons

  • Only the US market covered
  • $10 for wire transfer withdrawals
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