Vanguard review

Vanguard is an investor-owned company with a strong track record that’s better for long-term investors.

Vanguard is best known for its low-cost investment options. The company has no private owners, which allows it to keep operation costs low and give more back to its investors. But their brokerage accounts are ill-equipped for day traders or those looking to use complex options strategies.

  • Consider Vanguard if you’re a long-term investor with a high account balance.
  • Look elsewhere if you’re looking for high-volume stock trading.

$20 per year

Fee

Details

Option trade fee$1
Asset typesStocks, Options, Mutual funds, ETFs
Account typesBrokerage, Retirement

What investments does Vanguard offer?

Vanguard offers an assortment of investment products and account types, including brokerage, retirement and 529 college savings accounts. Trade the following securities:

  • Stocks and ETFs
  • Mutual funds
  • Options
  • CDs and bonds

Who is Vanguard best for?

With over 1,800 in-house exchange-traded fund (ETF) and mutual fund options — and no fees for online trading — Vanguard appeals to anyone looking to buy and hold investments. A Vanguard Brokerage account is recommended for:

  • Investors with high account balances. Because of Vanguard’s tiered approach to customer benefits, customers with high account balances receive more personalized help and lower account fees.
  • Long-term investors. Vanguard’s customer-owned model gives them a significantly lower expense ratio than the industry average. That means more of the money you earn stays in your account, earning you more for your long-term investments.
  • Mutual fund investors. Vanguard offers no-fee mutual fund investing into its own funds as well as others with no investment fee.

Fees and costs

Vanguard’s trading and account fees are fairly competitive. It doesn’t charge commissions on stocks and offers a sweeping selection of fee-free ETFs and mutual funds.

Most trades made through Vanguard’s online trading platform are free, but a $25 to $50 fee applies to any trades made over the phone with the help of a Vanguard broker — a common practice for platforms with brokers available by phone. For investors with account balances of $50,000 and up, discounted phone trades are available.

SecuritiesTrading fees
Stocks and ETFs$0
Options0% commission + $1 per contract
Mutual funds
  • Vanguard mutual funds $0
  • No-transaction fee (NTF) mutual funds from other companies $0
  • Transaction-fee (TF) mutual funds $20 per trade
CDs and bonds
  • CDs, US government agency securities, US Treasury securities, corporate bonds $0
  • Mortgage-backed securities $35 per trade

Vanguard also charges a $20 annual account fee but offers a number of conditions for waiving the fee:

  • Investors with at least $10,000 in Vanguard ETFs mutual funds
  • Investors with at least $50,000 in qualifying Vanguard assets
  • Investors who opt into e-delivery of account statements
  • Investors with an organization or a trust account registered under an employee identification number (EIN)

Note also that Vanguard offers a variety of accounts, including Personal Advisor Services with access to financial advisors, and Digital Advisor, an automated account. Both have different minimums and fees from this account.

Vanguard mutual fund investment minimums

Vanguard offers three classes of mutual fund shares, each with its own minimum investment requirements. The three tiers are:

  • Investor Shares. Most require a $3,000 opening investment, while some start at $1,000.
  • Admiral Shares. Admiral Shares have a $3,000 minimum investment for most index funds, $50,000 for actively managed funds and $100,000 for a selection of sector-specific index funds.
  • Institutional Shares. Most institutional shares require a minimum investment of $5 million.

Vanguard Personal Advisor Services: Best for investors with large portfolios

For those who prefer the human touch, Vanguard’s Personal Advisor Services offer ongoing access to a Vanguard financial advisor. Your advisor works with you to determine your ideal investment strategy and curates a portfolio that best fits your financial goals. The downside? You need a portfolio of at least $50,000 to be eligible for the service.

  • Minimum investment deposit: $50,000
  • Annual advisory fee: 0.30%

Vanguard Digital Advisor: Best for hands-off investors

For those seeking a robo-advisor to manage their account, Vanguard’s Digital Advisor may be a practical fit. It offers access to both traditional and Roth IRAs, and investors gain direct access to Vanguard’s low-fee ETFs. But you’ll need at least $3,000 to get started, and the service isn’t equipped to offer tax-loss harvesting.

  • Minimum investment deposit: $3,000
  • Annual advisor fee: 0.15% to 0.20%

How do I sign up?

Follow these steps to become a part of this investor-owned company:

  1. From the Trading Online page of Vanguard’s website, choose Open or transfer accounts.
  2. Select Let’s open my account or Begin my transfer or rollover.
  3. Select how you will fund the account and choose Continue to open a new account. If you have an existing account, use your credentials to log in. If not, select No and then Continue.
  4. Note the required information and process information and choose Continue.
  5. Select why you’re investing and the account type you want to open, then choose Continue.
  6. Select your Primary— or SecondaryInvestment objective, then select your Source of funds. Choose Continue.
  7. Enter your personal information, including your employment status and income, and choose Continue.
  8. When you have funded the account, review your information and e-sign to open your account.

Eligibility

To qualify for a Vanguard account, you’ll need:

  • To be at least 18 years old
  • Valid Social Security number
  • Valid US residential address

Required information

You’ll need to have the following details handy during the application process:

  • First and last name
  • Social Security number
  • Address, phone number and email
  • Employer information
  • Investment goals
  • Investment and financial information

Research tools

Vanguard’s research options — specifically its charting tools — may not be comprehensive enough to cater to active traders:

  • Stock screener. Filter stocks, ETFs and mutual funds by a variety of metrics to narrow down your investment options.
  • Asset allocation. Fill out Vanguard’s asset allocation questionnaire to help you diversify your portfolio and optimize your risk tolerance.
  • Charting tools. Perform your own technical analysis with limited drawing tools and 15 technical indicators.
  • Analyst ratings. Compare analyst opinions from Argus and Market Garder.
  • Market news. Stay on top of market trends with news from the Associated Press and MT Newswires.

Pros

Vanguard’s company model created a lot of unique advantages for its investors:

  • Investor-owned company. After investing in a mutual fund or ETF, you own part of the company.
  • Low expense ratio. A low average expense ratio at 0.10% means lower overhead, and you get to keep more of your earnings.
  • Wide variety of investment options. Whether you’re investing for retirement, saving for education, or investing to grow your wealth, Vanguard has options for you and advisers to help you build your plan.
  • Hands-off investing. Vanguard offers self-directed accounts, financial advisers and a fully automated robo-advisor, so you can choose how hands-on you want to be.

Vanguard’s tiered benefits

The more you invest, the more it has to offer.

For account balances up to $50,000:

  • No commissions. Buy and sell Vanguard ETFs and mutual funds, and your trades are commission-free.
  • Low stock trade fees. Pay only $0 per trade for the first 25 trades a year.
  • Investor education and tools. Vanguard provides an investment knowledge base, as well as calculators and tools to help you create an investment plan.

For account balances from $50,000 to $500,000:

  • Personal adviser services. A personal adviser creates a custom investment plan for you, reviews your portfolio quarterly, and is available by phone, email or video chat to answer any questions. Advisers charge an annual service fee rather than a commission — $3 for every $1,000 invested.
  • Reduced commissions. Pay lower commissions and transaction fees on all stock and non-Vanguard ETF trades.
  • Canceled service fees. No account service fees on most account types.

For account balances from $500,000 to $1 million:

  • Certified Financial Planner. Your personal adviser becomes a CFP to advise and manage your portfolio.
  • Investment team. At this level, you have access to a full team of investment professionals to advise, answer questions and make transactions for you.
  • Greater discounts. Make non-Vanguard ETF and stock purchases for $2 per trade.

For account balances from $1 million to $5 million:

  • Personalized resources. Access to specialists in everything from estate planning to philanthropy, depending on your investment goals.
  • Deeper discounts. More reduced commissions and 25 more commission-free trades in your brokerage account.

Cons

Because the benefits are tiered, expect to pay more in fees and costs if you have a lower account balance.

  • Trading technology limits. Vanguard doesn’t offer streaming quotes, which limits day trading and makes complex options strategies impossible.
  • Basic mobile app. While most people find the app more intuitive than the website, the lack of features like live-chat customer support makes it too simplistic to use as a trading tool.
  • High minimum investment. There’s technically no minimum account balance, but mutual funds require a minimum investment of $1,000, and most require a $3,000 investment.

Is Vanguard legit?

Yes. Vanguard was founded in 1975 and has become one of the world’s largest investment firms, with over $6.2 trillion in global assets under management.

Your accounts are protected by Securities Investor Protection Corporation (SIPC) for up to $500,000, which includes $250,000 for claims for cash. Vanguard Brokerage Services is also a registered broker with the Financial Industry Regulatory Authority (FINRA).

Vanguard reviews and complaints

As of October 2021, the Vanguard Group has an A- rating with the Better Business Bureau (BBB) but isn’t accredited. The company has a 3.9 out of 5-star rating at Consumer Affairs, with 634 reviews in the last year.

BBB ratingA-
BBB accreditedNo
BBB customer rating1.11/5 based on 28 customer reviews
Trustpilot score3.6/5 out of 383 customer reviews
Google Play app1.5/5 stars based on 6,435 reviews
Apple app store4.7/5 stars based on 167,471 reviews
Customer reviews verified as ofOctober 2021

A majority of the negative reviews complain that the company is slow to respond to account changes and transfer requests. The positive reviews point to the excellent, pressure-free advice they get from company experts and advisers and how well the customer’s portfolios have grown.

How do I contact Vanguard support?

If you need assistance with your personal brokerage account, use one of the following options:

  • Phone. Call 800-349-5814, weekdays from 8 a.m. to 9 p.m. EST.
  • Secure email form. From the Contact Us Brokerage Services page, choose Send a secure message to fill in Vanguard’s email form. There’s a non-secure option if your browser doesn’t support SSL and encryption.

Compare with other stock trading platforms

Explore your options by asset type, option trading fee, annual fee and signup bonus. Select the Go to site button for more information about a particular platform.

Name Product Asset types Option trade fee Annual fee Signup bonus
Robinhood
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J.P. Morgan Self-Directed Investing
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$0 + $0.65/contract
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INVESTMENT AND INSURANCE PRODUCTS ARE: NOT A DEPOSIT • NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE
Vanguard Personal Advisor
Stocks, Options, Mutual funds, ETFs
N/A
$20 per year
N/A
Financial advice powered by relationships, not commissions.
TradeStation
Stocks, Bonds, Options, Mutual funds, ETFs, Cryptocurrency
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Sofi Invest
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Moomoo
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Trade stocks on the US, Hong Kong, Shanghai and Shenzhen markets.
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*Signup bonus information updated weekly.

Disclaimer: The value of any investment can go up or down depending on news, trends and market conditions. We are not investment advisers, so do your own due diligence to understand the risks before you invest.

Bottom line

Vanguard stands out for its collection of fee-free mutual funds and ETFs, making it an ideal choice for long-term investors or those saving for retirement. But the firm’s offerings may fall short for active investors.

For instance, Vanguard’s research tools aren’t as robust as those of its competitors. A $1 per contract fee on options trades is also higher than it is for most competitors. And some mutual funds require large minimum investments.

But before you decide to open an account, compare trading platforms to find the one that works best for you.

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