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Does anyone have any experience in opening a Vanguard account in the name of a revokable living trust? Their account information makes no mention of that option at all, at least that I could see. No other fund company has given me any problems on this, but Vanguard seems to want to treat a revokable living trust like it's a big legal deal with lots of forms and BS.
No experience with trusts (though I did open an estate account with them), but here's where it seems you can find an account form:
- On the Vanguard (personal investor) home page, look to Forms at top right - On the forms page, "open a nonretirement account", Trust - Select Trust only form (which is really an all-purpose new account form)
On the form: 1) Type of account is trust 3-4) Trustee and trust info 11) Signature(s)
In #4 (and in the reminder at the end of the form) it says that you need to provide a copy of the trust agreement including trustee names and signature pages
I've no idea if this is sufficient, but this does appear to be the account-opening form you're looking for.
Here's a really old (2007) M* thread that seems to be consistent with the above. It notes that you'll also want to look at a change of ownership form if you're trying to transfer assets already at Vanguard into the trust once the account is open. http://socialize.morningstar.com/NewSocialize/forums/t/192493.aspx
(There was another way mentioned in the thread on how to do this - use a lawyer )
I thought you were also going to "trust" me; so that I might fund/direct monies to the local high school music/band program. Sadly, not much money arrives any longer from state education funds for such functions. What is directing you towards Vanguard for this trust? And/or is Vanguard only one of several areas for these monies? Edit: a quick look at Fido trust services indicates an annual fee range of: .85-1.70%, variable upon acct. and a minimum of $200k. Thank you and take care, Catch
@Catch22- Hello there. Actually, the revokable living trust has been set up for years, and in CA is a very common alternative to other variations for holding property in common with a married partner. It has to do with establishing a the step-up in property value for tax purposes at the death of the first partner, and avoiding probate after the death of the second partner. Because it is revokable, it does not have the complexities of more traditional types of trust.
So the trust itself has nothing to do with selecting Vanguard for an account. I'm just looking at the possibility of some VWINX, and don't want to pay Schwab every time I add a little or move something.
I did download Vanguard's standard trust form, and it is twelve pages long, very legalistic, and very intimidating. An exercise in absurdity compared to setting up similar accounts at American Funds or Schwab, for instance.
@Maurice- Thanks for your input Mo. Glad to see that you are alive, hope that you are well, and happy that you are still with us. I'm thinking that you are right on with respect to the VG bureaucracy. When we set up our account with the local Schwab office it was just like your Fidelity experience.
Vanguard is not that hard to deal with in theory. One needs to recognize that they are meticulous about following (and creating) rules. If one knows all the rules beforehand and plans on their being followed to the letter, things will go fine.
Realistically, most people are not so fastidious, and in unusual or complex situations get burned with Vanguard.
A couple of quick examples related to the estate I mentioned:
- Though I had POA, I expected Vanguard to freeze the accounts the instant I informed them of the death of the owner, and not to have access (even viewing access) until probate was started and I had letters testamentary. So I checked to see whether any last minute moves should be made (none needed), downloaded all records, and then called Vanguard. It took them a few hours to freeze everything, but otherwise they acted as expected.
- The deceased had written a couple of checks prior to death (I suppose "prior to death" goes without saying) that I really wanted to see clear. These were written against a Fidelity account. Fidelity said that they (like Vanguard) were supposed to shut down the account immediately, but that Fidelity would allow the checks to clear if they came through in the next couple of days. Much more reasonable, though likely not following the letter of the law.
With respect to min balances - I believe Fidelity will also close accounts that drop below the min balance. Vanguard says that it will convert Admiral shares to Investor shares if the balance drops too low. My experience there is that they do that conversion on closed funds but not on open funds they're not monitoring closely. So even Vanguard isn't 100% rigid.
Finally, regarding old MMFs - The original one was The Reserve Primary. After that, I believe was Dreyfus Liquid Assets (early 1974). Vanguard jumped in the next year with VMMXX.
I opened trust accounts with Vanguard and did not have any issues or complex paperwork to fill out. A copy of the trust was required and mailed with the application.
Vanguard customer reps kept me informed via email with the status of the applications (multiple accounts). Old_Joe, the 12 page application is a standard application for all types of accounts (including trusts), asks for information on contacts, address, funding and tax status which is basic for establishing an account. It was not difficult to complete, most was fill-in. I don't know what being legalistic means or being a big deal in your post, maybe you could elaborate.
Additionally Old_Joe, I had to provide the same information with my bank when opening a trust checking account. The experience of going to Schwab & Fidelity local office to establish/document & fund your accounts rather than mail is kind of of comparing apples to oranges. Now I'm not saying Vanguard is easier, better or whatever from Fidelity or Schwab but doing things by mail is different. Maybe you should re-think going to Vanguard and find a Schwab substitute for VWINX if your having trouble or doubts.
I'm doing the same thing for the same reasons and it's been an ongoing process. I downloaded the forms and sent them in no issues. They created the account with only one trustee when there were 2 on the form. It took 2 weeks to find that out as they kept telling me they didn't receive the forms. Another 10 days to correct the mistake. Then I found out I could only buy mutual funds so I'm trying to make it a brokerage account. 10 days waiting for the paper work, likely 10 days back. Fidelity got all this done in a week. I'm still sticking with it because I want someone to have easy access to the balanced funds they offer in case I die but if it was just for me I would get my money back and stick with Fidelity only. They told me they don't use email in matters concerning a trust account so that has been a big issue with Vanguard. I commonly use email with Fidelity. I see where Dennis1 says they used email with him but that's what they are telling me and I have received no email from them at all. They have point blank refused to use email and attach any documents. It would seem they would have at least notified me right away when the account was set up so I could get the number and send some more money. I'm not impressed at all. Junk like this Fidelity has over nighted both ways at their expense.
There are some things that Fidelity won't deal with by email either. But they are working on enabling their secure email system to handle more types of papers.
I "beta tested" this fairly recently (Fidelity made a one-time invitation when I spoke with them about some paperwork). I don't remember what document it was that I sent in. Easy enough to do on my end. But I got the impression that right now they were expending extra effort on their end to ensure everything went right. So not ready for prime time, but coming.
Comments
- On the Vanguard (personal investor) home page, look to Forms at top right
- On the forms page, "open a nonretirement account", Trust
- Select Trust only form (which is really an all-purpose new account form)
On the form:
1) Type of account is trust
3-4) Trustee and trust info
11) Signature(s)
In #4 (and in the reminder at the end of the form) it says that you need to provide a copy of the trust agreement including trustee names and signature pages
I've no idea if this is sufficient, but this does appear to be the account-opening form you're looking for.
Here's a really old (2007) M* thread that seems to be consistent with the above. It notes that you'll also want to look at a change of ownership form if you're trying to transfer assets already at Vanguard into the trust once the account is open.
http://socialize.morningstar.com/NewSocialize/forums/t/192493.aspx
(There was another way mentioned in the thread on how to do this - use a lawyer
I thought you were also going to "trust" me; so that I might fund/direct monies to the local high school music/band program. Sadly, not much money arrives any longer from state education funds for such functions.
What is directing you towards Vanguard for this trust? And/or is Vanguard only one of several areas for these monies?
Edit: a quick look at Fido trust services indicates an annual fee range of: .85-1.70%, variable upon acct. and a minimum of $200k.
Thank you and take care,
Catch
So the trust itself has nothing to do with selecting Vanguard for an account. I'm just looking at the possibility of some VWINX, and don't want to pay Schwab every time I add a little or move something.
I did download Vanguard's standard trust form, and it is twelve pages long, very legalistic, and very intimidating. An exercise in absurdity compared to setting up similar accounts at American Funds or Schwab, for instance.
Thanks- hope all is well at your end.
OJ
Realistically, most people are not so fastidious, and in unusual or complex situations get burned with Vanguard.
A couple of quick examples related to the estate I mentioned:
- Though I had POA, I expected Vanguard to freeze the accounts the instant I informed them of the death of the owner, and not to have access (even viewing access) until probate was started and I had letters testamentary. So I checked to see whether any last minute moves should be made (none needed), downloaded all records, and then called Vanguard. It took them a few hours to freeze everything, but otherwise they acted as expected.
- The deceased had written a couple of checks prior to death (I suppose "prior to death" goes without saying) that I really wanted to see clear. These were written against a Fidelity account. Fidelity said that they (like Vanguard) were supposed to shut down the account immediately, but that Fidelity would allow the checks to clear if they came through in the next couple of days. Much more reasonable, though likely not following the letter of the law.
With respect to min balances - I believe Fidelity will also close accounts that drop below the min balance. Vanguard says that it will convert Admiral shares to Investor shares if the balance drops too low. My experience there is that they do that conversion on closed funds but not on open funds they're not monitoring closely. So even Vanguard isn't 100% rigid.
Finally, regarding old MMFs - The original one was The Reserve Primary. After that, I believe was Dreyfus Liquid Assets (early 1974). Vanguard jumped in the next year with VMMXX.
Vanguard customer reps kept me informed via email with the status of the applications (multiple accounts). Old_Joe, the 12 page application is a standard application for all types of accounts (including trusts), asks for information on contacts, address, funding and tax status which is basic for establishing an account. It was not difficult to complete, most was fill-in. I don't know what being legalistic means or being a big deal in your post, maybe you could elaborate.
Additionally Old_Joe, I had to provide the same information with my bank when opening a trust checking account. The experience of going to Schwab & Fidelity local office to establish/document & fund your accounts rather than mail is kind of of comparing apples to oranges. Now I'm not saying Vanguard is easier, better or whatever from Fidelity or Schwab but doing things by mail is different. Maybe you should re-think going to Vanguard and find a Schwab substitute for VWINX if your having trouble or doubts.
Regards,
Ted
They told me they don't use email in matters concerning a trust account so that has been a big issue with Vanguard. I commonly use email with Fidelity. I see where Dennis1 says they used email with him but that's what they are telling me and I have received no email from them at all. They have point blank refused to use email and attach any documents. It would seem they would have at least notified me right away when the account was set up so I could get the number and send some more money. I'm not impressed at all. Junk like this Fidelity has over nighted both ways at their expense.
I "beta tested" this fairly recently (Fidelity made a one-time invitation when I spoke with them about some paperwork). I don't remember what document it was that I sent in. Easy enough to do on my end. But I got the impression that right now they were expending extra effort on their end to ensure everything went right. So not ready for prime time, but coming.