Above-the-fold article on this morning's WSJ website. Also mentioned are concerns over new fees nickle-and-diming customers and how growth of AUM not leading to customer service/interface improvements.
(gift link)
https://www.wsj.com/personal-finance/vanguards-die-hard-customers-have-a-message-for-new-ceo-the-service-is-abysmal-c2da0491?st=79tslq2qz4mj6bi&reflink=desktopwebshare_permalinkVanguard ranked last out of eight major brokerages for customer satisfaction with website performance and mobile apps in a recent survey of 2,700 investors conducted by Investor’s Business Daily, which is published by The Wall Street Journal’s parent company, Dow Jones. The asset manager has acknowledged the problems, which some analysts chalk up to an underinvestment in technology.
Former CEO Tim Buckley, who announced his retirement in February, said in 2019 that the firm would spend $1 billion a year to improve its technology. Vanguard rolled out a modernized app in 2021, but customers weren’t impressed and complained of bugs and dumbed-down functionality.
“The complaints go back years and years,” said Daniel Sotiroff, a research analyst who covers Vanguard at Morningstar. “Part of the issue is their size and how fast they’ve grown. It’s hard to turn the Titanic.”
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For investors having web or tech issues, the lack of night or weekend service is a particular point of frustration. Vanguard’s customer-service line is open Monday through Friday from 8 a.m. to 8 p.m. Eastern time. Rivals Fidelity and Charles Schwab both offer 24/7 customer service by phone.
“They’ve always tried to keep costs low and service has suffered as a result,” said Jeff DeMaso, editor of the Independent Vanguard Adviser, a newsletter. “Long wait times are an issue.”
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There’s a theory, and I’m not the only one to come up with it, that they’d rather move people onto the personal advisory service where they make more money or they’re just as happy if they go to another brokerage,” said Allan Roth, founder of Wealth Logic, a financial-planning firm.
Comments
Customer complaints on a % basis , I don't see it presented.
I'm not a fan of VG, but I do have an account there.
Last question. When RMD account runs out of money, are you charged $100 ?
I called them up a short while ago about opening up a new taxable account. I didn't want to open an account online, but couldn't find a form on their website. The rep told me they don't post the forms because they're trying to save me money. I explained that I'd rather do everything via USPS. I had to be sent a form via a super-secret email thing or whatever. I don't care if they shave another .0001 points off the expense ratio at this point -- I'll pay that extra .0001 in ER to get decent service.
2) firm had strong reputation; 3) firm was mutually owned vs. publicly traded.
I was never fond of Vanguard's investor website even after it was redesigned.
I seldom contacted Vanguard for assistance but did experience several suboptimal interactions.
Dan Wiener (The Independent Adviser for Vanguard Investors) chronicled Vanguard's customer service
issues for years. Regardless of the new CEO, I'm not confident these long-standing issues will be
ameliorated in the near-future. Updated commission and fee schedules (effective July 1) suggest
Vanguard is prioritizing "nickel-and-diming" investors rather than improving customer service.
Consequently, my two Vanguard accounts were recently transferred to other brokerages.
"Maybe their new motto will be 'Please buy our finds, but not from us.'"
Exactly. Vanguard is a fine mutual fund company but a lousy brokerage.
This tread is named, 'Customer Service Mega Thread' and begins March 29, 2024. Scroll down the page to the blue colored area, second paragraph. This write says a lot.
I have no desire to read the thread, but some here may have an interest.
My last Vanguard connection was a 401k plan. The rollover of that plan to a Fidelity IRA was absolutely smooth. A three way phone call and presto, finished in about 20 minutes. I suspect that wouldn't happen today.
where he reportedly stated: "Vanguard’s technology spending is paying off."
The following info is from Jeff DeMaso's IVA Weekly Brief for Wednesday, July 9.
"Ramji pointed to quicker updates to the 'front-end experience' (the side of Vanguard’s site you and I use)
as proof of progress. But two weeks after I first wrote about it, I still don’t have a 'Compose' or 'Send Message' button in my Message Center on vanguard.com."
"Earlier this month, two IVA readers contacted me after their routine ACH transactions failed.
One had an automatic monthly transfer that’s been humming along for more than a decade
and suddenly stopped. The other had a trade reversed because Vanguard was unable
to withdraw the money from their external savings account."
"Then there’s the simple (yet fundamental) task of showing the correct fund holdings.
Take Total International Stock ETF (VXUS), which owns more than 8,500 stocks.
On Vanguard’s Investor site, the holdings list shows… just three companies:
SCB X PCL, Saregama India, and AEM Holdings. (If you haven’t heard of them, you’re not alone.)"
The following link can be used to view the portfolio composition for VXUS.
https://investor.vanguard.com/investment-products/etfs/profile/vxus#portfolio-composition
Equity Fixed income Short-term reserve Portfolio composition file
There is header above the 3 listed holdings in the link you provided.
Click on [Portfolio composition file]
You will then see the following, in blue, at bottom of your screen:
View the PCF for this Vanguard ETF
Click on it, accept the conditions, and you have access to 1,375 page listing of holdings, broken down into ten holding per page.
Pretty simple, huh? Couldn't be friendlier!
This could make Schwab blue, and Fidelity green with envy!
Please excuse me for a while—it will take some time to review these holdings.
I recall that at one time, Vanguard had received special permission to not disclose its ETF holdings on a daily basis, and that they were granted a delay with respect to disclosure. Don't know if that 'understanding' or special permission is still in effect.
Case in point, I had a frustrating website experience at Vanguard yesterday.
I am managing a friend's portfolio and wanted to sell "all shares" of an OEF on line. Got a nonsensical error message that the transaction could not be completed because the fund had insufficient shares. Requested I call an agent. Was on hold for 45 minutes until I finally got an agent on the phone. However, he got the same error message and spent the next 15 minutes in the "back office" trying to complete my transaction request. Seemed to be as frustrated as I was.
Thankfully, he finally was successful, but I wasted a good hour on the phone. It was also a good reminder why I prefer not to have an account at Vanguard. Low cost or not.
Most of Vanguard's equity ETFs have been passive and those do require daily disclosures. Why would that be an issue for indexed ETFs?
On the other hand, active equity ETFs are newer and daily disclosures had been a big issue. But after the SEC opened the floodgates a few years ago, , there are now nontransparent, semitransparent and transparent ETFs now.
Vanguard is starting to move into active ETFs.
recorded at the recent Morningstar Investment Conference.
This podcast was published on July 8.
https://www.morningstar.com/podcasts/the-long-view/1bdada96-5893-45e1-969f-6ba3440902b3
But when Salim first said they were revamping I thought it might be the perfect time to revamp. as Vanguard is kind of a DIY stalwart, build AI into everything. I don't know if they'll do that. time will tell.