Consistent with Vanguard’s long-term investment ethos, there are some gaps in this brokerage platform’s offering. Foreign exchange (forex), futures and cryptocurrencies are some of the asset classes missing from the Vanguard lineup.
Vanguard offers two ways to hold cash in your account: a money market fund and certificates of deposit (CDs). The money market fund has a minimum investment requirement of $3,000 and an average seven-day SEC return of 0.01%, with expense ratios ranging from 0.09% to 0.15%.
CDs have a minimum investment requirement of $1,000 and are FDIC insured for up to $250,000. Vanguard currently offers yields ranging from 0.05% to 2.00% for maturities from three months to 10 years.
Vanguard Digital Advisor
Vanguard Digital Advisor is a below-average fee robo-advisor that invests money in one of four Vanguard ETFs, with expense ratios ranging from 0.03% to 0.08%. While the digital advisor is well-suited to younger investors who want a simple investment portfolio and low fees, it lacks certain common traits of other robos, like ESG funds or collecting tax losses.
To start investing with Vanguard Digital Advisor, complete a short questionnaire that will help you determine your retirement goals, risk tolerance, and funding needs to meet your goals. This will help the robo advisor invest you in the best ETFs for your needs; The program will then automatically rebalance your account over time.
For taxable broker accounts, there is a minimum registration balance of $3,000 for Vanguard Digital Advisor and a minimum registration balance of $5 for 401(k) accounts.
Vanguard personal consulting services
Investors with larger portfolios should check out Vanguard Personal Advisor Services. It requires a minimum balance of $50,000 and charges an annual administration fee of 0.3% of your balance.
To get started with Vanguard Personal Advisor Services, complete a questionnaire to determine your goals, risk tolerance, and funding needs. Once you complete this step, a financial advisor will contact you so you can work together to create an investment plan and portfolio tailored to your needs.
If your portfolio is between $50,000 and $500,000, you get access to a team of financial advisors to help you plan. Investors who have invested more than $500,000 will work with a dedicated advisor who will stay with them long-term.
Personal Advisor Services invests your money in one of four Vanguard ETFs with expense ratios ranging from 0.03% to 0.08%. While the program does not provide tax loss recovery, it does offer a service called the MinTax cost basis method to help you determine which asset sales in your portfolio qualify for preferential tax treatment.