Slog
News & ArtsTuesday, March 10, 2009
Science / Economy Slog Virtual Investment Deathmatch
Posted by Jonathan Golob on Tue, Mar 10, 2009 at 5:33 PM
Today resident Slog expert and proud Canadian nationalist Will in Seattle provided the following investment advice:
But, yes, the best thing anyone under the age of say 60 can do is start putting money from each paycheck into a 401(k) or 403(b) low-cost index fund. Total Stock or US Stock is ok, but in general S&P 500 is the best choice due to the nature of financial cycles at this point.
Neat. Let's do that. After the closing bell today I 'purchased' $100,000 worth of VFINX, the Vanguard low-cost S&P500 index fund—about 1,500 shares at $66.63 apiece. Until I lose interest, I'll track the performance of this investment.
In fact, give me your suggested investment (starting today, and if it's something reasonable) and I'll do the same for you. Consider this the Slog virtual investment deathmatch. Who is the smartest luckiest investor? Who really knows how to play the markets?
1
Um, I said from each paycheck starting today.
And you can't sell it in less than seven years, fwiw.
Best choices are index funds with about a 0.15 to 0.18 percent annual cost.
And you can't sell it in less than seven years, fwiw.
Best choices are index funds with about a 0.15 to 0.18 percent annual cost.
4
Will wonders never cease. Will is just about correct for once. Vanguard is an excellent choice, due to their rock-bottom fees. Index funds rock.
The question is, how long are you going to stick to this? Because it simply does not matter what the S&P looks like tomorrow or six months from now or even six years from now. You're thinking long term. If some hotshot is blowing away the S&P in September, that doesn't mean this was a bad idea.
The question is, how long are you going to stick to this? Because it simply does not matter what the S&P looks like tomorrow or six months from now or even six years from now. You're thinking long term. If some hotshot is blowing away the S&P in September, that doesn't mean this was a bad idea.
6
How are you going to track dividends? Do you have a smaller Vanguard account so you know how big they are? Without the divident data you will not get an accurate picture of the performance of your investment.
7
No, the best bonds to purchase at this juncture are depressed bonds in firms that were hammered down on illusionary news but are in profitable firms that won't go bankrupt.
I'd recommend a utility with some moderate exposure to alternative energy where people are overreacting to short term news that has little impact on long term profits.
Bonds were good for the downslide mostly and are ok if high-yield corporates in firms that will survive the next 3 years or so.
I'd recommend a utility with some moderate exposure to alternative energy where people are overreacting to short term news that has little impact on long term profits.
Bonds were good for the downslide mostly and are ok if high-yield corporates in firms that will survive the next 3 years or so.
8
@6 - an easier way is an ETF from Vanguard that covers the same index - but to get the low rates on expenses, you would still need to assume it was in a 401(k) or 403(b) or the Roth variants of those. Those record dividends (which can be up to half your actual earnings during most periods).
9
$100,000 in Citigroup! I've never invested a dime but I'm pretty sure I know how wall street works: assholes + douches = insane profit! Somebody else can clean up the foul mess.
10
Investment advice is completely meaningless unless it includes a sell date. If you are going to make money investing, you need to know the when, not just the what.
11
Also, everyone please remember that this advice pertains to money that you don't need for at least 5 years. Historically, in the United States stock indexes have performed very well, and have lost money over very few 10-year periods. This may not be true in the future, and it has not been true in other countries like Japan. And of course, anyone who bought stocks in the last 10 years is now worse off because of it. So money you need in the short to medium term should be in an interest-bearing account or bonds or whatever.
Vanguard offers low-cost "target retirement" funds that automatically shift toward safer investments as you approach your retirement year (and beyond). Here are the 1-year returns, which clearly demonstrate the way the funds take on less risk as retirement nears:
retirement date:
2005: -20.84%
2010: -26.07%
2015: -29.7%
2020: -32.86%
2025: -36.04%
2030: -39.01%
Beyond that they're basically all the same. You can replicate this yourself by shifting money out of stocks and into bonds over time, but Vanguard makes it pretty easy.
And of course, the big determinant of your retirement income is how much you save. Better to save an extra 1% of your income than spend a lot of time worrying about your investments and chasing high returns. One of the key advantages of simply putting x% of each paycheck into a stock index (for long-term money) is that it requires so little of your attention. And indeed paying attention can lead to costly mistakes if you overreact to market changes.
Vanguard offers low-cost "target retirement" funds that automatically shift toward safer investments as you approach your retirement year (and beyond). Here are the 1-year returns, which clearly demonstrate the way the funds take on less risk as retirement nears:
retirement date:
2005: -20.84%
2010: -26.07%
2015: -29.7%
2020: -32.86%
2025: -36.04%
2030: -39.01%
Beyond that they're basically all the same. You can replicate this yourself by shifting money out of stocks and into bonds over time, but Vanguard makes it pretty easy.
And of course, the big determinant of your retirement income is how much you save. Better to save an extra 1% of your income than spend a lot of time worrying about your investments and chasing high returns. One of the key advantages of simply putting x% of each paycheck into a stock index (for long-term money) is that it requires so little of your attention. And indeed paying attention can lead to costly mistakes if you overreact to market changes.
12
Also, at the risk of being obvious, do not invest a substantial portion of your savings in your own employer unless you could afford to lose those savings while being laid off. When a company goes down, some of the saddest stories are always the long-term employees who had a lot of their money invested in their employer. Now they have no job and no savings. If you diversify your investments, you have a lot less to lose. And good companies can go south incredibly quickly, it's not just the Enrons of the world that collapse spectacularly.
14
@8 - if you are socking away a small amount with each paycheck, I don't think an ETF makes sense (admittedly it makes more sense if you're doing what Golob is hypothetically doing). The commissions will kill you. Beyond that I don't know much about ETF's - I take it you put them in tax-sheltered accounts because they are not as tax-efficient as the regular funds?
15
And you know very little about the Canadian Constitution, @13.
Most of minderbender's advice is quite good. Except for the 1 percent part - you should literally be saving about 10 percent of your income anyway, mortgage doesn't count, and at least max on any 401(k) or 403(b) match from the firm you work for. You can shove the rest in a Roth IRA (yes, you can do BOTH).
And then forget about it.
Seriously.
Most of minderbender's advice is quite good. Except for the 1 percent part - you should literally be saving about 10 percent of your income anyway, mortgage doesn't count, and at least max on any 401(k) or 403(b) match from the firm you work for. You can shove the rest in a Roth IRA (yes, you can do BOTH).
And then forget about it.
Seriously.
18
@14 - this is why I said a mutual fund. But to track it, you can use the corresponding ETF (Vanguard has both). That will show you the dividends (presuming they are reinvested in the mutual fund). There's a bit of math involved, actually.
You can also auto-sweep it periodically into an ETF and let it sit in a money market fund until it builds high enough that fees are waived.
Bonds in general underperform, and unless you're about 5 years out from retirement or about to buy a house or go to college, should be avoided for the most part.
You can also auto-sweep it periodically into an ETF and let it sit in a money market fund until it builds high enough that fees are waived.
Bonds in general underperform, and unless you're about 5 years out from retirement or about to buy a house or go to college, should be avoided for the most part.
19
Today I "purchased" a sandwich. Then I ate it. I consider this to have been about the best investment possible in these desperate times.
20
@16 - oops. sorry. Rule of thumb is 10 percent - if you're currently saving 0 percent, try ratcheting it up by 1 percent each time you get a pay raise or cost of living until you reach that level.
All this assumes you are living within your means and have 2-3 months of cash just in case you get fired. Stick that in your credit union savings account and forget about it.
All this assumes you are living within your means and have 2-3 months of cash just in case you get fired. Stick that in your credit union savings account and forget about it.
24
You might ask yourself, "Aside from trying to fix the economy, is Obama doing anything constructive in this area?" And the answer is yes.
This is a classic example of what Cass Sunstein calls "soft paternalism" - you can fiddle with the defaul settings to improve outcomes. People are free to opt out of saving, so no one is being coerced, but more people save this way.
This is a classic example of what Cass Sunstein calls "soft paternalism" - you can fiddle with the defaul settings to improve outcomes. People are free to opt out of saving, so no one is being coerced, but more people save this way.
26
Are we doing this or not?
If so I'll purchase $100,000 in FSHCX please.
Also, Will, if you figure out a way to monetize your douchery and joy-killing let me know, I'd invest in that shit.
If so I'll purchase $100,000 in FSHCX please.
Also, Will, if you figure out a way to monetize your douchery and joy-killing let me know, I'd invest in that shit.
28
Oh, and I forgot to mention, Fnarf is right (@4): Golob's proposed contest entirely misses the point. You should pay no attention to short-term performance when you are investing for the long term. Because you are investing over years and years, market declines just mean cheaper stocks for you.
The winner of Golob's contest would be some idiot who picked a highly volatile stock and happened to be right (I'll take Alcoa). Among the losers would be plenty of others who picked highly volatile stocks and weren't right, but no one would be paying attention to them.
By investing in a broad index (or several broad indexes), you are not trying to beat the market. You are trying to match the market while minimizing your costs (including taxes). And this is where Vanguard really shines: its costs are very low.
The winner of Golob's contest would be some idiot who picked a highly volatile stock and happened to be right (I'll take Alcoa). Among the losers would be plenty of others who picked highly volatile stocks and weren't right, but no one would be paying attention to them.
By investing in a broad index (or several broad indexes), you are not trying to beat the market. You are trying to match the market while minimizing your costs (including taxes). And this is where Vanguard really shines: its costs are very low.
29
@28, lol, thats why I went with financials and autos. The S&P might pop 30% if were lucky, but given the right circumstances, stocks like GM and Citi could go up 10 fold or more. Though them becoming completely worthless is a distinct and probably more likely possibility.
30
We're doing this.
And I really mean until I get bored of it. Five years? Ten years? If there still is a slog and me, I'll at least try.
Joh, or anyone: Do you know of a used pokemon card trading site?
meh@19: Wasn't that the plot of a Futurama episode?
And I really mean until I get bored of it. Five years? Ten years? If there still is a slog and me, I'll at least try.
Joh, or anyone: Do you know of a used pokemon card trading site?
meh@19: Wasn't that the plot of a Futurama episode?
31
Gimme fifty on PFG, they're outsourcing everything but the air in the pipe to the kitchen sink, and a phat fitty on GE, because they make lighters don't they? stock up!
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32
minderbender: Thanks for all of your excellent comments. Sincerely.
For what it's worth, my retirement account is one of those Vanguard Targeted Retirement funds. I love 'em.
Right now I do have a fair bit in a high-yield savings account plus some municipal money market funds (no taxes, yay!)
For what it's worth, my retirement account is one of those Vanguard Targeted Retirement funds. I love 'em.
Right now I do have a fair bit in a high-yield savings account plus some municipal money market funds (no taxes, yay!)
33
HAIL MARY S&P 500 vertical LEAP option:
Buy 101 Dec 2011 SPY $70 call options for $145,945
Sell 101 Dec 2011 SPY $100 call options for $46,460
Cost basis: $99,485.
If the S&P 500 closes at or over 1,000 by Dec 2011 (up 38.9% from today):
Sell 101 Dec 2011 SPY $70 call options for $303,000+
Sell Dec 2011 SPY $100 call options sell for $0+
Total proceeds: $303,000.
Total gain: 304%.
(Based on back of envelope calcs and numbers at http://finance.yahoo.com/q/op?s=SPY&m=20… )
It's a hail mary vertical! w000000t
Buy 101 Dec 2011 SPY $70 call options for $145,945
Sell 101 Dec 2011 SPY $100 call options for $46,460
Cost basis: $99,485.
If the S&P 500 closes at or over 1,000 by Dec 2011 (up 38.9% from today):
Sell 101 Dec 2011 SPY $70 call options for $303,000+
Sell Dec 2011 SPY $100 call options sell for $0+
Total proceeds: $303,000.
Total gain: 304%.
(Based on back of envelope calcs and numbers at http://finance.yahoo.com/q/op?s=SPY&m=20… )
It's a hail mary vertical! w000000t
35
I'm a fan of the dollar-cost averaging technique, and regularly purchase the Vanguard ETF thingie (technical term, I know!). But I do this through ShareBuilder for $4/trade, once per quarter for the last year or so. Is there a cheaper or better way to buy? I'm still in my, uh, wealth-building years, so I don't have a very big portfolio yet...
37
Hah, you fools! Don't you know your trifling paper money is going to be worthless? President Obama will bring about the end of civilization! The only thing of value in the future are shot gun shells and canned yams. Silly libruls and your ideals will be selling yourselves on street corners for moldy bread crusts whilst all us Doomsday Survivalists will be laughing it up eating potatoes and dog meat.
39
@35: If you can afford the minimum $3,000 to open an account (it sounds as though you can), open a Vanguard account instead of buying the ETF. If you're making a lump sum investment, ETF's might make sense, but for small, periodic contributions the commission is not justified. See here.
And if you are eligible, invest the money in an IRA or 401(k). If you are in a low tax bracket, make it a Roth IRA or Roth 401(k). A brief aside on taxes:
As an investor, you face 2 kinds of taxes, income taxes and capital gains taxes. Income taxes arise from wages (obviously) but also from interest income, such as interest on a savings account or on bonds (except muni's, see below). Capital gains arise from the increase in value of an asset you own, such as shares of stock.
So let's say you earn $50,000 one year and you want to invest some of it. First, remove the income tax. Now, say you save $5,000 of what's left. If you put it in a savings account, as you earn interest you pay income tax on it. If you buy shares of stock, then when you sell those shares you will pay capital gains tax on the amount by which they have increased in value (if, inshallah, their value has increased at all). Capital gains taxes are generally lower than income taxes.
A traditional 401(k) or IRA allows you to invest "pre-tax" dollars. So in our example, if you invest the $5,000 in an IRA or 401(k) plan, your taxed income will be $45,000 instead of $50,000, saving you the income taxes on $5,000. The money will also grow (inshallah) without incurring capital gains taxes. But when you withdraw the money, you will pay income taxes on it.
In a Roth 401(k) or IRA, you do not get to treat the investment as pre-tax, so you still pay income taxes on the full $50,000 you earned. But if you save $5,000 in a Roth investment, that is the last time you will ever pay taxes on that money (throughout, I am assuming that you are not withdrawing it early, i.e. before you are 59 1/2). No capital gains taxes, no income taxes when you withdraw it. I guess you will pay sales tax when you spend it, but that's it.
So IRA's and 401(k)'s basically shelter you from capital gains taxes. The traditional/Roth choice depends on whether you want to pay income taxes on the money now or later. If you are in a low tax bracket now, you probably want to go with Roth (especially if you anticipate being in a higher tax bracket when you retire). If you are a in a high tax bracket now, it may make sense to go with a traditional IRA or 401(k).
There are limits on how much you can invest in tax-sheltered retirement accounts. For investing outside those accounts, remember that capital gains are generally taxed at a lower rate than income, and interest is taxed as income. So if you do want to invest in bonds, do so in a tax-sheltered account. Stocks are more "tax-efficient," but you should still put them in a sheltered account if you can.
The exception to the "shelter bonds first" rule is municipal bonds, the interest on which is not taxed (but make sure this is true at the state level - I think New York taxes non-NY muni bonds, which is why Vanguard has a special muni bond fund for NY).
In short: use a 401(k) or IRA to avoid capital gains taxes, and make it a Roth if you prefer to pay income taxes now rather than later. For small, regular investments, buy shares in an index fund. For a large, lump-sum investment, maybe buy an ETF (I don't know enough about them to endorse them, but smart people seem to like them, so I guess look into them)/
More...
And if you are eligible, invest the money in an IRA or 401(k). If you are in a low tax bracket, make it a Roth IRA or Roth 401(k). A brief aside on taxes:
As an investor, you face 2 kinds of taxes, income taxes and capital gains taxes. Income taxes arise from wages (obviously) but also from interest income, such as interest on a savings account or on bonds (except muni's, see below). Capital gains arise from the increase in value of an asset you own, such as shares of stock.
So let's say you earn $50,000 one year and you want to invest some of it. First, remove the income tax. Now, say you save $5,000 of what's left. If you put it in a savings account, as you earn interest you pay income tax on it. If you buy shares of stock, then when you sell those shares you will pay capital gains tax on the amount by which they have increased in value (if, inshallah, their value has increased at all). Capital gains taxes are generally lower than income taxes.
A traditional 401(k) or IRA allows you to invest "pre-tax" dollars. So in our example, if you invest the $5,000 in an IRA or 401(k) plan, your taxed income will be $45,000 instead of $50,000, saving you the income taxes on $5,000. The money will also grow (inshallah) without incurring capital gains taxes. But when you withdraw the money, you will pay income taxes on it.
In a Roth 401(k) or IRA, you do not get to treat the investment as pre-tax, so you still pay income taxes on the full $50,000 you earned. But if you save $5,000 in a Roth investment, that is the last time you will ever pay taxes on that money (throughout, I am assuming that you are not withdrawing it early, i.e. before you are 59 1/2). No capital gains taxes, no income taxes when you withdraw it. I guess you will pay sales tax when you spend it, but that's it.
So IRA's and 401(k)'s basically shelter you from capital gains taxes. The traditional/Roth choice depends on whether you want to pay income taxes on the money now or later. If you are in a low tax bracket now, you probably want to go with Roth (especially if you anticipate being in a higher tax bracket when you retire). If you are a in a high tax bracket now, it may make sense to go with a traditional IRA or 401(k).
There are limits on how much you can invest in tax-sheltered retirement accounts. For investing outside those accounts, remember that capital gains are generally taxed at a lower rate than income, and interest is taxed as income. So if you do want to invest in bonds, do so in a tax-sheltered account. Stocks are more "tax-efficient," but you should still put them in a sheltered account if you can.
The exception to the "shelter bonds first" rule is municipal bonds, the interest on which is not taxed (but make sure this is true at the state level - I think New York taxes non-NY muni bonds, which is why Vanguard has a special muni bond fund for NY).
In short: use a 401(k) or IRA to avoid capital gains taxes, and make it a Roth if you prefer to pay income taxes now rather than later. For small, regular investments, buy shares in an index fund. For a large, lump-sum investment, maybe buy an ETF (I don't know enough about them to endorse them, but smart people seem to like them, so I guess look into them)/
40
Right now I would put that money in a decent interest-bearing savings account (if you can find one; in Canada it's pretty easy to get 2-3% still, I'm not sure what ING in the US is doing now). We're not at the point where plowing into the market is the right answer yet, I think; build up the capital on the sideline and be ready to put it back in a few more months (or a year or two).
41
I realize I was a bit unclear: I should have said, in an IRA or 401(k), your money grows tax free. It could be growing because of interest or capital gains, but the growth is tax free. You still pay income tax, now (Roth) or later (traditional).
Also, obviously get tax advice. My overview was necessarily oversimplified and incomplete, and tax rules have a way of being different at different income levels.
Also, obviously get tax advice. My overview was necessarily oversimplified and incomplete, and tax rules have a way of being different at different income levels.
42
@39 - your costs for a Vanguard account drop once it gets big enough, so ponying up $10,000 is good too.
43
50% PTTAX
Pimco Total Return Fund.
They're much smarter fixed-income investors than you.
50% VIPSX
Vanguard Inflation Protected Treasuries
...because inflation will be the easiest way to work off the national debt.
Pimco Total Return Fund.
They're much smarter fixed-income investors than you.
50% VIPSX
Vanguard Inflation Protected Treasuries
...because inflation will be the easiest way to work off the national debt.
44
Count me in: 33% in mattress cash, 33% in canned goods, and 33% in ammo. I'll get drunk on the remaining 1%.
46
Step 1: Tape today's Wall Street Journal to the wall
Step 2: Throw dart at said wall
Step 3: Short the hell out of whatever stock the dart hits
Step 4: Profit.
Seriously though, I have been making a killing trend trading SKF and SRS over the past year.
Step 2: Throw dart at said wall
Step 3: Short the hell out of whatever stock the dart hits
Step 4: Profit.
Seriously though, I have been making a killing trend trading SKF and SRS over the past year.
48
JohnathanG, you're the smartest person posting here, which means you're smart enough to understand dollar-cost averaging and the compounding power of reinvested interest and dividends.
You can't possibly think this is going to prove anything meaningful or that "Pretend to invest $100K in any particular ticker symbol for an arbitrary amount of time" bears any relationship to Will's original advice.
To everyone in the thread mocking Will's advice: Have fun retiring to fun-filled days handing out shopping carts at Wal-Mart.
You can't possibly think this is going to prove anything meaningful or that "Pretend to invest $100K in any particular ticker symbol for an arbitrary amount of time" bears any relationship to Will's original advice.
To everyone in the thread mocking Will's advice: Have fun retiring to fun-filled days handing out shopping carts at Wal-Mart.
49
@39/41 minderbender, thanks! I have a tax accountant and am aware of all of the tax implications of a Roth/traditional IRA and 401K already, but maybe another reader will find that particularly helpful. I contribute to my IRA first (I have both a traditional and a Roth, but I tend to favor the traditional because I have some self-employment/freelance income and don't have mortgage interest or kids to deduct). I don't have access to a 401K now, but I always take part if I do.
I could come up with $3K for a Vanguard account, although bumping it to $10K would require raiding the emergency fund. NOT an option for me, even in a good economy.
My remaining question is this: What happens if the value of your Vanguard account goes below $3K (even while investing)? They don't charge one of those crazy-high maintenance fees or kick you out or anything, do they?
I could come up with $3K for a Vanguard account, although bumping it to $10K would require raiding the emergency fund. NOT an option for me, even in a good economy.
My remaining question is this: What happens if the value of your Vanguard account goes below $3K (even while investing)? They don't charge one of those crazy-high maintenance fees or kick you out or anything, do they?
51
Thanks, investing monthly.
Just an aside - other than for people in their 60s, this is a good time, because the overpriced assets we called stocks and homes are now a lot cheaper, so it's a lot easier to buy a house or invest with a higher rate of eventual return now than it was during the Bush Regime.
Just an aside - other than for people in their 60s, this is a good time, because the overpriced assets we called stocks and homes are now a lot cheaper, so it's a lot easier to buy a house or invest with a higher rate of eventual return now than it was during the Bush Regime.
52
@49 - actually, you then pay fees - but if you have an automatic paycheck set-aside they waive it, provided you continue to invest - usually ...
Just remember, Warren Buffet stopped buying US stocks for a couple of years, and only recently started to buy them ...
Just remember, Warren Buffet stopped buying US stocks for a couple of years, and only recently started to buy them ...
53
@46
But that requires more active participation in the account. There is also a killing to be made in UYG, URE, when they hit bottom (did you see the ~40% climb of FAS yesterday?)
Theres also the risk that any of these ETFs or ETNs could go tits up, if the provider goes tits up. The same is true of any company and their stock
Dollar cost averaging in an index is boring but it's sound advice for the average investor squirreling away their money monthly.
But that requires more active participation in the account. There is also a killing to be made in UYG, URE, when they hit bottom (did you see the ~40% climb of FAS yesterday?)
Theres also the risk that any of these ETFs or ETNs could go tits up, if the provider goes tits up. The same is true of any company and their stock
Dollar cost averaging in an index is boring but it's sound advice for the average investor squirreling away their money monthly.
54
I refuse to engage in anything where Will in Seattle is featured. It's like the bits of good stuff that came out of the Bush Administration, it might be okay but it's still tainted and you're wise to be suspicious of it.
55
You should be wary of his long call on Ford. There are so many more companies that don't have bankruptcy potential and are at that price, also have a recent history of positive earnings, paying a dividend regularly, and aren't controlled by a deranged family via different class of shares.
The Ford call has too much risk for the potential reward. The potential reward based on the idea that it will return to previous valuations at some point in time, and they alone will.
The Ford call has too much risk for the potential reward. The potential reward based on the idea that it will return to previous valuations at some point in time, and they alone will.
56
What's up with the Vanguard/Alito hint of corruption? Speaking as someone uncomfortable with the possible ethical problems of my Vanguard IRA. Including the fact that it's bound to contain some oil, Halliburton, etc. etc.
57
There are ethical funds, but most of them severely underperform the market.
Even so, a low-cost socially conscious mutual fund should still do relatively well.
Domini had some good ones as I recall, but the best one I ever had was the VanCity Ethical Growth Fund (back when I had an RRSP). I think TIAA-CREF offers some, and maybe Fidelity and Vanguard.
Even so, a low-cost socially conscious mutual fund should still do relatively well.
Domini had some good ones as I recall, but the best one I ever had was the VanCity Ethical Growth Fund (back when I had an RRSP). I think TIAA-CREF offers some, and maybe Fidelity and Vanguard.
58
@49: There is no penalty for dropping below $3,000. That's just the minimum initial investment in most of their funds. It is true that they charge $20/year for some funds, but it can be waived, and not by having direct deposit. In short, if electronic delivery of your statement works for you, you should be able to avoid the $20 fee. I quote:
For nonretirement accounts, traditional IRAs, Roth IRAs, UGMAs/UTMAs, SEP–IRAs, and education savings accounts (ESAs):
Vanguard charges a $20 annual account service fee for each Vanguard fund with a balance of less than $10,000 in an account. This fee does not apply if you sign up for account access on Vanguard.com and choose electronic delivery of statements, confirmations, fund reports, and prospectuses. This fee also does not apply to members of our enhanced services, which require a minimum of $100,000 in total eligible household assets held at Vanguard by you and your immediate family members who reside at the same address.
Eliminate this fee by registering for our convenient e-delivery package.
For nonretirement accounts, traditional IRAs, Roth IRAs, UGMAs/UTMAs, SEP–IRAs, and education savings accounts (ESAs):
Vanguard charges a $20 annual account service fee for each Vanguard fund with a balance of less than $10,000 in an account. This fee does not apply if you sign up for account access on Vanguard.com and choose electronic delivery of statements, confirmations, fund reports, and prospectuses. This fee also does not apply to members of our enhanced services, which require a minimum of $100,000 in total eligible household assets held at Vanguard by you and your immediate family members who reside at the same address.
Eliminate this fee by registering for our convenient e-delivery package.
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Meet the UW "Swagga Suit" by David Schmader
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