Vanguard Mutual Funds to ETF

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skeptical1
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Vanguard Mutual Funds to ETF

Post by skeptical1 »

I've held mutual funds, at Vanguard, for all my investing life. I recently moved them in-kind from VG to Schwab. Given that I have VG funds, I see no advantage to ETFs. Hypothetically, that could change in the future. Is there any reason I could not transfer in-kind back to Vanguard, then convert to ETFs at some time in the future (assuming Vanguard still allows its free conversion)?
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anon_investor
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Re: Vanguard Mutual Funds to ETF

Post by anon_investor »

skeptical1 wrote: Tue Sep 21, 2021 2:27 pm I've held mutual funds, at Vanguard, for all my investing life. I recently moved them in-kind from VG to Schwab. Given that I have VG funds, I see no advantage to ETFs. Hypothetically, that could change in the future. Is there any reason I could not transfer in-kind back to Vanguard, then convert to ETFs at some time in the future (assuming Vanguard still allows its free conversion)?
You can do that, but Schwab charges you a fee to transfer funds out (to Vanguard).
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skeptical1
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Re: Vanguard Mutual Funds to ETF

Post by skeptical1 »

anon_investor wrote: Tue Sep 21, 2021 2:33 pm You can do that, but Schwab charges you a fee to transfer funds out (to Vanguard).
I assume Schwab might waive or refund the fees if I committed to bring the ETFs back.
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anon_investor
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Re: Vanguard Mutual Funds to ETF

Post by anon_investor »

skeptical1 wrote: Tue Sep 21, 2021 2:53 pm
anon_investor wrote: Tue Sep 21, 2021 2:33 pm You can do that, but Schwab charges you a fee to transfer funds out (to Vanguard).
I assume Schwab might waive or refund the fees if I committed to bring the ETFs back.
You can always ask, but they have a fee schedule for in-kind transfers out. So any fee waiver would be YMMV.
tashnewbie
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Re: Vanguard Mutual Funds to ETF

Post by tashnewbie »

YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.

Why would you want to continue holding the Vanguard mutual funds at Schwab? I presume you're no longer going to add to those funds, because of the transaction fees.

Probably would've been easier to have done the conversion to ETFs before moving to Schwab.

Is this in a taxable account or an IRA?
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Artsdoctor
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Re: Vanguard Mutual Funds to ETF

Post by Artsdoctor »

skeptical1 wrote: Tue Sep 21, 2021 2:27 pm I've held mutual funds, at Vanguard, for all my investing life. I recently moved them in-kind from VG to Schwab. Given that I have VG funds, I see no advantage to ETFs. Hypothetically, that could change in the future. Is there any reason I could not transfer in-kind back to Vanguard, then convert to ETFs at some time in the future (assuming Vanguard still allows its free conversion)?
It's difficult to see what the Schwab fee structure might be for Vanguard funds. In their fee schedule, they state that "up to $49.95" is the fee to buy non-Schwab mutual funds but I don't know if that includes reinvestment of dividends and sales.

Usually, as you are making the decision to leave Vanguard, you'd convert your mutual fund shares to its ETF equivalent because it's a tax-free conversion and you can trade easily wherever you move the ETF to (unlike the mutual fund).
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anon_investor
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Re: Vanguard Mutual Funds to ETF

Post by anon_investor »

Artsdoctor wrote: Tue Sep 21, 2021 3:36 pm
skeptical1 wrote: Tue Sep 21, 2021 2:27 pm I've held mutual funds, at Vanguard, for all my investing life. I recently moved them in-kind from VG to Schwab. Given that I have VG funds, I see no advantage to ETFs. Hypothetically, that could change in the future. Is there any reason I could not transfer in-kind back to Vanguard, then convert to ETFs at some time in the future (assuming Vanguard still allows its free conversion)?
It's difficult to see what the Schwab fee structure might be for Vanguard funds. In their fee schedule, they state that "up to $49.95" is the fee to buy non-Schwab mutual funds but I don't know if that includes reinvestment of dividends and sales.

Usually, as you are making the decision to leave Vanguard, you'd convert your mutual fund shares to its ETF equivalent because it's a tax-free conversion and you can trade easily wherever you move the ETF to (unlike the mutual fund).
I thought Schwab just announced the fee was going up to $74.95. There was a recent thread about it:
viewtopic.php?f=10&t=357283
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skeptical1
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Re: Vanguard Mutual Funds to ETF

Post by skeptical1 »

tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.

Why would you want to continue holding the Vanguard mutual funds at Schwab? I presume you're no longer going to add to those funds, because of the transaction fees.

Probably would've been easier to have done the conversion to ETFs before moving to Schwab.

Is this in a taxable account or an IRA?
I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades. What's not to like about Vanguard Funds?

I may never convert to ETFs but just keeping my options in mind.
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anon_investor
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Re: Vanguard Mutual Funds to ETF

Post by anon_investor »

skeptical1 wrote: Tue Sep 21, 2021 6:13 pm
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.

Why would you want to continue holding the Vanguard mutual funds at Schwab? I presume you're no longer going to add to those funds, because of the transaction fees.

Probably would've been easier to have done the conversion to ETFs before moving to Schwab.

Is this in a taxable account or an IRA?
I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades.

I may never convert to ETFs but just keeping my options in mind.
Did they guarantee the fee waiver forever? How much did you have to transfer to swing that?
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Artsdoctor
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Re: Vanguard Mutual Funds to ETF

Post by Artsdoctor »

skeptical1 wrote: Tue Sep 21, 2021 6:13 pm
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.

Why would you want to continue holding the Vanguard mutual funds at Schwab? I presume you're no longer going to add to those funds, because of the transaction fees.

Probably would've been easier to have done the conversion to ETFs before moving to Schwab.

Is this in a taxable account or an IRA?
I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades. What's not to like about Vanguard Funds?

I may never convert to ETFs but just keeping my options in mind.
That's interesting! Then that's a good deal. I wasn't aware that you could buy and sell Vanguard mutual funds at Schwab for free.

For others, I would just caution the fees that might be associated with trading Vanguard funds at other institutions.
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skeptical1
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Re: Vanguard Mutual Funds to ETF

Post by skeptical1 »

anon_investor wrote: Tue Sep 21, 2021 6:14 pm
skeptical1 wrote: Tue Sep 21, 2021 6:13 pm
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.

Why would you want to continue holding the Vanguard mutual funds at Schwab? I presume you're no longer going to add to those funds, because of the transaction fees.

Probably would've been easier to have done the conversion to ETFs before moving to Schwab.

Is this in a taxable account or an IRA?
I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades.

I may never convert to ETFs but just keeping my options in mind.
Did they guarantee the fee waiver forever? How much did you have to transfer to swing that?
No guarantee, at least not in writing. About $2M.
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anon_investor
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Re: Vanguard Mutual Funds to ETF

Post by anon_investor »

skeptical1 wrote: Tue Sep 21, 2021 6:22 pm
anon_investor wrote: Tue Sep 21, 2021 6:14 pm
skeptical1 wrote: Tue Sep 21, 2021 6:13 pm
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.

Why would you want to continue holding the Vanguard mutual funds at Schwab? I presume you're no longer going to add to those funds, because of the transaction fees.

Probably would've been easier to have done the conversion to ETFs before moving to Schwab.

Is this in a taxable account or an IRA?
I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades.

I may never convert to ETFs but just keeping my options in mind.
Did they guarantee the fee waiver forever? How much did you have to transfer to swing that?
No guarantee, at least not in writing. About $2M.
Thanks for sharing. My fear would be to transfer Vanguard mutual funds to Schwab and get that waiver and have them take it away later. Therefore, I would convert to ETF before transferring. I did just that for some funds I transfered to Merrill Edge as ETFs.
nalor511
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Re: Vanguard Mutual Funds to ETF

Post by nalor511 »

anon_investor wrote: Tue Sep 21, 2021 6:26 pm
skeptical1 wrote: Tue Sep 21, 2021 6:22 pm
anon_investor wrote: Tue Sep 21, 2021 6:14 pm
skeptical1 wrote: Tue Sep 21, 2021 6:13 pm
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.

Why would you want to continue holding the Vanguard mutual funds at Schwab? I presume you're no longer going to add to those funds, because of the transaction fees.

Probably would've been easier to have done the conversion to ETFs before moving to Schwab.

Is this in a taxable account or an IRA?
I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades.

I may never convert to ETFs but just keeping my options in mind.
Did they guarantee the fee waiver forever? How much did you have to transfer to swing that?
No guarantee, at least not in writing. About $2M.
Thanks for sharing. My fear would be to transfer Vanguard mutual funds to Schwab and get that waiver and have them take it away later. Therefore, I would convert to ETF before transferring. I did just that for some funds I transfered to Merrill Edge as ETFs.
I transferred admiral funds to Schwab. If I could do it over I would convert to ETF first, purely for the portability and ease of quick rebalancing. I have the fee waiver. You do not need the fee waiver for DRIP (no fees on that anyway)

If I ever leave Schwab, I will bounce thru VG and convert to ETF. I shudder at the prospect of trying to deal with VG again.
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Re: Vanguard Mutual Funds to ETF

Post by TropikThunder »

tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.
Wait, you’re saying Vanguard paid your transfer fee to leave Schwab? Unheard of!
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Re: Vanguard Mutual Funds to ETF

Post by tashnewbie »

skeptical1 wrote: Tue Sep 21, 2021 6:13 pm I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades. What's not to like about Vanguard Funds?

I may never convert to ETFs but just keeping my options in mind.
Rock on! Sweet deal.
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Re: Vanguard Mutual Funds to ETF

Post by tashnewbie »

TropikThunder wrote: Wed Sep 22, 2021 12:02 am
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.
Wait, you’re saying Vanguard paid your transfer fee to leave Schwab? Unheard of!
I'm pretty sure. I'd have to check my records to confirm. I think Schwab charged $50 transfer fee, and I'm pretty sure I was reimbursed for that (maybe Schwab did it).
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Re: Vanguard Mutual Funds to ETF

Post by sycamore »

Artsdoctor wrote: Tue Sep 21, 2021 6:21 pm
skeptical1 wrote: Tue Sep 21, 2021 6:13 pm ...
I transferred our IRAs a couple of years ago. I since converted them to Schwab funds. I've been very happy with Schwab's service.

I just transferred my taxable funds last month. I got a bonus for transferring and a permanent waiver to buy/sell any Vanguard funds that Schwab trades. What's not to like about Vanguard Funds?

I may never convert to ETFs but just keeping my options in mind.
That's interesting! Then that's a good deal. I wasn't aware that you could buy and sell Vanguard mutual funds at Schwab for free.

For others, I would just caution the fees that might be associated with trading Vanguard funds at other institutions.
FYI, There's a Schwab Information thread that discusses all things Schwab, including the potential for Schwab waiving fees under certain conditions.
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Re: Vanguard Mutual Funds to ETF

Post by tomsense76 »

anon_investor wrote: Tue Sep 21, 2021 3:50 pm I thought Schwab just announced the fee was going up to $74.95. There was a recent thread about it:
viewtopic.php?f=10&t=357283
AIUI that fee is only for new purchases. So if the OP just holds and does not add to them, this should be a non-issue (though of course they have a fee waiver for additions). There's no fee for selling IIUC. New purchases could be ETFs (if one is worried).
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
nalor511
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Re: Vanguard Mutual Funds to ETF

Post by nalor511 »

tashnewbie wrote: Wed Sep 22, 2021 8:40 am
TropikThunder wrote: Wed Sep 22, 2021 12:02 am
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.
Wait, you’re saying Vanguard paid your transfer fee to leave Schwab? Unheard of!
I'm pretty sure. I'd have to check my records to confirm. I think Schwab charged $50 transfer fee, and I'm pretty sure I was reimbursed for that (maybe Schwab did it).
Please check! 8-)
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anon_investor
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Re: Vanguard Mutual Funds to ETF

Post by anon_investor »

tomsense76 wrote: Wed Sep 22, 2021 2:57 pm
anon_investor wrote: Tue Sep 21, 2021 3:50 pm I thought Schwab just announced the fee was going up to $74.95. There was a recent thread about it:
viewtopic.php?f=10&t=357283
AIUI that fee is only for new purchases. So if the OP just holds and does not add to them, this should be a non-issue (though of course they have a fee waiver for additions). There's no fee for selling IIUC. New purchases could be ETFs (if one is worried).
True. Personally, I won't want a mix match of ETF/Mutual Fund share classes of the same fund in the same account, so for any Vanguard Mutual Funds that have an ETF share class, I would do the tax free conversion to ETF before transferring them out. For example for funds I transfered out from Vanguard to Merrill Edge, those are all in ETF, but the funds I kept at Vanguard are mutual funds. I am not really adding to the ETFs at Merrill Edge though (left dividend reinvestment on though) and I am just making new purchases at Vanguard. I only have money at Merrill Edge in hopes to get a certai tier of Bank of America Preferred Rewards status. I am not leaving Vanguard yet, but if I do, I will just convert everything to ETF. With partial ETF share purchases at Fidelity, that is where I would likely go.
tomsense76
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Re: Vanguard Mutual Funds to ETF

Post by tomsense76 »

anon_investor wrote: Wed Sep 22, 2021 3:23 pm
tomsense76 wrote: Wed Sep 22, 2021 2:57 pm
anon_investor wrote: Tue Sep 21, 2021 3:50 pm I thought Schwab just announced the fee was going up to $74.95. There was a recent thread about it:
viewtopic.php?f=10&t=357283
AIUI that fee is only for new purchases. So if the OP just holds and does not add to them, this should be a non-issue (though of course they have a fee waiver for additions). There's no fee for selling IIUC. New purchases could be ETFs (if one is worried).
True. Personally, I won't want a mix match of ETF/Mutual Fund share classes of the same fund in the same account, so for any Vanguard Mutual Funds that have an ETF share class, I would do the tax free conversion to ETF before transferring them out. For example for funds I transfered out from Vanguard to Merrill Edge, those are all in ETF, but the funds I kept at Vanguard are mutual funds. I am not really adding to the ETFs at Merrill Edge though (left dividend reinvestment on though) and I am just making new purchases at Vanguard. I only have money at Merrill Edge in hopes to get a certai tier of Bank of America Preferred Rewards status. I am not leaving Vanguard yet, but if I do, I will just convert everything to ETF. With partial ETF share purchases at Fidelity, that is where I would likely go.
Agreed. Makes sense. Would do the same.

Also have no plans to leave Vanguard atm. Though have other brokerage accounts that I could consolidate into if I felt the need.

Fractional shares at Fidelity is nice. Think also Schwab and IBKR have a good reputation for supporting ex-pats, which has interested me since I like to travel a fair bit.

The only place where ETF conversion gets tricky is Vanguard's active funds, which don't have ETF versions. Many of the muni funds fall into this category. Getting a waiver from Schwab sounds appealing in that case.
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
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Re: Vanguard Mutual Funds to ETF

Post by anon_investor »

tomsense76 wrote: Wed Sep 22, 2021 5:21 pm
anon_investor wrote: Wed Sep 22, 2021 3:23 pm
tomsense76 wrote: Wed Sep 22, 2021 2:57 pm
anon_investor wrote: Tue Sep 21, 2021 3:50 pm I thought Schwab just announced the fee was going up to $74.95. There was a recent thread about it:
viewtopic.php?f=10&t=357283
AIUI that fee is only for new purchases. So if the OP just holds and does not add to them, this should be a non-issue (though of course they have a fee waiver for additions). There's no fee for selling IIUC. New purchases could be ETFs (if one is worried).
True. Personally, I won't want a mix match of ETF/Mutual Fund share classes of the same fund in the same account, so for any Vanguard Mutual Funds that have an ETF share class, I would do the tax free conversion to ETF before transferring them out. For example for funds I transfered out from Vanguard to Merrill Edge, those are all in ETF, but the funds I kept at Vanguard are mutual funds. I am not really adding to the ETFs at Merrill Edge though (left dividend reinvestment on though) and I am just making new purchases at Vanguard. I only have money at Merrill Edge in hopes to get a certai tier of Bank of America Preferred Rewards status. I am not leaving Vanguard yet, but if I do, I will just convert everything to ETF. With partial ETF share purchases at Fidelity, that is where I would likely go.
Agreed. Makes sense. Would do the same.

Also have no plans to leave Vanguard atm. Though have other brokerage accounts that I could consolidate into if I felt the need.

Fractional shares at Fidelity is nice. Think also Schwab and IBKR have a good reputation for supporting ex-pats, which has interested me since I like to travel a fair bit.

The only place where ETF conversion gets tricky is Vanguard's active funds, which don't have ETF versions. Many of the muni funds fall into this category. Getting a waiver from Schwab sounds appealing in that case.
Ah yes, the active funds. I only have the index funds with the ETF share class right now, but future portability is a reason to not start with the actively managed funds in taxable.
tashnewbie
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Re: Vanguard Mutual Funds to ETF

Post by tashnewbie »

nalor511 wrote: Wed Sep 22, 2021 3:07 pm
tashnewbie wrote: Wed Sep 22, 2021 8:40 am
TropikThunder wrote: Wed Sep 22, 2021 12:02 am
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.
Wait, you’re saying Vanguard paid your transfer fee to leave Schwab? Unheard of!
I'm pretty sure. I'd have to check my records to confirm. I think Schwab charged $50 transfer fee, and I'm pretty sure I was reimbursed for that (maybe Schwab did it).
Please check! 8-)
I can't quite make heads or tails of the statements from Schwab and Vanguard. But, it looks like Schwab reimbursed me for the $50 transfer fees.
nalor511
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Re: Vanguard Mutual Funds to ETF

Post by nalor511 »

tashnewbie wrote: Thu Sep 23, 2021 9:20 am
nalor511 wrote: Wed Sep 22, 2021 3:07 pm
tashnewbie wrote: Wed Sep 22, 2021 8:40 am
TropikThunder wrote: Wed Sep 22, 2021 12:02 am
tashnewbie wrote: Tue Sep 21, 2021 3:19 pm YMMV, but I think Vanguard reimbursed my account transfer fees when I transferred a couple IRAs from Schwab.
Wait, you’re saying Vanguard paid your transfer fee to leave Schwab? Unheard of!
I'm pretty sure. I'd have to check my records to confirm. I think Schwab charged $50 transfer fee, and I'm pretty sure I was reimbursed for that (maybe Schwab did it).
Please check! 8-)
I can't quite make heads or tails of the statements from Schwab and Vanguard. But, it looks like Schwab reimbursed me for the $50 transfer fees.
Thanks for checking!

I found it impossible to believe that VG would reimburse anything, as I've never ever heard of them doing it, and they've always answered me with a hard "no" the three times I've inquired.
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