Automatic Investment - Vanguard vs Others

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Mike83
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Automatic Investment - Vanguard vs Others

Post by Mike83 »

I tried to set up automatic (periodic) exchange from a Vanguard settlement fund to an ETF in my Vanguard account that is now a brokerage account. It was not possible and a phone rep confirmed this. Apparently you could do it on the old mutual fund platform.

Is this unique to Vanguard? I'd be interested in knowing if Schwab or Fido can handle this.
Bigt3142
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Re: Automatic Investment - Vanguard vs Others

Post by Bigt3142 »

Fidelity is the same, it must be a mutual fund to set up automatic investments.
Investor1986
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Re: Automatic Investment - Vanguard vs Others

Post by Investor1986 »

Yep, that's the main reason most of new investors who have no tie with Vanguard yet, choose to use platforms such as M1 Finance as it allows for automatic ETF investments (from Vanguard or others), buying partial shares, with no fees.
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Brianmcg321
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Re: Automatic Investment - Vanguard vs Others

Post by Brianmcg321 »

Use a mutual fund.

I have Vanguard brokerage accounts and I use auto invest into VTSAX.
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Topic Author
Mike83
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Re: Automatic Investment - Vanguard vs Others

Post by Mike83 »

Brianmcg321 wrote: Wed Oct 27, 2021 12:25 pm Use a mutual fund.

I have Vanguard brokerage accounts and I use auto invest into VTSAX.
Thanks. Their website suggest that brokerage platform holdings can do transfers between mutual funds, as you describe. My brokerage holding does have a money market fund and one or two mutual fund investments (leftovers). Even between these funds, it would not allow me to set up periodic exchange from mm to mutual fund.

Phone rep said they get asked this question a lot from folks who are used to doing it on their old mutual fund platform.

I guess I could always subscribe to their roboadvisor service :}
Mike Scott
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Re: Automatic Investment - Vanguard vs Others

Post by Mike Scott »

I do a scheduled auto invest from a bank account to a mutual fund in the "new" Vanguard brokerage account each month. This may be different than trying to do it from a settlement money market account.
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Mike83
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Re: Automatic Investment - Vanguard vs Others

Post by Mike83 »

Thanks to the responses I got here, I persisted and went back and found it is possible to exchange from a settlement account to a mutual fund. You have to begin the process pretending the money will come from an outside bank, but then a submenu allows selecting VG settlement as an option.

Since I have just converted most of my Mutual fund accounts to ETFs to simplify :oops: my accounts and shave off a bit of ER, I now find it necessary to re-establish a mutual fund account for SP500 to receive a portion of the transfers.
backpacker61
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Re: Automatic Investment - Vanguard vs Others

Post by backpacker61 »

Mike83 wrote: Wed Oct 27, 2021 12:00 pm I tried to set up automatic (periodic) exchange from a Vanguard settlement fund to an ETF in my Vanguard account that is now a brokerage account. It was not possible and a phone rep confirmed this. Apparently you could do it on the old mutual fund platform.
You could never hold ETF's at any time on the old mutual fund platform. ETF's require being held in a brokerage account.
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ruralavalon
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Re: Automatic Investment - Vanguard vs Others

Post by ruralavalon »

Investor1986 wrote: Wed Oct 27, 2021 12:22 pm Yep, that's the main reason most of new investors who have no tie with Vanguard yet, choose to use platforms such as M1 Finance as it allows for automatic ETF investments (from Vanguard or others), buying partial shares, with no fees.
Source for "most of new investors who have no tie with Vanguard yet, choose to use platforms such as M1 Finance . . . "?

One of the benefits of regular mutual funds over exchange traded funds (ETFs) is that is easy to set up both automatic investment of new contributions and automatic reinvestment of dividends and distributed gains.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
UpperNwGuy
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Re: Automatic Investment - Vanguard vs Others

Post by UpperNwGuy »

I just invest manually. It isn't that much work. I do it on the first of each month, so I never forget to do it.
lostdog
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Re: Automatic Investment - Vanguard vs Others

Post by lostdog »

UpperNwGuy wrote: Thu Oct 28, 2021 6:04 am I just invest manually. It isn't that much work. I do it on the first of each month, so I never forget to do it.
+1

It's not that hard to do it.manually unless you have other reasons for doing it automatically.

The money I save in ER is well worth the extra minute it takes to do a few clicks.
Stocks-80% || Bonds-20% || Taxable-VTI/VXUS || IRA-VT/BNDW
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