A gorgeous, sunny, good morning to you from Newport, RI. Isn’t it amazing what a little sun can do to one’s psyche?
Last week I told you how my SEP-IRA contribution was incorrectly deposited to my traditional IRA by Vanguard. Lucky for me, I caught their mistake early and avoided a potential paperwork hassle come tax-time next year.
I chalked the error up to the fact that Vanguard is in the transaction business and mistakes happen. But in thinking about the issue further, I probably caught their mistake because I do this for a living. Which makes me wonder: is the average investor paying enough attention to Vanguard?
Because when it comes to money, much like a baseball swing, a lot can be lost if you lose your confidence.
According to Sarah Krouse in the WSJ, “Over the past year, sentiment expressed about Vanguard on Twitter has been less favorable than opinions about rival brokerage firms such as Charles Schwab Corp. and Fidelity Investments, according to Social Market Analytics, Inc., a company that uses information on social media to analyze how companies are perceived.”
I’m writing from a unique perspective. I have experience with both Vanguard and Fidelity platforms: I used to work at Fidelity, we use Fidelity as the custodian for client accounts, and I have accounts at both firms.
In comparison, Fidelity is light-years ahead of Vanguard. Case in point, purchasing non-Vanguard funds at Vanguard is clunky. It’s done through a separate account called Vanguard Brokerage Services. It’s just not intuitive.
One of the advantages for Fidelity investors is the ability to buy Vanguard funds—it’s the best of both worlds. They also have access to superior service and technology at Fidelity. For clients I work with, we take the service a step higher as their liaison to Fidelity. If there’s ever a problem all it takes is simply one phone call to me.
I didn’t want to be too harsh on Vanguard, but my recent experience has left a bad taste in my mouth. Superior service, like a sunny day, helps your psyche and confidence, which should never be left to chance.
E.J. Smith - Your Survival Guy
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