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Vanguard might be for you if: You're a hands-off investor who wants low-cost index fund ETFs and mutual funds. This broker is a longtime industry leader in passive investing, offering thousands of low-fee or no-fee diversified stock and bond ETFs and mutual funds, a wide range of investment account types, and an easy-to-use platform. Read our Vanguard review to see if this brokerage is the right choice for your investment goals.
Vanguard
Vanguard is one of the best brokerages for passive investors who want to buy low-cost index fund ETFs. It also offers thousands of no-transaction-fee mutual funds, and excellent zero-commission options for buying stocks online, with no account minimums for brokerage accounts. Vanguard tries to keep its costs and expense ratios low so investors (like you) can keep more of your returns.
$0 online; $25 broker-assisted fee for some phone trades of stocks and ETFs from other companies (Less than $1 million)
$0
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My experience: I'm a longtime Vanguard customer, and despite some other people's recent complaints about customer service, in my experience the Vanguard Client Services team has always been super-responsive, helpful, smart, and detail-oriented. Vanguard's funds tend to have some of the lowest fees and a wide range of ways to invest in stocks and bonds. I'm not a day trader. If you want professional trading capabilities for active investing, Vanguard's not the right brokerage. But if you want to slowly, quietly, simply build wealth with passive investing in low-cost index fund ETFs, Vanguard makes it easy.
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Vanguard offers a wide range of investment products and account types, and you can buy Vanguard ETFs with a minimum investment of $1 in your brokerage account. Vanguard is owned by its investors, so it keeps its costs low -- the average Vanguard ETF and mutual fund expense ratio is 82% less than the industry average.
Vanguard, like most major online brokers, offers commission-free online stock trades. Although Vanguard's per-contract options commissions are not free, they're close: only $1. Vanguard charges $0 commissions for Vanguard ETFs and mutual funds, but it does charge commissions for some ETF and mutual fund trades from other companies. Both the options and mutual funds commissions can be waived for accounts with more than $1 million invested in Vanguard funds.
Investment product | Cost |
---|---|
Stocks | $0 online, $25 for broker-assisted trades by phone if you have less than $1 million invested with Vanguard |
ETFs | $0 for Vanguard ETFs, $25 for broker-assisted trades by phone for ETFs from other companies (if you have less than $1 million invested with Vanguard) |
Mutual funds |
$0 online for Vanguard mutual funds and no-transaction fee (NTF) mutual funds from other companies; up to $20 for others. Extra fee of up to $25 for broker-assisted trades by phone for mutual funds from other companies (if you have less than $1 million invested with Vanguard) |
Options | $0 plus $1 per contract (less than $1 million invested with Vanguard) |
Vanguard offers margin loans that let investors borrow against the stocks, bonds, ETFs or other eligible securities that they hold in a brokerage account. Borrowing on margin can be risky, but it gives you a flexible line of credit.
Margin balance | Effective rate |
---|---|
Up to $19,999 | 13.75% |
$20,000-$49,999 | 13.25% |
$50,000–$99,999 | 12.75% |
$100,000–$249,999 | 12.25% |
$250,000–$499,999 | 11.75% |
$500,000 and above | Contact Vanguard for rates. |
Vanguard publishes extensive original research on the economy, markets, retirement savings, and investing. You can get free insights from Vanguard's experts on topics such as stock market trends, the U.S. and international economies, and deciding whether to invest in different asset categories.
Recent Vanguard research focuses on understanding the municipal bond market, deciding how much cash to have in your portfolio, and Vanguard's fundamental principles of investing success. In addition to its academic-style research, Vanguard offers extensive financial education content to help everyday investors.
Some of its recent educational content on investing strategies includes topics such as:
Vanguard lets you open an account, manage your account, invest, and conduct transactions online through its online brokerage platform. Everything you need to buy stocks and ETFs with Vanguard is available through the Vanguard website.
The Vanguard interface is designed more for passive investors and it shows. If you only want to check your investment account balance a few times per year, or perhaps buy investments once per month on payday, Vanguard's interface should give you plenty of functionality to do everything you need.
Vanguard is definitely not a day-trading platform. If you are an active investor who wants more sophisticated trading tools for frequent stock trading and advanced investment strategies, other brokerages will likely be a better fit.
The Vanguard mobile app is available for Android and iOS, and lets you invest on the go via mobile device. You can use Vanguard's app to buy and sell investments, deposit checks via mobile check deposit, withdraw funds, check your account balance, track your investment performance, compare investment options, and more.
Vanguard's app gets significantly better reviews on the App Store (4.7 stars) than on Google Play (3.5 stars). Android users have recently complained about login issues and navigation problems; some Vanguard customers said that the Android app worked so poorly that they had to go use the Vanguard website instead.
Vanguard customer service seems to be going through a time of struggle. The company is not accredited by the Better Business Bureau (BBB); the BBB website gives Vanguard a grade of "F," with 202 customer complaints closed in the past 12 months. Trustpilot gives Vanguard a rating of 1.7 stars.
Customers have complained on the BBB website about serious problems with Vanguard's service -- such as:
Vanguard is a major financial institution with more than 50 million clients. Just like the biggest banks sometimes make mistakes, with any brokerage of this size there are going to be a few customers that encounter problems and have bad experiences. But even Vanguard's biggest fans on the Bogleheads.org website (named after Vanguard founder John Bogle) have recently been complaining that Vanguard's customer service has gone downhill.
Maybe you can get better customer service by signing up for Vanguard Personal Advisor®? This service gives you automated investment help (like a robo-advisor), personalized investment planning, and on-demand access to Vanguard financial advisors. But you need a minimum of $50,000 of assets to qualify.
Vanguard Personal investors (which includes brokerage account customers) can contact Vanguard Client Services in the following ways:
Vanguard uses a variety of advanced, industry-standard security techniques to help protect your account. These include:
Vanguard was founded in 1975 and has become one of the largest and most influential investment management companies in the world. Vanguard's approach to investing is focused on keeping fees low and encouraging low-cost, long-term, uncomplicated, passive investing. This brokerage is popular with everyday investors who aren't trying to beat the market, but who want to buy and hold diversified portfolios of stocks and bonds -- without paying unnecessary fees and commissions. As of Dec. 31, 2023, Vanguard had more than $8.6 trillion of assets under management (AUM).
Keep reading about Vanguard on these pages:
At The Motley Fool Ascent, brokerages are rated on a scale of one to five stars. We primarily focus on fees, available assets, and account types; however, we also take into account features like research, education, tax-loss harvesting, and highly rated mobile apps. Our highest-rated brokerages generally include low fees, a diverse range of assets and account types, and useful platform features.
See our full methodology here: Ratings Methodology
There is no specific account minimum to open a brokerage account with Vanguard. However, since Vanguard doesn't allow fractional share investing except with its own ETFs, you'll need at least enough money to purchase one share of a stock or a fractional share of an ETF, or the minimum investment amount for a mutual fund you want to invest in.
There are a few things Vanguard doesn't offer for investors. Fractional share investing of stocks is a big example -- if a stock is trading for $500 per share, you'd need $500 to invest in it. Many competitors would allow you to directly buy a piece of a share. Plus, as a platform focused on long-term, buy-and-hold investing strategies, Vanguard's trading platform isn't as feature-packed as many other traditional brokerages.
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Vanguard disclosures
Visit vanguard.com to obtain a prospectus or, if available, a summary prospectus, for Vanguard and non-Vanguard funds offered through Vanguard Brokerage Services. The prospectus contains investment objectives, risks, charges, expenses, and other information; read and consider carefully before investing.
Options are a leveraged investment and are not suitable for every investor. Options involve risk, including the possibility that you could lose more money than you invest. Before buying or selling options, you must receive a copy of Characteristics and Risks of Standardized Options issued by OCC. A copy of this booklet is available at theocc.com. It may also be obtained from your broker, any exchange on which options are traded, or by contacting OCC at 125 S. Franklin Street, Suite 1200, Chicago, IL 60606 (888-678-4667 or 888-OPTIONS). The booklet contains information on options issued by OCC. It is intended for educational purposes. No statement in the booklet should be construed as a recommendation to buy or sell a security or to provide investment advice. For further assistance, please call The Options Industry Council (OIC) helpline at 888-OPTIONS or visit optionseducation.org for more information. The OIC can provide you with balanced options education and tools to assist you with your options questions and trading.
Commission-free trading of Vanguard ETFs applies to trades placed both online and by phone. All ETFs are subject to management fees and expenses; refer to each ETF's prospectus for more information. Account service fees may also apply. All ETF sales are subject to a securities transaction fee. See the HYPERLINK "https://investor.vanguard.com/investing/transaction-fees-commissions/etfs" Vanguard Brokerage Services commission and fee schedules for full details.
Vanguard funds not held in a brokerage account are held by The Vanguard Group, Inc., and are not protected by SIPC. Brokerage assets are held by Vanguard Brokerage Services, a division of Vanguard Marketing Corporation, member FINRA and SIPC.
Vanguard Marketing Corporation, Distributor of the Vanguard Funds
Fidelity disclosure
Fractional share quantities can be entered out to 3 decimal places (.001) as long as the value of the order is at least $1.00. Dollar-based trades can be entered out to 2 decimal places (e.g. $250.00)
Robinhood disclosure
All investments involve risk and loss of principal is possible.
Securities are offered through Robinhood Financial LLC, member FINRA/SIPC. Cryptocurrency services are offered through an account with Robinhood Crypto, LLC (NMLS ID 1702840). Robinhood Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Cryptocurrency held through Robinhood Crypto is not FDIC insured or SIPC protected. For more information see the Robinhood Crypto Risk Disclosure.
Trades of stocks, ETFs and options are commission-free at Robinhood Financial LLC. Other fees may apply. Please see Robinhood Financial’s Fee Schedule to learn more.
Fractional shares are illiquid outside of Robinhood and are not transferable. Not all securities available through Robinhood are eligible for fractional share orders. For a complete explanation of conditions, restrictions and limitations associated with fractional shares, see the Fractional Shares section of our Customer Agreement.
Robinhood Gold is an account offering premium services available for a $5 monthly fee. Not all investors will be eligible to trade on Margin. Margin investing involves the risk of greater investment losses. Additional interest charges may apply depending on the amount of margin used. Bigger Instant Deposits are only available if your Instant Deposits status is in good standing.