Investors who are looking for more guidance for their portfolio can sign up for Personal Advisor Services. Users create an online login, fill out a brief questionnaire about risk tolerance and goals, and then schedule a phone call with an advisor, who’ll dig a little deeper into the information the user has provided. That’s followed by a phone call with an advisor, who presents a customized plan and portfolio. Once that plan is implemented, clients can contact Vanguard whenever they have questions or want to make changes.
You won’t have a dedicated advisor unless you hit a certain asset level, but a team of advisors is available via phone or video appointment. The design of the portfolio and ongoing monitoring happen via a combination of algorithms and advisor guidance. However, a minimum investment of $50,000 is required.
Who should consider Vanguard Personal Advisor Services
To sign up for Vanguard Personal Advisor Services, you must first clear the hurdle of the account minimum: $50,000. Ergo, this feature is more suited to investors with some assets under their belt and the desire to add professional guidance to their portfolio choices.
For investors who meet the minimum, this service is appropriate for anyone seeking professional investing advice, including those with complex financial situations and those who just aren’t comfortable doing their own investing. If you don’t have the willingness or time to construct and monitor your own portfolio, this robo-advisor service is a good next step.
Vanguard Personal Advisor Services fees and features
|Amount minimum to open account|
|Account fees (annual, transfer, inactivity)|
|Tax loss harvesting|
|Tax loss harvesting detail||Investments will be allocated strategically among taxable and tax-advantaged accounts. Tax loss harvesting is available but requires work on the investor's part.|
|Offers fractional shares|
|Ease of use|
|Mobile app||iOS, Android, Fire OS|
|Customer support||Phone, Email|
Strengths of Vanguard Personal Advisor Services
- Low fees: For portfolios under $5 million, Vanguard charges just 0.30% of assets. Taking into account the costs of underlying investments, the company estimates that clients pay about 38 basis points in all. (A basis point is equal to 1/100th of a percent, so 38 basis points is equivalent to 0.38%.) That cost is in line with other robo-advisors in the field — it’s slightly higher than Betterment’s 0.25% management fee, but clients at Betterment can communicate with planners only by app messaging.
- Investment choices: The company focuses on Vanguard funds for portfolios, with a bent toward Vanguard index funds, which are plentiful and low-cost — the average expense ratio is 70% less than the industry average, according to the company. Users also have the ability to incorporate outside investments.
- Flexibility: Although the company will manage only the assets you have in nonretirement accounts, IRAs and trusts, Vanguard won’t ignore the money you have elsewhere. It will take your other savings and investments into account when it designs your plan, ensuring that you aren’t overbalanced or underrepresented in any asset class.
- Human contact: While you aren’t assigned a specific advisor unless you have half a million dollars in assets, you have access to an advisor team no matter the amount you invest. If you want to connect, you can make an appointment online or call and speak to an available advisor. You also can email your questions or set up a video conference.
Drawbacks of Vanguard Personal Advisor Services
- High minimum: In order to participate in this Vanguard service, you must have at least $50,000 in assets, and that doesn’t include employer-sponsored retirement accounts — just taxable accounts, IRAs and trusts. Given that the median household retirement savings of 35-year-olds to 44-year-olds is just $37,000, this minimum will eliminate a big chunk of people who haven’t saved enough outside of a 401(k) yet.
- Tax loss harvesting: Although tax loss harvesting is available, it isn’t the default. Vanguard offers this service on a client-by-client basis instead of taking a blanket approach. If your money is in a taxable account and tax loss harvesting is crucial for you, this may not be the right place for you.
- No dedicated advisor: Although this robo-advisor offers access to real people, if you’re looking for a personal relationship with one planner, you won’t find it here unless you have a high level of assets.
Is Vanguard Personal Advisor Services safe?
All investments carry risk, but Vanguard comes with a solid reputation. In 2017, Vanguard’s Personal Advisor Services had $96.9 billion in assets under management, and Vanguard manages a total of $5.1 trillion globally. The company is a member of the Securities Investor Protection Corporation (SIPC), which protects securities customers of its members up to $500,000. Vanguard has more than 20 million investors in 170 countries.
Vanguard’s Personal Advisor Services is a strong robo-advisor option. Its fees are comparable to those of other robo-advisors, and clients have access to advice from professional advisors.
That said, the $50,000 minimum may be a high bar for many, shrinking the likely client base to those who are nearer to retirement and who’ve had time to save more. If you have the assets, however, this service has a lot to offer.