How much should I start investing with Vanguard?
Most Vanguard mutual funds have a $3,000 minimum, but you can invest in any Vanguard Target Retirement Fund or Vanguard STAR® Fund with as little as $1,000. (Some funds have minimums greater than $3,000 to protect the funds from short-term trading activity.)
Vanguard managed funds
A minimum purchase amount of $500 applies to the initial purchase of any managed fund, with a minimum investment amount of $1 when you are adding to an existing managed fund that you already hold.
Vanguard is the king of low-cost investing, making it ideal for buy-and-hold investors and retirement savers. But beginner investors and active traders will find the broker falls short despite its $0 stock trading commission, due to the lack of a strong trading platform and accessible educational resources.
The minimum initial investment is $3,000.
You can invest from £100 per month, or get started with a £500 lump sum.
If you are looking to create a diversified, ETF-based portfolio that you will periodically rebalance—and not much else—then Vanguard is a good fit. If you are an active investor or trader, however, Vanguard's limited tools and asset selection will likely be a non-starter.
Vanguard is a large investment advisor offering mutual funds and ETFs, many of which pay dividends. Most of Vanguard's ETF products pay monthly or quarterly dividends.
- Options commissions.
- Only offers fractional share investing on Vanguard ETFs.
- Active trading platform isn't as robust as competitors.
Best funds for beginning investors:
SPDR S&P 600 Small Cap Value ETF (SLYV) First Trust Small Cap Value AlphaDEX ETF (FYT) Vanguard Total Stock Market ETF (VTI) Vanguard Total International Stock ETF (VXUS)
Vanguard Digital Advisor is free for the first 90 days. After that, expect to pay up to 0.25% in advisory fees, which vary based on selected options. Fidelity's robo-advisor service is Fidelity Go. There's no minimum to get started, making it a better choice for beginner investors.
What is the average return on Vanguard funds?
| Average annual returns as of 02/29/2024 1 | ||
|---|---|---|
| Sort table ascending by Fund name | Sort table descending by Symbol | Sort table descending by 5 yr |
| Diversified Equity Fund | VDEQX | 13.81% |
| Dividend Appreciation Index Fund Admiral Shares | VDADX | 12.48% |
| Dividend Growth Fund | VDIGX | 12.32% |
Visit your My NerdWallet Settings page to see all the writers you're following. The average 401(k) balance at Vanguard was $112,572 in 2022.
The minimum amount needed to open a Vanguard stocks and shares ISA or Managed ISA is £500. The minimum regular monthly payment is £100.
Money market funds and other securities held in the Vanguard Brokerage Account are eligible for SIPC coverage. Securities in your brokerage account are protected up to $500,000. To learn more, visit the SIPC's website. Up to $250,000 by FDIC insurance.
Once you have cash available in your account, you can withdraw it following these steps: Log into your account. Any money held as cash and available for withdrawal will be shown here. Choose 'Withdraw cash'.
The company also launched a cash deposit option for sweep accounts called Vanguard Cash Deposit, which has an APY of 3.7% as of August 2023 and similar FDIC coverage. Vanguard began piloting Vanguard Cash Deposit and Vanguard Cash Plus with small groups of existing clients in January 2022 and August 2023, respectively.
While not all of the households in this study are millionaires, the vast majority of them are. The median household in the study has over $1 million with Vanguard and those below the median have assets outside of Vanguard (i.e. real estate, non-Vanguard accounts, etc.) that make most of them millionaires as well.
If you want to actively trade within your accounts, Fidelity might be the better option. However, if you want to focus more on index investing, or you want to use a robo-advisor, Vanguard has a slight edge.
Vanguard's unique cost structure, the economies of scale it has achieved, and the total number of assets under management (AUM) allow it to offer its ETFs at the lowest cost available in the market. We've listed 10 of the firm's cheapest ETFs by their expense ratio.
Investors who exchange or redeem out of a Vanguard fund will be eligible to purchase or exchange back into the same fund 30 calendar days later.
How do I avoid Vanguard fees?
We'll waive the fee if you have at least $5 million in qualifying Vanguard assets. Refer to the applicable fund prospectus for other exclusions that may apply.
Account & service fees
A $25 annual fee applies to each of your brokerage and mutual-fund-only accounts. SIMPLE IRAs, Individual 401(k)s, and Vanguard 529 Plan accounts have special account service fees.
When the market cratered, investors withdrew $16.4 billion from Vanguard's index mutual funds. What accounts for remaining index mutual fund outflows? Johnson says it could be clients pulling out money because they're retiring, or because they're negatively affected by the pandemic.
The securities that underlie the funds are held by a custodian, not by Vanguard. Vanguard is paid by the funds to provide administration and other services. If Vanguard ever did go bankrupt, the funds would not be affected and would simply hire another firm to provide these services.
Basic withdrawals cost $0, but there may be exceptions
But I have good news: basic withdrawal at Vanguard is free of charge.
