I am currently enrolled in personal capital's financial assistance, where the annual fee is 0.89%. I have been using them for the last 2.5 years. Although I get personal finance assistance, 0.89% is a high fees. I looked into Vanguard's robo advisor as a lower cost option. Do you guys have experience with Vanguard's advisor? Any feedback / thoughts will be greatly appreciated. Thanks #personalfinance #investments
I highly recommend Vanguard over Personal Capital. Vanguard Personal Advisor has a lower fee of 0.30% for accounts under $5 million. Their advisors are all Certified Financial Planners, and they can do tax loss harvesting like Personal Capital. I've been a satisfied Vanguard Personal Advisor client for years. It's pretty much set-it-and-forget-it because the advisor controls your assets under management and rebalances your portfolio. You'll meet with your advisor regularly (typically 4 times a year, less or more based on your preference) with a phone call. If you prefer not dealing with a human, Vanguard Digital Advisor, their 100% robo-advisor service, has a lower fee of 0.20%. The minimum investment is also lower ($3,000 for Digital Advisor vs. $50,000 for Personal Advisor). Vanguard typically uses a simple 4-fund portfolio of their own US and International stock and bond ETFs: VTI, VXUS, BND, BNDX. Fees matter, and Personal Capital charges too much. I like their aggregation tool, but not their sales pitch for their advisory service. They tried to justify their high fees with special perks like equal-weighted direct indexing, which they claim can beat the market. It's always better to go with the lower cost service because higher fees compound more over time, and you'll end up with less wealth that accumlates over the decades. It also comes down to whether you can trust your advisor. I also found a similar question on the Bogleheads forum which might also help. https://www.bogleheads.org/forum/viewtopic.php?t=399667
Thanks for the detailed explanation? I am assuming their performance is somewhat close to the S&P benchmark? Or output wise, did you have a good experience with Vanguard?
@hKgf56 One of the ETFs in my portfolio, VTI (Vanguard Total Market ETF) consistently outperforms the S&P 500 because it follows a total market index of large, medium and small cap stocks, while the S&P 500 is a large cap index only. My average rate of return for the past 7 years trails the S&P 500 by about 3% because in addition to VTI, I also have VXUS (international stocks), BND (domestic bonds), and BNDX (international bonds). The other 3 ETFs add diversification but can also lower returns overall when these don't perform as well. I need the extra diversification because I can't take a lot of risk less than 10 years away from retirement, so my portfolio is 60% stocks, 40% bonds. If you want returns like the S&P 500, then you need to be 90-100% in stock ETFs, especially if you are decades away from retirement. Vanguard's online questionnaire is about determining how much risk you are willing to take to get higher returns. Then your Vanguard advisor comes up with a financial plan for you based on your risk tolerance. I have a very good experience with Vanguard, and the returns are in line for the risk I am willing to take. I had 7% return for past 7 years, and I think S&P 500 average annualized return is around 10%. My portfolio is customized for my needs. Yours might be completely different. Here's a review I found online about Vanguard. https://www.forbes.com/advisor/investing/vanguard-personal-advisor-services-review/
Why not wealthfront?
Mine underperformed s&P
Attentive, can you please explain more? Investment timeline, chosen risk etc. Thanks!