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The Vanguard Group Review

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The Vanguard Group

The Vanguard Group, Inc. (Vanguard) is a corporation that provides investment advisory services to several entities including the Vanguard family of mutual funds, offshore pooled investment vehicles and institutional clients of Vanguard’s international subsidiaries. It currently has more than $151 billion in assets under management and 793 financial advisors on staff.

The Vanguard Group was founded in 1975, and it advises clients according to investment strategies including indexing and active management. If you’re an individual looking for a financial advisor, you may be looking for Vanguard Personal Advisor Services, the company's robo-advisor service.

The Vanguard Group Background

The Vanguard Group, Inc. was founded in 1975. The firm primarily offers advisory services to other investment companies, namely Vanguard mutual funds, Vanguard offshore funds and institutional clients of Vanguard’s international subsidiaries.

What Types of Clients Does The Vanguard Group Accept?

The Vanguard Group offers services to Vanguard offshore funds and a small number of separate clients of international subsidiaries of Vanguard. Vanguard doesn’t require a minimum investment for its services, although many of the offshore funds have investment minimums for its underlying investors.

Services Offered by The Vanguard Group

The Vanguard Group employs two different broad strategies when it comes to its advisory services: indexing and active management. Within each of those strategies, Vanguard performs the following services.

  • Indexing
    • Replication
    • Sampling
  • Active Management
    • Return analysis
    • Stock valuation
    • Fundamental investment research
    • Market forecasting

The Vanguard Group Investment Philosophy

The Vanguard Group determines its investment approach and strategies using several tools, including quantitative modeling, fixed-income analysis, fundamental investment research and research obtained from external organizations. Its indexing strategies rely on both replication, which is the process of assembling a portfolio with the same stocks/bonds as a particular target index in roughly the same proportions, and sampling, which uses a computer program to create a representative sample of the target index that resembles the index in terms of several characteristics.

Fees Under The Vanguard Group

The Vanguard Group charges fees for its advisory services that are tailored to each individual client. The fee rate can vary depending on the complexity and size of the account, and the frequency at which clients pay will be specified in the initial advisory agreement. The firm's offshore clients will also have to pay various administrative and operational expenses that aren’t included in the standard advisory fees. The Vanguard Group doesn’t charge performance-based fees, meaning clients’ fees won’t be dependent on any capital gains or the appreciation of assets.

Disclosures

The Vanguard Group has two disclosures. A financial regulatory authority has found the firm or one of its affiliates to have been involved in a violation of investment-related regulations or statutes within the last 10 years. Specifically, the firm employed an advisor in Pennsylvania who was registered as an investment advisor in Arizona but not in Pennsylvania. Also, Vanguard Marketing Corporation, an advisory affiliate, was sanctioned for not having a satisfactory system in place to supervise the disclosure of unsatisfied judgments or liens of registered representatives. 

Where Is The Vanguard Group Located?

The Vanguard Group is headquartered in Malvern, Pennsylvania, a suburb of Philadelphia.

Tips for Finding a Financial Advisor

  • Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in 5 minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
  • If you're looking to meet with a financial advisor, you should first decide what you're looking to accomplish. Are you looking to save up for retirement? Do you want to save for your child's education with a 529 plan? Having your primary goals established will make it easier for your advisor to help you achieve them.

How Many Years $1 Million Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about the cost of living in retirement for that location.

Least
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Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology To determine how long a $1 million nest egg would cover retirement costs in cities across America, we analyzed data on average expenditures for seniors, cost of living and investment returns.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. Using this data, SmartAsset calculated the average cost of living for retirees in the largest U.S. cities.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%. This reflects the typical return on a conservative investment portfolio. Then, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would cover retirement expenses in each of the cities in our study. Cities where $1 million lasted the longest ranked the highest in the study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research