Not a Member?

Free Resources
	Free Reports Learn more about important investing and financial topics.
Get Blog updates sent directly to your email every day or every week. You decide. Sign up today!

Archives

• May 2012
• April 2012
• March 2012
• February 2012
• January 2012
• December 2011
• November 2011
• October 2011
• September 2011
• August 2011
• July 2011
• June 2011
• May 2011
• April 2011
• March 2011
• February 2011
• January 2011
• December 2010
• November 2010
• October 2010
• September 2010
• August 2010
• July 2010
• June 2010
• May 2010
• April 2010
• March 2010
• February 2010
• January 2010
• December 2009
• November 2009
• October 2009
• September 2009
• August 2009
• July 2009
• June 2009
• May 2009
• April 2009
• March 2009
• February 2009
• January 2009

BLOGS WE READ

• Bible Money Matters
• Bucks (New York Times)
• The Capital Spectator
• Christian Personal Finance
• CT's Money and Business
• Debt Free Adventure
• Free Money Finance
• MarketBeat
• Money Help for Christians
• Money Rules, Debt Stinks
• Real Time Economics
• Redeeming Riches

Social Bookmarking

October 19, 2010

Policy change at Vanguard opens door to lower fees

Vanguard, now America's largest mutual-fund company, is making its lowest-fee fund class available to more investors. The Associated Press has the story:

[Vanguard] is reducing the minimum investment amount to qualify for its Admiral share class, which charges lower investment expenses than its Investor mutual fund shares.

The biggest cuts affect Vanguard's index funds.... Investors who previously needed to invest at least $100,000 to qualify for Admiral shares can now get in with just $10,000 for Vanguard index funds....

For example, Admiral shares of Vanguard's Total Stock Market Index Fund will charge $7 in annual expenses for every $1,000 invested, provided an investor has at least $10,000 in the fund. That's down from $18 in annual expenses for Investor shares....

For Vanguard's...actively managed funds, the new investment minimum for Admiral shares is $50,000 instead of $100,000.

The company "will be converting qualifying accounts to Admiral shares in coming months," the AP notes, a change that could affect almost 2 million Vanguard customers.

This latest policy change continues a series of pricing/availability modifications in the fund industry that have been good news for consumers. Earlier, Vanguard launched commission-free trades for Vanguard-branded ETFs and created new ETFs that mirror some of the company's top mutual funds, but with lower expenses. Schwab has made similar moves, as has Fidelity.

In this article, AP personal finance writer Mark Jewell refers to Vanguard as "the Wal-Mart of investing. It manages more money than any other mutual fund company, so it has tremendous pricing power. When it makes a move, competitors feel pressure to follow suit."

So stay tuned.