Vanguard Lowers My Portfolio’s Fund Fees… Again!

March 21, 2012 By Jonathan Ping 6 Comments
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There will always be debate regarding investing in actively-managed stock pickers vs. passive index followers. But even for active managers, costs matter more than star ratings and past performance. The lower the expenses, the less headwind year in and year out.

The best thing about using Vanguard funds is that they have consistently lowered my investment fees over time as their own costs have dropped. When that happens, it’s like getting guaranteed higher returns that continue to compound each year.

Last year, they lowered the fees on several funds and also added Admiral shares. Last month, they dropped some fees on their Emerging Markets fund. Most recently, they announced another round of expense ratio cuts. Check the article for all the funds, but here are the ones that I hold:

Funds In My Personal Portfolio Old expense ratio New expense ratio
Vanguard Emerging Markets Stock Index Fund (Investor shares) 0.35% 0.33%
Vanguard Emerging Markets Stock Index Fund (ETF/Admiral) 0.22% 0.20%
FTSE All-World ex-US Index (ETF) 0.22% 0.18%
Total International Stock Index (Investor shares) 0.26% 0.22%
Total International Stock Index (ETF/Admiral) 0.20% 0.18%

The total weighted expense ratio of my investments is probably under 0.20% annually now. The only way to go lower is to hold the stocks or bonds directly in a brokerage account, and even then I have consider commission charges.

Filed Under: Investing
Last updated: March 21, 2012
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Comments

  1. Jason says
    March 21, 2012 at 7:22 am

    Gotta love Vanguard! Over the long term, incurring unnecessary management fees can unnecessarily limit performance – thanks for the update.

    Reply
  2. Dan says
    March 21, 2012 at 8:22 am

    Thank you for clearing that up for me. I bought the ETF for Total International last week and noticed the 0.18% er and thought it looked smaller than I remembered it.

    Reply
  3. aa says
    March 21, 2012 at 8:45 am

    If I convert VEIEX to VEMAX (admiral of VEIEX), will I get hit by Redemption Fee:2% if held < 2 mos for my newest shares?

    Reply
  4. Jonathan says
    March 21, 2012 at 2:03 pm

    @aa – I don’t think so, but I would call them up to confirm. Otherwise, just try it and it will tell you about the fee before you complete the transaction, if there is one.

    Reply
  5. Eric says
    March 21, 2012 at 3:24 pm

    More love for Vanguard 🙂

    Reply
  6. Long Term Returns says
    March 23, 2012 at 9:53 am

    Vanguard is great, but does this mean that all you hold in your portfolio are foreign equities? Or those are just the only funds that you hold that have had their expenses lowered?

    Reply

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