Can I Buy Vanguard Admiral Shares at Schwab?

Can I Buy Vanguard Admiral Shares at Schwab?

Vanguard’s Admiral Shares offer a cost-effective way to invest in a broad spectrum of the stock market. Not only are you able to have your money invested automatically each month, the fees you pay Vanguard’s Admiral Shares are on average much lower than that of regular shares.

Generally, the easiest way to buy Admiral Shares would be through Vanguard directly, however, if you already have your funds with another broker like Schwab you might be wondering if you can buy Admiral Shares at Schwab as well.

Can I buy vanguard admiral shares at Schwab? You cannot buy Vanguard Admiral Shares at Schwab. Even though the may appear in Schwab’s investment offerings, once you try to invest, Schwab will let you know that Vanguard Admiral Shares are unavailable. This is because Vanguard has reserved their Admiral Shares and institutional share classes to be exclusively traded with them.

Let’s have a closer look at this phenomenon!

Admiral Shares at Schwab

Oddly enough, when browsing Schwab’s site and their investment options, a Vanguard Admiral Shares fund – such as VTSAX – will pop up every now and then. Schwab even has an entire page on their site dedicated to VTSAX:

Admiral Shares (VTSAX) at Schwab

This can be found under “Mutual Fund Quotes & Research Tools”.

As the name suggests this page simply provides insights into a great fund you could invest in which is unfortunately unavailable through Schwab.

So, what can you do? Well, let’s go through some option of how you could go about buying Vanguard Admiral Shares when you have an account with Charles Schwab.

Option #1: Buying an ETF instead

This would probably be a good option that comes with the least amount of hassle.

Most Vanguard Admiral Shares in their mutual fund structure are available as exchange-traded funds as well. For instance, take VTSAX which is Vanguard’s Total Stock Market mutual fund. The same fund with exactly the same holdings is available as an ETF: VTI.

You might also want to consider if Vanguard Admiral Shares are actually worth it. Some of the Admiral Share classes charge higher fees than their ETF counterparts. VTSAX, on the one hand, has an expense ratio of 0.04% while VTI charges 0.03%.

Buying an ETF instead might also have some additional benefits in terms of tax-loss harvesting and general tax-efficiency. And luckily, all of Vanguard’s index funds are also available at Schwab.

Option #2: Transferring Your Account

The second option which comes with a lot more hassle is to transfer your account from Schwab to Vanguard in order to buy Admiral Shares there.

You can do this somewhat easily with the Automated Customer Account Transfer Service (ACATS). This service is usually free and allows you to switch brokers without having to sell all of your shares and securities through your current broker and re-buying them through your new broker.

Transfer funds from Schwab to Vanguard

This section on Vanguard’s website is set up to easily move an account or asset to Vanguard. Once you make it through the entire process and have filled out all of your details the transfer of accounts will work relatively painlessly.

As mentioned before, you might want to take a good hard look at whether moving accounts is actually worth it to you.

And if you decide that it is, there might be an even better option for you.

Option #3: M1 Finance

This third will give you the best of both worlds: a no-commission innovative brokerage platform and the ability to buy Vanguard’s funds at no additional cost.

Setting up an account with M1 Finance takes less than 10 minutes.

Once you signed up you will be able to set up your own investment pie consisting of as many Vanguard funds as you like:

Plus, you will have all the benefits of Vanguard Admiral Shares when investing in their index funds through M1 Finance, such as auto-investing and purchasing fractional shares.

Furthermore, it is easier to re-balance your portfolio with their automatic re-balancing feature to keep your portfolio allocation in check.

Conclusion

Unfortunately, you cannot buy Vanguard Admiral Shares at Schwab.

However, this inconvenience may lead to exploring some alternatives to your current investment set up. Perhaps you’ll discover that Vanguard Admiral Shares are not really worth it or that you could be simplifying your investing through an innovative brokerage, such as M1 Finance.

Whether or not you decide to make these changes, Vanguard’s funds are in any case an excellent option for any long-term investor.

Leave a Reply