Vanguard Hidden Fees
Online brokerage companies often have a range of fees they charge their customers. The most familiar fee is the “trading fee” or “commission fee,” which is a cost for carrying out a trade or for buying and selling financial securities. This fee could be a set amount or a percentage of the trade's total value.
These companies might also have other charges not directly linked to the transactions of buying and
selling. These include fees for account services or costs for money transfers.
Account Service Fee
Vanguard imposes a $20 yearly “account service” fee on each brokerage account.
However, Vanguard does not charge this fee under certain conditions:
- Clients with $1 million or more in qualifying Vanguard assets.
- Clients who opt for electronic delivery of statements, reports, and updates.
- Clients with an organization or trust account that has a registered employee identification number (EIN).
- Brokerage accounts that are part of an advisory program managed by a Vanguard affiliate.
Wire Transfer Fee
Vanguard applies a $10 charge for each asset moved via wire transfer.
This fee is waived for clients holding $1 million or more in qualifying Vanguard assets.
American Depositary Receipts (ADRs) Fees
American Depositary Receipts (ADRs) let U.S. investors buy shares in foreign companies. Banks managing ADRs for investors may impose specific fees as stated in the ADR prospectuses.
A common type of ADR fee is a “pass-through” fee, which Vanguard collects on behalf of the Depository Trust Company (DTC) and then deducts from the client’s account.
The DTC might also charge fees for processing dividends.
Foreign Securities Transactions Fees
For securities that aren’t eligible for DTC (unlike ADRs), there's a $50 processing fee. This fee is charged on top of any commission.
Vanguard could also charge a daily commission if a trade spans multiple days.
Extra fees might apply if the trade occurs directly on foreign markets instead of through an intermediary.
Tax Filing for Master Limited Partnerships (MLPs) in an IRA
Vanguard Fiduciary Trust Company (VFTC) handles tax matters for any MLP held in an IRA. The IRS mandates that VFTC file specific MLP tax forms, for which they charge a $300 fee per account.
Vanguard Trading Fees
Generally, Vanguard does not charge for trading stocks and ETFs online. However, trading mutual funds, options, CDs, and bonds may involve fees or “commissions.” Additionally, trades made over the phone might have extra charges.
Stocks
Trading stocks online at Vanguard comes without transaction fees. However, trading over the phone is subject to a $25 fee, which Vanguard does not charge for clients with $1 million or more in Vanguard investments.
ETFs (Exchange-Traded Funds)
Vanguard offers its own ETFs and also allows trading of ETFs from other providers. No transaction fees apply to online trades, but trading ETFs from other companies by phone incurs a $25 fee. This fee is waived for clients with investments of $1 million or more at Vanguard.
Mutual Funds
Vanguard offers its own mutual funds and those from other companies.
Vanguard’s own mutual funds do not have transaction fees, although some funds might charge special purchase or redemption fees ranging from 0.25% to 1.00% of the transaction.
Vanguard requires a minimum investment in its mutual funds, which varies from $1,000 to $100,000 depending on the fund.
Vanguard categorizes mutual funds from other companies into three groups:
- No-transaction-fee (NTF) mutual funds,
- Transaction-fee (TF) mutual funds, and
- Load mutual funds.
No-Transaction-Fee (NTF) Mutual Funds
NTF mutual funds traded online do not incur fees. However, trading them by phone has a $25 fee, waived for those with over a million invested in Vanguard funds.
Transaction-Fee (TF) Mutual Funds
Fees for TF mutual funds depend on your total investments in Vanguard ETFs and mutual funds, with different charges for online and phone trades.
Clients with less than $1 million in Vanguard funds pay $20 per online trade and an additional $25 for phone trades.
For clients with $1 million to $5 million, the first 25 online trades are free, with subsequent trades costing $8.
Clients with over $5 million get 100 free trades, with each additional trade costing $8.
Load Mutual Funds
Fees for load mutual funds vary by the share class: A, B, & C.
Class A shares have a front-end load, up to 5.75%, depending on the fund.
Class B & C shares are subject to a decreasing back-end load over time.
Each share class may also include specific sales charges and minimum purchase requirements, depending on the fund.
Options Contracts
Fees for trading options vary based on your investments in Vanguard funds.
Clients with less than $1 million pay $1 per contract.
Clients with $1 million to $5 million get 25 free trades, while those with over $5 million receive 100 free trades. After that, each contract costs $1.
All options exercises and assignments are free of commissions.
Fixed-Income Securities
The costs for trading CDs and bonds vary depending on whether the instruments are new issues or traded on the secondary market.
New issues are mostly free except for mortgage-backed securities, which have a $35 per trade fee.
Secondary market trades generally have higher fees, except for U.S. Treasury securities which are free.
Fees for CDs, U.S. government securities, corporate bonds, and municipal bonds are $1 per $1,000 face amount, capped at $250.
Mortgage-backed securities and unit investment trusts (UITs) cost $35 per trade.
An additional $25 fee applies to secondary market trades made by phone, waived for clients with investments of $1 million or more.
Vanguard also sets minimum investments for its fixed-income securities. The minimums are $1,000 for U.S. government agency securities, corporate bonds, CDs, and U.S. Treasury securities, and $5,000 for municipal bonds.
Margin Rates
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Debit Balance
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Vanguard Margin Rates
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under $19,999
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12.25%
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$20,000 – $49,999
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11.75%
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$50,000 – $99,999
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11.25%
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$100,000–$249,999
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10.75%
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$250,000–$499,999
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10.25%
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$500,000–$999,999
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9%
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above $1,000,000
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call
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Vanguard Review
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Updated on 6/25/2025.
Arthur Chachuna is a professional personal finance blogger, and the owner of Brokerage-Review.com.
He has been an avid investor for 25 years, and has a background in both applied math and programming.
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