You can get “elite” status…with Vanguard

Magic carpet ridePhoto courtesy of Annie Brightstar

I’m an unsophisticated investor, but I consider that a good thing. I’d rather do something simple that has a proven track record, rather than go for big bets that are unproven and even more risky. After all, this is my retirement we’re talking about here.

And Vanguard can be as unsophisticated as it gets.

I’ve extolled the virtues of investing with Vanguard for a long time here. Not only is their account-managing service painless, but what they are most known for, their low-cost mutual funds, are practically as thought-free as it gets. Put money in a fund that tracks an index of companies, and wait for the value to slowly rise over the long-term.

Vanguard as an account management service is not flashy, but that fits my style too.

Vanguard home page

Nothing slick here

They have a detailed listing of all investments held in every account, a reasonable amount of performance charts, and all the fund info you could want.

But did you know that Vanguard has “elite” status, just like an airline? Well, maybe not quite like an airline. There’s no first class cabin to get upgraded to, but it can still be valuable.

Airline elite status, a “first-class” primer

Airline elite status is a achievement that offers you perks and benefits with an airline after meeting a certain threshold of activity. You get things like complimentary upgrades to first class, priority seating, and earning bonus miles.

Historically, the way to achieve elite status with an airline is to fly a certain amount of miles in a given year (25,000 was the typical minimum). But recently, as airline competition has led to airline collusion and as planes become more full, airlines realized that they could get away with requiring not only flying, but also spending a certain amount of money with the airline.

Most airlines have between 3-4 levels of elite status, each requiring more, but offering more in return.

United Arlines elite tiers

United Airlines elite tiers. Some people have actually moved their address to be overseas to get around the PQD requirement. Really.

Airline elite status isn’t for everyone. You have a fly a lot to get it, and then you have to fly a lot more to get reasonable benefits from it. I currently have Alaska Airlines MVP Gold (middle-tier), and The Points Guy values this at $3,465, but I think that’s wildly optimistic.

Vanguard elite status, a “commission-free” primer

What many people don’t know is that Vanguard has elite tiers too.

In order to qualify for this status with Vanguard, you need to house a certain amount of assets with them. Here is how it breaks down:

  • Less than $50,000: Standard user
  • $50,000 – $500,000: Voyager
  • $500,000 – $1,000,000: Voyager Select
  • $1,000,000 – $5,000,000: Flagship
  • More than $5,000,000: Flagship Select

Here are some of the highlights of Voyager (full list):

  • Reduced commissions for stock and non-Vanguard ETF trades
  • No account service fees on most account types

Some highlights of Voyager Select (full list):

  • Access to Certified Financial Planner professionals for specific questions
  • Even bigger discounts on brokerage costs

Some highlights of Flagship (full list):

  • Access to Certified Financial Planner professionals for more general help
  • Exclusive access to certain mutual funds

Highlights of Flagship Select:

  • Magic carpets
  • Free rides to space and back
  • Will rename a mutual fund after you

Okay, so I was lying about that last part, but you get the idea.

(Please see Vanguard’s website for the specific terms and conditions. This is just an unofficial sampling.)

Prepare to qualify

For those who are interested, there is good news and bad news. Bad news first:

  • Bad news: Like airline elite status, it is difficult to attain this status.
  • Good news: Unlike airline elite status, it is much easier to retain status.

Getting to your first $50,000 in investments is no easy task. In fact, it’s the toughest $50,000 you’ll ever achieve.

And let’s face it, once you do make it to $50,000, the difference between $50,000 and $500,000 is pretty monumental. I expect most people with Vanguard will languish at Voyager status for even longer than it took to achieve it.

But until we have another big crash or other catastrophic event, you won’t lose the status once you gain it. Or if you do, you’ll get it back once the market recovers. Once a Voyager, always a Voyager.

My Voyage

For me, the biggest benefit of Voyager status (which I have recently achieved) is the ability to receive paper statements without incurring a service fee. I know that’s not exciting to most people, but as much as I like to do most things online (like pay bills), I like to save paper statements for my investments. Perhaps it’s silly, but it feels safer to have some record that’s not online. Again, this is my retirement.

I kind of wish Vanguard would spice up their offerings, to make elite status something people want to achieve, just like people want to achieve airline elite status (whether or not it’s a good idea).

But then again, that’s not really Vanguard’s way. Unlike airlines, Vanguard doesn’t make their standard experience horrible so as to make their premium product look appealing. Their standard experience is more than adequate for the task.

The bigger question is: are you taking advantage of that task? Are you thinking about your retirement? Are you moving beyond worry and actually planning your financial future? The time is now.

(And remember, it’s easy to set up an Roth IRA with Vanguard. It took 30 minutes when I helped someone do it, and we took breaks. And that isn’t an affiliate link, to be clear.)

But enough about me: Do you have elite status with Vanguard (or any other service)?

Mike Pumphrey

Mike Pumphrey

I'm the founder and author of Unlikely Radical, a site to help people succeed with money, achieve their goals, and live intentionally.

I offer a free phone consultation to anyone who is interested in changing their financial narrative. Are you ready? Click here for details.
Mike Pumphrey
Posted on February 13, 2017