CONVERSION OVERVIEW

Frequently asked questions

About the conversion

As part of their ongoing commitment to providing high-quality employee benefits, your employer feels that Vanguard Digital Advisor® can better meet your unique financial needs and help you reach your retirement goals and more.

VMAP is an automated, third-party investment and money management service powered by Edelman Financial Engines. VMAP provides retirement income planning but does not link to Vanguard brokerage accounts and IRAs.

Both services offer automated investment management and retirement planning. But only Digital Advisor can manage Vanguard taxable brokerage accounts and IRAs. It also provides powerful planning tools that can help you pay off debt, optimize your Social Security benefits, and save for an emergency. Find out more about Digital Advisor and how it compares with VMAP.

You’ll pay about $15 for every $10,000 Digital Advisor manages each year.1 With VMAP, you paid about $40 for every $10,000 VMAP managed each year.2 So you'll save about $25 a year for every $10,000 Digital Advisor manages.

And the fee won’t come out of your paycheck. Digital Advisor will deduct the fee quarterly from the investments you authorize us to manage in your 401(k) account.

Log in to your Digital Advisor account and:

  1. Confirm your retirement details. For example, when you want to retire and how long you expect to need money in retirement.
  2. Take the Digital Advisor risk survey. Digital Advisor will then create a personalized saving and investing plan just for you.
  3. Review and confirm your investment plan.

That's it. Digital Advisor will now manage your account using your unique info.

Digital Advisor will invest your money in a mix of stocks, bonds, and cash or cash equivalents. Your particular mix depends on your personal info and your comfort with risk. Digital Advisor adjusts your mix automatically as you near, then enter, retirement. Typically, your mix will initially contain a higher percentage of stocks and then gradually shift to a higher percentage of bonds. That’s because stocks are riskier than bonds but tend to offer greater potential reward over time.

Both target-date investments and online advice services like Digital Advisor can help you choose the right investment mix. And with both options, your mix will automatically become less risky as you get closer to your goals.

Unlike a target-date investment, Digital Advisor will build a customized investment mix just for you based on your personal info. And it will monitor your investment mix every business day and rebalance it automatically to help you reach your goals. Digital Advisor also considers assets outside your retirement plan so it can manage your investments based on your full financial picture. Finally, Digital Advisor can help you reach multiple goals, like saving for a home or car, not just for retirement.

Target-date investments are subject to the risks of their underlying funds. The year in the investment's name refers to the approximate year (the target date) when an investor would retire and leave the workforce. The investment will gradually shift its emphasis from more aggressive investments to more conservative ones based on its target date. A target-date investment is not guaranteed at any time, including on or after the target date.

No. Digital Advisor uses complex computer calculations, known as algorithms, to create your investment plan and manage your money. Digital Advisor’s algorithms are based on Vanguard’s 45 years of investment expertise. We use them to build your personalized portfolio, monitor your investments, and rebalance them as needed.

Understanding your settings

Your employer selected identical default settings for everyone in your retirement plan. This is a legal requirement and ensures that Digital Advisor will manage your account based on a standard risk level and a typical retirement age and time in retirement. These default settings may work for some people in your plan, but they may not reflect your personal situation and comfort with investment risk. Complete your profile today to update your details. Then Digital Advisor can manage your savings and investments using your unique info.

So you can get even more value from Digital Advisor. Your personal details did not transfer from VMAP to Digital Advisor. So you need to provide Digital Advisor with the unique info it needs to manage your savings and investments based on your individual financial situation. Also, when you complete your profile, you’ll unlock powerful planning tools that can help you pay off debt, save for nonretirement goals, and save for a financial emergency.

Digital Advisor will create a personalized saving and investing plan just for you using your profile settings. Your plan will:

  • Incorporate your savings, income, marital status, retirement time horizon, and comfort with risk.
  • Include a broadly diversified mix of investments designed to help you meet all your goals—using the funds available in your retirement plan.
  • Reduce risk as the timeline for your goals approaches.

Digital Advisor will then invest your savings, keep a close eye on your investment mix, and automatically rebalance when needed.

Watch our 2-minute video to learn more about how Digital Advisor builds your personalized saving and investing plan.

Your comfort with risk shapes your investment mix. With that in mind, Digital Advisor uses a risk survey to determine your risk tolerance. It also uses your personal info to figure out your risk capacity. Risk capacity is the amount of risk you can afford to take and still be on track to meet your goals. Using your risk tolerance and risk capacity, Digital Advisor builds a personalized saving and investing plan for you and then automatically adjusts your plan over time to help you meet your retirement goal, plus any custom goals you may have created.

Completing your profile

It takes about 5 minutes. Log in to your profile and:

  • Confirm a few personal details.
  • Take our quick 3-question risk survey.
  • Review your custom investment mix.
  • Confirm your investment plan.

Yes. Digital Advisor will use your profile info and comfort with financial risk to build a personalized investment strategy based on Vanguard’s decades of time-tested investment knowledge. Then your plan will be tested against 10,000 scenarios to ensure that your investments can handle the market’s ups and downs. Digital Advisor will also keep an eye on your investments, rebalancing your account when necessary to help keep you on track to meet your retirement goal.

Digital Advisor will start managing your retirement plan account after your plan converts from VMAP to Digital Advisor. You may notice that Digital Advisor has sold some of your assets. That’s normal. Digital Advisor is adjusting your investment mix based on your profile info and comfort with risk. After you personalize your profile, you’ll also unlock powerful planning tools that can help you pay off debt, save for nonretirement goals, and save for a financial emergency.

You’ll answer 3 questions. The first question will focus on your comfort with risk by asking about a long-term investing outcome. The second and third questions will focus on your comfort with loss by asking about short-term investing outcomes. The answers to these 3 questions will help us determine your overall attitude toward risk and return, which allows Digital Advisor to recommend a risk level for you. 

Vanguard’s Digital Advisor risk assessment is backed by complex modeling and forecasting tools that draw on our decades of investment experience. Our expert knowledge and experience, combined with qualitative and quantitative testing with thousands of Vanguard investors, helped us create a 3-question survey that assesses your tolerance for risk and loss.

If you don’t feel that the results of the risk survey are accurate, you can bump your recommended risk level up or down 1 or 2 levels. Or you can retake the survey.

If you don’t complete your Digital Advisor profile before your retirement plan converts, Digital Advisor will manage your investments using settings picked by your employer. These settings may work for some people in your retirement plan, but they may not be a good fit for you and your unique financial needs.

Within 1 business day of your retirement plan’s conversion from VMAP to Digital Advisor.

Digital Advisor can manage your investments even if you’re already retired. Making sure your money lasts in retirement is key to a successful postretirement life. And Digital Advisor can help you manage your cash flow and efficiently withdraw money from your investments to help you meet that goal.

You deserve financial advice that’s as unique as you are

Get even more value from Digital Advisor. Complete your investor profile.
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Whenever you invest, there's a chance you could lose the money.
Diversifying means having different types of investments. It doesn’t guarantee you’ll make a profit or that you won’t lose money.
1Actual costs vary. Digital Advisor will reduce your gross advisory fee by the amount of revenue (such as expense ratio rebates) that Vanguard (or a Vanguard affiliate) collects on your portfolio in order to calculate the net advisory fee. Digital Advisor’s annual net advisory fee is approximately 0.15% across your enrolled accounts for a typical investment portfolio, although your actual net fee will vary depending on the specific holdings in each enrolled account. Your net advisory fee can also vary by enrolled account type. Plan participants’ actual advisory fees will vary depending on your plan’s lineup and the revenue that Vanguard receives from those investments. Please see your plan fee disclosure notices for the applicable annual gross advisory fees that apply to your plan assets.

2Actual costs vary. Each VMAP participant pays fees to Vanguard Advisors, Inc. (VAI), based on a percentage of assets in each account managed by VAI (excluding loan balances) according to the following schedule:

• 40 basis points (0.4%) per year for assets up to $100,000.
• 30 basis points (0.3%) per year for assets between $100,000 and $250,000.
• 20 basis points (0.2%) per year for any assets over $250,000.
The fee schedule above reflects the standard schedule of fees for VMAP which became effective on January 1, 2019.
Vanguard Digital Advisor's services are provided solely by Vanguard Advisers, Inc. (VAI), a registered investment advisor. Please review the Vanguard Digital Advisor brochure  for important details about this service. Vanguard Digital Advisor's financial planning tools provide projections and goal forecasts, which are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. 
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