INVEST: New American Express and Vanguard Co-Branded Robo-Advisor

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I had to double-check the date when I received the press release for this product to make sure it wasn’t April 1st. 🤯 INVEST is a new partnership between Vanguard and American Express, but Vanguard provides all of the financial investment advice. More accurately, Vanguard is paying a credit card company to find new customers and charging those new customers higher prices to cover the marketing costs. Yes, the same Vanguard that made its brand by putting its customers first, selling direct, and not paying sales commissions to financial advisors though big upfront loads on mutual funds. Somebody please create an animated GIF with Jack Bogle shaking his disappointed head. 😞

Another step towards the “New” Vanguard(TM). I wonder how many “consultants” were involved. Ah well, I suppose I should take a closer look anyway.

  • Annual gross advisory fee of 0.50%. (Waived for the first 90 days.)
  • Minimum $10,000 to eligible assets to start.
  • Includes Vanguard’s digital advisory platform.
  • Access to a 30-minute consultation where you can talk with a Vanguard advisor.
  • If you maintain $100,000 or more in your account(s) managed by INVEST, you get ongoing access to “an unlimited number of advisory phone calls”
  • Bonus American Express Membership Rewards® points annually based on the average annual taxable assets: 5,000 points for $50,000+, 25,000 points for $100,000+, 50,000 points for $500,000+.
  • Interest boost on American Express High Yield Savings Account. Get $15 for every $10,000 in average daily balance over the last 12 months (up to $50,000) in your Amex Savings account.

We basically have a few add-ons wrapped around the basic Vanguard Digital Advisor Services (VDAS) product (my review). As a reminder, VDAS sets you up with a model portfolio of low-cost Vanguard index ETFs and charges an annual gross advisory fee of only 0.20% and a lower minimum investment of $3,000.

So let’s add on the perks. Everyone gets a one-time 30-minute phone call. Thirty whole minutes! With a real, live human! If you give them $100,000, then you get unlimited phone calls. They don’t promise access to certified financial planners or anything specific. But if you had $50,000 to invest, you could alternatively upgrade to Vanguard Personal Advisory Services (VPAS) which also includes access to human advisors and more complex advice. VPAS charge an annual advisory fee of 0.30% on top of the expenses from underlying investments. Add on the estimated 0.05% from a model underlying ETF portfolio, and you’d have 0.35%.

For the bonus points, using a value of of 1 cent per Membership Rewards point, the bonus works out to a $50 value on exactly a $50,000 balance, or 0.10%. But that’s a little deceiving because you need $10,000 to open an account. That makes the bonus worth only 0.05%. $250 value on exactly a $100,000 balance is 0.25%. $500 value on exactly a $500,000 balance is 0.10%. So $100,000 is the sweet spot, but the cutoff is a bit severe if you miss it.

For the savings account interest boost, you are adding about 0.15% to the interest rate at the most optimistic on the AmEx online savings account. Their current rate is 0.50% APY. That’s about the same as most “high yield online savings accounts”, but comparison shoppers can almost always do much better. I wouldn’t really consider this a worthwhile bonus since 0.15% is not a significant margin when you don’t know if the base rate will stay competitive.

To summarize, the added perks do not reliably offset the higher cost of this product when compared to going directly through Vanguard.

Vanguard, known for not paying commissions to financial advisors…. is paying a commission to American Express. So why are you paying 0.15% to 0.30% more annually than going direct through Vanguard? Well, you should know that up to half of the fees that you pay will go directly into American Express’s pocket.

American Express (Amex) will receive a promoter fee in an amount that is up to 50% of the advisory fee that you pay to Vanguard Advisers, Inc. (VAI) if you enroll in INVEST. The promoter fee Amex receives will be reduced by certain costs, including the cost of your advisory calls with VAI Financial Advisors and other benefits that provide an incentive for you to consider INVEST. This promoter fee will be paid by VAI to Amex for so long as you maintain your advisory relationship with VAI.

Is this the most evil thing ever? No. You can always argue that anything that exposes people to investing is good, even if it’s a bit more expensive than necessary. I’m still disappointed. Vanguard was different because it was boring with little advertising and letting the product sell itself.

Bottom line. INVEST has Vanguard’s robo-advisor at its core but with a higher costs and added perks. The added perks do not reliably offset the higher cost of this product when compared to going directly through Vanguard. The reason for this is that… wait for it…. costs matter. Vanguard has to pay American Express a cut of half of your fees forever for this marketing relationship, which eventually lowers your returns as an investor. I wonder what company taught me that?!


My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

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  1. Wilson Chan says

    Well said and super helpful to know. Amex is just either evil OR GREEDY in this offering. What values does Amex bring in? Absolutely none and with a few that is totally avoidable by going directly to Vanguard.

  2. Great write up. Disappointed in this new direction vanguard had taken. Hopefully it’s not an indication of their cultural philosophy taking a turn for the worse

    • Vanguard is definitely trying to grow their assets under management with their recent moves. In my opinion, I wish they had improved their customer service first before going for this expansion effort. I feel the quality is going down, and they are just spreading themselves thinner.

      For now, I am keeping a lot of assets at Vanguard, but I have been only opening new accounts at Fidelity.

  3. Michael Anderson says

    “Thirty whole minutes! With a real, live human!” I love the subtle sarcasm (or not so subtle)! I suspect most folks who have been Vanguard investors for 10 years or more are quite disappointed with many of their actions over the last 5 years. It’s not the same company, and I need to stop complaining and start doing something about it. So, is it possible to transition my investments to another investment firm without the need to sell, thus incurring heavy taxes? I’ve never tried this.

    • Yes, it is relatively straightforward to make a broker-to-broker transfer and your cost basis should transfer over seamlessly. If you have tax lots from decades ago, I would still check and make sure you have everything backed up before making the transfer.

  4. I still like Vanguard funds, but the constant pestering about personal advisor services, the target date fund capital gain fiasco, and new movies like this one (that do NOT put the customer first), have me considering switching to a different brokerage.

    I like Fidelity’s product, but I don’t like that it’s privately held by a family of billionaire heirs. Schwab is publicly traded, so at least ownership is more clear, but I still don’t like that publicly traded companies tend to optimize for their own short-term interests, instead of the interests of their customers.

    Any other brokerages people would recommend?

    I know TD Ameritrade is now part of Charles Schwab. M1 is interesting, but I don’t generally trust venture-funded startups (because at some point, they’re going to want to start making money instead of spending it). I tried switching to Interactive Brokers, but I hate their interface (and the company, its owner, and its recent cryptocurrency push). I feel like I’m running out of options!

    • I’m not a fan of the VPAS pop-ups every time I log in, either.

      For now, I have only been opening new accounts at Fidelity. I feel that as a private company, their culture has at least prioritized good customer service, even if it is subsidized by some high-margin products. I feel that I am able to decline the high-margin products, while still enjoying the good customer service. Meanwhile, at Vanguard, the customer service is now reliably worse than Fidelity in my experience.

      I have some money at M1 too because I think it is also cool, but I agree that I don’t know if it will sustain. I can always move my ETFs out if they do. I do think they are advancing the user experience and tech for DIY investors.

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