Vanguard to end its small cash-management service

Bank-like program was being used by just 2% of eligible customers.

Vanguard Group will end a service for larger customers on July 31 that lets them write checks and pay bills from a Vanguard account.

The VanguardAdvantage program was launched in 2002 as a way to compete with banks. Customers who had between $500,000 and $1 million at Vanguard were charged an annual fee, while it was free for those with at least $1 million invested.

Less than 2% of eligible clients are using it, according to a Wall Street Journal report, and only half were active users in recent months.

In a letter to clients obtained by the Journal, Vanguard said it regretted any inconvenience that ending the program may cause customers. Separately, it said it is exploring other cash management options it may offer.

While only a tiny portion of Vanguard customers may have used the program, the news of its demise has generated 270 comments on Bogleheads.org, a web forum for investors who use Vanguard funds.

Many commenters expressed their disappointment. “The Advantage Account served my needs well,” said a Boglehead with the monicker jimcrawford01. “I will now seek alternatives for my investing needs. Been a good 43 years with Vanguard.”

Others discussed possible alternatives to VanguardAdvantage.

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