Since all trading sites get a commission on each trade it's no surprise that they don't push people to put their money in a number of Vanguard index funds for 30 years.
On some of the investment funds offered by my bank their fees are so high the investment fund will never ever make money for the customer. And yet they shamelessly sell it anyway.
I use TDAmeritrade, which actually offers a number of vanguard and iShares ETF's commission free. It really incentivizes investing in those rather than anything else. I know there has to be a catch somewhere on it, but I don't see what it is...
9 out of 10 times this means TDAmeritrade receives a kickback from Vanguard/iShares whenever you buy their shares. So there is a commission, and it's still being paid by you (albeit indirectly). This kickback doesn't need to be very large because TDAmeritrade isn't doing much work. My guess is that you can't buy shares in Vanguard's low profit margin funds (such as VFIAX - 0.05% expense ratio) without any fees, only Vanguard's high margin funds.
Of course, Vanguard wants to steer people to their more profitable investment funds, and paying the sales fee to the bank on behalf of the customer is a good way to do that.
Perhaps. I'm quite green when it comes to investing, so I probably haven't paid as much attention to expense ratio as I should have, but I have tried to minimize investments in high expense ratio accounts. The big one for me that I get commish free is IVV, which, if I buy in small chunks monthly isn't too bad at a .07% ratio, no?
IVV is very solid. IVV is competing fiercely with the new competitor VOO and SPY (the 3 funds are effectively identical). Vanguard charges the least (0.05% per year) and SPDR charges the most (0.09%). 3 years ago IVV had an expense ratio of 0.09%, now they're charging 0.07% and I expect their ratio to go down to 0.06% in the next year or two. Vanguard is trying to steal their lunch.
So if you get IVV without commission you're benefiting from this price war.
On some of the investment funds offered by my bank their fees are so high the investment fund will never ever make money for the customer. And yet they shamelessly sell it anyway.