Is it safe to keep all/most of my investment money in one fund family, such as Vanguard?

I am considering keeping all my investment money at Vanguard for simplicity and low expenses. Am I protected in any way in case the company goes belly-up?

In the real world if there was a financial meltdown to the degree that they went out of business it would affect all asset managers and NO ONE would get their money, deposit insurance or not. So to answer your question your money is no safer or less safe ther than it is anywhere else.

Nope. Only those accounts that are insured by the FDIC or other agency will be protected. Those are usually savings accounts, not mutual fund or other investments.

Vanguard offers many different types of funds. If you are diversified among funds, then you should be alright. Vanguard will still operate for years since they are earning fees on the money invested in their funds. Unlike a Bear Sterns, Vanguard themselves are not "at risk".

It is possible that some of their funds could underperform and you could lose some money (e.g., like the current market downturn has caused many people to have investment losses of 5% or more). In the long-term, you should make money in the diversified funds.

If you want absolute iron-clad guarantee of your principle, then stick your money in FDIC-secured banks and not to exceed the amounts insured.

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