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Old 10-28-2010, 03:26 PM   #21
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Isn't it satisfying to see those accounts disappear from Ameriprise?!
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Old 10-29-2010, 08:25 AM   #22
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It's almost life changing to see that account disappear! LOL!

Even better, I can't wait to see all my accounts pop up in Vanguard's website and watch them grow beyond anything that would happen in Ameriprise!
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Old 10-29-2010, 10:14 AM   #23
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When I go to financial dinners and eat heartily at their, I also feel very satisfied. Just feel sorry for those who will get hooked.
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Old 10-29-2010, 12:32 PM   #24
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In regards to M* ratings, the same analysts who assign those stars to the funds advise investors not to be too hung up on them. The stars are all about the past. But yes, I agree it's psychological and so comforting to see more stars like a hotel .
E.g. Total Stock Index fund (VTSMX) is rated 3*. How different will it be if I move my $$ from this fund to a similar fund at a different co.? It's an index fund and its managers are barely involved in it. Well, maybe Fidelity has a lower expense ratio for this kind of index fund, but again I like Vanguard and I don't want to keep moving my money around + tax considerations if I had to sell in one co. in order to move to another co.
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Old 10-29-2010, 12:50 PM   #25
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Total Stock Index fund (VTSMX) is rated 3*
By definition an index fund can't beat the market, or under perform it. hence the 3 stars.

Trying to beat the market is a fools errand. You either delude yourself or end up with a higher risk portfolio.

Those 5 star funds almost always are a flash in the pan. Almost nobody can consistently beat the market.

Check out this discussion (from the Coffeehouse Investor website) on trying to beat the market to see the futility of trying:

http://www.coffeehouseinvestor.com/i...utfox-the-box/
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Old 10-29-2010, 12:52 PM   #26
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E.g. Total Stock Index fund (VTSMX) is rated 3*. How different will it be if I move my $$ from this fund to a similar fund at a different co.? It's an index fund and its managers are barely involved in it.
I would expect most index funds to have three stars almost by definition, because they are designed to track the market, not beat it (or trail it).
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Old 10-29-2010, 06:09 PM   #27
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By definition an index fund can't beat the market, or under perform it. hence the 3 stars.
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I would expect most index funds to have three stars almost by definition, because they are designed to track the market, not beat it (or trail it).
I'd suggest that a perfect index fund would under perform the market by it's (low) MER. What's a few basis points among friends?
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Old 10-29-2010, 06:36 PM   #28
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By definition an index fund can't beat the market, or under perform it. hence the 3 stars.

Trying to beat the market is a fools errand. You either delude yourself or end up with a higher risk portfolio.

Those 5 star funds almost always are a flash in the pan. Almost nobody can consistently beat the market.

Check out this discussion (from the Coffeehouse Investor website) on trying to beat the market to see the futility of trying:

The Coffeehouse Investor » Outfox the Box
Yuck, now I'm thoroughly confused. I had dumped my Ameriprise IRA into Vanguard's Wellesly Income Fund and was thinking of also investing in their 2035 Target Retirement Fund. Mind you, this decision was based on not knowing anything yet (I still have to read up on investing wisely). I liked Wellesley because it has a 60/40 stock/bond ratio and that's just my cup of tea for no really good reason. It also had a high M* rating (back then when I thought ratings were very important) and relatively low expense ratio. I also thought that the 2035 Target Retirement Fund would be an aggressive counterbalance to my being timid by going along with Wellesly's ratio. The Target Fund has, I think an 80% stock investment.

But, now I see that the coffeehouse investor is telling me that I'd be a fool to rely so heavily on stocks.

Goodness, I can't wait to get my books in the mail so I can read up on investing and really make an informed decision instead of throwing darts.

Diversify, diversify, I have to chant the diversification mantra and not get too caught up in coming up with the perfect portfolio!
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update and another question
Old 11-04-2010, 07:16 PM   #29
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update and another question

Well, Vanguard has notified me that they have notified Ameriprise about transferring my IRA. I closed my SPS account and got a check in the mail. Dumb*ss that I am, I opened up a Roth IRA out of sheer joy only to realize afterwards that I could just have simply and more cheaply converted part of my IRA. But, whatever.

I also sent in a request to Amerprise to terminate my relationship with my advisor and to give me a refund. I knew I wasn't going to get a refund after three years but I figured that I had nothing to lose and, besides, I got the pleasure of stating in the request form that I was unhappy with my financial advisor.

Today, my advisor called and left a message that she was surprised to find out that I had closed two of my accounts. She was concerned and asked that I call her and also suggested that I, at least, carefully consider my VA because of the surrender charge.

Needless to say, I felt a little smug sense of self satisfaction. But, call me a pushover of a wimpy pussy cat, I then felt bad after thinking about it. I figured that she did, after all, really gave me a pretty diverse portfolio.

My initial big shock was finding out about the high front loads and expense ratios and all I could think was that I needed a voodoo doll of her likeness but that the next best thing was just to close my accounts without her knowledge and give her a bad word in my cancellation/refund request.

If I recall correctly, I think she said that Ameriprise does not pay her a salary and that her money comes from commissions. So, is it so bad that she steered me towards fund that would pay her livelihood? Is the reality of the situation just that I was ignorant and chose to be ignorant by convincing myself that she was looking out for my best interest although I really knew better? What was she supposed to do, tell me not to invest with Ameriprise? Not!

So, I decided to write a letter to Ameriprise telling them to disregard my negative review of her and told them I was simply deciding to take control of my finances and moving them to a company that was not going to charge me all their crazy fees.

My colleague tells me I'm crazy and that I'm being the biggest wimp and that I should call my advisor and give her a piece of my mind. Another colleague says that I should send that letter because if my advisor really wanted to she could have really taken advantage of my ignorance but instead did the best she could do given her commission based salary.

I don't know, I say she could always just work for Vanguard or become a fee-based advisor instead of preying on the ignorant. But, who knows, maybe she's not really that good, and Ameriprise is her only opportunity. Oh, I don't know, I'm just having arguments with myself. I do that a lot.

Of course, there's always the option of just moving on forgetting the whole thing. But what if she gets reprimanded?? There I go arguing with myself again.

So, what thinks you all?? Send the letter or not?
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Old 11-04-2010, 07:20 PM   #30
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Let it go because you're Free at last, Free at last!

If she was on salary where did you think that money would come from.
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Old 11-04-2010, 07:23 PM   #31
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Of course, there's always the option of just moving on forgetting the whole thing.
This gets my vote.

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But what if she gets reprimanded??
I'd say the odds of her getting a reprimand as a result of your letter and having Elvis show up at your front door at noon tomorrow were roughly the same...
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Old 11-04-2010, 09:47 PM   #32
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I let it go as well.

Last week I got a survey from Ameriprise asking me to rate my advisor. I don't know if it was because we closed our accounts or if it was coincidence, but I chose to throw away the survey.
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Old 11-05-2010, 02:31 AM   #33
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(snip)
If I recall correctly, I think she said that Ameriprise does not pay her a salary and that her money comes from commissions. So, is it so bad that she steered me towards fund that would pay her livelihood? Is the reality of the situation just that I was ignorant and chose to be ignorant by convincing myself that she was looking out for my best interest although I really knew better? What was she supposed to do, tell me not to invest with Ameriprise? Not!
There you have in a nutshell the conflict of interest inherent in paying people by commission who advise others on their investments. This system rewards your "advisor" (actually a salesperson) for getting you, her client, to invest in the products that will maximize her income, rather than those that will maximize yours. You saw the result. She had you in funds with high expense ratios, variable annuities with their surrender charges, and so on, all of which was eating into your returns in order to line her pockets.

Quote:
So, I decided to write a letter to Ameriprise telling them to disregard my negative review of her and told them I was simply deciding to take control of my finances and moving them to a company that was not going to charge me all their crazy fees.

My colleague tells me I'm crazy and that I'm being the biggest wimp and that I should call my advisor and give her a piece of my mind. Another colleague says that I should send that letter because if my advisor really wanted to she could have really taken advantage of my ignorance but instead did the best she could do given her commission based salary.

I don't know, I say she could always just work for Vanguard or become a fee-based advisor instead of preying on the ignorant. But, who knows, maybe she's not really that good, and Ameriprise is her only opportunity. Oh, I don't know, I'm just having arguments with myself. I do that a lot.

Of course, there's always the option of just moving on forgetting the whole thing. But what if she gets reprimanded?? There I go arguing with myself again.

So, what thinks you all?? Send the letter or not?
I dithered about that one too. When I was a naive new investor, my Ameriprise advisor sold me a variable annuity inside my Roth IRA account, and it later cost me a stiff surrender charge to disentangle myself. When I decided to get all my money out of the hands of Ameriprise, it was suggested to me that I write a letter requesting a refund. I did think, when I had learned more about investments, that I had been sold an unsuitable product, but I was the one who told the advisor I was risk averse, so maybe we were just equally ignorant together. Who knows? In the end, I didn't request a refund. I decided to chalk up the several hundred dollars of surrender charge, account closing fee etc, to experience. I agree with REWahoo. Don't bother sending the second letter, just get on with Life After Ameriprise. As the old proverb goes, it's no use crying over spilt milk.
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Old 11-05-2010, 07:15 AM   #34
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IMO - 5% front-load and 1.5% expense is a sin! I would move the mutual funds ASAP.

Ditto about moving on. Chewing out the sales person will not help.

A better approach would be to share your story with everyone you know so friends and family do not fall for it.



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Old 11-05-2010, 08:24 AM   #35
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Now that you have gotten your money from Ameriprise, it is time to start thinking about a nice vacation timeshare.
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Old 11-05-2010, 08:24 AM   #36
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The concept is that your VA grows tax deferred in the variable annuity accounts. Then when you retire you "annuitize" it into a stream of income payments over your remaining lifetime.

If you want to do the variable annuity path then consider a low cost provider like vanguard. Keep in mind though that annuities are insurance. thereffore they will always have some extra fees to provide for the "can't lose" death benefit and will usually trail a similar IRA/401k account.
Vanguard's annuities do not have living beneft riders..........
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Old 11-05-2010, 08:29 AM   #37
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There you have in a nutshell the conflict of interest inherent in paying people by commission who advise others on their investments. This system rewards your "advisor" (actually a salesperson) for getting you, her client, to invest in the products that will maximize her income, rather than those that will maximize yours. You saw the result. She had you in funds with high expense ratios, variable annuities with their surrender charges, and so on, all of which was eating into your returns in order to line her pockets.
On a wholly separate issue, she could NOT find lower cost products for you without getting fired.........how sweet is that? I do love the ongoing assumption that the ADVISOR makes all the money for themselves.......cracks me up everytime.......most reps like her are lucky to see 50% of the total commissions net, often less.........the client is the big loser and the FIRM, not the rep in most cases, makes out like a bandit..........

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I dithered about that one too. When I was a naive new investor, my Ameriprise advisor sold me a variable annuity inside my Roth IRA account, and it later cost me a stiff surrender charge to disentangle myself. When I decided to get all my money out of the hands of Ameriprise, it was suggested to me that I write a letter requesting a refund. I did think, when I had learned more about investments, that I had been sold an unsuitable product, but I was the one who told the advisor I was risk averse, so maybe we were just equally ignorant together. Who knows? In the end, I didn't request a refund. I decided to chalk up the several hundred dollars of surrender charge, account closing fee etc, to experience. I agree with REWahoo. Don't bother sending the second letter, just get on with Life After Ameriprise. As the old proverb goes, it's no use crying over spilt milk.
Places like Amerprise and NML sell a LOT of VAs inside IRA accounts, and it mainly stems from one reason........production requirements. Amerprise reps are required to "sell" X number of "lives" a year, and a VA counts as a "life", so they get closer to their goal. Is that a conflict of interest to the client? Definitely! Is that going to change anytime soon? No............
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Old 11-05-2010, 10:33 AM   #38
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... I do love the ongoing assumption that the ADVISOR makes all the money for themselves.......cracks me up everytime.......most reps like her are lucky to see 50% of the total commissions net, often less.........the client is the big loser and the FIRM, not the rep in most cases, makes out like a bandit..........
You have said this before, but I don't ever see anyone assuming the individual advisor is being paid 100 percent of the fee, FD. It's the paying it that bothers us, not how much is ending up in the advisor's pocket.
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Old 11-05-2010, 11:51 AM   #39
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. . .

I also sent in a request to Amerprise to terminate my relationship with my advisor and to give me a refund. I knew I wasn't going to get a refund after three years but I figured that I had nothing to lose and, besides, I got the pleasure of stating in the request form that I was unhappy with my financial advisor.
. . .
My initial big shock was finding out about the high front loads and expense ratios and all I could think was that I needed a voodoo doll of her likeness but that the next best thing was just to close my accounts without her knowledge and give her a bad word in my cancellation/refund request.
. . .
So, I decided to write a letter to Ameriprise telling them to disregard my negative review of her and told them I was simply deciding to take control of my finances and moving them to a company that was not going to charge me all their crazy fees.
Did they sell you front loaded funds and charge other fees in addition to the loads?

If so and if you don't mind saying, how much in fees?

Agree with the posters saying to just move on quietly.
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Old 11-05-2010, 06:17 PM   #40
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First to the OP congrats Willongo for escaping the evil clutches of Ameriprise. It was also nice to see a recent board member and victim like Lisa99 help show him the light.

I have been trying unsuccessfully to convince my best friend to leave Ameriprise. Ironically, the only reason he is thinking about is he see from her Facebook that they are political opposites. (So Sarah, FD be careful of friending your clients he he).

One of the things that did get his attention, is when I started reading from the back of the 100+ page compensation disclosure brochure that Ameriprise is required to hand out about their lawsuits. Over the years dozen of states Attorney General have filed suit against Ameriprise and over a wide variety of deceptive practices.

Now I don't think a 5% load is particularly deceptive, although an selling annuity in an IRA is border line financial malpractice IMO. Still Ameriprise can do no longer do lots of things in many states due to settlements, what they did to you may or may not be covered. So since you have the letter written I'd go a head and send a copy to the local better business bureau, along with your state's consumer protection agency. The BBB letter will hurt Ameriprise's future business, and the letter to the state will at least put your name on the list for any current or future lawsuits. It seems worth a couple of stamps to me.
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