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Old 07-20-2014, 12:14 AM   #21
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My Ameriprise advisor sold me an annuitized life insurance product years ago in an IRA that was invested in market. I did not really need or ask for an annuity or life insurance. I lost just over 50% in 2009 ($100k) and never once heard from him. When I finally got a hold of him and was frustrated with the loss, he actually said to me - "well the good news is you purchased a rider that will keep the death benefit at the $200k mark although cash value is now under $100k." So, in other words, when I die, there will be an "up side". I'm in the process of transferring what is left (I moved to cash when I lost more than 50%) to Vanguard.

I dont know how these guys sleep at night.

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Old 07-20-2014, 09:47 AM   #22
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Alright, I'm convinced. I see the light and will switch my funds to vanguard ASAP. But don't feel too sorry for me, I made thousands more than leaving it in a bank, and buying companies before merger was a lot more fun than sitting on a fund with way better odds than a state lotto.


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Old 07-20-2014, 11:12 AM   #23
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Alright, I'm convinced. I see the light and will switch my funds to vanguard ASAP. But don't feel too sorry for me, I made thousands more than leaving it in a bank, and buying companies before merger was a lot more fun than sitting on a fund with way better odds than a state lotto.
Well, when we see the "A" word around here the red lights start flashing and the klaxons start sounding, so....
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Old 07-20-2014, 11:44 AM   #24
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He's been doing about 7.5% per annum nominally with my money since 2009 by buying companies right before they get bought out/merge.
This would definitely not be the normal, routine Ameriprise scenario. Typically, Ameriprise FA's put people in load funds with high ER's and try to sell them annuities. They don't function as brokers getting clients in and out of individual equity opportunities.

I know it is possible to have a brokerage account and trade equities, etc. with Ameriprise but I've never run into anyone who has had one before. You may be dealing with a situation that our other Ameriprise threads or comments you'll receive here don't relate to.

Personally, I'm not a fan of having a "broker," Ameriprise or other. Years ago I had an account with Payne Webber and received trading advise (likely mostly churning but a few excellent selections for me) but I've gone DIY and plan to remain that way.

OP, or anyone, please comment on the "brokerage" account side of Ameriprise if you have any familiarity. This as opposed to the normal load funds and annuties salespeople we're all familiar with and like to jump on.
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Old 07-20-2014, 11:49 AM   #25
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Personally, I'm not a fan of having a "broker," Ameriprise or other. Years ago I had an account with Payne Webber and received trading advise (likely mostly churning but a few excellent selections for me) but I've gone DIY and plan to remain that way.
I'm not a fan of ever having a financial relationship with any planner or fund manager where their compensation wasn't directly related to the performance of my portfolio. In a traditional brokerage arrangement their compensation is only related to the number of trades they can churn, and bears no real relation to the portfolio they are helping to advise.

For non-DIY types I don't see a big problem with a good fee-only planner/advisor whose fees are based only on a reasonable percentage of your assets (they get paid more when you make more and less when you lose money), but I think most of the folks here are a lot more hands-on and comfortable managing their own money, of course.

That said, sometimes people can get lucky. In the late 1980s and very early 1990s I worked with a guy who had a fair bit of money with a broker who encouraged him to invest in a (then) little-known company called Amgen. Needless to say, if he stayed the course he's a millionaire many times over by now.
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Old 07-20-2014, 12:04 PM   #26
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I'm not a fan of ever having a financial relationship with any planner or fund manager where their compensation wasn't directly related to the performance of my portfolio.
I think this sounds better than it works in practice.
1) If the broker gets compensated based only gains, then he would definitely have an incentive to take very aggressive bets. Hey, the worst that can happen (on that particular account) is that he makes nothing (while the customer loses a big %age of his money), and if he "wins", he gets a big payoff. Not well aligned with the customer's interests, IMO. I think it may also be improper/illegal.
2) If he gets paid a % of assets under management, we have a situation where the guy gets paid more for managing a big account than a small one, when they are the same amount of work. And there's the difficulty of knowing if the broker/advisor is compensated by the underlying funds/insurance agencies, etc, which introduces a big conflict of interest.

It just seems a lot more honest and above board to pay an advisor for his time or a fixed fee for the service, just like I'd pay a plummer or a lawyer. Get the recommendations, then have the client move the money himself. Yes, there's no direct "link" between investment results and the compensation earned by the advisor, but that doesn't bother me because I don't think they can add risk-adjusted value over a prudent low-cost buy-and-rebalance passive approach. T
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Old 07-20-2014, 12:10 PM   #27
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That said, sometimes people can get lucky. In the late 1980s and very early 1990s I worked with a guy who had a fair bit of money with a broker who encouraged him to invest in a (then) little-known company called Amgen. Needless to say, if he stayed the course he's a millionaire many times over by now.
I had a satisfactory experience with the Payne Webber guy I used for a number of years. I belonged to an investment club and he was our broker. He came to some meetings and provided some training and information. Several members picked him up for their individual accounts. I can't remember him ever giving me bad advise or causing excessive churning. Most of the activity was pretty vanilla. He did get me into some municipal bonds which turned out to be fabulous winners at a time when I had not yet learned to research those for myself. The bad news was that commissions were staggeringly high compared to today's commissions at discount brokers.

Information is much, much easier to come by with all of the big name brokerage houses such as Ameritrade, Schwab, etc., having great web sites and search tools. DIY seems to be the way to go and brokers and advisors seem to be drifting more into the sales arena.

OP's experience with Ameriprise seems to be with some sort of brokerage arm of the company as opposed to the bag draggers selling load funds and annuities. I've never seen that aspect of Ameriprise commented here on the FIRE board before.
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Old 07-20-2014, 01:10 PM   #28
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We had Ameriprise to start when we knew zero. She did not sell us anything wacky, only one Riversource fund, no annuities or anything like that. The funds were actually all good. She was very good in creating an asset allocation for my hub who was a contractor at Fidelity (Fidelity was horrible on their recommendations). She recommended all low cost index funds and he did super well. She made no commissions on this or my 401k at my company.

So although we did pay fees for those years (maybe 3?) she did get us started off in a good direction. When my hub took a perm job at Fidelity we had to move all funds inside Fidelity (except my 401K) so we ended the relationship. Fidelitity's proposal to us were just so bad it's embarassing.

We are now in Vanguard. But I do think that some Ameriprise FA are better than others in terms of how they operate. Not that I am recommending them....our FP was free as my company paid for it.
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Old 07-20-2014, 03:22 PM   #29
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It just seems a lot more honest and above board to pay an advisor for his time or a fixed fee for the service, just like I'd pay a plummer or a lawyer. Get the recommendations, then have the client move the money himself. Yes, there's no direct "link" between investment results and the compensation earned by the advisor, but that doesn't bother me because I don't think they can add risk-adjusted value over a prudent low-cost buy-and-rebalance passive approach. T
Sure, when you find ones which will work well on that model. I don't know many who would charge the same for a $200K portfolio as a $2M portfolio. The bottom line, and the most important point, IMO (the rest is sweating the small stuff), is that you don't use anyone who increases profit simply by churning stocks or steering you into loaded mutual funds.

Also, I'd expect a flat-fee-only from an advisor who did a *one time* portfolio consultation, but probably not one who is retained in an ongoing advisory/consulting basis. So if you are talking about paying for only one-time consultations once in a while at your request and not an ongoing monitoring and evaluation of your portfolio, yeah, I'd tend to agree with you.
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Old 07-20-2014, 05:08 PM   #30
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our FP was free as my company paid for it.
I bet that you paid for it as folks don't work for free and companies don't give freebees to employees.
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Old 07-22-2014, 10:37 AM   #31
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I did not write a check for it (it was before we had them manage money) and neither my company nor Ameriprise took any money from me for it when we decided to sign up about 6 months later. I suspect Ameriprise was happy to offer free plans to my employer or some huge discount.

Vanguard did something similar at the last company I worked for.
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Old 07-22-2014, 11:07 AM   #32
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I bet that you paid for it as folks don't work for free and companies don't give freebees to employees.
It may not have been free, but if it was included in the price of admission (i.e. available to plan participants for no additional fee), why not give it a try.

No, I am not promoting Ameriprise.
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Old 07-22-2014, 11:51 AM   #33
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If you want a simple read on all the ways Ameriprise (and other FAs) is sticking it to you, read "Millionaire Teacher."

I'm one of the ones that got away from Ameriprise. It will be 4 years in August since I moved all of our money to Vanguard. BEST financial decision we've ever made even though we had to pay almost $5k to get out of the VUL they had us in.
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Old 07-22-2014, 09:03 PM   #34
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Not so much about Ameriprise, but a friend of mine who retired from the AF a couple years ago became a FA with Edward Jones and for months he harassed me about managing my money. He was offended that I was a Vanguard guy and even said 'oh, your one of those Bogleheads they told us about in class'.

I don't like the idea of Edward Jones looking for new clients by hunting through neighborhoods that have 'big trees, fat squirrels and long cars'.

On the other hand, I was proud to be called a Boglehead. Also, when I told him I was retiring from the Air Force he asked what I was going to do for work...I told him that I wasn't going to. The look on his face was absolutely priceless.

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Old 07-22-2014, 09:16 PM   #35
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Also, when I told him I was retiring from the Air Force he asked what I was going to do for work...I told him that I wasn't going to. The look on his face was absolutely priceless.
You were too kind. I would have said "One thing I won't be doing is badgering my old friends to buy expensive products."

At least he didn't go to USPA/IRA, First Command, or whatever they are calling themselves now.
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Old 07-22-2014, 10:09 PM   #36
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You were too kind. I would have said "One thing I won't be doing is badgering my old friends to buy expensive products."

At least he didn't go to USPA/IRA, First Command, or whatever they are calling themselves now.
Well, he is still a friend so I didn't want to be too rude!


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Old 07-23-2014, 11:09 AM   #37
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I have been an Ameriprise client for about 30 years via the purchase of a universal life insurance policy. Other than that I have used Vanguard for TIRA and Roth IRAs and non-qualified mf investments. A recent inheritance that is invested at Ameriprise must be rolled into Ameriprise accounts in my name before I can access this money. These accounts will consist of a brokerage account of primarily bluechip stocks, a bond mutual fund, a money market account, an inherited IRA that must be cashed out or rolled into an annuity, and several other annuities that must either be cashed out with significant tax consequence or annuitized. The total of this inherited money is approx. 23.5% of my total investments.

For the time being I will probably leave the money with Ameriprise as I didn't really plan on making too many changes to the investments and I have no options for the annuities other than to cash them out and pay big taxes. I did just pay a fee to my advisor to help with a financial plan since I am recently retired. We are trying to control income starting in 2015 to maximize ACA subsidies and minimize tax. So far I am satisfied with the work he has done for me.

So, for my situation, I will continue working with Ameriprise, and will be listening to their recommendations, but if I get a bad feeling I will pull the plug on them. My advisor already knows I have little use for their services and have no love lost for his profession.
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Old 07-30-2014, 11:33 PM   #38
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Ameriprise?

So I had an hour long talk with my Ameriprise Broker. He became insulting. Apparently I've only been super lucky the past five years and I don't understand inflation and anyone could beat the market in the past five years cause everything has gone up and he still did well in 2011 when the market was going all over the place and would I feel comfortable performing surgery without an expert present...you get the idea. It got a little ridiculous, which is funny in retrospect, and I saw his true defensive colors.

I'm definitely taking my IRA out and putting it into vanguard. But I'm still tempted to leave a few thousand in a taxable account to see how he performs over the long term with his buyout scheme. I don't want to let his jerkiness cloud my judgement.

Basically, he just does a ton of research and buys a company right before they get bought out when the buyout price is a bit higher than the market price. A few successful buys a year and you're in the double digits on returns (only one sale has gone south out of dozens over the past few years). His claims this is safer than index funds, which I find laughable, but the real selling point is he's confident he can continue to make 7-15% even if/when the market plummets again because companies are still getting bought and traded. I'm curious to see if this is true. I figure either I will make decent returns through the next downturn or I won't. Either way, 97% of my investable money will not be in his hands.


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Old 07-30-2014, 11:56 PM   #39
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So I had an hour long talk with my Ameriprise Broker. He became insulting. Apparently I've only been super lucky the past five years and I don't understand inflation and anyone could beat the market in the past five years cause everything has gone up and he still did well in 2011 when the market was going all over the place and would I feel comfortable performing surgery without an expert present...you get the idea. It got a little ridiculous, which is funny in retrospect, and I saw his true defensive colors.

I'm definitely taking my IRA out and putting it into vanguard. But I'm still tempted to leave a few thousand in a taxable account to see how he performs over the long term with his buyout scheme. I don't want to let his jerkiness cloud my judgement.

Basically, he just does a ton of research and buys a company right before they get bought out when the buyout price is a bit higher than the market price. A few successful buys a year and you're in the double digits on returns (only one sale has gone south out of dozens over the past few years). His claims this is safer than index funds, which I find laughable, but the real selling point is he's confident he can continue to make 7-15% even if/when the market plummets again because companies are still getting bought and traded. I'm curious to see if this is true. I figure either I will make decent returns through the next downturn or I won't. Either way, 97% of my investable money will not be in his hands.

Why be normal when you could just be yourself.
I've been eating for free and studying the FA type for about 5 years now. In the past couple of weeks I noticed that these salesmen advisors need an adoring crowd. When you challenge, your adoration is in doubt, isn't it?

You may be in for a surprise if you try to leave a small amount with Ameriprise and it doesn't meet his expectations. Might be funneled into a different arrangement.

It does sound like he is successful at his game. But you probably can't corroborate this entirely by analyzing your own returns. So it is time to walk and get index results.
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Old 07-31-2014, 12:45 AM   #40
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You may be in for a surprise if you try to leave a small amount with Ameriprise and it doesn't meet his expectations. Might be funneled into a different arrangement.

It does sound like he is successful at his game. But you probably can't corroborate this entirely by analyzing your own returns.

Very, very good point.


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