Fee Only Advisor wants to use Schwab

[Sunset]

Quote:

Originally Posted by samclem Vanguard absolutely does have a way for him to see and act (if you want) on your accounts. You can make him your "agent" and there are quite a few controls you can put into place to help prevent hanky-panky (e.g. you can allow him to see your holdings but not buy/exchange/sell, you could allow him to exchange funds within your account but not to forward any funds to any banks, etc). You can call Vanguard and ask them about this yourself, see if it would meet your requirements. .....

+1

I am an agent on a relative's Vanguard account.
It's very convenient as I see that account as a section on mine when I do a login, so not even a need to log into multiple accounts.

[Sunset]

Quote:

Originally Posted by samclem ? C'mon. You know you have no means to "hold him accountable." What are you going to do, give him a severe talking to? All you can do is try to make him feel bad if his recommendations don't work out (that's unlikely to be effective). ......

+1

So funny, that is what I was also thinking as I read it, but I was thinking a tongue lashing would set him straight .

[pb4uski]

Quote:

Originally Posted by Sunset +1 I am an agent on a relative's Vanguard account. It's very convenient as I see that account as a section on mine when I do a login, so not even a need to log into multiple accounts.

How do you go about doing that? It would be real handy to me as I manage not only my own account, but DW's, DS's and DM's as well.

[samclem]

Quote:

Originally Posted by pb4uski How do you go about doing that? It would be real handy to me as I manage not only my own account, but DW's, DS's and DM's as well.

Just contact Vanguard. I am an agent for my MIL. IIRC, they will send the account owner some forms to sign appointing you as their agent with some check boxes with the authorities that are granted. It has worked really well for us. You log in once and see your own accounts plus those for whom you are an agent. If there's stuff you >don't< want to see (i.e. named beneficiaries for the accounts, etc), make sure the correct boxes get checked.

[gerntz]

Quote:

Originally Posted by RE2Boys Is his fee like 1% per year??

Only if the fixed annual fee - as stated in the original post - is at or more than 1% of the assets.

[gerntz]

Quote:

Originally Posted by Tork Hey there FIRE experts. I am considering using a fee only advisor (one fee per year not percentage based). He wants to use Schwab as he says they have the best digital platform to allow both of us to have access to reporting, etc. When I asked about Vanguard he said they do not have a platform for 3rd party investment advisors. I have been burned in the past by advisors so I want to know if there might be any other reason that he is very pro-Schwab? Does he get a kickback for total investments under his name or anything? We are not planning to use any funds with "loads" that would be paid to him.

We use a fixed $ annual fee advisor who custodies at Schwab & uses a couple of Vanguard funds. Neither are load.

[Closet_Gamer]

Quote:

Originally Posted by jazz4cash I guess I am very surprised that a fee only FA would need account access. I always envisioned they provide advice and the individual would implement. Sent from my iPhone using Early Retirement Forum

This is my reaction as well.

If he's going to be actively trading, and therefore need direct access, I would run away.

If he's going to build a stable portfolio that only gets tweaked annually, I don't know why he need access.

You could just send him your quarterly statements and he can crunch the numbers.

I'd be very cautious about giving anyone trading authority on my accounts. I did that once many years ago and it quickly went from making me feel like a high roller to making me cringe every time I looked at what he was doing.

YMMV.

[rodi]

I may be misremembering but I thing Sarah's firm uses Schwab funds for their clients.

I don't use a financial adviser but I do use schwab funds. There is nothing nefarious about schwab funds - lots of super low ER Mutual funds and ETFs, and they allow you to hold non schwab funds (like vanguard) in your brokerage account... something Vanguard doesn't.

[bingybear]

Quote:

Originally Posted by krotoole This is my reaction as well. If he's going to be actively trading, and therefore need direct access, I would run away. If he's going to build a stable portfolio that only gets tweaked annually, I don't know why he need access. You could just send him your quarterly statements and he can crunch the numbers. I'd be very cautious about giving anyone trading authority on my accounts. I did that once many years ago and it quickly went from making me feel like a high roller to making me cringe every time I looked at what he was doing. YMMV.

Many advisers trade clients accounts. I use the term trade loosely. They implement the investment advice that they provide. This way they know it was done in a timely manner. Yes, you do have to have a level of trust, but you can see what is happening. This really is not all that rare and there are many advisers who do this without doing anything unethical.

I think many are over thinking the Schwab being custodian. An adviser learns a system at one or two financial custodians and then sticks with them. Why? Because it is easier. Think about simple word processing. How many of you would use MS Word for a document. Then for the next document use iPages, then LaTex (look it up) for the next document. Then Manuscript (old Lotus product that was really good for equations back in the late '80s). It makes sense to learn a good tool and keep using it as long as it is a good tool. Switching interfaces for each client does not enhance the FA advice.

I talked with an adviser that uses Fido and Schwab. However, for an individual client they only will use one or the other... not both. Why? Because it is easier.

Some custodians do provide some benefits. I believe Schwab provides some research and online tools.

[MRG]

If a person is managing say 200 clients assets do you think they login to Vanguard or Schwab for each and every client when a change is needed? Guess again. Say all clients were adding to an allocation, would you trust yourself to login manually and change each clients account(s)? I wouldn't.

It takes different tools!

[target2019]

Quote:

Originally Posted by Tork Hey there FIRE experts. I am considering using a fee only advisor (one fee per year not percentage based). He wants to use Schwab as he says they have the best digital platform to allow both of us to have access to reporting, etc. When I asked about Vanguard he said they do not have a platform for 3rd party investment advisors. I have been burned in the past by advisors so I want to know if there might be any other reason that he is very pro-Schwab? Does he get a kickback for total investments under his name or anything? We are not planning to use any funds with "loads" that would be paid to him.

Before signing anything, I'd be asking many more questions. For example, is this cheaper than a robo-adviser? It sounds like your needs are very simple, and you need to set allocation, and then rebalance. Robo at any firm will do that for you.

When Schwab or any company ofr that matter gives an FA a management platform, it is much different that having someone added as a restricted agent to a Vanguard account, for instance.

1. You need to investigate the FA's credentials. If he is affiliated with Schwab, then look into what Schwab knows. Research as much as you can, and seek other opinions.
2. I would never add an individual FA to any of our accounts.
3. There may be tax implications to what you are contemplating.

It seems that you are probably moving some funds from place A to place B. Without knowing specifics, you're asking quite a lot for someone to speculate.

[target2019]

Quote:

Originally Posted by MRG If a person is managing say 200 clients assets do you think they login to Vanguard or Schwab for each and every client when a change is needed? Guess again. Say all clients were adding to an allocation, would you trust yourself to login manually and change each clients account(s)? I wouldn't. It takes different tools!

That's a good summary of why a management platform is required for an FA.

[samclem]

But not a good reason for a client to want it to be done.

[Sunset]

Quote:

Originally Posted by samclem Just contact Vanguard. I am an agent for my MIL. IIRC, they will send the account owner some forms to sign appointing you as their agent with some check boxes with the authorities that are granted. It has worked really well for us. You log in once and see your own accounts plus those for whom you are an agent. If there's stuff you >don't< want to see (i.e. named beneficiaries for the accounts, etc), make sure the correct boxes get checked.

You can also do it online if you know the account numbers, they will send letters to each person stating it has been done. And of course both people have to agree to it within their own account.
It of course can only be initiated from the client side, not the agent side.

I don't recall exactly where it was but it's in the settings for an account.

[Cobra9777]

Quote:

Originally Posted by samclem Just contact Vanguard. I am an agent for my MIL. IIRC, they will send the account owner some forms to sign appointing you as their agent with some check boxes with the authorities that are granted. It has worked really well for us. You log in once and see your own accounts plus those for whom you are an agent. If there's stuff you >don't< want to see (i.e. named beneficiaries for the accounts, etc), make sure the correct boxes get checked.

+1

I'm set up as an agent on my in-law's accounts at Fidelity. When I log in, I see their accounts as a subsection alongside mine. I'm also set up same way for DW's IRAs. I have full trading authority on all the accounts.

At Fidelity, this can all be done online. My in-law's each had to log in to their accounts. I helped them make the selection and fill in the forms online. After submitting, the system sent them each an email with another form that had to be electronically signed and returned. On the joint account, it sent an email to both of them. I had full access the next day. Pretty simple, and very convenient if you are managing a relative's accounts for them.

[Tork]

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[Tork]

Thank you to everyone that has replied! It seems to be just like everyone else has mentioned, probably for his convienance, not necessarily for a kickback. For those asking why he needs access it is because I make quarterly deposits and he provides a recommendation and if we agree, he does the rebalance for me. His fee is not even close to 1%, it is completely reasonable and it is worth it to me. Thanks again!

[EastWest Gal]

One more reply. I'e used a fee only advisor using Schwab for years. I switched advisors last year. I can see all of my accounts, including an self-managed account account and my inherited IRA.

The advisor does get a discount for their orders that I do not get. My advisor rebalances when it is appropriate to do so. Other than that, we talk regularly and she makes sure I am comfortable with the portfolio. She did some tax loss harvesting maneuvers this year, which taught me a lot about how to do it.

Without a professional advisor at the outset, I would have done poorly at investing. My DH has no interest in the subject. The internet wasn't available then.

I won't be made to feel stupid by members in this forum over my choice.

Schwab has a user friendly robust platform. I'm very happy with it. And it's easy to transfer money to your portfolio and out of it as well, directly from your bank.


Sent from my iPhone using Early Retirement Forum

[Bestwifeever]

Quote:

Originally Posted by EastWest Gal One more reply. I'e used a fee only advisor using Schwab for years. I switched advisors last year. I can see all of my accounts, including an self-managed account account and my inherited IRA. The advisor does get a discount for their orders that I do not get. My advisor rebalances when it is appropriate to do so. Other than that, we talk regularly and she makes sure I am comfortable with the portfolio. She did some tax loss harvesting maneuvers this year, which taught me a lot about how to do it. Without a professional advisor at the outset, I would have done poorly at investing. My DH has no interest in the subject. The internet wasn't available then. I won't be made to feel stupid by members in this forum over my choice. ....

No fiscal shaming here. I happen to handle almost all our money, which is at Vanguard in an IRA. DH has a very small inheritance that he left with his parents' choice, Edward Jones. I know that should I not be available to continue my stellar fiscal duties (i.e., we just leave it all in the accounts we put it in 8 years ago), he will either move it all to Edward Jones or pay a Vanguard advisor to take care of it, and he won't worry a whit about it then either.

[RE2Boys]

Quote:

Originally Posted by EastWest Gal One more reply. I'e used a fee only advisor using Schwab for years. I switched advisors last year. I can see all of my accounts, including an self-managed account account and my inherited IRA. The advisor does get a discount for their orders that I do not get. Sent from my iPhone using Early Retirement Forum

Are you saying that the advisor gets a discount that he does not pass on to you or that you benefit from a special rate by using the advisor?

Just curious, if the former, I would not consider him a fee only advisor, if the latter case, you gain an additional benefit (good for you!).