Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
I left Ameriprise, but what was my broker doing?
Old 10-25-2011, 08:19 PM   #1
Dryer sheet wannabe
Red35's Avatar
 
Join Date: Aug 2011
Posts: 21
I left Ameriprise, but what was my broker doing?

I didn't start trying to educate myself on investing until last year. I foolishly trusted my Ameriprise Broker.

I would send him 2 checks every year totaling $7,000. I would tell him to put $5,000 in my ROTH IRA and $2,000 in my SEP IRA. Everything else I left up to him and trusted him.

I have looked at my past statements and how he was investing my money.

For example he has me in a couple Open End Mutual Funds and one is Small Cap World Fund B (SCWBX).

Every month he would purchase a very small quantity. It would be weird stock quantities like 1.799, 1.846, 1.851, 1.799, etc.


The only reason I can think of to make so many small stock purchases is to get the COMMISSION CHARGE every time.

I noticed it is also a LOAD FUND!

Does anyone have an explanation as to why he would make so many small purchases?
__________________

__________________
Red35 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 10-25-2011, 08:29 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2004
Posts: 8,542
That sounds like the small purchases that result from reinvesting dividends. Maybe he was buying new shares in that B-Fund with the dividends from the same fund or from other funds you owned with him? Maybe it was interest from a MM fund or sweep account?

All this is legit.

Congratulations on your escape from Ameriprise. Now, tell a friend.
__________________

__________________
"Freedom begins when you tell Mrs. Grundy to go fly a kite." - R. Heinlein
samclem is offline   Reply With Quote
Old 10-25-2011, 09:24 PM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,474
Quote:
Originally Posted by Red35 View Post
I didn't start trying to educate myself on investing until last year. I foolishly trusted my Ameriprise Broker.

I would send him 2 checks every year totaling $7,000. I would tell him to put $5,000 in my ROTH IRA and $2,000 in my SEP IRA. Everything else I left up to him and trusted him.

I have looked at my past statements and how he was investing my money.

For example he has me in a couple Open End Mutual Funds and one is Small Cap World Fund B (SCWBX).

Every month he would purchase a very small quantity. It would be weird stock quantities like 1.799, 1.846, 1.851, 1.799, etc.


The only reason I can think of to make so many small stock purchases is to get the COMMISSION CHARGE every time.

I noticed it is also a LOAD FUND!

Does anyone have an explanation as to why he would make so many small purchases?
American Funds quit selling B shares several years ago. DOn't know how he could still be buying them
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Old 10-25-2011, 09:26 PM   #4
Thinks s/he gets paid by the post
73ss454's Avatar
 
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,379
Red, understand that this is what these guys do for a living. They are doing what they had to do to generate the most money for themselves. Just be happy that you escaped, look forward and not back.

When I read my first investment book and realizied what my broker was doing to me I broke out in a cold sweat. Just think about all the folks out there that never wake up, you're one of the lucky ones.
__________________
Work is something you do to get enough $ so you don't have to....Me.
73ss454 is offline   Reply With Quote
Old 10-25-2011, 11:37 PM   #5
Dryer sheet wannabe
Red35's Avatar
 
Join Date: Aug 2011
Posts: 21
Quote:
Originally Posted by FinanceDude View Post
American Funds quit selling B shares several years ago. DOn't know how he could still be buying them

I said I was looking back at old statements of what he purchased for me. I had been with him for a long time.

He made those purchases from 2003 to 2010.

My statement says he last purchased 1.364 stocks in December 2010.


They must be dividends then.
__________________
Red35 is offline   Reply With Quote
Old 10-25-2011, 11:38 PM   #6
Dryer sheet wannabe
Red35's Avatar
 
Join Date: Aug 2011
Posts: 21
Quote:
Originally Posted by 73ss454 View Post
Red, understand that this is what these guys do for a living. They are doing what they had to do to generate the most money for themselves. Just be happy that you escaped, look forward and not back.

When I read my first investment book and realizied what my broker was doing to me I broke out in a cold sweat. Just think about all the folks out there that never wake up, you're one of the lucky ones.

Amen 73.
__________________
Red35 is offline   Reply With Quote
Old 10-25-2011, 11:39 PM   #7
Dryer sheet wannabe
Red35's Avatar
 
Join Date: Aug 2011
Posts: 21
Quote:
Originally Posted by samclem View Post
That sounds like the small purchases that result from reinvesting dividends. Maybe he was buying new shares in that B-Fund with the dividends from the same fund or from other funds you owned with him? Maybe it was interest from a MM fund or sweep account?

All this is legit.

Congratulations on your escape from Ameriprise. Now, tell a friend.

Yeah I think they are dividends.
__________________
Red35 is offline   Reply With Quote
Old 10-26-2011, 03:59 AM   #8
gone traveling
 
Join Date: Sep 2010
Location: midwestern city
Posts: 4,042
Yes it is.
Quote:
Originally Posted by Red35 View Post
The only reason I can think of to make so many small stock purchases is to get the COMMISSION CHARGE every time.
__________________
obgyn65 is offline   Reply With Quote
Old 10-26-2011, 06:23 AM   #9
Recycles dryer sheets
 
Join Date: Nov 2008
Posts: 407
I do all my business with Fidelity or Vanguard so I pay the lowest fees available, investing primarily in index funds. Now, those were load funds, a bad deal for sure. But, he could have been buying a little each month so you were averaging into the market, therefore, not buying at the year's high or low. That's what I do, I buy a little each month, although I may put a large amount into my money market fund and then invest monthly.

This forum will give you a lot of great ideas on how and where to invest your money, wisely and cheaply. Good luck, stay away from high fee and load funds, and you can't go wrong with one of the "major" fund families if you stick to index and no load funds. By the way, I've made a lot of money on my small cap funds over the past 10 years.......have you made money on your account over the many past years you were with Ameriprise? If you did, not to worry........I don't like brokers but other in my extended family do and I hear about every time they make a little money. I'm not so sure I hear about it when they don't. GOOD LUCK!
__________________
jerome len is offline   Reply With Quote
Old 10-26-2011, 06:25 AM   #10
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,474
Quote:
Originally Posted by obgyn65 View Post
Yes it is.
Uh, no......... Does anyone on here know that dividends and capital gains are typically reinvested? There's no commissions paid on that, just to set the record straight........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Old 10-26-2011, 08:16 AM   #11
Recycles dryer sheets
Coolius's Avatar
 
Join Date: May 2010
Posts: 262
Leaving Ameriprise is probably one of the best things you did for yourself.

I have heard little but negative experiences from friends who have had the misfortune to invest their money with Ameriprise; almost all of them have less money than they would have had with a no load index fund from Vanguard. And this over periods stretching up to 8 years!

I have been with Vanguard for many years now; no complaints, except that their commissions for option trades are very high. But as I do not trade frequently in that space, I can live with that.
__________________
Coolius is offline   Reply With Quote
Old 10-26-2011, 08:39 AM   #12
Thinks s/he gets paid by the post
 
Join Date: Apr 2006
Posts: 1,289
Quote:
Originally Posted by FinanceDude View Post
Uh, no......... Does anyone on here know that dividends and capital gains are typically reinvested? There's no commissions paid on that, just to set the record straight........
+1

Not sure I would use the word "typically" as you did above, but when dividends and capital gains ARE automatically reinvested, there are no commissions, and if it is a loaded fund, there are no loads on the reinvested amount.

Not defending Ameriprise, btw.

Could the OP look at the statement to see what is was happening?
__________________
Rustward is offline   Reply With Quote
Old 10-26-2011, 08:42 AM   #13
Thinks s/he gets paid by the post
 
Join Date: Apr 2006
Posts: 1,289
Quote:
Originally Posted by samclem View Post
That sounds like the small purchases that result from reinvesting dividends. Maybe he was buying new shares in that B-Fund with the dividends from the same fund or from other funds you owned with him? Maybe it was interest from a MM fund or sweep account?

All this is legit.

Congratulations on your escape from Ameriprise. Now, tell a friend.
Another +1.

And I would not recommend Ameriprise to anyone.
__________________
Rustward is offline   Reply With Quote
Old 10-26-2011, 09:01 AM   #14
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,474
Quote:
Originally Posted by Coolius View Post
Leaving Ameriprise is probably one of the best things you did for yourself.
+1

Quote:
I have been with Vanguard for many years now; no complaints, except that their commissions for option trades are very high. But as I do not trade frequently in that space, I can live with that.
VG makes their money on their brokerage side, that's how they can keep their salaried reps...........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Old 10-26-2011, 11:07 AM   #15
Thinks s/he gets paid by the post
73ss454's Avatar
 
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,379
Quote:
Originally Posted by FinanceDude View Post
VG makes their money on their brokerage side, that's how they can keep their salaried reps...........
At 2 bucks a trade for equities I can't imagine they pay them very much.

I doubt that if I call Vanguard Brokerage I'll be getting FD on the phone.
__________________
Work is something you do to get enough $ so you don't have to....Me.
73ss454 is offline   Reply With Quote
Old 10-26-2011, 12:32 PM   #16
Dryer sheet wannabe
Red35's Avatar
 
Join Date: Aug 2011
Posts: 21
Quote:
Originally Posted by Rustward View Post
+1

Not sure I would use the word "typically" as you did above, but when dividends and capital gains ARE automatically reinvested, there are no commissions, and if it is a loaded fund, there are no loads on the reinvested amount.

Not defending Ameriprise, btw.

Could the OP look at the statement to see what is was happening?

I was an ignorant fool and completely trusted my broker.

The statement does not specify if they are reinvested dividends or not.

I'm just glad to be out of Ameriprise now.
__________________
Red35 is offline   Reply With Quote
Old 10-26-2011, 05:09 PM   #17
Dryer sheet wannabe
Red35's Avatar
 
Join Date: Aug 2011
Posts: 21
Here is what my SEP IRA looks like.

Open End Mutual Funds:
FRANKLIN CUST GRWTH B (FKGBX) $430.73
FRANKLIN GROWTH FD A (FKGRX) $1,449.51
FRANKLIN INCOME FD B (FBICX) $443.55
FRANKLIN INCOME FUND-A (FKINX) $2,804.27
MUTUAL SER FD SHS CL B (FMUBX) $361.05
MUTUAL SHARES CLASS A (TESIX) $2,057.74
SMALLCAP WORLD FD B (SCWBX) $1,041.11
TEMPLETON GROWTH CL B (TMGBX) $339.24
TEMPLETON GROWTH FD A (TEPLX) $1,199.65
Total Funds: $10,126.86

Common Stock:
ISHARES MSCI EAFE IN ETF (EFA) $3,056.02
SPDR S&P 500 TRUST ETF (SPY) $5,238.24
VANGUARD MID CAP ETF (VO) $1,887.08
VANGUARD MSCI EMRG ETF (VWO) $2,821.00
VANGUARD SMALL CAP ETF (VB) $1,911.00
Total Stocks: $14,800.24

Money Market: $281.26

Total SEP: $25,208.35


This is what my ROTH IRA looks like:

Mutual Funds:
SMALLCAP WORLD FD INC B (SCWBX) $6,666.31
SMALLCAP WORLD FUND CL A (SMCWX) $71.58
Total Funds: $6,737.89

Common Stock:
SPDR S&P 500 TRUST ETF (SPY) $3,977.60
VANGUARD MID CAP ETF (VO) $7,120.68
VANGUARD REIT ETF (VNQ) $5,658.02
VANGUARD SM/CAP VALU ETF (VBR) $3,503.92
VANGUARD VALUE ETF (VTV) $2,888.48
Total Stocks: $23,148.70

Money Market: $43.15

Total ROTH: $29,929.74



Coincidently he purchased my Vanguard stocks after I had a meeting with him in 2006.

I had watched Suze Orman prior to this meeting and she was recommending Vanguard FUNDS.

So in my meeting with him I told him I wanted Vanguard FUNDS.

But he put me in Vanguard stocks not in funds like I specifically requested.


It's my own fault for being an idiot though.
__________________
Red35 is offline   Reply With Quote
Old 10-26-2011, 06:00 PM   #18
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 8,404
Well Red35, I can't comment on the holdings in your Ameriprise account other than to say you have a lot of opportunities to educate yourself on investing, especially in the area of understanding "common stock" vs "ETF's" vs mutual funds. It's a lot of fun and I'm sure you'll enjoy diving in and learning.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 10-26-2011, 09:12 PM   #19
Moderator
Alan's Avatar
 
Join Date: Jul 2005
Location: Houston
Posts: 14,814
Quote:
Originally Posted by youbet View Post
Well Red35, I can't comment on the holdings in your Ameriprise account other than to say you have a lot of opportunities to educate yourself on investing, especially in the area of understanding "common stock" vs "ETF's" vs mutual funds. It's a lot of fun and I'm sure you'll enjoy diving in and learning.
+1

That is a lot of funds and ETF's (21) that you have there.
__________________
Retired in Jan, 2010 at 55
Now it's adventure before dementia
Alan is offline   Reply With Quote
Old 10-26-2011, 10:41 PM   #20
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,474
Quote:
Originally Posted by 73ss454 View Post
I doubt that if I call Vanguard Brokerage I'll be getting FD on the phone.
True, I couldn't afford to quit my business and make $35,000 a year and live in Boston........
__________________

__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Leaving Ameriprise - One Year Later Lisa99 Hi, I am... 69 10-17-2011 09:20 AM
Ameriprise workers sue over company's own 401(k) funds travelover FIRE and Money 26 10-04-2011 09:52 AM
Wells Fargo Private Banking and leaving Ameriprise. Red35 FIRE and Money 17 08-14-2011 04:28 PM
Looking for a broker? Check them with FINRA BrokerCheck DWPC Stock Picking (Individual Security Analysis) 1 08-02-2011 11:38 AM

 

 
All times are GMT -6. The time now is 02:23 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2014, vBulletin Solutions, Inc.

Early Retirement News right to your Email!

Stay up-to-date with all the latest news to your inbox!

unsusbcribe at anytime with one click

Close [X]