|
Merrill ends mutual fund sales in brokerage retirement accounts
11-03-2016, 02:13 PM
|
#1
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2004
Location: South Texas~29N/98W Just West of Woman Hollering Creek
Posts: 6,674
|
Merrill ends mutual fund sales in brokerage retirement accounts
Looks like brokerage houses are adapting to new fiduciary rules in dramatic fashion.
Quote:
Merrill Lynch told its advisers to stop selling mutual funds in retirement brokerage accounts such as IRAs, a move that attempts to spare the wirehouse from potential conflicts of interest ahead of the Department of Labor's fiduciary rule.
A memo sent Tuesday to the firm's roughly 14,500 advisers alerted them to the change. Mutual funds will still be available through Merrill Lynch Investment Advisory Program accounts and non-retirement brokerage accounts, Frank McDonnell, the firm's head of global mutual funds, said in the memo.
|
Merrill ends mutual fund sales in brokerage retirement accounts, citing fiduciary rule | Financial Planning
__________________
Part-Owner of Texas
Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx
In dire need of: faster horses, younger woman, older whiskey, more money.
|
|
|
|
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!
|
11-03-2016, 03:42 PM
|
#2
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
|
If not MFs, then what do they sell? Annuities? Penny stocks?
__________________
"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
|
|
|
11-03-2016, 04:25 PM
|
#3
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
|
I personally think that ML is trying to get clients to write their congressional reps in order to get the rules changed. They have taken a ploy from the playbooks of health insurance companies: Simply refuse to do business until the rules are changed.
Other brokerages don't seem to have the problem that ML has, but if ML shows some success, those other brokerages will get on that bandwagon.
ML could do lots of things such as sell variable annuities which are not mutual funds, stocks, and ETFs.
|
|
|
11-03-2016, 04:26 PM
|
#4
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2016
Posts: 8,968
|
Mine is all common stock.
|
|
|
11-03-2016, 04:37 PM
|
#5
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2013
Posts: 11,078
|
Quote:
Originally Posted by LOL!
I personally think that ML is trying to get clients to write their congressional reps in order to get the rules changed. They have taken a ploy from the playbooks of health insurance companies: Simply refuse to do business until the rules are changed.
Other brokerages don't seem to have the problem that ML has, but if ML shows some success, those other brokerages will get on that bandwagon.
ML could do lots of things such as sell variable annuities which are not mutual funds, stocks, and ETFs.
|
I would agree. I thought Edward D. Jones had already announced the same thing.
Sad, I expected it to get better, not more difficult.
|
|
|
11-03-2016, 05:02 PM
|
#6
|
Thinks s/he gets paid by the post
Join Date: Mar 2009
Posts: 2,985
|
Don't need them so there's no feeling of loss here. DM worked for ML the last couple months of a 50 year career. She could not tolerate the low life churn and earn culture. Lucky for me I caught on early
__________________
Took SS at 62 and hope I live long enough to regret the decision.
|
|
|
11-03-2016, 07:12 PM
|
#7
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2004
Location: SW Ohio
Posts: 14,404
|
Quote:
Originally Posted by MRG
Sad, I expected it to get better, not more difficult.
|
But I was not optimistic that these outfits would offer good, customer-first advice anyway. It was just too much of a culture change to be accommodated. Somebody else will fill the market vacuum, maybe it will be low-cost robo-advisers or a company that only sells advice and doesn't even sell the instruments themselves. Most customers would be far better served with that than with the former model of advisor compensation.
|
|
|
11-03-2016, 07:36 PM
|
#8
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2016
Posts: 8,968
|
I think it makes sense. Why would you want to employ a paid advisor to buy mutual funds for your account? So you can pay twice?
I employ an advisor to select and balance my bag with common stocks to follow my financial plans. He does a good job. No mutual funds are involved.
I have 2 other brokers doing my bonds and they don't get paid. Bonds are kinda boring and don't need much attention.
|
|
|
11-03-2016, 07:46 PM
|
#9
|
Thinks s/he gets paid by the post
Join Date: Mar 2010
Location: Kerrville,Tx
Posts: 3,361
|
Quote:
Originally Posted by NW-Bound
If not MFs, then what do they sell? Annuities? Penny stocks?
|
Note that this applies in the advisor channel where the advisor selects the funds for the client, to avoid conflicts of interest. Other self managed channels still exist to buy Mutual funds "According to Merrill, clients looking for alternatives to commission-based funds in their IRAs can turn to the firm’s Investment Advisory Program (IAP), Merrill Edge Select Portfolios, the Merrill Edge self-directed channel and Merrill Edge Guided Investing (beginning in January). “Each of these offerings will be augmented on an ongoing basis to ensure choice for our clients,” it said."
So it is essentially saying that 12-b1 programs create conflicts of interest.
|
|
|
11-03-2016, 08:01 PM
|
#10
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2013
Posts: 11,078
|
Quote:
Originally Posted by samclem
But I was not optimistic that these outfits would offer good, customer-first advice anyway. It was just too much of a culture change to be accommodated.
Somebody else will fill the market vacuum, maybe it will be low-cost robo-advisers or a company that only sells advice and doesn't even sell the instruments themselves. Most customers would be far better served with that than with the former model of advisor compensation.
|
I see that point. No way a pond scum learns to walk overnight. Honestly there's no way to flip a business model over as I had hoped might happen.
Nature abhors a vacuum so if there is a need.... I'd love to see alternatives like robo gaining more acceptance. I don't know how folks get education on where to go.
|
|
|
11-03-2016, 08:13 PM
|
#11
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2016
Posts: 8,968
|
Pond scum?
|
|
|
11-03-2016, 08:24 PM
|
#12
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2013
Posts: 11,078
|
Quote:
Originally Posted by RobbieB
Pond scum?
|
https://goo.gl/images/8CA0TY
Pond scum.
Probably stated too strongly, sorry.
Some advisors in the business are very expensive for little return. There are others who provide a valuable service to their clients.
Unfortunately many of my professional encounters were with the former, hence my preconceived notions.
|
|
|
11-03-2016, 08:45 PM
|
#13
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2016
Posts: 8,968
|
OK.
My guy keeps me in caviar, truffles and lobster tails.
But he's an old grey haired guy like me. Not one of those young "all fired up whippersnappers" out to make a name for themselves.
|
|
|
11-03-2016, 08:57 PM
|
#14
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
|
Maybe this is also a way to keep clients in high-fee mutual funds that they already own. The linked article was all about selling mutual funds and not about buying mutual funds. Aren't I terribly cynical?
|
|
|
11-04-2016, 12:27 AM
|
#15
|
Thinks s/he gets paid by the post
Join Date: Sep 2012
Posts: 1,570
|
Trends in brokerage industry have been towards fee based accounts and away from commission based products for a long time. Many brokers, especially those who are CFPs, welcome the elimination of conflict of interest inherent in commission based business. The good ones have tried to offer value added "holistic" advice whether they are paid by commissions or fees.
Signing a document saying you understand you are paying, say 1%, for advice and investing in low fee funds or just getting charged the same 1% in the form of higher annual (12b?) mutual fund charges seems mostly cosmetic to me. But I'd be in favor of the regulation as it makes everything more transparent, as there are probably lots of clients in C shares that don't realize they're paying higher fees.
Merrill now offers a program like Robbie mentioned, where you pay the advisory fee, and invest directly in portfolios of stocks/bonds, eliminating the mutual fund/ETF fees.
But if the broker has been doing C share type business in retirement accounts, it's a pain in the a** to convert clients to advisory model to continue to get paid.
__________________
You know that suit they burying you in? Thar ain’t no pockets in that suit, boy.
|
|
|
11-04-2016, 05:35 AM
|
#16
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2006
Location: Washington, DC
Posts: 11,329
|
Quote:
Originally Posted by meierlde
Note that this applies in the advisor channel where the advisor selects the funds for the client, to avoid conflicts of interest. Other self managed channels still exist to buy Mutual funds "According to Merrill, clients looking for alternatives to commission-based funds in their IRAs can turn to the firm’s Investment Advisory Program (IAP), Merrill Edge Select Portfolios, the Merrill Edge self-directed channel and Merrill Edge Guided Investing (beginning in January). “Each of these offerings will be augmented on an ongoing basis to ensure choice for our clients,” it said."
So it is essentially saying that 12-b1 programs create conflicts of interest.
|
This sounds like no big deal. I was wondering what they would do for corporate 501K accounts and the like. Sounds like they will leave things pretty much as they were for everyone except the 1%ers.
__________________
Idleness is fatal only to the mediocre -- Albert Camus
|
|
|
11-04-2016, 07:34 AM
|
#17
|
Thinks s/he gets paid by the post
Join Date: Jan 2011
Location: Fair Lawn
Posts: 2,962
|
Sorry for this partial thread drift but I can't resist. Based on one experience, I hate Merrill Lynch. My toddler son, was injured and we got a modest settlement. I bought a zero bond maturing at his high school graduation. Simple - give them the money, and at graduation get the matured proceeds.
Some 5 years afterwards, Merrill sent me a letter advising they were [unilaterally] changing the terms of the agreement and charging me $50 annual fee. Every year I had to call to get that illegal fee "waived." Then, a new rep took over my account. He was a young and arrogant p*&^k, and made sarcastic remarks about my whining about the fee.
I complained and at first the complaint went nowhere. I ultimately got a new rep, but still had to call every year to get the fee waived. Oh, yeah, they did offer other products which would not have an annual fee, BUT there would be a fee to process the change! And, none of those products were as good as the return on the zero bond.
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|