can you please tell me if my ameriprise advisor is full of crap?

[dooo42]

Well i have been reading all the negative things about ameriprise and the tons of fees they charge, hidden and not hidden. i have been thinking about moving my stuff over to vanguard. well i asked him to give me all the specifics on all the charges for all my accounts because i wanted to know how much money they were taking from me. this is what he wrote. please tell me if he's full of it and if i should get the hell out of there. all names have been erased of course.

[FONT=&quot]Your life insurance, disability insurance and cash reserve certificate do
not have any fees associated with it.

The only fees you pay are on your Roth IRA's for the mutual funds. You
each pay $19 per year for a custodial fee, and B shares have an internal
fee of 1.00% to manage the funds. You do not pay a load to get into the B
shares.

Having said that, Ameriprise is in the process of doing away with the B
shares very shortly. You and I need to review our options for your Roth
IRA contributions going forward.

The annual planning fee not only covers my work regarding these accounts,
but also your annuities at work, refinancing your mortgage, education
savings options for your son and credit issues as well. The annual
planning will address all of these items, plus more, like benefits at work,
and help us closely monitor your progress towards retirement.

Please call me if you have any questions.

[/FONT]

 

[REWahoo]

Run.

 

[WanderALot]

Ameriprise does not have a good reputation. Feel free to search both this forum and the diehards.org forum where the vast majority of reviews are negative.

[FONT=&quot]Your life insurance, disability insurance and cash reserve certificate do
not have any fees associated with it.

The only fees you pay are on your Roth IRA's for the mutual funds. You
each pay $19 per year for a custodial fee, and B shares have an internal
fee of 1.00% to manage the funds. You do not pay a load to get into the B
shares.
[/FONT]

I wonder if your adviser was careful to use the word "fee" to avoid mentioning the high "expense ratios" that each mutual fund charges? Custodial fees, if any, are charged in addition to a fund's expense ratio.

Try reading the prospectus on the funds or plugging in your ticker symbols into sites like Morningstar and Yahoo Finance and compare the expense ratios with the equivalent Fidelity or Vanguard funds.

 

[Avalon]

Here's a thread about Ameriprise from a couple of years ago.

http://www.early-retirement.org/forums/f30/is-ameriprise-any-good-30658.html

 

[FIREd]

[FONT=&quot]Your life insurance, disability insurance and cash reserve certificate do
not have any fees associated with it.

The only fees you pay are on your Roth IRA's for the mutual funds. You
each pay $19 per year for a custodial fee, and B shares have an internal
fee of 1.00% to manage the funds. You do not pay a load to get into the B
shares.



[/FONT]

It's true, you do not pay a load to get into the B shares. You pay the load to get out of the B shares!

As for the life insurance, I assume he got you into a variable universal life insurance policy?

 

[LOL!]

I think the response was truthful.

The response you listed did not tell us the actual "annual planning fee" that you pay in addition to the 1% fees on your Roth IRA funds.

 

[Nords]

can you please tell me if my ameriprise advisor is full of crap?

Yes, we can tell you. Yes, he is.

The rest of your advisor's post was just the details of the contents.

Seriously, another poster pointed out that it's going to be somewhat difficult to figure out exactly what you're paying in fees because of the way they're calculated and charged. However even without the calculations, we're all positive that you're paying more than you'd pay at Vanguard.

 

[photoguy]

As a previous poster mentioned, one very big thing to watch for is the expense ratio, which the advisor didn't mention. Go to morningstar and lookup your funds at ameriprise, write down the expense ratio, then find the corresponding/similar fund at vanguard.

I'm not sure what the actual difference would be, but I wouldn't be surprised if it was 0.5% or more on some funds (in my 401k some of the funds were 3x the e.r. of vanguard). One half percent doesn't sound like much, but on a 500K portfolio, that is $2500 per year.

Another thing to look at is the turnover rate. Turnover creates trading costs and these are not included in the expense ratio. For a given asset class, you generally want lower turnover.

 

[chinaco]

It seems that Mutual Funds offered by Insurance companies often have high fees. Especially compared "real" no-load funds... that is fund companies that have a strategy of being a low cost provider offering a comparable product. I am sure there are a few exceptions.

The way it usually works is there are several classes of shares. Some of the share have explicit loads (front or back) other classes bury the commission in 12(1b).

Bottom line... those fees are largely used to pay commissions... but the Insurance company often keeps some of it.

Some of the 12(1b) is used for other marketing expenses like advertising (sometimes funding sales campaigns for the sales channel).

Well... if the fees are high... somebody is going to have to convince the retail investor why it is a good investment.

 

[brewer12345]

I would not be at all surprised to find that you are getting badly screwed via the life insurance policy.

 

[dgoldenz]

I would not be at all surprised to find that you are getting badly screwed via the life insurance policy.

You may want to take a look at your coverage to at least know what you have. Guardian has the best disability policy around. One of my friends used to work for Ameriprise. That didn't last long and it had nothing to do with him being incompetent.

 

[73ss454]

Trust me, he's screwing you.

 

[BUM]

If Vanguard is your choice, call them. It is painless. Sign the forms (perhaps electronically). They will have the funds transferred for you.

 

[amcan57]

I reviewed Ameriprises' retirement plans for a large group I am a member. It was shockingly bad, no hyperbole, at all. I strongly suggest speaking to Vanguard and especially the www.Boglehead.org site.....best , Doug

 

[JustCurious]

If you stay with Ameriprise, you need to practice this maneuver: Drop your pants, bend over and smile.

 

[Texas Proud]

He is probably telling the truth... in a legal sense.... IOW, he is not committing perjury...

Like a former president.... it matters what the definition of 'is' is... or in this case 'fee'.... he seems to only be talking about hard dollar fees... ie, you pay $19 per year for X... but not the 1.25% fee for them managing X.. or the profit margin in the life insurance product (which is probably more than that)...


As an example... you have $1 mill invested and the expense ration is 1.25%... you pay $12,500... he says 'you only pay $19'... because they actually take that $19 from you... is it a lie to say that the fee is only $19

 

[d]

without even reading what he said, i answered "yes". then i read what he said, and i remain with "yes".

 

[ziggy29]

without even reading what he said, i answered "yes". then i read what he said, and i remain with "yes".

On boards such as Bogleheads and this one, the question in the thread title is pretty much the same as asking us whether water is wet...