Re-posting to this now oldish thread. While my position is to never have everything in one account, I am trying to help my ex who is thinking of retiring later this year. She has just spent some $ with a local firm who produced a report which basically convinced her that she has sufficient funds to retire. She asked me to look at the analysis, which I did. While I can argue with a few parts of it, she is likely OK primarily because of her LCOL lifestyle. She is going to meet with them in a couple weeks, where they will offer their services to her (% basis). I have (as gently as I can) tried to give her input on what a 1% or 1.25% management fee can have on her portfolios growth.
As further background, she gave me a sum of money to invest for her (because at the time she had next to none of her net worth in equities) after getting some inheritance money which was sitting in a bank getting next to nothing. Since I was already using Amertirade, the account is there and has done pretty well. I have it mostly invested in Vanguard ETF's (e.g. Total Mkt), but with some other sector funds. I $ cost averaged her in to these and the overall portfolio is up 56% from her initial see money. [It would have done even better but I was pretty conservative in terms of putting the money to work given her fear of equities.] Note that this money is in her name (not mine), but I have access to trade the account.
I was also able to convince her around the same time to use the inherited cash as a backdrop to her job earnings and to max out her employers 401k plan w/catch up, and to put all of it into broad based passive index funds (e.g. Total Stock Market). That has also done well (given the market over the last 6 years), and it is a factor on why she can likely retire. Even with that, she still has a big $ amount in CD's at a local institution (although I did get her to take advantage of the Nasa FCU 3.25% deal).
One of the recommendations of the adviser plan is to do Roth conversions of the money in her 401K. This does make sense assuming she is going to defer social security, at least to the extend of maxing out the 12% bracket each year.
The adviser also recommended the bucket approach. This also makes sense in that it might help her not look over the day to day ups and downs of an equity portfolio, knowing that this portion of her wealth isn't important in terms of asset draw down over any two or so year period.
She has stated that she is attracted to the managed (fee) adviser simply because she doesn't feel capable of doing it on her own, and that she would like to have things consolidated. On the other hand, she also knows that the management fee is money out of her pocket.
In our discussions, I mentioned that she can consolidate the now scattered accounts into one place. Given that this includes a large amount of cash which she would like to keep in cash (CD's, etc), I am trying to help her in terms of Vanguard vs. Fidelity vs. Schwab etc.
I am eliminating Ameritrade from consideration because they have no/limited cash management features. For myself, this isn't a big issues because I simply ACH or wire money in/out of my account. But for her, this would be too much to have to deal with on a constant basis.
Schwab and Fidelity also have a physical presence in the area, which is a big benefit. I don't think she does electronic payments on anything, so having a branch which she could go to is a big plus. So, I think that might eliminate Vanguard? In addition, I have accounts at both Schwab and Fido so I could help her navigate things more easily than with Vanguard (which I don't use).
What I could use some help with is other considerations. For example:
1) Checking tied to the account/ Debit card
2) Credit card possibilities tied to the account?
3) Cash management - assuming a decently large amount of $ and the desire to keep most of it in the same place.
4) Other factors - e.g. beneficiary set up
5) Ease of doing rollover piecemeal to a Roth (conversion) to optimize taxes
6)
I have mentioned VG, FIDO, Schwab, Ameritrade to her. She keeps asking me which one she should do...and I would like to give the best answer I can (and why that might be the best choice).
Thoughts? (Other than the obvious need to be careful given this is my ex. I do her taxes and have already discussed Ameritrade, so she does trust me to do the right thing...which I try my very best to do.)