Advice on Fidelity Decisions

[ICNTR]

So we finally funded a Fidelity cash management account and did enough to get the “free” CFP services. However, the initial consult left us with many questions. Thanks in advance if anyone is willing to share their thoughts and experiences.

1. The CFP services seem to add value but I’m honestly reluctant to disclose all of our financial and other info they seem to want in order to develop a comprehensive plan. Is reluctance warranted or not?

2. Are the fees associated with the Managed Account worth it? Argument is that tax loss harvesting alone more than covers the fees. However, I went to fidelity to minimize fees and expenses.

3. Feels like the other approach is just doing the extremely cheap index funds without the fees and the “financial undressing” associated with a CFP plan. Is simple and cheap the better approach?

Any other thought on Fidelity and the options is welcome and valued. Thank you!

 

[MRG]

I've been with Fidelity for 20+ years, private client for 10+. I'll give you my impressions from over the years. I definitely feel, in my case at least, their value add has gone downhill. Ten years ago I has a pretty decent advisor who helped Fidelity and me utilize more of the Fidelity products. Today I get nothing.

Five years ago after we moved away from any branch office their value was diminished further. The third new rep I was assigned was a dirty rotten annuities salesman who I foolishly allowed to steal two days of my time. I told this "CFP" in the first fifteen minutes I was not buying an annuity ever and he blatantly ignored me. I must have told him eighteen freaking times I would never ever consider an annuity for multiple reasons. I was stupid for not hanging up the phone and treating him like an Ed Jones guy. When I complained to the branch manager he said he didn't have anyone for me, call the 800 number. My last communications with them I suggested that they had become Vanguard only worse(Vanguard doesn't push bad annuities).

So today I use Fidelity for their system only.

1. As far as I can tell they used some of the information I'd entered in RIP to see our total assets at another provider as the annuity salesman's plan was to annutize all our assets.
2. I listened to their managed accounts speal and couldn't find how it benefited me.
3. Fidelity was an old school managed fund provider for most of their years. They were the 800 pound gorilla until the 2008 financial crisis when #3 Vanguard became #1 knocking Fidelity to #2. I remember my first adviser telling me they were going after Vanguard in a price war maybe 2009. In.my mind they have been successful in degrading their service to be Vanguard competition.

 

[PatrickA5]

What "free CFP" are you talking about?

I have an "account manager" guy I occasionally talk to at the local office. I'm not sure he adds much value, but he's free. As far as I know my guy isn't a CFP. For me anyway, I wouldn't pay Fidelity for their advice or do any of their Managed Accounts (that require a fee).

 

[OldShooter]

First step is to differentiate between an Investment Advisor and a Financial Advisor. IA just does the investments and is likely what you get from a brokerage house "Managed Account.' FA does a lot more, helping optimize your whole financial life, badgering you to get that will done, talking tax, SS, ACA, and educational (529) strategies, insurance, etc.

IMO (your #3) is completely adequate on the investment side. Read a couple of good books and you are good to go. Buying FA services, OTOH,ideally on a task basis (for example $2,500 for a comprehensive plan) can be a valuable thing for some people. We have a friend who inherited a couple $M and who has no financial expertise (used to buy her clothes at Goodwill). For her, an FA is mandatory and the fee is money well spent.

Tax loss harvesting argument indicates you should not deal with this person any longer. You can do that yourself and it doesn’t take any expertise. The person is trying to trick you with a bogus argument. Move on.

 

[RunningBum]

2. Are the fees associated with the Managed Account worth it? Argument is that tax loss harvesting alone more than covers the fees. However, I went to fidelity to minimize fees and expenses.

Another way to look at this is that any tax loss harvesting benefits will be eaten up by the managed account fees.

In a buy and hold index fund strategy, you may never even have losses to harvest. Sounds like the guy wants to churn your account and that makes it more likely you'll catch some losses. No thanks.

 

[chassis]

I am a satisfied Fidelity customer. I do not use any advisory services. I don't believe it is the right thing to do, if a person has average financial acumen, or above average. If you have below average financial acumen, go with a Bogleheads three fund strategy, and you still don't need advisory services.

I have cash managment, taxable brokerage, IRA and 401k accounts with Fidelity. I use the Advance Trader Pro platform daily and like it. I use the mobile app daily and like it. I have used phone customer support and it has been responsive and effective (answered my questions). Rollovers have been smooth. Electronic account linkage is smooth, easy and effective. Tax documentation is on time and complete. Really no complaints.

If you do choose to use an advisor, "undressing" is in the best interest of the relationship in my opinion. It's like going to a physician and not disclosing all of your health information, if you don't fully undress. I don't see the harm in it. The worst case scenario is that they try to sell you life insurance and annuities. That's one of a very long list of reasons why I don't use advisors.

Agree with the previous comment on tax loss harvesting. Another alternative if you have a "tax loss", is to hold on to the investment until you return to a breakeven position.

 

[Bamaman]

When I was in college, I had to meet with an advisor before selecting any courses. And it didn't take me long to realize the guy's job was to completely fill up every class within every school within the university. His opinions were not objective as he didn't care if I went to school from 7:00 am until 9:00 pm.

I feel just about the same about Fidelity's advisors. I too am eligible for free advice, but I again feel the advisors are told where to send accountholders' funds. They need to push some funds more than others--to spread the wealth around.

So I still invest with no advise. But I do have access to Fidelity's charts comparing all like funds side by side. It's not at all difficult to see which accounts are superior.

 

[Finance Dave]

So we finally funded a Fidelity cash management account and did enough to get the “free” CFP services. However, the initial consult left us with many questions. Thanks in advance if anyone is willing to share their thoughts and experiences.

1. The CFP services seem to add value but I’m honestly reluctant to disclose all of our financial and other info they seem to want in order to develop a comprehensive plan. Is reluctance warranted or not?

2. Are the fees associated with the Managed Account worth it? Argument is that tax loss harvesting alone more than covers the fees. However, I went to fidelity to minimize fees and expenses.

3. Feels like the other approach is just doing the extremely cheap index funds without the fees and the “financial undressing” associated with a CFP plan. Is simple and cheap the better approach?

Any other thought on Fidelity and the options is welcome and valued. Thank you!

1) I would turn your question around and ask YOU...why are you reluctant?

2) I don't think the fees are warranted, but then I'm an indexer.

3) Yes, see #2

 

[foxfirev5]

Funny thing happened this week with my Fido account. Last year I got demoted from the Private Client Group to Active Trader something or another. This was despite a rising account balance. The Private Client rep even called me to let me know. Since I could see no advantage I was very agreeable. (Still got Free Turbo Tax even though I don't use it .

Now I see I'm back in the Private Client group again. My account is actually down a little after a heavy w/d for capital expenditures. Maybe they think I'm closing out or maybe it was the Fido annuity link I clicked on a while back. I'll never figure out how this stuff works. I see a lot of theories on this site but my experiences contradict most of them.

Meanwhile I chuckle when I see the status at the top of the Fido screen and just hope no one calls to try and sell me something.

 

[DrRoy]

I have an assigned manager due to my account balance. He came to meet with me a couple of times, but when I was not interested in changing my investments to his suggestions, he stopped setting up the meetings. I would never do anything that added a fee. He is there if I have a question or need something.

 

[HarveyS]

1. The CFP services seem to add value but I’m honestly reluctant to disclose all of our financial and other info they seem to want in order to develop a comprehensive plan. Is reluctance warranted or not?


2. Are the fees associated with the Managed Account worth it? Argument is that tax loss harvesting alone more than covers the fees. However, I went to fidelity to minimize fees and expenses.


3. Feels like the other approach is just doing the extremely cheap index funds without the fees and the “financial undressing” associated with a CFP plan. Is simple and cheap the better approach?

1. If you have never had a comprehensive plan, this would be a good thing. Disclosing what you have is required for this, and I do not see an issue with it. I've done this with Fido and VG (and ML) in the past.
2. I self-manage. I do not do as good a job at tax loss harvesting as others suggest I could, even though I am capable of doing that. I just don't do it as aggressively as a planner would (maybe).
3. You don't know what you don't know. Again, if you've never had a plan (like OldShooter said, with will, life insurance, disability, LTC options, etc., etc.,), I would think a free Fido plan would be worth the undressing and the time. If you have plan, maybe it's worth a second look?

 

[capjak]

1. Yes Do the plan and disclose, I have done this several times over the years, it can give things to ponder (you do not need to follow the advice but you should fully investigate it either way)

2. No do not do the advisor. I have a Fixed Income SMA with Fidelity for a short period of time (8 months) and it has not kept up with BND.

3. Yes do index funds yourself that have low expense fees.

 

[Ncc1701]

I used to be a Fidelity "Financial Planning Consultant". I and my colleagues were (and I know they still are) under tremendous pressure to bring in new money, sell managed accounts (e.g. Portfolio Advisory Services) and Annuities. The number of financial plans completed is also a super important metric.

Managed accounts and annuities are what pays the bills of the branch so one should expect to be sold those products. If it were not for those products, Fidelity, Schwab and the like would simply close their branches and use Vanguard's strategy of no branches and all phone reps.

The Fidelity retirement Income planning tool is awesome IMHO and much more user friendly than FireCalc. That's a tool you can use yourself without having the rep input the data for you. If you think you're going to use your rep for help building a self managed, low cost index fund portfolio, it's not gonna happen...you're just wasting his/her time.

 

[LOL!]

Use Fidelity for its HSA, its Donor-Advised-Fund, its 2% cashback card, its index funds, the no-commissions on ETFs, and its Analysis tools on its web site.

Do not use Fidelity for its people. There is no reason really to ever talk to them nor let them put their hand in your pocket.

 

[braumeister]

The Fidelity retirement Income planning tool is awesome IMHO and much more user friendly than FireCalc. That's a tool you can use yourself without having the rep input the data for you.

I agree, but FWIW some years ago my rep was able to show me how to get more out of it. Some of its features were not as intuitive as they could be, so a bit of guidance was valuable to me. I think that was worth at least one visit.

 

[MRG]

Funny thing happened this week with my Fido account. Last year I got demoted from the Private Client Group to Active Trader something or another. This was despite a rising account balance. The Private Client rep even called me to let me know. Since I could see no advantage I was very agreeable. (Still got Free Turbo Tax even though I don't use it .

Now I see I'm back in the Private Client group again. My account is actually down a little after a heavy w/d for capital expenditures. Maybe they think I'm closing out or maybe it was the Fido annuity link I clicked on a while back. I'll never figure out how this stuff works. I see a lot of theories on this site but my experiences contradict most of them.

Meanwhile I chuckle when I see the status at the top of the Fido screen and just hope no one calls to try and sell me something.

I'm pretty sure Fidelity doesn't know what Private Client is anymore. I think it varies from branch to branch. I was PC in KC when I moved to the Denver branch the branch manager said he didn't have a rep for me anymore. Reality was I told his dirty rotten annuity salesman to take a hike. So for me PC may avoid one phone queue and when I'm transferred to a common group(Roth conversions) I wait like the Wall Street Bets kids Fidelity is recruiting.

 

[scrabbler1]

What "free CFP" are you talking about?

I have an "account manager" guy I occasionally talk to at the local office. I'm not sure he adds much value, but he's free. As far as I know my guy isn't a CFP. For me anyway, I wouldn't pay Fidelity for their advice or do any of their Managed Accounts (that require a fee).

Mine I call an Account Executive. I have had one at Fido since early 2008 when I was putting together my ER plan. She was helpful at the crucial time, setting up their RIP program to analyze my ER plan, all at no charge.

But she didn't last at Fido much longer. AE #2 replaced her a few months later and he was also crucial to my ER because he was there when I actually left my company at the end of October. He set up my rollover IRA and handled 2 large transactions which got my ER going.

But in late 2009 AE #2 left and I as assigned to AE #3. But before I could meet with him, I got poached by someone else who was eager to take control of my portfolio for a fee - I was not interested. I met with Mr. Pushy in early 2010 and after 2 uncomfortable hours, I left and had already mentally written a letter to the office manager by the time I reached my car. I mailed that letter and got a call from the office manager who immediately transferred me back to AE #3.

AE #3 was a good man, not pushy, and one I met with once every 12-18 months. He helped me update the RIP program when circumstances in my life changed. He offered advice in a friendly way and if I asked him for it. It was useful dealing with him if I had questions which were more specific to my situation and didn't want to explain it to a phone rep. AE #3 was also the AE for my (snake-bit) friend starting in late 2012 after he received a large inheritance. I help my friend out on a regular but informal basis.

But the office manager just switched me (and my snake-bit friend) to another AE, AE #4. I have spoken to him a few times so he could learn about my situation (and my snake-bit friend's). He seems like a decent guy who won't be anything like Mr. Pushy (whom I told AE #3 about; Mr. Pushy left Fido not long afterward).

 

[latexman]

I have an assigned manager due to my account balance. He came to meet with me a couple of times, but when I was not interested in changing my investments to his suggestions, he stopped setting up the meetings. I would never do anything that added a fee. He is there if I have a question or need something.

I think I have the same. Near the upper right side of the home web page, it says Fidelity Premium Services and has a link to my "advisor". I meet with her twice a year, have her "teams" e-mail, and her direct phone number. The service has no direct fees; I'm sure they are baked into other very small, reasonable fees. She always reviews my Retirement Analysis with me, and is extremely helpful in filling in gaps with local area data for my level of spending and tweaking my personal data. She has increased my confidence immensely over the last 5-10 years that our Retirement Analysis is realistic and, therefore, doable.

She has presented ideas on reducing risk, but did not try to sell me on it.

I think this is the perfect level of service for me and my DIY approach.

 

[LarryMelman]

1) I would turn your question around and ask YOU...why are you reluctant?

By "disclose all of our financial and other info" I'm sure they just wanted a snapshot of your assets and other life issues. You don't give away your account numbers or passwords or etc. I've done this many times with planners, hoping to get some fresh ideas or issues that I may not be addressing. But instead, they see that I'm a self-directed stock investor and most of them shut down the discussion immediately.

Anyway, you're just giving them a snapshot in time. It's nothing to be afraid of.

 

[jazz4cash]

I am extremely appreciative that megacorp and megacorp spin-off both selected Fido for our 401k. They have dedicated numbers to call staffed by reps that specialize in megacorp 401ks. They also manage both pensions but one is just a front for Wells Fargo. Wells Fargo is lousy. As I transitioned to retirement and opened Roth and tIRAs I started getting reps assigned that were not pushy but they never stuck around either. Sometimes they have silos for workplace savings vs other accounts which is inconvenient. Once they see I have used many of the tools available (RIP, GPS, etc) and have no glaring deficiencies (50% in a single stock) they generally leave me alone. These young reps probably know less than many folks on this board so if they’re not selling you something they may not have much else to offer.

Fido opened a new office nearby just before the pandemic and it is still closed but a new rep reached out, scheduled a meeting and attached his pic to my Fido homepage. He was disappointed that I would not transfer my 401k but he handled it professionally. He says next quarter we will look at adding some bods to my portfolio. We’ll see.

 

[eytonxav]

I really like Fidelity simply for their website and available funds and if you need to speak to a representative for various admin things I have found their phone support to also be very good. I have access to a CFP as my Fidelity advisor, but do not use her for any investment or financial advice.

 

[pb4uski]

So we finally funded a Fidelity cash management account and did enough to get the “free” CFP services. However, the initial consult left us with many questions. Thanks in advance if anyone is willing to share their thoughts and experiences.

1. The CFP services seem to add value but I’m honestly reluctant to disclose all of our financial and other info they seem to want in order to develop a comprehensive plan. Is reluctance warranted or not?

2. Are the fees associated with the Managed Account worth it? Argument is that tax loss harvesting alone more than covers the fees. However, I went to fidelity to minimize fees and expenses.

3. Feels like the other approach is just doing the extremely cheap index funds without the fees and the “financial undressing” associated with a CFP plan. Is simple and cheap the better approach?

Any other thought on Fidelity and the options is welcome and valued. Thank you!

1. If you want the benefit of a comprehensive plan then you'll need to disclose to them what other various accounts that you have and the types and amount of investments in each... tickers and amounts but not account numbers, user ids or passwords.

2. I find it a bit funny that part of their pitch would be that they do a better job of tax loss harvesting. I would prefer working with an advisor who doesn't have purchase lots that have tax losses to harvest even to begin with. Tax loss harvesting isn't particularly complicated so I don't see much benefit there.

3. I think simple and cheap is a better approach and there are a lot of studies that support that notion.

We have our HSAs with Fidelity and we have accounts with Vanguard, Fidelity and Schwab. A couple months ago I go frustrated with Fidelity's online trading restrictions... for example, I could not by a floating rate preferred stock online but had to call... so I moved all the tIRA holdings that I had with Fidelity to Schwab.