Hi! Ameriprise client needing advice...

[gcgang]

Am I being naïve that since my financial advisor at Ameriprise has CFP & CRPC designations that she should be acting in my best interests as far as growing my money and making the best investments? Despite the front-loads and high expense ratios, maybe the funds perform better than other funds and make up for those fees? Am I just being optimistic and hopeful?
?

Rules of Conduct - CFP Board

Above links to Code of Conduct for CFPs. I do not believe there is any mention of acting as a fiduciary.

I don't think you are being optimistic and hopeful, unfortunately, I think you are being borderline delusional.

You can do this on your own, with the help of some study on your part. But you must have the fortitude to develop an appropriate plan and stick to it when the inevitable corrections occur. Passive indexing, eliminating the layers of fees you are currently saddled with, will make a HUGE difference.

 

[Walt34]

Am I being naïve that since my financial advisor at Ameriprise has CFP & CRPC designations that she should be acting in my best interests as far as growing my money and making the best investments?

Well, yes. They do not have your best interests in mind. They have in mind their paychecks and commissions and the reviews they get from their supervisor because they generate income for Ameriprise. Your interests are only relevant to the extent that they can persuade you to keep sending them money.

Please, please read the books that have been suggested.

 

[gcgang]

Correcting my own comment, Section 1.4 DOES say the CFP must place the interests of the client ahead of his own, and goes on to say to act like a fiduciary.

 

[samclem]

Correcting my own comment, Section 1.4 DOES say the CFP must place the interests of the client ahead of his own, and goes on to say to act like a fiduciary.

When a person gains the CFP designation, does it always mean he/she is acting in that capacity? Clearly, that same person could go to work as a stock broker and would not have a fiduciary responsibility to his clients. And if that person goes to work for Ameriprise ?

The roles of advisor and the client should be spelled out in the relevant written contracts/agreements.

 

[Lisa99]

I'm one of the ones who got away from Ameriprise. Cost some money to get out of the VUL but it was worth it. Our investments have tripled in the four years since we've been investing on our own. Partly because the market has been going gangbusters, partly because we've been pouring every extra cent into the market, but also because we're in very low cost index funds.

I can GUARANTEE that we would have a much smaller portfolio were we still with Ameri-crooks... Oops did I say that?

My feelings about them are so negative that I no longer like Tommy Lee Jones now that he's their spokesman!

Google the coffee house investor or couch potato portfolio. Keep it simple, keep it in index funds, rebalance when needed and save yourself a bundle of money in the process.

 

[gcgang]

When a person gains the CFP designation, does it always mean he/she is acting in that capacity? Clearly, that same person could go to work as a stock broker and would not have a fiduciary responsibility to his clients. And if that person goes to work for Ameriprise ?

The roles of advisor and the client should be spelled out in the relevant written contracts/agreements.

According to the Rules of Conduct, these standards are binding on all CFPs regardless of their title, at all times.

Last comment, that the roles are spelled out, not to mention the means of compensation, also appears to be a requirement.

 

[cucumber]

I absolutely love this forum and everyone that has provided their wisdom!!! I will definitely get started on reading the books! I'm SO excited to take ahold of my finances and investments. All these years with Ameriprise I knew something was fishy but never really trusted my gut because I trusted my FA since she was so nice. But little did I know...

Just last year I moved my 401k from Fidelity to Ameriprise on the recommendation of my FA and now I find out they are charging me all these fees!! It makes me so upset and I want to just cut all ties but I don't want to jump the gun.

So my plan is to just take a few months to study and read up on investing before I break the news to our FA who obviously is not acting as a fiduciary with my best interests in mind. Now I know that even with the credentials, it doesn't mean that they are acting in that capacity unless otherwise stated.

I am so grateful that I found this site and all of you wise investors!!! I can't thank you all enough!!!!!!!!!

 

[Meadbh]

Way to go cucumber! Nobody cares about your financial welfare as much as you do. Becoming an informed investor will give you power and will save you money. Lots. Let the journey begin!

 

[2B]

+1 to pretty much everything already said. I do have one comment on the VUL.

To decide whether it is worth cashing the VUL policy out and paying the fee look at the ongoing costs. If you have a 10% cancellation fee, compare that to the fees of the funds inside the policy. Add in any wrap or account fees. Then add in the extra cost for the life insurance versus the cost of a term policy. Typically, these VUL policies have really expensive insurance policies compared to term.

You may find that you have a one to three year payback on just pulling your money out now. Also, consider the joy you will have by not having to deal with Ameriprise again.

Remember cucumber, at one time everyone on this forum knew less than you do now. We all have some similar story about buying overpriced investments and being with rip-off investment firms.

 

[samclem]

I will definitely get started on reading the books! I'm SO excited to take ahold of my finances and investments.

Super! This is going to save you a lot of money. More importantly, you'll understand and have more control over your finances which is a great feeling.

It makes me so upset and I want to just cut all ties but I don't want to jump the gun.

You are right to study up on these things, but remember that it is not hard. Don't get "analysis paralysis," because the perfect investment plan can only be designed in retrospect. A "good enough" plan will put you ahead of the vast majority of investors and probably well ahead of where you'd have been with Ameriprise. But be sure to stay mad about this--mad at Ameriprise and mad at your FA. She'll be just as friendly the next time you see her--don't give in! Every day when you get to work, remember that part of your paycheck--part of your life in that office--is being used to buy your FA nicer things that should be yours instead.

Google the coffee house investor or couch potato portfolio. Keep it simple, keep it in index funds, rebalance when needed and save yourself a bundle of money in the process.

Lisa is a success story, she escaped Amerirpise just as you are doing. The web sites she recommends are a good start.

Remember cucumber, at one time everyone on this forum knew less than you do now. We all have some similar story about buying overpriced investments and being with rip-off investment firms.

Oh, yes.

 

[cucumber]

I just opened an account with Vanguard and invested in my first Vanguard Roth IRA in their target retirement fund!! Yay!!! I just want to hurry and move everything over to Vanguard because I get more and more upset every time I think of how much money Ameriprise sucked out of my retirement!!! Can't wait to read all the books and study up!! I feel like I'm in college all over again. Ha! Thanks again!

 

[panacea]

Remember cucumber, at one time everyone on this forum knew less than you do now. We all have some similar story about buying overpriced investments and being with rip-off investment firms.

+1
My first $5,000 went into a "high return, tax-advantaged" variable annuity. I must have been a really easy target. To that point, I didn't know anything about investing so the advisor could have said anything and I would have given him all my money. It's been 20 years, and I still remember what he looks like (sort of like a snake with slicked back hair) and how angry I was when I learned what I had invested in.

 

[dontworry]

I just opened an account with Vanguard and invested in my first Vanguard Roth IRA in their target retirement fund!! Yay!!! I just want to hurry and move everything over to Vanguard because I get more and more upset every time I think of how much money Ameriprise sucked out of my retirement!!! Can't wait to read all the books and study up!! I feel like I'm in college all over again. Ha! Thanks again!

Congrats!!! Happy day!

 

[MRG]

+1
My first $5,000 went into a "high return, tax-advantaged" variable annuity. I must have been a really easy target. To that point, I didn't know anything about investing so the advisor could have said anything and I would have given him all my money. It's been 20 years, and I still remember what he looks like (sort of like a snake with slicked back hair) and how angry I was when I learned what I had invested in.

Probably a guy with a mortgage, wife, and kids. He has to sleep at night, look at himself in the mirror when he shaves. IMHO, we come across folks in life, who's entire purpose is to teach us lessons.

I'm probably full of crap, but it's kept me outa jail, for running over a couple of id10ts.
MRG

 

[Coolius]

Got a call from an Ameriprise salesman today. Pushing the usual VUL with promises of "guaranteed" returns that were so unbelievable I could hardly believe I was talking with a supposedly professional FA.

When I pressed him on the fees, his commission, and surrender policies, he became more and more flustered, and finally told me that I should not bother with the details, but simply transfer all my retirement accounts to him and trust him as he had my best interest in mind - always.

When I asked him for a list of his clients that would be willing to speak with me, he stalled for a while, blurted out an expletive, and abruptly hung up on me.

I then called my ex-friend who had given him my name and admonished him severely.

 

[travelover]

........my ex-friend ..........

 

[Walt34]

When I pressed him on the fees, his commission, and surrender policies, he became more and more flustered, and finally told me that I should not bother with the details, but simply transfer all my retirement accounts to him and trust him as he had my best interest in mind - always.

When I asked him for a list of his clients that would be willing to speak with me, he stalled for a while, blurted out an expletive, and abruptly hung up on me.

Salesmen always hate intelligent customers don't they?

 

[haha]

Got a call from an Ameriprise salesman today. Pushing the usual VUL with promises of "guaranteed" returns that were so unbelievable I could hardly believe I was talking with a supposedly professional FA.

When I pressed him on the fees, his commission, and surrender policies, he became more and more flustered, and finally told me that I should not bother with the details, but simply transfer all my retirement accounts to him and trust him as he had my best interest in mind - always.

When I asked him for a list of his clients that would be willing to speak with me, he stalled for a while, blurted out an expletive, and abruptly hung up on me.

I'm impressed. It's really hard to get these guys to drop their pose, and you certainly did!

I have never been called by any financial products salesman. I must turn up on some stay away list.

Ha

 

[gindie]

I can't remember if the OP said he needed the insurance. If it is needed, then don't completely surrender the VUL until you have other insurance in place.

 

[comicbookgujy]

When a person gains the CFP designation, does it always mean he/she is acting in that capacity? Clearly, that same person could go to work as a stock broker and would not have a fiduciary responsibility to his clients. And if that person goes to work for Ameriprise ?

The roles of advisor and the client should be spelled out in the relevant written contracts/agreements.

I work in this industry. People in my firm with CFP designation are nothing more than sales people. Plus getting a CFP isn't hard. Getting a CFA is hard. Selling high commission products such as annuities is what get them the big bonus.

Fiduciary? LOL. Only person they are looking out for is themself and their paycheck. That's why I'm trying to ER. Working in this industry sucks. It's all about a money grab. People only care about sales number.

You don't met you sales goal, you will have to take your CFP designation somewhere else. RE agent have a fiduciary responsibility too...but do you really think they are looking out for your best interest?

My advice, learn more about investing and stick with low expense index fund with Vanguard or Fidelity. the 1% to 2% you're paying won't beat the index

 

[Lakewood90712]

Kind of strange, this thread is 4 days old, and so far , no sign of an Ameriprise sales , uh , I mean "Advisor" troll signing up and trying to defend the company.

 

[panacea]

I work in this industry. People in my firm with CFP designation are nothing more than sales people. Plus getting a CFP isn't hard. Getting a CFA is hard. Selling high commission products such as annuities is what get them the big bonus.

Fiduciary? LOL. Only person they are looking out for is themself and their paycheck. That's why I'm trying to ER. Working in this industry sucks. It's all about a money grab. People only care about sales number.

Geez, I feel like I just posted this but I guess it was the same issue on another thread... whether an advisor is a salesperson has nothing to do with being a CFP, it has to do with the fee structure of the firm. Most firms are commission-based, which results in biased information and a sales environment and CFPs can fall into the same trap. However, an advisor in a fee-only environment are not incented to sell products and hit sales goals, making that type of firm a better fit for CFPs IMO. Also, only about half of CFP applicants actually obtain the designation... granted that's probably a higher pass rate than the CFA but they're two different areas of expertise. Having said all that, I agree that no one cares more about their own finances than themselves.

 

[cucumber]

I've been reading up on Mutual Funds, expense ratios, front loads, and index funds. There's still a lot for me to learn and my initial plan was to learn as much as I can first and then start moving my money out of Ameriprise. But as I read about index funds versus mutual funds and as I look at my 401(k) that I moved to Ameriprise's actively managed account that has literally earned $479.60 in the past year for my $50,000 that I rolled over, I really am considering just telling my advisor that I want to move it to Vanguard and put it in the Vanguard 500 Index Fund for the time being. At least it would be hopefully earning a little more, right? Would this be a good move? It's making me so upset that I moved my 401(k) from Fidelity to Ameriprise and am paying 5-6% loads and 1-2% in expense ratios and also because it is actively managed, I believe I am paying another fee. It makes me so sick but I don't know what to do. We have about $200K in Ameriprise but not sure how the rest is invested. I just know about this one because it was a big chunk of change that I did recently based on the recommendation of my advisor. Am I being impatient and jumping the gun?

 

[cucumber]

Another question since I am learning to DIY. Btw, I'm loving Vanguard! So my advisor would normally project how much we need to save each month for a particular goal. So for preschool tuition currently it is about $10K per year. I know Vanguard has the LifeStrategy Funds which make the AA simple but how do people calculate how much to put away every month factoring in inflation, returns, time, etc. My advisor used to just plug it into her program and it would spit out a number and that's how much she said we would need to save every month and give to her to invest in order to have enough to pay for preschool when the time comes. I think that's one of the parts I'm scared of. That I will calculate it wrong and not put in enough.

 

[2B]

Hey cucumber. You are not being impatient. You have just realized you are being hosed big time. I think it is reasonable to move everything to Vanguard ASAP. You could maintain your current asset allocation until you figure out where you want to be.

Expect Ameriprise to give you some grief when moving. Expect calls from you FA and expect your paperwork to get delayed. The final indignity will be the fee they charge for closing your account.

I'm not a big fan of target date or life strategy funds. I'd rather have control of my asset allocation.

As for predicting what you need to save, you will just have to wing it like the rest of us. You can't accurately predict how much your investments will return and what preschool tuition (or anything else) will actually cost in the future. The shorter the time frame the more you should look at CDs or something that won't lose value. If you are going to save three years for a year of $10K preschool, you would need to put away $280/month. You can hope that the interest equals any price increase. Longer term savings like for a distant retirement can be planned with any of the financial calculators that are around. You just can't assume they are perfect and you are always safer to over-save.