Anyone use Ameriprise for investing help?

[Fedup]

I did try to get my secretary to transfer from Amerprise to Vanguard. Her advisor put her money in precious metal funds and she was loosing money on top of the 1% commmision.

 

[OldShooter]

OldShooter, I have read most of your posts and I must admit that I think you are on the high side of the objectivity scale. IOW: Your stuff makes a lot of sense. Thank you for your posts and your insight.

Not every investor is concerned with getting the last 0.000000001% of return. In our case, we have much greater concerns than whether we get a 10.0% return or a 10.5% return. I don't know if we are typical, (probably not) but it is very unlikely that we will ever run out of money over our lifetimes, so return is not our greatest concern. I hope I did not jinx our futures by saying that.

There are just so many different situations, that there is no "one size fits all" solution.

@Rustward, thank you for the flowers. (One of my strengths, of course, is my humility. )

You are correct, of course. And has been remarked elsewhere in this thread, this forum is biased towards DIY investing. I think there are a few reasons why:

The idea of a "Financial Advisor" is very commonly confused with the idea of an "Investment Advisor." A good FA is far more than just an IA; most of the bias here is against the IA function. Particularly for younger folks, consulting with a good FA is IMO very advisable. That is one of the punch lines from my Adult-Ed investing class, but with the recommendation that the FA be fee-for-services rather than charging for AUM.

There are a lot of crooks out there. Ameriprise is the current poster child, but Fast Eddy Jones is certainly right up there, as are 99% of life insurance salespeople. (All IMO, of course.) So advising people to stay away from FAs is a prescription to keep them from being victimized but maybe unnecessarily broad. (OT a little: I have worked search & rescue and one of the issues with small lost children is that they will sometimes hide from a search party because their parents have told them to never talk to strangers.)

I am involved with a nonprofit investment committee where one of the members is quite wealthy and quite knowledgeable. When the subject of the committee running the money ourselves comes up, his vehement response is "Absolutely not. We need a throat to choke!" Said another way, he does not want the committee to be in a position where it can be blamed if performance is low. I think this "throat to choke" is a big factor in individuals' using IAs. They are insecure about doing the job themselves and, of course, every IA and FA on the planet does his/her best to reinforce this feeling.

(Almost done, I promise .... ) The cost of a bad FA is far more than your numbers. 1% AUM + 0.75% mutual fund fees + 1-2% hidden cost due to stock pickers' excessive trading. On the bond side, too, excessive fund fees for simple clerical tasks like buying risk-free government securities. If someone said to me "I am OK with 2-4% underperformance in order to get the hand-holding and the throat to choke, I would say "That's fine. Whatever makes you happy." But I think that few people hiring IAs/FAs realize what it is costing them and are making an informed decision to purchase.

So while I don't disagree at all with your broad point, I think there are some reasonable reasons why many members of this forum recommend avoiding IAs and FAs. If it comes across as hostility or as belittling forum members that is unfortunate. I hope i have not come across that way.

 

[MichaelB]

There are a lot of crooks out there. Ameriprise is the current poster child, but Fast Eddy Jones is certainly right up there, as are 99% of life insurance salespeople. (All IMO, of course.) So advising people to stay away from FAs is a prescription to keep them from being victimized but maybe unnecessarily broad. (OT a little: I have worked search & rescue and one of the issues with small lost children is that they will sometimes hide from a search party because their parents have told them to never talk to strangers.)

The financial services businesses you mention - investing and life insurance - are high cost and limited options, but calling them crooks is (IMO) unnecessary and excessive, and people using their services are not victims. They are not getting a good deal, and could do better elsewhere, but there is no crime here.

 

[OldShooter]

The financial services businesses you mention - investing and life insurance - are high cost and limited options, but calling them crooks is (IMO) unnecessary and excessive, and people using their services are not victims. They are not getting a good deal, and could do better elsewhere, but there is no crime here.

Point taken.

 

[RobbieB]

I don't feel despised at all, but;

It is rather funny that intelligent people have a brain melt down when considering managing their own investments. From early age, for example, women are probably taught that it is a job for men, it's complicated, etc.

Makes me feel stupid. I've suffered "brain Melt" according to target which I take as mentally incompetent.

 

[travelover]

........ there is no crime here.

Yea but - the reason there is no crime here is through lobbying by these same groups to allow them to appear to have your best interests at heart when they in fact do not. A simple requirement for them to have fiduciary duty would solve a lot of overcharging, but they have fought it tooth and nail.

 

[Helen]

Yea but - the reason there is no crime here is through lobbying by these same groups to allow them to appear to have your best interests at heart when they in fact do not. A simple requirement for them to have fiduciary duty would solve a lot of overcharging, but they have fought it tooth and nail.

I so agree with this.

If they have nothing to gain they have no reason to lie as well. I recently had an account rep at Fidelity repeatedly call their Tax Managed PAS product an index fund. He would have happily liquidated seven figures of capital gains of ours in order to bump his own annual bonus up by probably a small amount. He is no longer my account rep.

 

[OldShooter]

I so agree with this.

If they have nothing to gain they have no reason to lie as well. I recently had an account rep at Fidelity repeatedly call their Tax Managed PAS product an index fund. He would have happily liquidated seven figures of capital gains of ours in order to bump his own annual bonus up by probably a small amount. He is no longer my account rep.

Really. That's very interesting because my understanding was that all the Fido reps (and the Schwab reps) were fiduciaries. I found this description of compensation (https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/representative-compensation.pdf) but found it very hard to decipher; definitely some reps do get bonused for selling certain Fido products. The word "fiduciary" does not appear in the PDF.

I would be interested in the answer (and others here, too, I think) if you asked your branch manager whether his reps' relationships with you were a fiduciary relationship. TIA

 

[Helen]

Really. That's very interesting because my understanding was that all the Fido reps (and the Schwab reps) were fiduciaries. I found this description of compensation (https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/representative-compensation.pdf) but found it very hard to decipher; definitely some reps do get bonused for selling certain Fido products. The word "fiduciary" does not appear in the PDF.

I would be interested in the answer (and others here, too, I think) if you asked your branch manager whether his reps' relationships with you were a fiduciary relationship.

TIA

They are not fiduciaries. They get a step up in their bonuses for putting money into PAS, DAFs and trusts. Their bonuses are also based on other things like client retention, so I hope he felt the sting when he was removed as our rep.

I went with a friend to meet with a Fido rep and this guy was totally different, didn't try to push products and entered her data into what looked like the RIP program. He helped my friend a lot.

The link you provided spells out how they are compensated quite well. I had read that document before meeting with the account rep.

 

[OldShooter]

Hmmm ... one misconception of mine now busted! I have emailed my Schwab guy on the fiduciary question. Whether he is or not is not a big deal to me because he has never tried to sell me anything and I do not look to him for advice, but I will be very disappointed if I am wrong about Schwab, too.

I sent a friend to see my guy and friend was very impressed that the meeting started with "I want to explain to you how I get paid." But I haven't read the Schwab compensation policy in detail either -- long and boring.

 

[braumeister]

I went with a friend to meet with a Fido rep and this guy was totally different, didn't try to push products and entered her data into what looked like the RIP program. He helped my friend a lot.

This can be a real benefit. On one of my first meetings with my Fido guy he spent some time showing me how to really take advantage of their software (it used to be called RIP). I was surprised, because I had already used it at home, but he showed me how I could do a lot more with it. He also never tried to convince me to buy anything, just accepted what I was already doing. They also have pretty good coffee at the branch office.

 

[Rustward]

Why do we have to stop with the financial services industry? There are countless other industries that want (and get) our money. Big pharma! Lets invent some new diseases so we can treat them with very expensive drugs. And we'll run those expenses through your insurance company so it won't seem so painful. Auto repair -- who here has never been ripped off or at least had it attempted against them? Auto sales? Plumbers and electricians -- sure they are not all bad but some are. Why don't we try to list them all?

The thing about financial services is that nobody is forcing people to use them.

So let's say we put some fiduciary rules in place? Is that going to eliminate expensive products that are not optimal? I just don't think it is possible to idiot-proof the whole world.

 

[travelover]

Why do we have to stop with the financial services industry? There are countless other industries that want (and get) our money. Big pharma! Lets invent some new diseases so we can treat them with very expensive drugs. And we'll run those expenses through your insurance company so it won't seem so painful. Auto repair -- who here has never been ripped off or at least had it attempted against them? Auto sales? Plumbers and electricians -- sure they are not all bad but some are. Why don't we try to list them all?

Maybe we need a Consumer Financial Protection Bureau - no never mind. Congress would just kill it to make their lobbyists happy.

The thing about financial services is that nobody is forcing people to use them.

So let's say we put some fiduciary rules in place? Is that going to eliminate expensive products that are not optimal? I just don't think it is possible to idiot-proof the whole world.

Sorry, but I've seen enough little old ladies ripped off, including in my own family, that I'm not giving the sharks a pass because "you can't idiot proof the whole world". These clients need help with their investments and kicking them in the teeth for trusting is insult to injury.

 

[ERD50]

Why do we have to stop with the financial services industry? There are countless other industries that want (and get) our money. ....

OK. So start a thread about any industry you want. This one is about the financial industry.

And since financials are a central element of this forum, it seems reasonable to discuss it here.

-ERD50

 

[target2019]

Maybe we need a Consumer Financial Protection Bureau - no never mind. Congress would just kill it to make their lobbyists happy.

Sorry, but I've seen enough little old ladies ripped off, including in my own family, that I'm not giving the sharks a pass because "you can't idiot proof the whole world". These clients need help with their investments and kicking them in the teeth for trusting is insult to injury.

I do know that someone from our state looked into the FAs from daughters church who were churning my in-laws accounts. My in-laws were interviewed about their experience. Not sure if the scum received any action.

They were not Ameriprise, but some time later I had experience with that ilk, as we were reporting our observations to AARP for their advisor database.

 

[dougmoe]

I retired in 2007 and have been using Ameriprise as my financial advisors. When it comes to any financial advisor firm I would suggest it will be a love/hate relationship until things settle down and a relationship is developed. I have a wonderful agent/ advisor whom I respect and I treasure our bi yearly meetings. He is always looking out for me and is open to my thoughts and suggestions but I can tell you we have had our disagreements as well only because I personally like to stay personally involved and I can become emotional when it comes to my retirement savings. I believe advisors can help to keep you informed and calm in difficult situations. He has been wrong at times and I have been wrong at times but we work it out together and over time we have developed a strong relationship. I am not crazy about Ameriprise web site or the funds that they offer compared to like Fidelity or Ameritrade but I do stick with them due to our fine and trusted advisor. He is the difference in us remaining with Ameriprise to be truthful but otherwise I would switch to Fidelity. Hope this helps

 

[pb4uski]

^^^^ I guess that I would prefer to just couch potato and avoid the drama and the fees... but since it seems to work for you, good for you.

 

[travelover]

^^^^ I guess that I would prefer to just couch potato and avoid the drama and the fees... but since it seems to work for you, good for you.

+1. I doubt dougmoe actually knows what fees he / she is paying, but it is probably for the better. When others found out, they felt betrayed.

 

[dougmoe]

Been with Ameriprise for 12 years. I appreciate their service mainly because I have a very good advisor. I also self manage funds in a Fidelity and Ameritrade accounts. Each year my self managed funds have outperformed my Ameriprise managed funds by plenty but in fairness the Ameriprise account holds 65% of my savings and it is diversified into a moderate portfolio vs. an agressive one. I suppose if ai had to do it over again I would just self manage everything but 12 years ago I had little investment knowledge and needed stability and now I have developed a long relationship and friendship with my Ameriprise advisor. I think Financial services are way over rated for their costs but their is value to what they offer but that value is based on a clients needs and desires.

 

[mickeyd]

Ameriprise threads are always fun to read.

 

[YoungSaver]

Been with Ameriprise since 2009 (my guy's company was purchased by Ameriprise). I've never had an issue with Ameriprise or my advisor. I tell him what I want to buy, write him a check and he does it.

My assets are not high enough to have fees waived ($500k), but I pay $60 per year (https://www.ameriprise.com/financial-planning/our-fees/brokerage-accounts-custodial-fees/).

I'm not sure what you guys are doing to have advisors charging 1/4 to 1/3 of your income.

 

[ERD50]

Been with Ameriprise since 2009 (my guy's company was purchased by Ameriprise). I've never had an issue with Ameriprise or my advisor. I tell him what I want to buy, write him a check and he does it.

My assets are not high enough to have fees waived ($500k), but I pay $60 per year (https://www.ameriprise.com/financial-planning/our-fees/brokerage-accounts-custodial-fees/).

I'm not sure what you guys are doing to have advisors charging 1/4 to 1/3 of your income.

You are talking about a brokerage account, versus their FA fees for Assets Under Management. You tell your guy what to do, he does it. My broker will do that (though I do it myself online), and I just pay modest trading costs. Generally less than $60 a years, as I'm buy and hold, few transactions to make.

The typical Ameriprise client with an FA is paying the fees that have been discussed (~ 1%), plus likely being put into investments with added fees, maybe even some churning.

-ERD50

 

[YoungSaver]

I guess I don't understand what everybody in this thread is complaining about then. What is Assets Under Management and why do people do it?

 

[NW-Bound]

I opened a self-directed account with Ameriprise back in around 2000. For accounts with a balance of more than $100K (or was it $200K), they gave 10 free trades each month or something like that. Back then, Schwab was still charging $30/trade.

Then, Ameriprise slowly reneged on that and charged around $7/trade. Plus, they had the gall to charge me a periodic account fee. So, the money went back to Schwab, which had lowered the trading fee to $7, and never had an account fee.

I now do most of my trades at Merrill Edge, where they gave me free trades for keeping a 7-figure account there.

 

[ERD50]

I guess I don't understand what everybody in this thread is complaining about then. What is Assets Under Management and why do people do it?

Assets Under Management is the portfolio value, and they charge a % each year, regardless of what they do or don't do for you. So if you have a $500,000 account with them, they charge $5,000 a year. $1M and you pay $10,000, even though they clearly don't need to do 2x the work. And likely put you in funds with a expense ratio that may be ~ 1% higher than a broad based index fund.

Why do people do it? Because they think investing is hard, and that it takes a pro, and the pro will do better than they could do on their own. The first 2 points are wrong, and the 3rd is unlikely, and unpredictable.

-ERD50