Edward Jones and my remorse

[mrfeh]

OK, Flame away, but...

I have my grandchildren's 529s at EJ. They're in American Funds and I pay 2% off the top on new money since I have over $500K total in American Funds across all my accounts (including other brokerages). 2% is not bad amortized over the anticipated holding period (oldest kid is 7). I like American Funds and *I* tell the guy what to invest in when I put in new money. He's seen the statements for the other brokerages (to back up the $500K claim and has not once suggested I move them over to EJ. YTD Annualized IRR on the accounts is 13.5%.

So much depends on the advisor. I agree the OP has a loser and should get out ASAP.

2% is absolutely horrible.

You should take the advice you gave to the OP.

 

[DrRoy]

Yes, you are being screwed. That's their business model (and that of many other firms as well).

Get the money out of there ASAP. Put in back in Vanguard and manage it yourself.

+10exp10 I think I saw you are transferring your money out.
.
Ding! Ding! Ding! Right answer!

 

[racy]

2% is absolutely horrible....

^^^This. And, here is a calculator that shows a visual: https://tinyurl.com/y5sfdqap

 

[target2019]

We're 70 and I have always kinda taken care of the retirement money at Vanguard and our state PEPSICO plan but I don't really know much...I just look at what a fund has done in the last 10 years or so and pick the one with the highest rate of return.

I thought I would just let EJ take over and do a better job. I started with them in 6/22/21...we have three different pots with them...2 Traditional IRAs and a pot of already taxed money.

As of this moment we're making 1.98% on one IRA and 2.78% on the other IRA...the cash is making 1.30%.

When we met with our FA, we told the FA how much risk we can handle...one IRA is HIGH risk, one IRA is MEDIUM risk.

The FA has the cash pot split between 12 different funds. Each IRA has 13 fund holdings. Some of the funds don't have very long track records.

A lot of the funds are income funds...we told him we don't need income from this money, we want growth.

I'd like to transfer the money to another institution and buy ETFs.

Am I right to think we're being mishandled? I know the market has been down the last 6 months and that's how long we've been with EJ so maybe I'm expecting too much but my son and brothers are still making 15-18% this year.

What would you do if you were me? Thanks!

Mishandled? Definitely. But if you go in there all full of piss and vinegar it will leave you upset for even longer.

So, you asked us strangers for a drink, and you're getting the firehose. Since you've already said it was a mistake, and you want to move your assets, I'm surprised at some comments.

Your position at this time is not unusual, sad to say. There are many threads here about EJ and similar FA firms. It can grow tiring for some to respond, but you can pick through all the comments and use those that set you off in a direction where you come out ahead in a year or two. You are gonna lose some value unfortunately.

You need a list of steps to execute without emotion.
1. Find a local Schwab or Fidelity office.
2. Make an appointment.
3. Prepare your points for the meeting.
4. Tell the advisor candidate what you have, and what you want for the future. Tell them up front you do not want to pay for any management, just take advantage of the no-cost options they have.
5. Make notes and compare these two institutions.
6. Come back and discuss the options.

I wish you well with the transition. The good news is that the IRAs will probably not suffer much further damage. The taxable brokerage is something else as I know you're well aware of.

I believe in Ready! Aim! Fire!, and not the reverse. It's gonna take some time to get ready, to aim, and to fire. But you'll wrap this up I'm sure.

 

[zekeboz]

Great post target2019

+1

 

[lem1955]

Yes, leave and go with one of the three recommended houses. EJ will probably gouge you with some kind of account closing fees, but it is well worth the cost of ditching them.

Look at Target Year or Balanced Funds. They are index funds that automatically re-balance to follow a set asset stock/bond allocation. The fees are very low and you get the excellent returns of an index fund.

I prefer Vanguard Life Strategy Funds over Target Year for people already in retirement. Asset allocation remains stable unless you transfer to a different fund and they are comprised of the same underlying funds as the target dated funds.

 

[Ncc1701]

If you need hand holding, someone to talk to or manage your portfolio, use Vanguard PAS or Schwab Intelligent Portfolios Premium. Either one, even with all of their shortcomings, are infinitely better than any "advisor" picking stocks or funds for you.

 

[mhk7]

What do you think of TD Ameritrade? I noticed no one suggested them...What is their downfall? As always, thank you!

 

[finnski1]

What do you think of TD Ameritrade? I noticed no one suggested them...What is their downfall? As always, thank you!

I use TD Ameritrade and have forever. I also have my largest holdings with Fidelity.
I have never had any problems or bad experiences with TD. I think Schwab owns them now anyway.

 

[aja8888]

I use TD Ameritrade and have forever. I also have my largest holdings with Fidelity.
I have never had any problems or bad experiences with TD. I think Schwab owns them now anyway.

Yes, Schwab owns them and is in the process of combining the programs.

 

[Time2]

I know the market has been down the last 6 months and that's how long we've been with EJ so maybe I'm expecting too much but my son and brothers are still making 15-18% this year.

I have to say, the market has not been down the last 6 months. VTSAX (VTI)
is up 8.8%, and I didn't include two quarterly dividends.


What would you do if you were me? Thanks![/QUOTE]


As everyone else has said, call Vanguard or Fidelity and have them transfer your money over to them.

You may need to ask some questions about how to minimize any tax hit on the already taxed money.
Hmm, Did you take a tax hit when the sold what you had and bought the 12 funds in your taxable funds?

 

[Bruno]

Are you paying a load fee on those MF? ER?

I believe what FIRE was asking if you paid Edward Jones load fees? When EJ sells you funds you pay about 4 to 5 % front load fee. That is why you may not have made much you are trying to get back that front load fee. I also learned the hard way. Like me we should had check out this site before we bought and funds or stocks.

 

[TheWizard]

Market down last 6 months?
The S&P 500 is up 11% since you started with FastEddie.

Correct. I was gonna say that...

 

[Livin Large in MT]

Hi mhk7
I am a former investment adviser. I never worked for Jones but for a small firm that prided itself on working closely with clients to ensure they got the services they expect and deserve.
Jones is a one trick pony: they teach their advisers as much as they need to know by generally having them only use American funds. AF are good funds and they have some of the cheapest fees in the business.
However if you buy them in a retail store like Jones, you will pay up to 5.75% sales charge on top of their internal fees. Not cool but how the retail trade makes its money.
I still own a bunch of American funds because I got them through my institutional company retirement plan so no sales charge. You really can't beat Growth Fund of America and Capital Income Builder.
However, the advice you are getting here is spot on. Go back to VG and keep your pepsico money in your state plan. Those plans use institutional funds which have the lowest internal fees in the industry.
Jones teaches their advisers to pressure clients into cashing out their retirement plans and transferring to them as an IRA. That costs clients big money just at the time of their life when they need to be careful.
Hang in there. Everything done in the financial world can be undone. VG will help you.

 

[Bamaman]

My cousin's son is an Edward Jones associate. He had a beautiful home, but sold it and moved into a really large house. He goes to all the local university athletic competitions, and EJ wants him to be a "public person." Needless to say he's in the Jaycees and every lunch club in town.

He's forever flying to Vail and other fancy places on trips/meetings that he's won at EJ.

I'd say Ole Joe has done pretty well sipping the Edward Jones Kool-Aid. But I certainly have nothing with him or EJ.

 

[MrsHaloFIRE]

Fast eddie strikes again. Market has been doing well. You missed it. Got out of eddie now

 

[athena53]

Jones teaches their advisers to pressure clients into cashing out their retirement plans and transferring to them as an IRA. That costs clients big money just at the time of their life when they need to be careful.

I hope you're referring to tax-free rollovers and not just liquidating 401(k)s, paying the taxes and then putting them in EJ.

 

[djsander]

I had an EJ moment when we were headed to a B&M bank. I had changed an account registration at Fidelity and three days later it changed back. I messaged them and several days later they said it takes 5-7 business days and it shows in progress. When I saw the EJ office I thought it would be nice just to walk in and talk to a live person. At the B&M bank while DW was working with the banker I looked up EJs website then remembered the 1.35% AUM plus the high fee funds. I quickly decided I can deal with Fidelity without seeing a person to save that money.

 

[RobbieB]

Not to mention there are plenty of Fidelity offices too. Just have to drive a bit.

In the small city where I live (under 100,000) there are two EJ offices.

 

[djsander]

Not to mention there are plenty of Fidelity offices too. Just have to drive a bit.

In the small city where I live (under 100,000) there are two EJ offices.

Thanks,
I found one fidelity office local probably a 15 minute drive. I’ll probably touch base with them after the first of the year as there are a couple of non urgent issues that I would like to discuss with an actual person.

 

[OldShooter]

... In the small city where I live (under 100,000) there are two EJ offices.

Naïve investors in your city are lucky. In a town of 11,000 near our lake home there are seven EJ offices fleecing people.

 

[aja8888]

Naïve investors in your city are lucky. In a town of 11,000 near our lake home there are seven EJ offices fleecing people.

I just checked the EJ locations and there are three of their offices within a 2 mile radius of our house! But there are several 55+ communities around here for them to feed on.

 

[djsander]

I just checked the EJ locations and there are three of their offices within a 2 mile radius of our house! But there are several 55+ communities around here for them to feed on.

I put in our zip and there are only 3 EJ within 5 miles. Put in our old address in Louisiana and there were 15 within 5 miles. I remembered they seemed to be on every corner in Louisiana, I knew multiple people that used them and when our company merged with another company the EJ coffee cups and business cards showered the kitchen in our office.

 

[aja8888]

I put in our zip and there are only 3 EJ within 5 miles. Put in our old address in Louisiana and there were 15 within 5 miles. I remembered they seemed to be on every corner in Louisiana, I knew multiple people that used them and when our company merged with another company the EJ coffee cups and business cards showered the kitchen in our office.

Lots of poisonous snakes in Louisiana and you can add these guys that that list.

 

[MRG]

I just checked the EJ locations and there are three of their offices within a 2 mile radius of our house! But there are several 55+ communities around here for them to feed on.[emoji23]

They're everywhere!

They have been a staple across small town America for decades. These "advisors" make a good living else they're replaced.

We had a couple guys that needed maps to find their home in the cube farm(probably used the GPS to find home too) that were among Megacorp's first RIFFs. Both are doing well as Jones reps. Sadly they recruited folks who weren't very financially savvy and preyed on their former peers.