Trooper
Full time employment: Posting here.
Hi,
My DW and I are both recently retired and her mom passed away in January; as a result she inherited about $300K in investments managed by Edward Jones. The portfolio has a mix of Unit Investment Trusts (UITs) from First Trust, and actively managed mutual funds - mainly Class A ones from Invesco.
I had never heard of UITs so I did a little research and am a bit concerned. On the surface they seem like mutual funds, except 1) the underlying stocks and bonds never change and 2) they have a fixed life. I am not quite sure what happens at the end of their life, but I would bet that we would get hit with capital gains, and that they would be rolled over to perpetuate the sales charges.
Question #1: Am I correct in my brief understanding of UITs?
I have always known that EJ was a firm I wouldn't want to directly deal with, but after digging into the fee structures of the mutual funds opposite their performance I became pretty upset. I am a DIYer with all of our assets in either VG index funds or Fidelity index funds through my 401(k).
The 'financial advisor' has been a friend of my DW's family's for quite a while and my DW is reluctant to take my recommendation of transferring the funds from him/EJ to Vanguard. I want to be sensitive to my wife's wishes, but also don't want to see her pay 10X-20X what we are paying at Vanguard.
Question #2: I know this is a delicate situation, but how would you handle it? One potential recommendation is that she leave the money with EJ, and that we use that money first for our spending needs during retirement...prior to spending from VG.
Couple of notes:
- All of the money at EJ is taxable (non-qualified).
- This money was never in any of our retirement modeling, so it's "bonus money" in that respect.
Thanks!
My DW and I are both recently retired and her mom passed away in January; as a result she inherited about $300K in investments managed by Edward Jones. The portfolio has a mix of Unit Investment Trusts (UITs) from First Trust, and actively managed mutual funds - mainly Class A ones from Invesco.
I had never heard of UITs so I did a little research and am a bit concerned. On the surface they seem like mutual funds, except 1) the underlying stocks and bonds never change and 2) they have a fixed life. I am not quite sure what happens at the end of their life, but I would bet that we would get hit with capital gains, and that they would be rolled over to perpetuate the sales charges.
Question #1: Am I correct in my brief understanding of UITs?
I have always known that EJ was a firm I wouldn't want to directly deal with, but after digging into the fee structures of the mutual funds opposite their performance I became pretty upset. I am a DIYer with all of our assets in either VG index funds or Fidelity index funds through my 401(k).
The 'financial advisor' has been a friend of my DW's family's for quite a while and my DW is reluctant to take my recommendation of transferring the funds from him/EJ to Vanguard. I want to be sensitive to my wife's wishes, but also don't want to see her pay 10X-20X what we are paying at Vanguard.
Question #2: I know this is a delicate situation, but how would you handle it? One potential recommendation is that she leave the money with EJ, and that we use that money first for our spending needs during retirement...prior to spending from VG.
Couple of notes:
- All of the money at EJ is taxable (non-qualified).
- This money was never in any of our retirement modeling, so it's "bonus money" in that respect.
Thanks!