Change broker for sign up bonus

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CoderDude
Posts: 178
Joined: Mon Aug 04, 2008 8:19 pm

Change broker for sign up bonus

Post by CoderDude »

I've been with Wells Fargo brokerage for several years and am grandfathered in to the free trades. However, a recent post by TheFinanceBuff (http://thefinancebuff.com/merrill-edge- ... m-fee.html) has made me consider switching to Merrill Edge. My wife and I would each get $1000 for probably a few hours work. Plus they reportedly pay the transfer out fee from your old brokerage.

However, it just doesn't feel "right" to me. I will only be trading ETFs which are free, and I won't be using the checking account, so I don't see how I'm making them any money. It feels like I'm scamming them out of $1000.

I'm also not sure if it's worth my time. It's probably just a few hours work, but these things have a tendency to be more work than you initially think. For example, it will make my taxes a bit more difficult. And there's a small risk something would get messed up in the transfer and trigger huge capital gains.

On the other hand, I hate turning down free money.

What do you think? Do you swap brokerages often just to get the sign up bonuses?
Cash
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Joined: Wed Mar 10, 2010 9:52 am

Re: Change broker for sign up bonus

Post by Cash »

I did it once and earned around $3k between various brokerages. But it is a hassle to transfer in kind to the various accounts (cash is easy), keep track of the accounts, and close the accounts once the required holding period is over. I don't bother with it anymore, though several people on the board do it continually.
RunningRad
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Re: Change broker for sign up bonus

Post by RunningRad »

I have avoided these situations for the reasons that you have listed. Additionally, I moved assets between brokers several years ago (to Fidelity), and it literally took years for my cost basis information to get squared away. Going forward, for me, it's just not worth the hassle.
Few decisions in life motivated by greed ever have happy outcomes--Peter Bernstein, The 60/40 Solution
livesoft
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Re: Change broker for sign up bonus

Post by livesoft »

I have a thing against Bank of America, otherwise I would do this. Indeed, a few years ago when I was in the process of switching to the BoA brokerage, they made a huge mistake and prevented me from access to any of my money in any account for 3 weeks.

However, for better companies, I have done this a couple of times. For instance, I did a transfer of some shares (not all) to Fidelity to collect a bonus. You have exaggerated the amount of time involved. It took less than 10 minutes and the cost basis/date acquired info were transferred quickly and without issues.
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Re: Change broker for sign up bonus

Post by placeholder »

I have transferred several times for bonuses and I never found it to be much work so I figure that the payback of probably $1000 per hour of labor (and mostly sitting at the computer type of labor) to be well worth it and no I don't worry whether the custodian makes any money off the deal because that's their problem.
placeholder
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Re: Change broker for sign up bonus

Post by placeholder »

Specifically with Merrill Edge they have web based in kind transfer for most custodians that makes it even easier than the ones that require filling a form and faxing it although that's pretty easy too.
pkcrafter
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Re: Change broker for sign up bonus

Post by pkcrafter »

I wouldn't go to Merrill even if they paid me. :happy


Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
Topic Author
CoderDude
Posts: 178
Joined: Mon Aug 04, 2008 8:19 pm

Re: Change broker for sign up bonus

Post by CoderDude »

Paul: Why would you not go to Merrill?

Livesoft: The initial signup may be only 10 minutes, but there are lots of other hassles (e.g. I need to add the accounts to Quicken, I need to enter another form when doing my taxes). Also, you gave an example of how it can turn into a huge mess if things go wrong.

Another way I've been trying to justify this is to move just a portion of my assets rather than all. This gives me some diversification in the very unlikely case that one of my brokers steals my assets. I know there are supposed to be regulations that prevent this, but it would make me feel better if I didn't have all my assets with one broker.
pkcrafter
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Re: Change broker for sign up bonus

Post by pkcrafter »

Paul: Why would you not go to Merrill?
I would never become a member of an organization that would want me as a member. :D They have no standards! Besides, Merrill is a high cost firm. The offer is pure bait. Merrill wants to extract your money from you. And take a look at this Google page.

https://www.google.com/search?q=complai ... channel=sb

Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
livesoft
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Re: Change broker for sign up bonus

Post by livesoft »

CoderDude wrote:Livesoft: The initial signup may be only 10 minutes, but there are lots of other hassles (e.g. I need to add the accounts to Quicken, I need to enter another form when doing my taxes). Also, you gave an example of how it can turn into a huge mess if things go wrong.

Another way I've been trying to justify this is to move just a portion of my assets rather than all. This gives me some diversification in the very unlikely case that one of my brokers steals my assets. I know there are supposed to be regulations that prevent this, but it would make me feel better if I didn't have all my assets with one broker.
I didn't change anything in my portfolio tracking tools because I am not going to make any trades in my "new" account anyways. So my tools still assume that those shares are held where they used to be. Also, I already had an account at Fidelity, so I already had to enter tax info from that place. For 2013, I think I had 6 cents in interest there.

I would recommend that you do not shutdown your WellsTrade account when doing all this. I still prefer WT as my main broker. My other brokers remain in "set-and-forget" mode except for these bonus transfers.
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Re: Change broker for sign up bonus

Post by placeholder »

pkcrafter wrote:The offer is pure bait. Merrill wants to extract your money from you.
This is Merrill Edge the discount brokerage wing and they have made no attempt to upsell anything to me.
placeholder
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Re: Change broker for sign up bonus

Post by placeholder »

I guess people have been ignoring the stories of Vanguard locking people out of their accounts in fact making the accounts seem to disappear with no information given to the holders.
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