Just need to vent

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Topic Author
Lilly
Posts: 233
Joined: Wed Feb 21, 2007 6:14 am

Just need to vent

Post by Lilly »

My parents are 95 and 96 years old. They have been investing with Edward Jones since 1983, when they sold the family farm. My older sister, who is a CPA, has been helping them with their investments since then. I pulled out of Edward Jones about 8 years ago, after I discovered the Bogleheads.

My parents moved into a semi assisted living facility a couple of weeks ago. The same time my older sister headed to FL for the winter. My mother has to take over the finances for my dad and herself. I thought it would be wise to get the money that Jones transfers to their money market, transferred to their bank checking account. I also thought that most of their bills could be put on automatic at the bank. My sister thought this was a good idea also.

My mother set up an apt. to meet with their ( advisor ) at Jones. What I thought would take 10 min to fill out a form and leave a voided check, ended up taking 1 1/2 hours. I think because he knew I pulled out of Jones 8 years ago, he wanted to show me what he did for my parents. He had everything printed up for me to look at and take a copy home. He kept pointing out to me how much they have made since 2009.

He showed me that he has both of my parents in identical funds and annuities. They have 1.8 million. about 500k is in 23 different funds. 250k for mom and 250k for dad. The rest is in annuities and money market. My mother told me later that he split the investments down the middle some years ago. I know I can't do anything about this. It is too late in their lives and I will not mention to them what I think about their good friend at EJ. I just needed to blow off steam to people who understand my anger.

The following is the funds he has each of them in.

ANVIX ALLIANZGI NFJ LARGE CAP VALUE
BBTBX BRIDGE BUILDER BOND FUND
DODGX DODGE AND COX STOCK FUND
MDISX FANKLIN MUTUAL GLOBAL DISCOVERY FUND CL Z
AFIFX FUNDAMENTAL INVESTORS FUND CL F1
HAINX HARBOR INTERNATIONAL FUND CL
JFMXX JPMORGAN FEDERALMONEY MARKET
JMVSX JPMORGAN HIGH YIELD FUN
JMVSX JPMORGAN MID CAP VALUE FUND SELECT
SBPYX LEGG MASON CLEARBRIDGE SMALL CAP GROWTH FUND CL1
LSGBX LOOMIS SAYLES GLOBAL BOND FUND
LSIIX LOOMIS SAYLES INVESTMENT GRADE BOND FUND CL Y
EXWAX MANNING & NAPIER WORLD OPPORTUNITIES SERIES CL A
MWTIX NETROPOITAN WEST FUNDS TOTAL RETURN BOND FUND CL 1
MWNIX MFS INTERNATIONAL NEW DISCOVERY FUND CL 1
MEIIX MFS VALUE FUND CL 1
MIGYX OPPENHEIMER MAIN STREET FUND CL Y
PTUIX PIMCO FUNDS TOTAL RETURN FUND IV INST CL
PEGZX PRUDENTIAL JENNISON MID CAP GROWTH FUND CL Z
SCETX RIDGEWORTH SMALL CAP VALUE EQUITY FUND CL 1
TRBCX T ROWE PRIE BLUE CHIP CROWTH FUND CL 1
RPIBX T ROWE PRICE INTERNATIONAL BOND FUND
PRITX T ROWE PRICE INERNATIONAL STOCK FUND

He told me that he has all these funds on bands, so when they go up or down a certain % they will automatically adjust with each other. I can't remember what percent he said. By that time I was doing all I could not to blow up in front of my mother's good friend.

I don't know what annuities he has the rest of their money in. He didn't show me that. He even brought in a sheet on bill paying plan with them as soon as my mother mentioned what the plan was. I convinced her it would be easier through the bank. My sister has power of attorney. There is nothing I can do. Just needed to show others what this type of adviser will do after many years of leaving your retirement $ with them.

Best wishes,

Lilly
Call_Me_Op
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Re: Just need to vent

Post by Call_Me_Op »

I think many advisors put their clients into a large number of funds so that the clients believe they are really diversified and really getting something for their money. Fortunately, I have been able to help my folks and have them in a simple 4-fund portfolio.

The worst part of the "finaincial advisor" business is that the fee often doesn't include things like tax advice and estate planning - stuff that's actually complicated. For that, you need to go elsewhere and pay extra.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein
mhalley
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Re: Just need to vent

Post by mhalley »

So did he give you a comparison to what a 3 or four fund portfolio would have made? I suppose you will never be able convine your parents to become bogleheads, but at least they have enough money for their needs, and they didn't go with madoff.
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msj16
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Re: Just need to vent

Post by msj16 »

I have been in that situation too. I feel your pain. I sat down with my mother, father and their advisor, while their advisor said that it was fine for my 75 year old mother and 80 year old father to be invested 100% in stocks because of the "problem" with bonds. She then recommended putting a sizeable chunk of money into an actively managed growth fund, which as I pointed out to her had lost lots of money during the time when the market as a whole had huge gains. She pointed out that they had recently gotten a new manager. My father's money is still at the same firm, but I finally convinced my mother to transfer it out.
Woodshark
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Re: Just need to vent

Post by Woodshark »

Your parents are in their 90's and have over one million in investments. If they are happy with their adviser and he/she is not investing in something wildly outside the lines then I would let it be. Sure, they are probably paying a little more than a Boglehead would for management but if it's not too extreme, I would let it go. They were smart enough to amass this level of assets. Since they are happy and the $ does not have to last another 30 years, I would cut them some slack and not create friction about paying an extra percent or so for AUM this late in life.
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celia
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Re: Just need to vent

Post by celia »

Several Bogleheads have posted similar stories and feelings here. We usually remind them that they are lucky that their parents have enough assets to cover them for the rest of their life. You are also fortunate that they (singular or plural) are cognitive and knowledgeable enough to seek financial help, although it is not what you would have chosen.

If it makes you feel any better, instead of comparing them to a Boglehead's family, compare them to the average retiree household in America. Many people have no income other than Social Security. Apparently your parents have made prudent and conservative choices throughout their life, which you could acknowledge. Many Bogleheads would love to be in your position (ie, have parents with sufficient assets, no debt, and ability to leave an estate for their children).
A dollar in Roth is worth more than a dollar in a taxable account. A dollar in taxable is worth more than a dollar in a tax-deferred account.
larryinnewyork
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Re: Just need to vent

Post by larryinnewyork »

This is depressing.
But I want to hear more about the Farm.
After High school I worked on one (Dairy) for a short time. I wasn't cut out for it.
But it is a fascinating way of life.

Edit: You were serious when you said Farm, weren't you ?
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BigFoot48
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Re: Just need to vent

Post by BigFoot48 »

So he didn't want to show the details of the up to $1.3 million in annuities he has put them into? How not surprising. As for the obscenity of twenty-three funds, no doubt Edward Jones promotes that strategy to its employees which is a good reason to avoid this firm like the plague.
Retired | Two-time in top-10 in Bogleheads S&P500 contest; 18-time loser
Topic Author
Lilly
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Joined: Wed Feb 21, 2007 6:14 am

Re: Just need to vent

Post by Lilly »

op here. I didn't plan on saying anything to my parents. I just needed to express my frustration I guess.

Larryinnewyork. I really wasn't kidding about selling the farm. I am not kidding when I say I am married to a working farmer myself. He is out combining soybeans as I write this.

I am so happy I found my way to vanguard diehards somehow years ago. I am still learning on this forum as newbies ask questions. Thanks for all the help.

peace
Lilly
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arcticpineapplecorp.
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Re: Just need to vent

Post by arcticpineapplecorp. »

Ask him if he's a fiduciary. You already know the answer is no. If he is not a fiduciary then he does not have your parents' best interests in mind.
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions | Wiki
z3r0c00l
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Re: Just need to vent

Post by z3r0c00l »

Tons of redundancy and high ERs, but on the plus side they still probably made decent money on these investments. Not as much as they could have, and that is maddening, but they made something. Not quite as bad as going with a fraud like Madoff and losing money. The annuities are probably worse, IMHO. That is the real place to scam the elderly.
70% Global Stocks / 30% Bonds
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Meg77
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Re: Just need to vent

Post by Meg77 »

That is frustrating, particularly with regard to the annuities. I just wanted to point out that my dad worked for Edward Jones briefly and my mom still invests with them (they are divorced), and this investment scheme seems way out of the ordinary for them. They promote investing in individual stocks primarily, or at least they used to. I used to read all their newsletters when they came to the house, but I haven't in several years. My dad has never sold an annuity in his life and never mentioned being encouraged to with that firm. I just wanted to say this to point out that not all advisors, even within the same firm, are created equal.
"An investment in knowledge pays the best interest." - Benjamin Franklin
larryinnewyork
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Re: Just need to vent

Post by larryinnewyork »

I really wasn't kidding about selling the farm. I am not kidding when I say I am married to a working farmer myself. He is out combining soybeans as I write this.

Soybeans ...... Soybeans !
That's not farming, that's gardening.

I kid, I kid.

The farm life is a unique way to live.
Enjoy it and good luck.
letsgobobby
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Re: Just need to vent

Post by letsgobobby »

Are any of those funds loaded? I worry when you say there are automatic bands for rebalancing.
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ruralavalon
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Re: Just need to vent

Post by ruralavalon »

23 funds, with no index funds. Includes about 3 - 4 funds I would be OK using if I couldn't use index funds for some reason. Very sad, but not a surprise.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
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Zabar
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Re: Just need to vent

Post by Zabar »

I appreciate the frustration and understand the need to vent. But at this point, the best thing is to let it go. Your parents are in great financial shape. (None of us will ever optimize our finances, but as Bogleheads, we believe that we can come closer than the typical investor.) Nothing's to be gained by focusing on what might have been.

Having said that, I would be concerned about the EJ "advisor" having control of a discretionary account of people their age. You should look into setting it up so that any transactions above, say, $200 or totaling more than $500/month (numbers picked from thin air, admittedly) have to get the approval of your sister or you.
bdpb
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Re: Just need to vent

Post by bdpb »

Lilly wrote:My parents are 95 and 96 years old. They have been investing with Edward Jones since 1983, when they sold the family farm. My older sister, who is a CPA, has been helping them with their investments since then. I pulled out of Edward Jones about 8 years ago, after I discovered the Bogleheads.

My parents moved into a semi assisted living facility a couple of weeks ago. The same time my older sister headed to FL for the winter. My mother has to take over the finances for my dad and herself. I thought it would be wise to get the money that Jones transfers to their money market, transferred to their bank checking account. I also thought that most of their bills could be put on automatic at the bank. My sister thought this was a good idea also.
Looks like some of your frustration should be directed at your sister.
How could she let this go on for so long?

Is this her first time to FL? Why wasn't she better prepared for bill paying in her absence? Can't she use the internet?

A CPA. Really?
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