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Edward jones to vanguard?

Posted: Sat Apr 01, 2017 11:28 am
by randypape
Hello, we've been with EJ for about 4 years now and now they're changing their fee structure
Because of the Dept. of Labor ruling. The flat rate is going to around 1.5% plus any internal fund fees. My question is how hard is it to move everything and what kind of service can I expect with over 500k to invest? I haven't done bad with EJ and personally like our advisor, but I know I'm losing money on fees,etc. thanks for any advice and opinions.

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 11:42 am
by PFInterest
how hard to move? not at all. call the company you want to move to and have them do the work. vanguard or fidelity are fine
service? probably none. thats why you are being gouged by EJ. most here rec going alone or even finding a hourly fee adviser if necessary.
you may not have done bad, but depending on costs/loads/etc, most here are beating you by multiple % each and every year.

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 11:44 am
by CABob
I see that you have been a forum member for some time but have not posted a lot. Perhaps you would be surprised that this is a very common question that gets asked on the forum frequently. If you do a search for "edward jones" you get a lot of links to prior discussions.
https://www.google.com/search?sitesearc ... ward+jones
My suggestion would be to first decide to whom you want to move your account(s), then contact them to assist. You may find it is quite simple meaning they will do all of the busy work. It may depends on what type of accounts you have and what type of investments you have in the accounts. Some investments can be transferred "in-kind" to anther firm and others may have to be sold then transferred in cash.

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 12:00 pm
by radiowave
+1 on either Fidelity or Vanguard

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 12:18 pm
by 2b2
My guess is that you will find it easier than you anticipate - I certainly did. I only have experience with Vanguard, but am completely satisfied. They took care of everything except my signatures.

Getting out from under onerous fees is a very smart move.

2b2

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 3:08 pm
by Nate79
+1 for Vanguard. You would be sick if you actually knew how much money you have lost to EJ. Best to not even think about it and move on. Will be one of the best financial decisions you will ever make.

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 3:26 pm
by David Jay
Randy:

While many here on BH would be glad to help you with DYI (and recommend that you do it), Vanguard does have an advisor service if you feel that you require it. Cost is 0.3% per year. They will also let you drop the service at any time as your comfort level grows with handling your own investments.

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 5:25 pm
by harvestbook
Nate79 wrote:You would be sick if you actually knew how much money you have lost to EJ. Best to not even think about it and move on. Will be one of the best financial decisions you will ever make.
True dat. We moved over completely from EJ to Vanguard last year. I started the EJ when I became self-employed and literally didn't know any better. I take the blame because I didn't even know you can buy funds on your own--I thought you had to give your money to somebody in a suit. I, too, liked my adviser but now when I look back I know he was actively and knowingly doing me harm while benefiting himself.

Even after I began educating myself, I still was reluctant to make the full shift, so I started my Vanguard and let the EJ run at the same time. And eventually saw how much the EJ fees were eating into my growth--in 2015 my Vanguard made 1 percent and EJ lost 2 percent, and fees seemed to be the only difference. The final rollover to Vanguard was very simple and I only wish I'd done it years ago. I do feel a little foolish thinking about how much I "lost" but mostly happy that it wasn't too late. Like with any bad relationship, there's no reason to stay even one day longer than necessary.

Re: Edward jones to vanguard?

Posted: Sat Apr 01, 2017 5:38 pm
by NotWhoYouThink
If you move it away from E Jones, what would you want to do with it?

I suggest that before you move it, you figure out the answer to that question. Do you want to manage it yourself, or hire an advisor at the new company, or put it in an all-in-one fund?

What asset allocation do you want, and why?

If your accounts are mostly in IRAs, then there won't be any tax consequence to selling off all the funds E Jones has you in and investing in new funds. if they are in after-tax accounts, just regular brokerage accounts, you may have some taxes to pay when you do this, which might affect how quickly you'll want to make those changes.

I applaud your decision to move to lower cost investments, and strongly encourage you to do some planning before you act. It doesn't have to take very long, but it will require some thought.

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 4:14 am
by randypape
Thanks to everyone for the replies. Some great information and advice.

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 5:47 am
by aadwen
Don't get too scared about going it alone, but even if you do want some advisory services I think Vanguard only charges .3% and there is another firm by the guy who wrote All About Asset Allocation that I would consider looking at.

Personally I've changed my investments to the ultimate buy and hold portfolio. You can google that on here and there is a 4 vs 8 fund option. 4 simple fund buckets + bonds.

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 7:12 am
by Jack FFR1846
It's all about costs. Whatever the fees are for leaving EJ, it's going to be less than what you pay them yearly for absolutely nothing. Assuming no front end loads and 0.5% ER's, your $500k account costs you $10k in fees from EJ. I have accounts at Vanguard, Fidelity, Schwab and TDAmeritrade. My fees (assuming $500k....I actually have more) would be $225. Get out now!

If you move to Fidelity, Schwab or TDAmeritrade, you can collect a nice bonus for moving the account. All have good low cost index funds.

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 8:24 am
by deltaneutral83
Jack FFR1846 wrote:It's all about costs. Whatever the fees are for leaving EJ, it's going to be less than what you pay them yearly for absolutely nothing. Assuming no front end loads and 0.5% ER's, your $500k account costs you $10k in fees from EJ. I have accounts at Vanguard, Fidelity, Schwab and TDAmeritrade. My fees (assuming $500k....I actually have more) would be $225. Get out now!

If you move to Fidelity, Schwab or TDAmeritrade, you can collect a nice bonus for moving the account. All have good low cost index funds.

?? I come up with $2,500 on 50 basis point ER's with $500k invested. But the overall theme of 150 basis points per year is insanity

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 9:58 am
by nick evets
I find it odd that Edward Jones, Ameriprise, and the like, are considered the anti-Christ, but then people turn around and say, "Well, of course you can go with Vanguard, who offers a .3% management fee...."

Isn't it the AUM model that's broken; not that X company charges .5%, while Y company charges .3%....?

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 10:13 am
by JW-Retired
deltaneutral83 wrote: ?? I come up with $2,500 on 50 basis point ER's with $500k invested. But the overall theme of 150 basis points per year is insanity
It's $2500 for the ER's plus the (new) 1.5% AUM fee of $7500 that yields the OP's $10,000 EJ overall cost.

Probably this will end up with similar overall investor costs to before when it was done with loads and high ER's with 12b-1 fees.
JW

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 11:03 am
by deltaneutral83
JW-Retired wrote:
deltaneutral83 wrote: ?? I come up with $2,500 on 50 basis point ER's with $500k invested. But the overall theme of 150 basis points per year is insanity
It's $2500 for the ER's plus the (new) 1.5% AUM fee of $7500 that yields the OP's $10,000 EJ overall cost.

Probably this will end up with similar overall investor costs to before when it was done with loads and high ER's with 12b-1 fees.
JW
Thanks, I see now. Do EJ types go with the AUM (+ERs) or just charge for front loaded funds (+ERs). Seems over decades people would go with the up front load as 5.75% is steep off the top, but much better than 1-1.5% every year. Do EJ types give the client a choice?

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 12:03 pm
by StormShadow
nick evets wrote:I find it odd that Edward Jones, Ameriprise, and the like, are considered the anti-Christ, but then people turn around and say, "Well, of course you can go with Vanguard, who offers a .3% management fee...."

Isn't it the AUM model that's broken; not that X company charges .5%, while Y company charges .3%....?
What is so odd about recommending switching from AUM management fee of 1.5% to 0.3%? Not to mention 4.5-5% front end/back end load versus no-load funds. It's simple math.

The AUM model isn't broken at all. Some people want and need active management of their portfolio. Others do not. At least Vanguard gives you a cheap option for both.

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 12:16 pm
by JW-Retired
deltaneutral83 wrote: Thanks, I see now. Do EJ types go with the AUM (+ERs) or just charge for front loaded funds (+ERs). Seems over decades people would go with the up front load as 5.75% is steep off the top, but much better than 1-1.5% every year. Do EJ types give the client a choice?
I don't know if it's an option or not. My hazy understanding (just from reading here) is the new AUM approach is driven by new law forcing more of a fiduciary responsibility on them.

The front load isn't better if there is continuous churning of the funds. This is pretty easy to do with a typical 40 or 50 fund EJ portfolio.
JW

Re: Edward jones to vanguard?

Posted: Sun Apr 02, 2017 8:20 pm
by Earl Lemongrab
What size account are we talking? You might be able to get your fees covered and perhaps a cash bonus for transferring.

Re: Edward jones to vanguard?

Posted: Mon Apr 03, 2017 9:45 am
by sco
nick evets wrote:I find it odd that Edward Jones, Ameriprise, and the like, are considered the anti-Christ, but then people turn around and say, "Well, of course you can go with Vanguard, who offers a .3% management fee...."

Isn't it the AUM model that's broken; not that X company charges .5%, while Y company charges .3%....?

There is a huge difference in the size of you portfolio, based upon the 1.5 vs .3% difference...

https://vanguardblog.com/2011/10/28/sto ... f-returns/


Oh, and what we normally see here is that EJ clients aren't getting away with 1.5%, there is normally some churning, front loaded funds, AUM, and expensive ER funds. It isn't uncommon to see 2-3% total expense ratio per year there..