Say Bye Bye To Wells Fargo Advisors?

[LukeDell]

Hi All - my wife and I (both early 30s) moved her Roth (holdings snapshot) my Roth (holdings snapshot), and a brokerage account (holdings snapshot) to Wells Fargo Advisors a little over 2 years ago.

We like our advisor, but in the interest of consolidating accounts and reducing costs we are thinking of moving the accounts to Vanguard where we have another brokerage account and our new son's 529.

We're big fans of the passive buy & hold strategy for retirement and definitely want to reduce our long-term costs as much as possible (our total costs last year through WF were approx 0.66%).

Given the holdings, costs, and performance do you agree with our idea to make the jump? If so, what would your fund recommendations be? Here is our current holdings breakdown at Vanguard.

I don't really have anyone else I can ask their opinion on about this so thanks in advance for your advice!

[chinto]

Given what Wells has done in banking, I would never knowingly do business with any of their entities - period. That is one of the issues with building a brand you can leverage the positive god will you have built but you can also perish by association.

[Ethelred]

I think you should obviously leave Wells Fargo, given the information you've provided. However, you haven't said why you chose to use them two years ago. If the reason you made that choice still exists, then you should probably stay. I'm guessing you're now older and wiser, but you haven't explained.

[rob]

Do you "like" them enough to give up a stack of cash over the years (do the maths with and without in dollars so you can make a rational decision)? Exactly what value do they add to you - some of this can be subjective holding hands stuff? If that subjective value is higher than the long-term costs then your right to stick with them.... otherwise it's very expensive for someone you "like" vs. family or your own use of the cash.

[livesoft]

I'm a big fan of Wells Fargo do-it-yourself WellsTrade brokerage which is free for me, but I would never recommend using one of their advisors sales reps to have anything to do with my money.

[alfaspider]

I'm a big fan of Wells Fargo do-it-yourself WellsTrade brokerage which is free for me, but I would never recommend using one of their advisors sales reps to have anything to do with my money.

Yes, I hold Vanguard funds in my WellsTrade brokerage accounts. Nobody has tried to sell me anything and my ER is exactly the same as if I used Vanguard's platform.

[Avo]

We're big fans of the passive buy & hold strategy for retirement and definitely want to reduce our long-term costs as much as possible.

Well then of course people here are going to recommend that you switch to Vanguard. There is no reason to believe that a WF sales rep is going to do better, after fees, than a low-cost passive portfolio. At a glance, your WF portfolios do not seem diversified, and so are much higher risk than they need to be.

Re your stock holdings, consider using total-market funds only unless you have a well-understood reason for doing otherwise.

[LukeDell]

Thanks to everyone for their advice so far - it is very much aprpeciated. The main reason we transferred to WF a couple of years ago was I knew the advisor personally and they handled my office's 401K plan so it was a "safe place" at the time - while I knew how to make and save money, I was pretty lost on how to best invest it for the long term.

Growing older, wiser, and just more informed on how to best build retirement slowly we're ready to make the switch - but I've never had to deal with a situation like this so the fear of messing it up in some way is fairly strong. Though my logical side realizes I'd do more damage in the long-term keeping the $ at WF.

My current thought process is to liquidate the current holdings at WF, move the cash to Vanguard, and buy their funds - but that brings even more questions. Will there be a tax liability? What fund(s) do I put the $ for each account into? And so on.

I'm also thinking about utilizing Vanguard's advisor service temporarily in order to ease my mind during the transition and then just re-balancing it myself every few years. Does anyone have experience with this service? Would you recommend this plan?

Thanks again!

[Nate79]

Do you actually understand your portfolio at WF? It looks like a combination of random stocks, some UIT's of who knows what, along with at least one high expense fund. Unless you understand this portfolio and it matches your risk/reward needs then I would not trust this salesman whether he was your friend or not. Looks like a jumbled up mess to me.

[Random Poster]

My current thought process is to liquidate the current holdings at WF, move the cash to Vanguard, and buy their funds - but that brings even more questions. Will there be a tax liability? What fund(s) do I put the $ for each account into? And so on.

If you transfer the holdings in-kind to Vanguard or elsewhere, there should not be a tax liability for doing so.

Note, though, that you will likely get charged (by Wells Fargo Advisors) a $125 (or $150, I forget the exact number) transfer-out fee when you leave WFA.

[jasonrecite25]

I wouldn't worry about where your money is at the moment. I would worry about educating yourself on the basics of how to invest the money you do have. Your first post sounded like you knew what to do with the money when you moved it out of WF, but your more recent post about "what funds" struck me as needing to get a grounding in the basics. Tax question completely fair too.

I would do this:

Step 1: Keep your $ at WF.
Step 2: Read Bogleheads Guide to Investing, once or twice, skip over the basic stuff you already know, this should take you a few weeks
Step 3: Put together a plan for this $, i.e., asset allocation, goals, specific funds, stocks, etc., this should take another couple of days or weeks
Step 4: Move the $ to Vanguard, it will initially all get dumped into a money market account and just sit there, you can then take your time deciding what to put the money into.

[Will do good]

I'm a big fan of Wells Fargo do-it-yourself WellsTrade brokerage which is free for me, but I would never recommend using one of their advisors sales reps to have anything to do with my money.

Yes, I hold Vanguard funds in my WellsTrade brokerage accounts. Nobody has tried to sell me anything and my ER is exactly the same as if I used Vanguard's platform.

If their ER is exactly the same as Vanguard, why would you trust them with your money? why wouldn't you go to the source?
Wells Fargo is clearly a dishonest company, their interest is clearly not their customers.

[Tyler Aspect]

These positions look like a mess. The Pandora position had a loss of 38%; ouch.

[is1971]

I'm a big fan of Wells Fargo do-it-yourself WellsTrade brokerage which is free for me, but I would never recommend using one of their advisors sales reps to have anything to do with my money.

Yes, I hold Vanguard funds in my WellsTrade brokerage accounts. Nobody has tried to sell me anything and my ER is exactly the same as if I used Vanguard's platform.

If their ER is exactly the same as Vanguard, why would you trust them with your money? why wouldn't you go to the source?
Wells Fargo is clearly a dishonest company, their interest is clearly not their customers.

I can't speak for alfaspider, but I keep my funds in a Wells Trade brokerage account because they give me 50 commission free trades a year. I have had the account for ten years and have never paid a single penny of commission.

[Avo]

My current thought process is to liquidate the current holdings at WF, move the cash to Vanguard, and buy their funds - but that brings even more questions. Will there be a tax liability? What fund(s) do I put the $ for each account into? And so on.

There may be a tax liability in the brokerage account, but not in the Roths.

It may be cheaper to transfer everything "in kind" to Vanguard, and sell there, rather than sell at WF. If you're not paying an "assets under management" fee at WF, their sales charges may be quite high.

For the Roths, I would put everything into the appropriate Target Date Retirement Fund at Vanguard. Then you can read up more & decide if you want to change.

The taxable account requires more thought, and depends on your investment time horizon & tax bracket.

[nedsaid]

Listen up. If you want to save money on an advisory service, just do this. Look at the Target Date Retirement funds for Vanguard, Fidelity, and T. Rowe Price for the date that most closely matches your projected retirement date. Use the asset allocations as a guide for your own age appropriate asset allocation.

Let's go through this exercise together. For illustration we will use the 2025 funds and my actual asset allocation.

Nedsaid:
48% US Stocks
19% International Stocks
31% US Bonds and Cash
2% International Bonds

Vanguard 2025:
39% US Stocks
26% International Stocks
25% US Bonds
10% International Bonds

Fidelity 2025:
39% US Stocks
26% International Stocks
30% US Bonds and Cash
5% International Bonds

T. Rowe Price 2025:
44% US Stocks
22% International Stocks
26% US Bonds and Cash
8% International Bonds

So you can see that I am in the ballpark with 67% stocks. Vanguard and Fidelity have 65% and T. Rowe Price has 66%. You can see that Vanguard believes more in International Bonds than does Fidelity or T. Rowe Price.

This is an illustration how you can use Target Date Funds to guide you towards your age appropriate asset allocation. You get the opinions of the experts from three fund companies.

[LukeDell]

Listen up. If you want to save money on an advisory service, just do this. Look at the Target Date Retirement funds for Vanguard, Fidelity, and T. Rowe Price for the date that most closely matches your projected retirement date. Use the asset allocations as a guide for your own age appropriate asset allocation.

Thank you for this! This is in line with what I was thinking - I put some money into Wealthfront a few months ago (not enough to be charged a management fee) with this "mimic" thought process in mind. I was just a little lost as to how to best go about it. I promise I'm not as inept as my post and response may have implied - I've simply not had to handle this on my own in the past and am trying to get my arms around it now through reading, listening, and the advice/recommendations of people who may have encountered similar situations. I realized I've made some mistakes, but I'm trying to a) correct those mistakes and b) make sure I'm not making the situation worse with another move.

All in all I'm pretty proud of where we're at in regards to our retirement saving (we also fully fund our respective 401K accounts), but with a newborn son I want to make sure we're maximizing every opportunity we can to provide the best possible life for him - especially while we're still relatively young.

Keep the advice coming - I truly appreciate it!

[nedsaid]

Another alternative is just to buy the Target Date Retirement Fund and let the fund manager do all the work for you.

[tibbitts]

Am I wrong or is .66% in management fees at WFA amazingly low given the account balances in question?

[z3r0c00l]

On the plus side, you may wind up with some kind of auto insurance or a few extra bank accounts.

[jbolden1517]

If their ER is exactly the same as Vanguard, why would you trust them with your money? why wouldn't you go to the source?
Wells Fargo is clearly a dishonest company, their interest is clearly not their customers.

Just to throw in $.02. I'm leaving Wells for most of my banking because of the premium rewards program. But I've been a Wells customer since 1996 for checking, for credit cards and for my original mortgage. They haven't once been dishonest to me. They were far better than Chase was on the mortgage. They have generally provided better than expected service (especially on the checking where they have been outstanding). I can't think of a single mistake that is their fault in all that time. Their investment arm is a bit weak on services, and I wouldn't recommend them. After 2008 their loans got annoying complex, as did most banks. But that's much different than calling them thieves.

They have been a little rough on my daughter terms wise when she was a juvenile but I can see why they might want checking / savings accounts with no transactions and a $400-2000 balance. And I should say the fee structures were fully disclosed, explained and highlighted. Not only that they made suggestions to help her avoid the fees.

I get that Wells has a bad reputation because of "opening too many accounts" (I was never quite clear how this scam was supposed to work). I get that they may have crossed the line, since they have admitted as much. I wouldn't recommend them their brokerage. But this sort of blanket condemnation simply isn't true.

[jbolden1517]

These positions look like a mess. The Pandora position had a loss of 38%; ouch.

They are quite weird position. The good thing though is the only asset with much in capital gains is the OKE and that's tax protected. So they can just treat the whole thing like cash.

[alfaspider]

I'm a big fan of Wells Fargo do-it-yourself WellsTrade brokerage which is free for me, but I would never recommend using one of their advisors sales reps to have anything to do with my money.

Yes, I hold Vanguard funds in my WellsTrade brokerage accounts. Nobody has tried to sell me anything and my ER is exactly the same as if I used Vanguard's platform.

If their ER is exactly the same as Vanguard, why would you trust them with your money? why wouldn't you go to the source?
Wells Fargo is clearly a dishonest company, their interest is clearly not their customers.

I use them for regular banking because they have a branch within easy walking distance of my house. Putting money in the brokerage account allows me to use their upgraded "portfolio" services without having to keep too much cash with them. It's also part of avoiding a multiplicity of platforms. My company's 401k is with Fidelity, I have a Utah 529, an online savings account, and I already had the WF checking account. I didn't want to add a FIFTH banking/investing platform to have to log into.

True, they had issues with the fake accounts, but to some extent the fact that it's happened and they've been caught means the chances of me being affected is quite low. I've also never had any issues with them giving me a hard sell.

[pkcrafter]

Am I wrong or is .66% in management fees at WFA amazingly low given the account balances in question?

Yes, it sounds low, and I suspect that isn't the total in fees charged.

Paul

[sschoe2]

I have my 401k at WF in Target 2045. The fees are reasonable about $80 a year in admin. I rather have it in Vanguard as then I could get Admiral Funds rather than the Target Retirement Funds. The company I work for hasn't had any issues with the brokerage arm of their company. All the problems have been with the retail banking arm.

Although 0.66% AUM isn't as bad as say Edward Jones which charges 1.35% I don't think you need an advisor, if you did Vanguard PAS is 0.30%, and that portfolio is sub-optimal. I'd go with some variation of the three fund portfolio.

[wolf359]

I think this is being understated a bit. You're okay with your bank:

- Conducting identity theft and opening credit cards and bank accounts in your name without your authorization?
- Collecting additional fees and charges relating to these unauthorized accounts?
- Hiding notification and statements from the customers so the customers will be unaware that the accounts have been opened?
- Systematically evading auditors and coaching their staff as to how to avoid internal auditors who were looking for these illegal actions?
- Charging borrowers for auto insurance they did not purchase, ask for, or need, then sending them late fees or into delinquency if they didn't pay?

This isn't one event. These are multiple scandals spread over years. They speak to a corporate culture that is set up to defraud their customers. And they weren't "caught." A whistleblower revealed them (and then they illegally fired that person. Another lawsuit resulted.) That last one about the insurance came out 3 days ago, so this isn't over and done with.

Federal regulators are in fact dropping the ball. These acts are illegal, but instead of criminally prosecuting the individuals responsible, they're fining the company, making the shareholders liable instead. And yes, if you own Total Stock Market, that's you.

[sschoe2]

It will probably blow over for Wells Fargo after it fades from the news cycles. Just like United who had a paying customer beaten and dragged from its plane to make room for an employee, killed a cute fluffy bunny rabbit, and of course breaks guitars. These moral outrages have short shelf-lives.

As long as they have a competitive product, corporations can get away with murder and consumers will overlook it except for a small group of dedicated consumers who probably already hate all the big banks anyways.

[vbn]

Your account holding snapshots look a lot like my Wells Fargo Advisors accounts. There were some mutual funds, individual stocks and UITs. Like people commented here, they were not well diversified or cohesive at all.

I'm moving away from Wells Fargo Advisors to Vanguard (Roth IRA, traditional IRA, and taxable account) because I didn't think my advisor work for my best interests. Also, like you I didn't have anyone else to discuss how to break away and then found this forum. My advisor did get very ugly when I informed her my decision. So I guess be prepared when you call your advisor. Good luck!

[Will do good]

If their ER is exactly the same as Vanguard, why would you trust them with your money? why wouldn't you go to the source?
Wells Fargo is clearly a dishonest company, their interest is clearly not their customers.

Just to throw in $.02. I'm leaving Wells for most of my banking because of the premium rewards program. But I've been a Wells customer since 1996 for checking, for credit cards and for my original mortgage. They haven't once been dishonest to me. They were far better than Chase was on the mortgage. They have generally provided better than expected service (especially on the checking where they have been outstanding). I can't think of a single mistake that is their fault in all that time. Their investment arm is a bit weak on services, and I wouldn't recommend them. After 2008 their loans got annoying complex, as did most banks. But that's much different than calling them thieves.

They have been a little rough on my daughter terms wise when she was a juvenile but I can see why they might want checking / savings accounts with no transactions and a $400-2000 balance. And I should say the fee structures were fully disclosed, explained and highlighted. Not only that they made suggestions to help her avoid the fees.

I get that Wells has a bad reputation because of "opening too many accounts" (I was never quite clear how this scam was supposed to work). I get that they may have crossed the line, since they have admitted as much. I wouldn't recommend them their brokerage. But this sort of blanket condemnation simply isn't true.

I guess it wasn't a blanket statement. They got caught again few days ago: More than 800,000 of Wells Fargo's auto loan customers were charged for car insurance they did not need.

once top management of a corporation is willing to cheat in one area what's holding them back to cheat in another area? Nothing it seems. WF has the same board of directors as the first scandal, coincidence?

Cheat me once shame on you, cheat me twice shame on me. YMMV.

[Will do good]

I'm a big fan of Wells Fargo do-it-yourself WellsTrade brokerage which is free for me, but I would never recommend using one of their advisors sales reps to have anything to do with my money.

Yes, I hold Vanguard funds in my WellsTrade brokerage accounts. Nobody has tried to sell me anything and my ER is exactly the same as if I used Vanguard's platform.

If their ER is exactly the same as Vanguard, why would you trust them with your money? why wouldn't you go to the source?
Wells Fargo is clearly a dishonest company, their interest is clearly not their customers.

I use them for regular banking because they have a branch within easy walking distance of my house. Putting money in the brokerage account allows me to use their upgraded "portfolio" services without having to keep too much cash with them. It's also part of avoiding a multiplicity of platforms. My company's 401k is with Fidelity, I have a Utah 529, an online savings account, and I already had the WF checking account. I didn't want to add a FIFTH banking/investing platform to have to log into.

True, they had issues with the fake accounts, but to some extent the fact that it's happened and they've been caught means the chances of me being affected is quite low. I've also never had any issues with them giving me a hard sell.

The chances of being cheated by WF again just got better, More than 800,000 of Wells Fargo's auto loan customers were charged for car insurance they did not need. https://www.msn.com/en-ca/money/markets ... ar-AApeFJV

[Earl Lemongrab]

There are other options besides Vanguard. If you're comfortable with ETFs, then TD Ameritrade or Merrill Edge can be good options. They will give you cash bonuses and often cover transfer fees, as well as free transactions.

See viewtopic.php?f=10&t=196884 for more information on transfer bonuses.