Getting on track; Edward Jones & Vanguard advice

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Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Fri Nov 02, 2018 5:52 pm

Hi all, I’m new here and am simply hoping to get some direction with what I should do with my investments. It’s a bit all over the place at the moment. I’ll do my best to explain.

I’m 35 and had been contributing to an employer provided Edward Jones Basic IRA/Roth for some years. I’ve had some trouble with employment the few years since; working at a place that didn’t even offer retirement benefits for nearly 2 years, to getting a job at a bank and lasting there for only a couple of months before they decided to outsource my job. I was there long enough to maybe make two contributions to a 401k, but it basically amounted to nothing. Fast forward to now, I have a job at another bank, things seem a little more stable now, and after 6 months I’m finally eligible to contribute to the company’s Vanguard 401k. The company automatically contributes 3% of my salary and will match up to an additional 3% for 6% total.

I know its a no-brainer to max out the company match and take full advantage of basically free money, but I don’t know what funds I should select. I also don’t know what to do with the investments from the previous job I had. I’ve looked at the Bogleheads three-fund portfolio and am curious but 1) I don’t know if it’s right for me and 2) They suggest certain Vanguard funds but I don’t see them as options for me to select.

Maybe it’s best if I just tell you as much about my investments as I know. Please let me know if you need more information. I’m embarrassed because I feel like I should know more about all of this than I do, but that’s why I’m here. I really want to learn and understand more.

Emergency funds: Not exactly sure what this is, but I know I have liquid assets to cover at least the recommended 3-6 months of expenses should I become unemployed.
Debt: Mortgage (~$138,000, 3.625% interest rate), nothing else
Tax Filing Status: Single
Tax Rate: 10.42% Federal, 4.93% State
State of Residence: Montana
Age: 35
Desired Asset allocation: I know diversification is important, but other than that I don’t know
Desired International allocation: Same answer as last one

Current investments:

Edwards Jones - from previous employer, not really being funded at this point because I don’t know if I should or not
Traditional IRA (78.65% of investments)
This seems to be made up of a mix of money market funds, mutual funds (AFMBX, FNPFX, FNWFX, BKMIX, MPHQX, LCEFX, JCPUX, JGVVX, LBNOX, VEVRX), and it says “Exchange - Traded & Closed End Funds” (FVD, XMLV, EFAV).

Roth IRA (21.35%)
Mutual funds (FNPFX, BKMIX, LCEFX, JCPUX, JGVVX, TRGXX, VEVRX)

Total value for everything is a bit below $40k.

Vanguard
Employer 401k - Just became eligible to contribute yesterday and need advice
Fund options on my employer plan are as follows:

Domestic Stock Funds
Vanguard 500 Index Fund Investor Shares (VFINX)
Vanguard Explorer Fund Investor Shares (VEXPX)
Vanguard Mid-Cap Index Fund Investor Shares (VIMSX)
Vanguard Morgan Growth Fund Investor Shares (VMRGX)
Vanguard Small-Cap Value Index Fund (VISVX)
Vanguard Strategic Equity Fund (VSEQX)
Vanguard Windsor II Fund Investor Shares (VWNFX)

Bond Funds
Vanguard Imtermediate Term Bond Index Fund Investor Shares (VBIIX)
Vanguard Short-Term Bond Index Fund Investor Shares (VBISX)

International Stock Funds
Vanguard International Growth Fund Investor Shares (VWIGX)
Vanguard International Value Fund (VTRIX)

Short-Term Reserves
Vanguard Prime Money Market Fund (VMMXX)

Balanced Funds (Stocks and Bonds)
Vanguard Target Retirement Income Fund (VTINX)
Then there are all of these target retirement funds, which seem to default me to the 2050 one (VFIFX)

My dad has been investing for a while and tries telling me I should lean more on the riskier side since I’m young enough to recover if anything does go down, and I also feel like I’m a little behind getting all this sorted out anyway so I tend to agree. Maybe someone else has different advice though.

Again, if there’s any additional information I can provide please let me know. I come hat in hand, realizing I’m asking people to take time out of their own busy schedules to help a random person they don’t know. It’s not lost on me. As I said, I feel bad not knowing more about investing, but have always been more right brained than left; I can hear a song once and play it on the piano, but when it comes to most things with numbers it’s a struggle for me. I sincerely appreciate any advice as I know this board is well regarded for having some very smart people on it. Thanks in advance.
Last edited by ViPeRx007 on Fri Nov 02, 2018 8:55 pm, edited 2 times in total.

User avatar
fortfun
Posts: 1365
Joined: Tue Apr 19, 2016 7:31 pm

Re: Getting on track; Edward Jones & Vanguard advice

Post by fortfun » Fri Nov 02, 2018 6:55 pm

Can you post the ERs/fees associated with these?

I'd move the EJ stuff to Vanguard. Call Vanguard and do this in a way that doesn't incur penalties/taxes/fees.

Really can't go wrong putting everything into a Vanguard Target Date fund that matches your desired retirement date.

If you are willing to re-balance, consider:
65% Vanguard 500
20% Vanguard Tot Int.
15% Vanguard Bonds
(Or something that matches your desired AA).

However, without the ERs, it's hard to know for sure. Hopefully, someone like Duckie will chime in soon.

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Fri Nov 02, 2018 7:21 pm

fortfun wrote:
Fri Nov 02, 2018 6:55 pm
Can you post the ERs/fees associated with these?

I'd move the EJ stuff to Vanguard. Call Vanguard and do this in a way that doesn't incur penalties/taxes/fees.

Really can't go wrong putting everything into a Vanguard Target Date fund that matches your desired retirement date.

If you are willing to re-balance, consider:
65% Vanguard 500
20% Vanguard Tot Int.
15% Vanguard Bonds
(Or something that matches your desired AA).

However, without the ERs, it's hard to know for sure. Hopefully, someone like Duckie will chime in soon.
Thanks for the reply. Hopefully this is what you are looking for regarding ER's:

https://imgur.com/a/AQiBEsB
Last edited by ViPeRx007 on Fri Nov 02, 2018 7:41 pm, edited 1 time in total.

ExitStageLeft
Posts: 1017
Joined: Sat Jan 20, 2018 4:02 pm

Re: Getting on track; Edward Jones & Vanguard advice

Post by ExitStageLeft » Fri Nov 02, 2018 7:27 pm

I would select a target date fund and be done with it in the 401k.

Your EJ account is probably costing you close to 1% a year in fund expenses. I would open a Vanguard IRA and roll it over, custodian to custodian in-kind transfer. Just did that for my wife's IRA. Was quick and painless and didn't cost a cent. She went from 0.87% expense ratio to 0.04% :moneybag :greedy

krow36
Posts: 2018
Joined: Fri Jan 30, 2015 6:05 pm
Location: WA

Re: Getting on track; Edward Jones & Vanguard advice

Post by krow36 » Fri Nov 02, 2018 7:40 pm

If I were you I would exchange all the funds in your traditional IRA at EJ for a money market fund. Then I would call up Vanguard and tell them you want to move the tIRA to them. It will move as cash with no tax consequences. After the cash arrives in your new VG tIRA account, you can buy one of Vanguard's target retirement funds that will match your desired asset allocation (stock/bond ratio). Folks here can help you decide on a reasonable allocation. Funds inside a tIRA can be changed if you decide later that you want to use the 3 fund portfolio.

averagedude
Posts: 391
Joined: Sun May 13, 2018 3:41 pm

Re: Getting on track; Edward Jones & Vanguard advice

Post by averagedude » Fri Nov 02, 2018 7:53 pm

Great advice from previous posters. If you want to be an above average investor and have maximum deversification, just pick the Vanguard target date fund. If you believe in your Dad's advice with a high risk tolerance and you have a conviction that being an owner instead of a loaner is wise i will suggest this.
Vanguard 500 20%
Vanguard midcap 20%
Vanguard smallcap 20%
International growth 20%
Internaional value 20%

Freefallin
Posts: 31
Joined: Thu Oct 04, 2018 1:12 pm

Re: Getting on track; Edward Jones & Vanguard advice

Post by Freefallin » Fri Nov 02, 2018 8:06 pm

ViPeRx007 wrote:
Fri Nov 02, 2018 5:52 pm
Hi all, I’m new here and am simply hoping to get some direction with what I should do with my investments. It’s a bit all over the place at the moment. I’ll do my best to explain.

I’m 35 and had been contributing to an employer provided Edward Jones Basic IRA/Roth for some years. I’ve had some trouble with employment the few years since; working at a place that didn’t even offer retirement benefits for nearly 2 years, to getting a job at a bank and lasting there for only a couple of months before they decided to outsource my job. I was there long enough to maybe make two contributions to a 401k, but it basically amounted to nothing. Fast forward to now, I have a job at another bank, things seem a little more stable now, and after 6 months I’m finally eligible to contribute to the company’s Vanguard 401k. The company automatically contributes 3% of my salary and will match up to an additional 3% for 6% total.

I know its a no-brained to max out the company match and take full advantage of basically free money, but I don’t know what funds I should select. I also don’t know what to do with the investments from the previous job I had. I’ve looked at the Bogleheads three-fund portfolio and am curious but 1) I don’t know if it’s right for me and 2) They suggest certain Vanguard funds but I don’t see them as options for me to select.

Maybe it’s best if I just tell you as much about my investments as I know. Please let me know if you need more information. I’m embarrassed because I feel like I should know more about all of this than I do, but that’s why I’m here. I really want to learn and understand more.

Emergency funds: Not exactly sure what this is, but I know I have liquid assets to cover at least the recommended 3-6 months of expenses should I become unemployed.
Debt: Mortgage (~$138,000, 3.625% interest rate), nothing else
congrats on no debt other than the house!
Tax Filing Status: Single
Tax Rate: 10.42% Federal, 4.93% State
State of Residence: Montana
Age: 35
Desired Asset allocation: I know diversification is important, but other than that I don’t know
Desired International allocation: Same answer as last one

Current investments:

Edwards Jones - from previous employer, not really being funded at this point because I don’t know if I should or not
Traditional IRA (78.65% of investments)
This seems to be made up of a mix of money market funds, mutual funds (AFMBX, FNPFX, FNWFX, BKMIX, MPHQX, LCEFX, JCPUX, JGVVX, LBNOX, VEVRX), and it says “Exchange - Traded & Closed End Funds” (FVD, XMLV, EFAV).
Roll the traditional IRA over to a traditional IRA at Vanguard. VFIFX 2050 target date fund.
Roth IRA (21.35%)
Mutual funds (FNPFX, BKMIX, LCEFX, JCPUX, JGVVX, TRGXX, VEVRX)
Roll this over to Vanguard VFIFX 2050 target date fund. After you meet your present employer's match, max out the Roth IRA here if possible.
Total value for everything is a bit below $40k.

Vanguard
Employer 401k - Just became eligible to contribute yesterday and need advice
Fund options on my employer plan are as follows:

Domestic Stock Funds
Vanguard 500 Index Fund Investor Shares (VFINX)
Vanguard Explorer Fund Investor Shares (VEXPX)
Vanguard Mid-Cap Index Fund Investor Shares (VIMSX)
Vanguard Morgan Growth Fund Investor Shares (VMRGX)
Vanguard Small-Cap Value Index Fund (VISVX)
Vanguard Strategic Equity Fund (VSEQX)
Vanguard Windsor II Fund Investor Shares (VWNFX)

Bond Funds
Vanguard Imtermediate Term Bond Index Fund Investor Shares (VBIIX)
Vanguard Short-Term Bond Index Fund Investor Shares (VBISX)

International Stock Funds
Vanguard International Growth Fund Investor Shares (VWIGX)
Vanguard International Value Fund (VTRIX)

Short-Term Reserves
Vanguard Prime Money Market Fund (VMMXX)

Balanced Funds (Stocks and Bonds)
Vanguard Target Retirement Income Fund (VTINX)
Then there are all of these target retirement funds, which seem to default me to the 2050 one (VFIFX)
Go all in here with VFIFX 2050 target date fund.
My dad has been investing for a while and tries telling me I should lean more on the riskier side since I’m young enough to recover if anything does go down, and I also feel like I’m a little behind getting all this sorted out anyway so I tend to agree. Maybe someone else has different advice though.
You're doing just fine. VFIFX 2050 fund is 90% stocks 10% bonds. If you're planning to retire around 65, this will more than meet your needs and it keeps it simple! No need to worry about rebalancing a 3 fund portfolio. The target date fund rebalances automatically for you and percentage of stocks decreases as you age. If you choose to retire earlier, just choose an earlier dated target date fund. Investing in a single target date in all of your accounts will keep everything the same and very simple.
"Pain is the touchstone of all growth." - Bill W.

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Fri Nov 02, 2018 9:22 pm

I appreciate all of the advice. You're all great! It seems that everyone mostly agrees I should move my Edward Jones accounts over to Vanguard, which I was already thinking I wanted to do. The guy managing my EJ stuff barely ever talks to me and it feels weird having my money there; I think I'd prefer to have it somewhere where I feel more in control of it myself.

Miriam2
Posts: 2395
Joined: Fri Nov 14, 2014 11:51 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by Miriam2 » Fri Nov 02, 2018 11:07 pm

ViPeRx007 wrote: Hi all, I’m new here and am simply hoping to get some direction with what I should do with my investments. It’s a bit all over the place at the moment. I’ll do my best to explain. . . . had been contributing to an employer provided Edward Jones Basic IRA/Roth for some years . . .
Get out of EJ now before they take more of your money :annoyed Gadzooks! They put your 40k into some 14 different funds :annoyed
ViPeRx007 wrote:My dad has been investing for a while and tries telling me I should lean more on the riskier side since I’m young enough to recover if anything does go down, and I also feel like I’m a little behind getting all this sorted out anyway so I tend to agree. Maybe someone else has different advice though.
I'm a mom and I agree with your dad :happy

My kids are a little younger than you and are about 90/10 asset allocation. Their IRA's are at Vanguard - Vanguard Target Date 2055. This way, if they never want to bother about all that finance stuff, they can just keep depositing those dollars into their target date fund and it will automatically rebalance for them and become more conservative as they grow older - it will also be a big pot of :moneybag

Their savings accounts, for emergencies and big ticket items, are at Ally Bank on-line.
ViPeRx007 wrote:Again, if there’s any additional information I can provide please let me know. I come hat in hand, realizing I’m asking people to take time out of their own busy schedules to help a random person they don’t know. It’s not lost on me. As I said, I feel bad not knowing more about investing, but have always been more right brained than left; I can hear a song once and play it on the piano, but when it comes to most things with numbers it’s a struggle for me. I sincerely appreciate any advice as I know this board is well regarded for having some very smart people on it. Thanks in advance.
Very nice, and don't worry about not knowing much about investing. We were all there - and you are farther ahead of your peers in this investing stuff than you realize, I mean after all - you found us :D Can you play Scott Joplin on the piano?

baritone
Posts: 28
Joined: Sun Feb 05, 2017 12:33 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by baritone » Fri Nov 02, 2018 11:30 pm

ViPeRx007 wrote:
Fri Nov 02, 2018 5:52 pm
Hi all, I’m new here and am simply hoping to get some direction with what I should do with my investments. It’s a bit all over the place at the moment. I’ll do my best to explain.

I’m 35 and had been contributing to an employer provided Edward Jones Basic IRA/Roth for some years. I’ve had some trouble with employment the few years since; working at a place that didn’t even offer retirement benefits for nearly 2 years, to getting a job at a bank and lasting there for only a couple of months before they decided to outsource my job. I was there long enough to maybe make two contributions to a 401k, but it basically amounted to nothing. Fast forward to now, I have a job at another bank, things seem a little more stable now, and after 6 months I’m finally eligible to contribute to the company’s Vanguard 401k. The company automatically contributes 3% of my salary and will match up to an additional 3% for 6% total.

I know its a no-brainer to max out the company match and take full advantage of basically free money, but I don’t know what funds I should select. I also don’t know what to do with the investments from the previous job I had. I’ve looked at the Bogleheads three-fund portfolio and am curious but 1) I don’t know if it’s right for me and 2) They suggest certain Vanguard funds but I don’t see them as options for me to select.

Maybe it’s best if I just tell you as much about my investments as I know. Please let me know if you need more information. I’m embarrassed because I feel like I should know more about all of this than I do, but that’s why I’m here. I really want to learn and understand more.

Emergency funds: Not exactly sure what this is, but I know I have liquid assets to cover at least the recommended 3-6 months of expenses should I become unemployed.
Debt: Mortgage (~$138,000, 3.625% interest rate), nothing else
Tax Filing Status: Single
Tax Rate: 10.42% Federal, 4.93% State
State of Residence: Montana
Age: 35
Desired Asset allocation: I know diversification is important, but other than that I don’t know
Desired International allocation: Same answer as last one

Current investments:

Edwards Jones - from previous employer, not really being funded at this point because I don’t know if I should or not
Traditional IRA (78.65% of investments)
This seems to be made up of a mix of money market funds, mutual funds (AFMBX, FNPFX, FNWFX, BKMIX, MPHQX, LCEFX, JCPUX, JGVVX, LBNOX, VEVRX), and it says “Exchange - Traded & Closed End Funds” (FVD, XMLV, EFAV).

Roth IRA (21.35%)
Mutual funds (FNPFX, BKMIX, LCEFX, JCPUX, JGVVX, TRGXX, VEVRX)

Total value for everything is a bit below $40k.

Vanguard
Employer 401k - Just became eligible to contribute yesterday and need advice
Fund options on my employer plan are as follows:

Domestic Stock Funds
Vanguard 500 Index Fund Investor Shares (VFINX)
Vanguard Explorer Fund Investor Shares (VEXPX)
Vanguard Mid-Cap Index Fund Investor Shares (VIMSX)
Vanguard Morgan Growth Fund Investor Shares (VMRGX)
Vanguard Small-Cap Value Index Fund (VISVX)
Vanguard Strategic Equity Fund (VSEQX)
Vanguard Windsor II Fund Investor Shares (VWNFX)

Bond Funds
Vanguard Imtermediate Term Bond Index Fund Investor Shares (VBIIX)
Vanguard Short-Term Bond Index Fund Investor Shares (VBISX)

International Stock Funds
Vanguard International Growth Fund Investor Shares (VWIGX)
Vanguard International Value Fund (VTRIX)

Short-Term Reserves
Vanguard Prime Money Market Fund (VMMXX)

Balanced Funds (Stocks and Bonds)
Vanguard Target Retirement Income Fund (VTINX)
Then there are all of these target retirement funds, which seem to default me to the 2050 one (VFIFX)

My dad has been investing for a while and tries telling me I should lean more on the riskier side since I’m young enough to recover if anything does go down, and I also feel like I’m a little behind getting all this sorted out anyway so I tend to agree. Maybe someone else has different advice though.

Again, if there’s any additional information I can provide please let me know. I come hat in hand, realizing I’m asking people to take time out of their own busy schedules to help a random person they don’t know. It’s not lost on me. As I said, I feel bad not knowing more about investing, but have always been more right brained than left; I can hear a song once and play it on the piano, but when it comes to most things with numbers it’s a struggle for me. I sincerely appreciate any advice as I know this board is well regarded for having some very smart people on it. Thanks in advance.
The Edward Jones...uh... "advisor" is busy planning his retirement which is largely financed by you. Run from him and don't look back.

bltn
Posts: 252
Joined: Mon Feb 20, 2017 9:32 pm

Re: Getting on track; Edward Jones & Vanguard advice

Post by bltn » Sat Nov 03, 2018 12:33 am

In your position, I would first make sure I have an emergency fund equal to 6 months of income. Then I would have Vanguard transfer the EJ IRA money to Vanguard. Then I would put the total 401k investment into the Vangurard Index 500 Fund and continue to do this for the next five years. At age 40, I would see where I was and consider a diferent asset allocation. Not being an early retirement type of guy, I would dollar cost average into domestc index stock funds with savings in addition to my 401k plan throughout my forties. By age 50, l believe you ll be pleased with your accumulation. The key is saving 20% of your income, more if you can.
Best of luck with the saving.

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Sat Nov 03, 2018 3:46 am

Of course, now that I'm all ready to try and get going, Vanguard's website is down for maintenance this weekend. :oops:

I'll forgive them, but :x

longleaf
Posts: 198
Joined: Sun Nov 26, 2017 4:13 pm

Re: Getting on track; Edward Jones & Vanguard advice

Post by longleaf » Sat Nov 03, 2018 3:47 am

Don't worry, it is the weekend after all.

Hoping for big things coming from this downtime.
Frugality, indexing, time.

RickBoglehead
Posts: 1619
Joined: Wed Feb 14, 2018 9:10 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by RickBoglehead » Sat Nov 03, 2018 4:24 am

Great advice so far.

Since an IRA is not provided by an employer, I am confused as to how you got to Edward Jones in the first place. Was this a 401k that got rolled to an IRA?

Once you get the two IRAs from EJ to Vanguard, you should look at converting your traditional IRA to ROTH.

On your new 401k, do they have a ROTH option?

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Sat Nov 03, 2018 5:05 am

RickBoglehead wrote:
Sat Nov 03, 2018 4:24 am
Great advice so far.

Since an IRA is not provided by an employer, I am confused as to how you got to Edward Jones in the first place. Was this a 401k that got rolled to an IRA?

Once you get the two IRAs from EJ to Vanguard, you should look at converting your traditional IRA to ROTH.

On your new 401k, do they have a ROTH option?
I worked for a small business of less than 10 people which I believe allowed them to do a Simple IRA plan. They just did it through an Edward Jones advisor (I can already hear the groans...). I don't know how it differs from a regular 401k, but perhaps you do. I suppose it doesn't matter much since I'm ditching it anyway!

Yes, my new 401k has an option for Traditional or ROTH IRA.

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Sat Nov 03, 2018 5:15 am

bltn wrote:
Sat Nov 03, 2018 12:33 am
In your position, I would first make sure I have an emergency fund equal to 6 months of income. Then I would have Vanguard transfer the EJ IRA money to Vanguard. Then I would put the total 401k investment into the Vangurard Index 500 Fund and continue to do this for the next five years. At age 40, I would see where I was and consider a diferent asset allocation. Not being an early retirement type of guy, I would dollar cost average into domestc index stock funds with savings in addition to my 401k plan throughout my forties. By age 50, l believe you ll be pleased with your accumulation. The key is saving 20% of your income, more if you can.
Best of luck with the saving.
Thanks for the advise. Is the 20% you suggest determined from gross or net income?
Last edited by ViPeRx007 on Sat Nov 03, 2018 5:26 am, edited 1 time in total.

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Sat Nov 03, 2018 5:24 am

Miriam2 wrote:
Fri Nov 02, 2018 11:07 pm
ViPeRx007 wrote: Hi all, I’m new here and am simply hoping to get some direction with what I should do with my investments. It’s a bit all over the place at the moment. I’ll do my best to explain. . . . had been contributing to an employer provided Edward Jones Basic IRA/Roth for some years . . .
Get out of EJ now before they take more of your money :annoyed Gadzooks! They put your 40k into some 14 different funds :annoyed
ViPeRx007 wrote:My dad has been investing for a while and tries telling me I should lean more on the riskier side since I’m young enough to recover if anything does go down, and I also feel like I’m a little behind getting all this sorted out anyway so I tend to agree. Maybe someone else has different advice though.
I'm a mom and I agree with your dad :happy

My kids are a little younger than you and are about 90/10 asset allocation. Their IRA's are at Vanguard - Vanguard Target Date 2055. This way, if they never want to bother about all that finance stuff, they can just keep depositing those dollars into their target date fund and it will automatically rebalance for them and become more conservative as they grow older - it will also be a big pot of :moneybag

Their savings accounts, for emergencies and big ticket items, are at Ally Bank on-line.
ViPeRx007 wrote:Again, if there’s any additional information I can provide please let me know. I come hat in hand, realizing I’m asking people to take time out of their own busy schedules to help a random person they don’t know. It’s not lost on me. As I said, I feel bad not knowing more about investing, but have always been more right brained than left; I can hear a song once and play it on the piano, but when it comes to most things with numbers it’s a struggle for me. I sincerely appreciate any advice as I know this board is well regarded for having some very smart people on it. Thanks in advance.
Very nice, and don't worry about not knowing much about investing. We were all there - and you are farther ahead of your peers in this investing stuff than you realize, I mean after all - you found us :D Can you play Scott Joplin on the piano?
Thanks for your input! Yes, I'm actually using Ally Bank for savings right now as well. I work at a fairly well-regarded local (but large for the state) bank, but I'm not sure if they can compete with some of the interest rates Ally has, even with perks of being an employee. Of course they encourage employees to bank with the place we work, but I can't quite justify it.

BTW, I admit to having to Google Scott Joplin and upon listening to him I'm sad to say I'm not quite THAT good. Haha! Gotta love that old ragtime music though! I felt like I was back in an old west Saloon!

The Wizard
Posts: 12585
Joined: Tue Mar 23, 2010 1:45 pm
Location: Reading, MA

Re: Getting on track; Edward Jones & Vanguard advice

Post by The Wizard » Sat Nov 03, 2018 5:42 am

EJ likes to charge $95 for each account that is closed, so be aware of that.
Even if you initiate the transfer from Vanguard, EJ will withhold that $95 for their "services"...
Attempted new signature...

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Sat Nov 03, 2018 1:31 pm

The Wizard wrote:
Sat Nov 03, 2018 5:42 am
EJ likes to charge $95 for each account that is closed, so be aware of that.
Even if you initiate the transfer from Vanguard, EJ will withhold that $95 for their "services"...
That seems super cool.....not. A couple people above make it seem like they’ve done it without losing money. Curious if that’s actually true or if they did something different.

krow36
Posts: 2018
Joined: Fri Jan 30, 2015 6:05 pm
Location: WA

Re: Getting on track; Edward Jones & Vanguard advice

Post by krow36 » Sat Nov 03, 2018 2:04 pm

Edward Jones always charges an account closing fee which is currently $95 for IRAs. You have a traditional IRA and a Roth IRA account, so they will charge you for closing 2 accounts. I've never heard of anyone getting out of these fees. https://www.edwardjones.com/images/ira- ... f-fees.pdf

You'll avoid the EJ $40/yr/account at Vanguard. If you choose e-delivery instead snail mail, there's no annual fee on IRA accounts at Vanguard. You'll soon be ahead at Vanguard due to much reduced expense ratios, probably by 1% or more? That's assuming that you use Vanguard's low-cost, Total Market index funds.

Topic Author
ViPeRx007
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Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Sun Nov 04, 2018 4:11 am

krow36 wrote:
Sat Nov 03, 2018 2:04 pm
Edward Jones always charges an account closing fee which is currently $95 for IRAs. You have a traditional IRA and a Roth IRA account, so they will charge you for closing 2 accounts. I've never heard of anyone getting out of these fees. https://www.edwardjones.com/images/ira- ... f-fees.pdf

You'll avoid the EJ $40/yr/account at Vanguard. If you choose e-delivery instead snail mail, there's no annual fee on IRA accounts at Vanguard. You'll soon be ahead at Vanguard due to much reduced expense ratios, probably by 1% or more? That's assuming that you use Vanguard's low-cost, Total Market index funds.
Thanks! I guess it's ultimately worth it.

student
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Re: Getting on track; Edward Jones & Vanguard advice

Post by student » Sun Nov 04, 2018 7:29 am

I agree with others who said you should transfer out. However, I recommend transfer to places like Merrill Edge that gives you a bonus, pay for the closing fee and usually free trades to start with. With $40,000, you are eligible for preferred rewards that gives you some free trades anyway. See viewtopic.php?t=196884 for bonus transfer and viewtopic.php?f=2&t=150033 for preferred rewards. You can buy Vanguard ETFs.
Last edited by student on Sun Nov 04, 2018 8:18 am, edited 1 time in total.

diy60
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Re: Getting on track; Edward Jones & Vanguard advice

Post by diy60 » Sun Nov 04, 2018 7:51 am

Fidelity, Schwab, and maybe others will credit your account for the closing fees. I know first hand.

ExitStageLeft
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Re: Getting on track; Edward Jones & Vanguard advice

Post by ExitStageLeft » Sun Nov 04, 2018 8:44 am

ViPeRx007 wrote:
Sat Nov 03, 2018 1:31 pm
That seems super cool.....not. A couple people above make it seem like they’ve done it without losing money. Curious if that’s actually true or if they did something different.
Didn't mean to imply that EJ wouldn't get you coming and going. My wife transferred everything in kind to Vanguard. Once it all transferred over she sold the ten funds at Vanguard. Doing the sales online didn't cost a cent. I'm sure EJ charged the $95 account closure fee.

bltn
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Re: Getting on track; Edward Jones & Vanguard advice

Post by bltn » Sun Nov 04, 2018 12:22 pm

ViPeRx007 wrote:
Sat Nov 03, 2018 5:15 am
bltn wrote:
Sat Nov 03, 2018 12:33 am
In your position, I would first make sure I have an emergency fund equal to 6 months of income. Then I would have Vanguard transfer the EJ IRA money to Vanguard. Then I would put the total 401k investment into the Vangurard Index 500 Fund and continue to do this for the next five years. At age 40, I would see where I was and consider a diferent asset allocation. Not being an early retirement type of guy, I would dollar cost average into domestc index stock funds with savings in addition to my 401k plan throughout my forties. By age 50, l believe you ll be pleased with your accumulation. The key is saving 20% of your income, more if you can.
Best of luck with the saving.
Thanks for the advise. Is the 20% you suggest determined from gross or net income?
From the gross income would be better. 20% of the net should be a minimum. This is in addition to your 401 k. (You can do it.)
More saving is always better. The way to make it painless is to take it out of your pay as soon as you get it. What you have left will be the basis of your budget. Sticking to a monthly budget will be one of the foundations of your accumulation program. Very important to budget.
Dollar cost averaging (that is investing the same amount each month in good markets and bad) into a stock market index fund over the next 15 years is almost guaranteed to make you wealthy. Maintain the monthly savings and budget discipline. Once you do it for a while, it will become second nature.
Best of luck.

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BL
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Re: Getting on track; Edward Jones & Vanguard advice

Post by BL » Sun Nov 04, 2018 1:10 pm

Using V Target date fund sounds very good and very simple. You could use it for V IRAs as well. It has only 10% bonds which is quite aggressive for your age, but that should agree with your Dad's encouragement and he is there to talk you down from any panicking when stocks crash. This is similar to the 3-fund portfolio which you can search for in the Wiki here.

Using other suggested single or small groups of funds is not so bad, either.

Suggest you do some reading, such as Getting Started in the Wiki. The Boglehead's investing book is very good (there is a link here on Boglehead's to get you there and give a small donation to Bogleheads for free.)
Here is a great 16-page pdf (also in book form on Amazon):
https://www.etf.com/docs/IfYouCan.pdf

The tax brackets are 10%, 12%, 22%, 24%. You can search Google to check your bracket (top rate you pay.)

Save what you can. It is great if you can do 18.5k into 401k and 5.5k into a Roth IRA (if income is below 120k single). If you expect income to increase beyond that in future, you might want to roll over your Simple IRA to your current great 401k (see backdoor Roth in Wiki).

Topic Author
ViPeRx007
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Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Mon Nov 05, 2018 2:18 am

student wrote:
Sun Nov 04, 2018 7:29 am
I agree with others who said you should transfer out. However, I recommend transfer to places like Merrill Edge that gives you a bonus, pay for the closing fee and usually free trades to start with. With $40,000, you are eligible for preferred rewards that gives you some free trades anyway. See viewtopic.php?t=196884 for bonus transfer and viewtopic.php?f=2&t=150033 for preferred rewards. You can buy Vanguard ETFs.
Alright, I plead ignorance again. I like the idea of having the closing fee essentially paid by transferring to a place that reimburses you, but I'd still have two separate accounts then? Instead of EJ and Vanguard, I'd have Merrill Edge and Vanguard? I know I could still buy Vanguard ETFs but wouldn't I access them from two different portals then?

From what I read, I also can't really take advantage of the bonuses at Merrill Edge unless I also have a Bank of America Checking Account? :confused

I feel so stupid here. Maybe I'm making it more complicated than it needs to be....I'm good at doing that.

student
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Re: Getting on track; Edward Jones & Vanguard advice

Post by student » Mon Nov 05, 2018 8:40 am

ViPeRx007 wrote:
Mon Nov 05, 2018 2:18 am
student wrote:
Sun Nov 04, 2018 7:29 am
I agree with others who said you should transfer out. However, I recommend transfer to places like Merrill Edge that gives you a bonus, pay for the closing fee and usually free trades to start with. With $40,000, you are eligible for preferred rewards that gives you some free trades anyway. See viewtopic.php?t=196884 for bonus transfer and viewtopic.php?f=2&t=150033 for preferred rewards. You can buy Vanguard ETFs.
Alright, I plead ignorance again. I like the idea of having the closing fee essentially paid by transferring to a place that reimburses you, but I'd still have two separate accounts then? Instead of EJ and Vanguard, I'd have Merrill Edge and Vanguard? I know I could still buy Vanguard ETFs but wouldn't I access them from two different portals then?

From what I read, I also can't really take advantage of the bonuses at Merrill Edge unless I also have a Bank of America Checking Account? :confused

I feel so stupid here. Maybe I'm making it more complicated than it needs to be....I'm good at doing that.
Yes. You will have two accounts. (Actually 3, 401k at Vanguard, IRA and taxable at Merrill Edge.) Yes. You need to have a checking account with BoA for the preferred rewards but you can leave a few hundred dollars there. In fact, with $40,000, you will be a gold member and you can just leave $10 there, as Monthly maintenance fees waived on up to 4 eligible checking and 4 savings accounts from Bank of America. Please note that due to using 3 months average in computing your eligibility of preferred rewards, leave a few hundreds in your checking account to avoid fees until you reach gold status. Also one correction of my earlier comment, you need $50,000 to get some free trades every month. However, you can ask them to give you some (for 90 days) to begin with to get you in the market. I assume you will continue to contribute to this account, so you will get more free trades when you reach $50,000. Hope this is clear.

Lafder
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Re: Getting on track; Edward Jones & Vanguard advice

Post by Lafder » Mon Nov 05, 2018 9:13 am

KISS, keep it short and simple, or keep it simple stupid, or.......

It will be much easier to have all of your assets at Vanguard so you can look at your retirement account balance and asset allocation on one website.

The easiest way to move money is to contact the place you want to pull it to, and they will help you find the most cost effective way. Vanguard will help whether you are moving 4000$ or 4 million.

If the fees on your current employer account are low enough, you can roll your current IRA into your current 401k and only have one account! Many 401k's encourage you to roll old retirement plans into them.

There is a usual rec for an asset allocation of your age down to your age - 20 in bonds. I like at least 20% bonds regardless of your age as they help buffer drops during stock market crashes. There is a rec for 0-50 % of your stocks being International.

If you use a Vanguard all in one Target Date (TD) fund, they set the asset allocation for you. And they will make sales/trades to keep the fund at their stated asset allocation. The TD funds add more bonds with age. They have less than 20% bonds this far out from retirement. But since they do the rebalancing for you, there is less chance of you making a panicky change over time so I am more ok with the lower % bonds. The TD funds are a fund of funds made up of 4 mutual funds currently: total stock market index, total bond market index, total international stock index, total international bond index. Non Vanguard target date funds have different holdings, so always look up what a target date fund has. Some are much better than others.

Some people are telling you that you can have a 3 fund portfolio yourself and rebalance yourself if the asset allocation gets off from your desired AA. I say it is not worth the trouble as you are just learning about investing. Save the 3 or 4 fund portfolio til you are more comfortable and decide how much involvement you want. Yes it can be done in an hour or two a year. But the all in one funds do it for you and are a solid one fund holding.

As to the suggestion to just use an SP500 fund, that means a large cap biggest of the big companies stock fund. Some people will say go all stocks when you are young. But I believe in some bonds. Unless the ER of your target date fund is high, I would use the all in one fund as the simplest plan. If you forget to deal with it over the years, it will take care of itself.

lafder

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Mon Nov 05, 2018 2:10 pm

student wrote:
Mon Nov 05, 2018 8:40 am
ViPeRx007 wrote:
Mon Nov 05, 2018 2:18 am
student wrote:
Sun Nov 04, 2018 7:29 am
I agree with others who said you should transfer out. However, I recommend transfer to places like Merrill Edge that gives you a bonus, pay for the closing fee and usually free trades to start with. With $40,000, you are eligible for preferred rewards that gives you some free trades anyway. See viewtopic.php?t=196884 for bonus transfer and viewtopic.php?f=2&t=150033 for preferred rewards. You can buy Vanguard ETFs.
Alright, I plead ignorance again. I like the idea of having the closing fee essentially paid by transferring to a place that reimburses you, but I'd still have two separate accounts then? Instead of EJ and Vanguard, I'd have Merrill Edge and Vanguard? I know I could still buy Vanguard ETFs but wouldn't I access them from two different portals then?

From what I read, I also can't really take advantage of the bonuses at Merrill Edge unless I also have a Bank of America Checking Account? :confused

I feel so stupid here. Maybe I'm making it more complicated than it needs to be....I'm good at doing that.
Yes. You will have two accounts. (Actually 3, 401k at Vanguard, IRA and taxable at Merrill Edge.) Yes. You need to have a checking account with BoA for the preferred rewards but you can leave a few hundred dollars there. In fact, with $40,000, you will be a gold member and you can just leave $10 there, as Monthly maintenance fees waived on up to 4 eligible checking and 4 savings accounts from Bank of America. Please note that due to using 3 months average in computing your eligibility of preferred rewards, leave a few hundreds in your checking account to avoid fees until you reach gold status. Also one correction of my earlier comment, you need $50,000 to get some free trades every month. However, you can ask them to give you some (for 90 days) to begin with to get you in the market. I assume you will continue to contribute to this account, so you will get more free trades when you reach $50,000. Hope this is clear.
It is, thank you for the explanation.

Topic Author
ViPeRx007
Posts: 12
Joined: Fri Nov 02, 2018 1:38 am

Re: Getting on track; Edward Jones & Vanguard advice

Post by ViPeRx007 » Mon Nov 05, 2018 2:18 pm

Lafder wrote:
Mon Nov 05, 2018 9:13 am
KISS, keep it short and simple, or keep it simple stupid, or.......

It will be much easier to have all of your assets at Vanguard so you can look at your retirement account balance and asset allocation on one website.

The easiest way to move money is to contact the place you want to pull it to, and they will help you find the most cost effective way. Vanguard will help whether you are moving 4000$ or 4 million.

If the fees on your current employer account are low enough, you can roll your current IRA into your current 401k and only have one account! Many 401k's encourage you to roll old retirement plans into them.

There is a usual rec for an asset allocation of your age down to your age - 20 in bonds. I like at least 20% bonds regardless of your age as they help buffer drops during stock market crashes. There is a rec for 0-50 % of your stocks being International.

If you use a Vanguard all in one Target Date (TD) fund, they set the asset allocation for you. And they will make sales/trades to keep the fund at their stated asset allocation. The TD funds add more bonds with age. They have less than 20% bonds this far out from retirement. But since they do the rebalancing for you, there is less chance of you making a panicky change over time so I am more ok with the lower % bonds. The TD funds are a fund of funds made up of 4 mutual funds currently: total stock market index, total bond market index, total international stock index, total international bond index. Non Vanguard target date funds have different holdings, so always look up what a target date fund has. Some are much better than others.

Some people are telling you that you can have a 3 fund portfolio yourself and rebalance yourself if the asset allocation gets off from your desired AA. I say it is not worth the trouble as you are just learning about investing. Save the 3 or 4 fund portfolio til you are more comfortable and decide how much involvement you want. Yes it can be done in an hour or two a year. But the all in one funds do it for you and are a solid one fund holding.

As to the suggestion to just use an SP500 fund, that means a large cap biggest of the big companies stock fund. Some people will say go all stocks when you are young. But I believe in some bonds. Unless the ER of your target date fund is high, I would use the all in one fund as the simplest plan. If you forget to deal with it over the years, it will take care of itself.

lafder
Thank you for this detailed information. I appreciate your time.

I actually just called Vanguard to get a basic idea of how to transfer my accounts to them and they didn't seem all that helpful. I guess they must expect the person calling to know more than I do. They asked if I have a 401k from a previous employer or IRA's. I said I had IRA's. They asked if they were rollover IRA's and I didn't know what that even was. On Edward Jones it just says Traditional IRA and Roth IRA, nothing else. He told me to figure out if they're rollover because those are the only ones that work with my plan? Ugh. I'm so out of my element.

I'm trying to avoid calling EJ too because something tells me they won't be super helpful with me moving things away from them.

krow36
Posts: 2018
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Location: WA

Re: Getting on track; Edward Jones & Vanguard advice

Post by krow36 » Mon Nov 05, 2018 3:13 pm

A rollover IRA contains only contributions made to a previous employer-based retirement account (plus growth). If your tIRA contained only the SIMPLE IRA funds from your old job, it could be rolled over to an IRA that was labeled a rollover IRA. Rollover IRAs can be rolled into 401k plans at many financial institutions. Perhaps Vanguard thought that was what you wanted to do?

Have you added yearly contributions as well as the SIMPLE IRA balance to your tIRA? If you have, I don't think it matters much, just open a regular tIRA (not a rollover tIRA) at Vanguard. You can open one and fund it later with the transfer from EJ. The same for the Roth IRA.

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