I tried to fire my financial advisor of 12 years today...

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smectym
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Re: I tried to fire my financial advisor of 12 years today...

Post by smectym » Tue May 07, 2019 4:33 pm

It’s never good to get into a personal relationship with one’s financial advisor. Avoiding anything like that is a solid argument for robo. But Vanguard is a decent compromise for those investors who just feel they have to have a human they can think of as their financial advisor. Vanguard will rotate the “personal advisor” every so often anyway, so you never “become friends.”

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Abe
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Re: I tried to fire my financial advisor of 12 years today...

Post by Abe » Tue May 07, 2019 4:38 pm

I had a FA one time. I have to say I made some money with him; however, I may have been able to do better myself. I finally just stopped taking his advise. He would call and push me to buy this or sell that, but I just stopped doing anything. I just stood there as Mr Bogle would say. One day I got a letter from him telling me that he was "transitioning" my account to one of his underlings. Don't know why he didn't just say he was transferring my account. Anyway, I didn't have to fire him, he fired me which made it easy for me. I've never paid an AUM fee. Just curious, how do they take the fee? Do they just withdraw the money out of your account on a monthly basis?
Slow and steady wins the race.

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zachslow
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Re: I tried to fire my financial advisor of 12 years today...

Post by zachslow » Tue May 07, 2019 4:42 pm

Just got off the phone with Vanguard. So easy. Only took 20 minutes. They're able to transfer everything in kind. They offered all of the funds I had with Raymond James, so it was really painless. I feel a huge sense of relief!

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Raymond
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Re: I tried to fire my financial advisor of 12 years today...

Post by Raymond » Tue May 07, 2019 4:42 pm

zachslow wrote:
Tue May 07, 2019 4:42 pm
Just got off the phone with Vanguard. So easy. Only took 20 minutes. They're able to transfer everything in kind. They offered all of the funds I had with Raymond James, so it was really painless. I feel a huge sense of relief!
Excellent! :sharebeer

After everything has transferred over, please don't forget to follow up with a separate thread using the template here: "Asking Portfolio Questions"
"Ritter, Tod und Teufel"

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Duckie
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Re: I tried to fire my financial advisor of 12 years today...

Post by Duckie » Tue May 07, 2019 4:49 pm

zachslow wrote:Just got off the phone with Vanguard. So easy. Only took 20 minutes. They're able to transfer everything in kind. They offered all of the funds I had with Raymond James, so it was really painless. I feel a huge sense of relief!
Did you get your taxable basis first?
PQ12$ wrote:OP -- If you do decide to transfer your assets to Vanguard, or anybody, be sure you get all of the cost basis info for all of your holdings BEFORE you transfer. Take screen shots from your current brokerage account, get print outs, etc. as occasionally this can be tough to get once you've moved your money.

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zachslow
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Re: I tried to fire my financial advisor of 12 years today...

Post by zachslow » Tue May 07, 2019 4:54 pm

Duckie wrote:
Tue May 07, 2019 4:49 pm
zachslow wrote:Just got off the phone with Vanguard. So easy. Only took 20 minutes. They're able to transfer everything in kind. They offered all of the funds I had with Raymond James, so it was really painless. I feel a huge sense of relief!
Did you get your taxable basis first?
PQ12$ wrote:OP -- If you do decide to transfer your assets to Vanguard, or anybody, be sure you get all of the cost basis info for all of your holdings BEFORE you transfer. Take screen shots from your current brokerage account, get print outs, etc. as occasionally this can be tough to get once you've moved your money.
I did!

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Doom&Gloom
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Re: I tried to fire my financial advisor of 12 years today...

Post by Doom&Gloom » Tue May 07, 2019 5:14 pm

Well done!

dkb140
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Re: I tried to fire my financial advisor of 12 years today...

Post by dkb140 » Tue May 07, 2019 5:26 pm

Not only was he charging you 1.5%, I'd bet the managed funds he had you in had expense ratios up over 1%. So if you add those in, you were probably paying him ~2.5% per year to (mis) manage your money. I don't know about you, but I can't afford to pay someone $16k a year to make bad bets with my money.

Pick a good brokerage (I chose Fidelity, but Vanguard and Schwab are both popular choices), open an account, and initiate the transfer from the new account. You may want to sell everything in the old account and move your money as cash if your trading fees would be lower in the old account.

While it's pending, read up on the 3 fund portfolio, pick good low expense ratio: Total Market, International, and Total Bond funds, decide on your asset allocation, and go for it! Stay strong.

If your new portfoio had say a 0.05% average ER, you don't have to do as good as your adviser did. You only need to do < (2.5 - .05 = 2.45%) worse to break even. Keep reading up on these forums and there's a good chance you could outperform your adviser and come out way ahead!

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ruralavalon
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Re: I tried to fire my financial advisor of 12 years today...

Post by ruralavalon » Tue May 07, 2019 5:26 pm

zachslow wrote:
Tue May 07, 2019 4:54 pm
Duckie wrote:
Tue May 07, 2019 4:49 pm
zachslow wrote:Just got off the phone with Vanguard. So easy. Only took 20 minutes. They're able to transfer everything in kind. They offered all of the funds I had with Raymond James, so it was really painless. I feel a huge sense of relief!
Did you get your taxable basis first?
PQ12$ wrote:OP -- If you do decide to transfer your assets to Vanguard, or anybody, be sure you get all of the cost basis info for all of your holdings BEFORE you transfer. Take screen shots from your current brokerage account, get print outs, etc. as occasionally this can be tough to get once you've moved your money.
I did!
Congratulations, good move.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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nedsaid
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Re: I tried to fire my financial advisor of 12 years today...

Post by nedsaid » Tue May 07, 2019 5:38 pm

Stinky wrote:
Tue May 07, 2019 3:07 pm


I’m glad that you’ve found value in your full service brokerage account.

Have you ever tried to calculate the “cost”, in dollars, of the advice that you’re getting? Not only the explicit fees of the advisor but also any fund expense charges higher than you might have at Vanguard or Fidelity? I trust that you have, but it would be a good exercise for you if you haven’t.

If you’re happy with your current situation, more power to you.
The cost in dollars is pretty low. Don't trade much. He does get the 12(b)1 fees from the American and Franklin-Templeton Funds in the accounts. The expense ratios of the funds are relatively low. I pay $40 per account per year in account fees. My funds, stocks, and ETFs are set on reinvestment of dividends and capital gains, no fees for reinvestment. I have analyzed performance from the account, 2017 and 2018 were disappointing but it had to do with factors and not expenses. In other words, lots of Value stuff in the account during a time when the markets favor Growth. Lots of analysis in "My New 'Doo" thread.

But this is not the approach I would recommend. Pretty much fell into this.
A fool and his money are good for business.

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DanMahowny
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Re: I tried to fire my financial advisor of 12 years today...

Post by DanMahowny » Tue May 07, 2019 5:39 pm

Good job OP.
Funding secured

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FIREchief
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Re: I tried to fire my financial advisor of 12 years today...

Post by FIREchief » Tue May 07, 2019 6:08 pm

Mike Scott wrote:
Tue May 07, 2019 6:44 am
One more in the chorus of just do it.
Chorus?? My brain is now trying to come up with the lyrics to "There must be 50 ways to leave your FA."

Might help if the OP's name is Stan, Lee, Gus, Roy..... You get the idea....(hopefully) :P
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

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abuss368
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Re: I tried to fire my financial advisor of 12 years today...

Post by abuss368 » Tue May 07, 2019 6:16 pm

Taylor Larimore wrote:
Tue May 07, 2019 9:47 am
zachslow:

Welcome to the Bogleheads Forum!

I understand your feelings.

For many years, we had a relationship with our Merrill Lynch broker. He became our "friend." He used to invite us every year to go sailing on his lovely boat (which I now realize we helped pay for). After reading Mr. Bogle's first book, in 1986 we moved all our accounts to Vanguard. It was one of the most difficult decisions we ever made -- and one of the best decisions we ever made.

Best wishes
Taylor

PS: Our broker never again invited us to go sailing. :twisted:
Taylor -

I believe there was a book written “Where are the Customers Yachts” that provides a lot of the same experiences correct?
John C. Bogle: Two Fund Portfolio - Total Stock & Total Bond - “Simplicity is the master key to financial success."

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abuss368
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Re: I tried to fire my financial advisor of 12 years today...

Post by abuss368 » Tue May 07, 2019 6:21 pm

zachslow wrote:
Tue May 07, 2019 1:17 am
...It was tough. He didn't make it easy on me! He's asked me to just think about it over the weekend before I pull the plug.

I actually owe him a lot as he has helped me get a solid savings plan in order when I was younger and financial inept.

I'm now 40 and after reading a few investment books recently, I quickly realized the 1.5% he's been charging me is going to murder me in the long run. My plan is to switch over to a two-fund index fund at Vanguard.

So I tried to fire him today and it was tough.

He made a lot of arguments that were confusing and frankly over my head. He also said he's immediately lower the fee to 1%. I like him a lot and it was hard trying to break up with him. When he was scrambling to keep me, he pulled up some quick data on my portfolio. YTD it is up 16.90%. in 2018 it was -8.47%. Since inception (he moved firms, so the inception date at his new firm is 4/16) is up 10.21% average per year. Those numbers are after his fees are taken out.

I have $640,000 with him. It's currently divided between 4 stocks, 6 mutual funds and 3 ETFs.

If I were to switch over to a Vanguard account, with a plan to reallocate to a two-fund portfolio, what's the best way to go about doing that? The tax part is complicated so I'm curious the best way to switch things over and reallocate.

I'm feeling bad about pulling the plug on him after 12 years, so I'd love any thoughts or data about why this would be better for me in the long run! It'll help me make a final decision this weekend.

And lastly, do financial planner at Raymond James get incentivized by putting me into specific funds? I've been reading online about trailer fees and it blew my mind that it's legal.

Thanks in advance!
Many years ago we were introduced to our parents Merrill Lynch financial advisor. We were invited to events including the country club. From the start I was not comfortable with all the fees but was not educated enough at that time. Included was a lot of individual stock picking. Fortunately I had a colleague who was a Vanguard investor and he provided a fresh perspective.

After moving to Vanguard we no longer had a relationship with our advisor.

Many thanks Jack Bogle!
John C. Bogle: Two Fund Portfolio - Total Stock & Total Bond - “Simplicity is the master key to financial success."

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Re: I tried to fire my financial advisor of 12 years today...

Post by Fallible » Tue May 07, 2019 8:06 pm

zachslow wrote:
Tue May 07, 2019 4:42 pm
Just got off the phone with Vanguard. So easy. Only took 20 minutes. They're able to transfer everything in kind. They offered all of the funds I had with Raymond James, so it was really painless. I feel a huge sense of relief!
Congratulations to you and to all who advised on this thread! This is the way it's supposed to work. Jack Bogle would be proud of his Bogleheads!
The first principle is that you must not fool yourself – and you are the easiest person to fool. ~Richard Feynman

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Re: I tried to fire my financial advisor of 12 years today...

Post by Minot » Tue May 07, 2019 8:41 pm

Nedsaid, I must be missing something. You said
nedsaid wrote:
Tue May 07, 2019 2:04 pm
I am on the other side of this, I have had a full-service brokerage account for probably 31 years now.
[snip]
I have a Brokerage IRA and ROTH IRA with him, the two accounts are maybe 30% of my retirement.
[snip]
Would I do this over again? Probably not.
[snip]
If I had it to do all over again, I would probably have split my funds between Fidelity and Vanguard and used a mix of low-cost active funds, index funds, and ETFs based upon indexes. I probably would index 60% to 70% and use low-cost active funds such as found at Vanguard for the remainder. I would not have used stockbrokers or purchased individual stocks or loaded mutual funds. If you make the effort to inform yourself, self management of investment porfolios is very doable. Problem is, I didn't know then what I know now and I learned all of this over 35 years.
So what is keeping you from transferring these IRAs to Vanguard or Fidelity or Schwab and doing it the better way for the remainder of your investing life? Just because you made a less than ideal choice in the past, nothing that I read in your post requires you to continue that choice into the future.

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Wiggums
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Re: I tried to fire my financial advisor of 12 years today...

Post by Wiggums » Tue May 07, 2019 8:53 pm

You’re making the right decision.

Good luck to you.

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nedsaid
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Re: I tried to fire my financial advisor of 12 years today...

Post by nedsaid » Tue May 07, 2019 9:35 pm

Minot wrote:
Tue May 07, 2019 8:41 pm
Nedsaid, I must be missing something. You said
nedsaid wrote:
Tue May 07, 2019 2:04 pm
I am on the other side of this, I have had a full-service brokerage account for probably 31 years now.
[snip]
I have a Brokerage IRA and ROTH IRA with him, the two accounts are maybe 30% of my retirement.
[snip]
Would I do this over again? Probably not.
[snip]
If I had it to do all over again, I would probably have split my funds between Fidelity and Vanguard and used a mix of low-cost active funds, index funds, and ETFs based upon indexes. I probably would index 60% to 70% and use low-cost active funds such as found at Vanguard for the remainder. I would not have used stockbrokers or purchased individual stocks or loaded mutual funds. If you make the effort to inform yourself, self management of investment porfolios is very doable. Problem is, I didn't know then what I know now and I learned all of this over 35 years.
So what is keeping you from transferring these IRAs to Vanguard or Fidelity or Schwab and doing it the better way for the remainder of your investing life? Just because you made a less than ideal choice in the past, nothing that I read in your post requires you to continue that choice into the future.
Well, I am telling people what I did. I am telling the Original Poster that portfolios can be self-managed and though what I did was successful enough, that the simpler portfolios using index funds are a more efficient way to invest than what I did. As far as I could tell, my actively managed funds at American Century and my Brokerage IRA and Brokerage ROTH IRA with Broker #4 have not hurt my portfolio performance. Underperformance vs. the 3 fund portfolio has been mainly due to underweighting the Tech sector, I am underweight the so-called FAANG stocks. I am a Value oriented investor and this has cost me in relative performance as we have been in a Large Growth market for a decade now.

I may do portfolio simplification in the future, selling off my individual stocks. The individual stocks alternative lead the averages a bit or trail them a bit over rolling 15 year averages. That is the main complicating factor in the portfolio. I also split my portfolio mainly into three providers, that is the other factor. Not ready to give up on my legacy investments, that is stuff I owned before I became more of a Boglehead. I have tracked all of this over the years and so far so good.

I also found value in working with somebody with at least part of my retirement portfolio.
A fool and his money are good for business.

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Re: I tried to fire my financial advisor of 12 years today...

Post by Beliavsky » Tue May 07, 2019 9:40 pm

peterinjapan wrote:
Tue May 07, 2019 3:06 am
Great job. I also fired my investing guy, who charged me 1.4% to own funds that sometimes charged me 1% or more. He tried to put me in load funds but caught the fire in my eye when he suggested it. I realized I could make as many mistakes as he made, and for free.

Most angering of all, I was ready to go in guns blazing in Amazon when it dropped to $490, but he talked me out of it. I could strangle him...
On average, financial advisors who dissuade their clients from buying individual stocks are helping them. Undiversified risk is not rewarded unless you have stock-picking skill, and most people do not.

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Re: I tried to fire my financial advisor of 12 years today...

Post by Bronco Billy » Tue May 07, 2019 9:50 pm

I have an inherited account with EJ that was my dads. I get RMD off it and have left it with EJ FA. Its about 10% percent of my worth. Its got the high front end load American funds. To be honest it has kept up with the RMD taken for the last four years. The FA was nice to my dad and having to mess with RMD i have just left it there. The FA lives a long way from me and i have not put any new money. After reading this maybe i should also consider moving it to my VG and be down to just VG and FIDO.

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Re: I tried to fire my financial advisor of 12 years today...

Post by abuss368 » Wed May 08, 2019 5:52 am

This has been an interesting thread.
John C. Bogle: Two Fund Portfolio - Total Stock & Total Bond - “Simplicity is the master key to financial success."

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Re: I tried to fire my financial advisor of 12 years today...

Post by RickBoglehead » Wed May 08, 2019 6:18 am

zachslow wrote:
Tue May 07, 2019 4:42 pm
Just got off the phone with Vanguard. So easy. Only took 20 minutes. They're able to transfer everything in kind. They offered all of the funds I had with Raymond James, so it was really painless. I feel a huge sense of relief!
THIS ^^^^
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Re: I tried to fire my financial advisor of 12 years today...

Post by Rudedog » Wed May 08, 2019 6:45 am

These guys are sharks. One of them tried to stick it to my Mom's account, then he tried to stick it to me. Moving to Vanguard is a solid plan.

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meowcat
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Re: I tried to fire my financial advisor of 12 years today...

Post by meowcat » Wed May 08, 2019 11:30 am

Smart move. Really, how much did you think you owed him? Did you owe him enough to hand over half, or more, of your life savings? That's the way I think about it.
More people should learn to tell their dollars where to go instead of asking them where they went. | -Roger Babson

dknightd
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Re: I tried to fire my financial advisor of 12 years today...

Post by dknightd » Wed May 08, 2019 11:43 am

I did not read the whole thread. Shoot me.

I assume you were successful in firing your financial advisor.

I'm guessing they were older than you.
If you value a bird in the hand, pay off the loan. If you are willing to risk getting two birds (or none) from the market, invest the funds.

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Re: I tried to fire my financial advisor of 12 years today...

Post by Presintense » Wed May 08, 2019 11:50 am

Congratulations on your newfound freedom from a financial advisor. Investing just got simpler and a whole lot less expensive!
Performance = Potential - Distraction

mancich
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Re: I tried to fire my financial advisor of 12 years today...

Post by mancich » Wed May 08, 2019 1:28 pm

It's your money. I had a "financial advisor" several years ago that works for Ameriprise. He is a friend of 20 years. His recommendations were mostly around insurance products and annuities. As I educated myself on this forum, I grew more confident I would be fine, and it has worked out. You'll find out how much of a good guy he is based on his reaction, after you pull $640,000 away from his control...

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Re: I tried to fire my financial advisor of 12 years today...

Post by SGM » Wed May 08, 2019 1:40 pm

I have never had a FA. However, I have had access to the results of close relatives who used an FA and those accounts don't do nearly as well as they could have with a self directed BH approach. It isn't rocket science.

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