Help my Aunt decide on Edward Jones or somewhere else

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lane7068
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Help my Aunt decide on Edward Jones or somewhere else

Post by lane7068 »

My aunt has moved her 401k money to Edward Jones, has the paper to sign and return as they are requesting it to control the funds, but I've told her to wait so I could get some guidance from you Bogleheads.

I asked my aunt what kind of fees Edward Jones was going to charge her, what type of mutual funds they were going to put her money in, and asked what kind of annual expense ratio they had. She didn't know. She's called her local branch to try and meet with one of the advisors there to ask some questions, but aunt stated they wouldn't meet her in person as they are all working from home. But they did say sign and mail that paper used to control the account. (I forgot what its called when transferring from one place to another)

I went to the Edward Jones website to do some searches but can't find the info I want since I cant log in as a client. I've attempted to do some internet searches but can't find what I'm looking for, which is basically what type of TDF they have, such as a TDF 2025 or a LifeStrategy Fund (she's 67), how much their expense ratio's and fees are, are they actively managed or passively managed, and load fees, etc. She wants a little risk, but not much. Maybe I should keep looking but I know the wisdom is here.

For those of you that are much wiser than me, what advice could I give her to help her make, perhaps, a more informed decision. I wont be telling her what to do, just trying to show her that other options, such as Vanguard or Schwab, are out there that would most likely take less a bite out of her profits.
Last edited by lane7068 on Thu Aug 06, 2020 11:54 am, edited 2 times in total.
tashnewbie
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by tashnewbie »

I don't think I'm wiser than you. Sounds like you're thinking about the right things. If I were her, I'd want the information necessary to make an informed decision. At a minimum, that should include information about all of the fees EJ will charge her. I personally would use a low-cost provider like Schwab, Fidelity, or Vanguard.
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Sandtrap
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Sandtrap »

1. Don't sign anything for now.
2. Read all the past forum threads on "Edward Jones". Google search upper right hand corner.
3. Read the forum threads on "Financial Advisors". Tons of them.

Let us know what you think after reading those threads and discussions.

Go to the Vanguard web site.
Read about Vanguard Personal Advisor Services. VPAS

Search the forum threads for "VPAS" and read that. Upper right hand corner search.

At the moment, you are bait on the end of a hook.
So, wait a minute.

How receptive is your aunt to your advice?

j :happy
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SB1234
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by SB1234 »

lane7068 wrote: Thu Aug 06, 2020 10:26 am My aunt has moved her 401k money to Edward Jones, has the paper to sign and return as they are requesting it to control the funds, but I've told her to wait so I could get some guidance from you Bogleheads.

I asked my aunt what kind of fees Edward Jones was going to charge her, what type of mutual funds they were going to put her money in, and asked what kind of annual expense ratio they had. She knew nothing. She's called her local branch to try and meet with one of the advisors there to ask some questions, but aunt stated they wouldn't meet her in person as they are all working from home. But they did say sign and mail that paper used to control the account. (I forgot what its called when transferring from one place to another)

I went to the Edward Jones website to do some searches but can't find the info I want since I cant log in as a client. I've attempted to do some internet searches but can't find what I'm looking for, which is basically what type of TDF they have, such as a TDF 2025 (she's 67), how much their expense ratio's and fees are, are they actively managed or passively managed, and load fees, etc. She wants a little risk, but not much. Maybe I should keep looking but I know the wisdom is here.

For those of you that are much wiser than me, what advice could I give her to help her make, perhaps, a more informed decision. I wont be telling her what to do, just trying to show her that other options, such as Vanguard or Schwab, are out there that would most likely take less a bite out of her profits.
Show her the devastating impact of fees.
E.g see below thread

viewtopic.php?t=217026
anecdotes are not data
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retired@50
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by retired@50 »

You could start here... The link below is a Revenue Sharing Disclosure from the Edward Jones website.

https://www.edwardjones.com/images/reve ... losure.pdf

From the linked document. I highlighted the text in red.
Edward Jones receives payments known as revenue sharing from certain mutual fund companies, 529 plan program managers and insurance companies (collectively referred to as “product partners”). Virtually all of Edward Jones’ transactions relating to mutual funds, 529 plans and annuity products involve product partners that pay revenue sharing to Edward Jones. We do not receive revenue sharing payments on assets within investment advisory programs. We want you to understand that Edward Jones’ receipt of revenue sharing payments creates a potential conflict of interest in the form of an additional financial incentive and financial benefit to the firm, our financial advisors and equity owners in connection with the sale of products from these product partners. For the year that ended on December 31, 2019, Edward Jones received revenue sharing payments of approximately $228.8 million from mutual fund and 529 product partners and $6.4 million from annuity product partners. For that same period, Edward Jones’ net income was $1.09 billion.
The trouble with places like Edward Jones and others, is that they are motivated by things that aren't in your aunt's best interest. This is why Bogleheads recommend a do-it-yourself approach. It saves money on fees and leads to better outcomes for individual investors.

Regards,
This is one person's opinion. Nothing more.
radiowave
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by radiowave »

OP, if you look at the past Edward Jones threads here on Bogleheads.org and look at the dozens of portfolios posted, you will see a substantial and confusing number of overlapping funds in each account, high expense ratios, funds that have 4-5% front end loads, and an annual AUM fee of 1.35%. Add this all up and the average EJ portfolios annual costs are typically 2 to 3% (not counting one time load fees). By signing that form, EJ has complete control over the porfolio with no recourse to the client. This is not in your aunt's best interest. Consider other low cost alternatives like Vanguard.
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lane7068
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by lane7068 »

Sandtrap/All,

Thanks for the quick turnaround. I was so unaware of the right top search function, just mainly used the search function under "Quick Links, left top side." Just a few glances at the responses show a ton of negativity toward EJ.

As for her listening to my advice, I believe she knows I have her best interest in mind. I'm not asking her for her money, unlike Edward Jones. Plus, with just the few responses thus far with negative comments of Edward Jones fees as well as links to negative comments and problems with Edward Jones, and people moving on to greener pastures, Im thinking that will help her get a more informed decision.
Last edited by lane7068 on Thu Aug 06, 2020 11:32 am, edited 1 time in total.
dbr
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by dbr »

There are mistakes and there are Mistakes. EJ is a MISTAKE.

But a different question is why is she/did she roll over a 401k? That would not normally be an automatic thing to do and is often a pile of BS sold to retirees by predatory financial firms like EJ. For them it is low hanging fruit but not so for their victim.
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lane7068
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by lane7068 »

DBR,

She had a trusted friend for many years at EJ that took care of her account, but has since retired and moved on. Now, I just don't think she is getting a good feeling about if the new advisor(s) are more concerned with her pockets or their own. Other than that, I can't really say.

I'm compiling all these responses in an email and I'll be sending them to her in the next hour or two. So far, I greatly appreciate the responses from everyone.
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Watty
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Watty »

Something to point out to her is that there have been academic studies that have shown that in the past a person starting a 30 year retirement could start out with about a 4% "safe withdraw rate. There are all sorts of qualifications and limitations so you can't just mindlessly go by that but it is a reasonable number.

https://www.bogleheads.org/wiki/Safe_wi ... 20at%20any

The problem is that if she pays them a 1% annual fee and they put her in mutual funds that charge a fee that ia 1% too high then that adds up to 2%. She would not see them take the money but that 2% needs to come out of her 4% so she would be paying them half of her spendable money each year. :shock:

In reality with other fees, both stated and hidden she could very easily pay then a lot more than that.

They may try to say that they will do so great that they will outperform enough to make up for the costs but that is bull pucky. If they show example they are likely just cherry picking old data, sort of like picking last weeks lottery numbers then saying that you can do it again next week

Even worse is that they might put her money into a complex annuity with high fees that would be difficult or impossible for her to get the money out of. There are all sorts of complex things called annuities that pay the salesperson a large commission. The only one that most people should consider would be a Single Premium Immediate Annunity(SPIA) which is like buying a pension.

If she feels that she needs someone to help manage her money then Vanguard will do that for just a 0.3% fee and they will not put her into expensive mutual funds. She could use that for a year or two to get her investments organized then stop paying the fee and do it herself.

https://investor.vanguard.com/financial ... r-services
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lane7068
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by lane7068 »

Thanks Watty. I mentioned earlier to her about a 3.5% withdrawal rate as she's got some money plus her SSI. I forgot about the their rate minus the withdrawal rate. That will definitely open her eyes. Much appreciated for the reminder. I think she's more a set-it-and-forget-it person, which I mentioned a TDF 2025 with Vanguard at .15% or a Schwab's 2025 with an E/R I believe was .08%.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Minty »

Watty wrote: Thu Aug 06, 2020 11:32 am
The problem is that if she pays them a 1% annual fee and they put her in mutual funds that charge a fee that is 1% too high then that adds up to 2%. She would not see them take the money but that 2% needs to come out of her 4% so she would be paying them half of her spendable money each year. :shock:
This fundamental point--you take all of the risk, they take half of the average return even in a down market; half of your money for you, half for them--is worth repeating, emphasizing, highlighting, etc.
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Kintora
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Kintora »

Going to Edward Jones with my money to invest 9 years ago was a huge financial mistake. I can see that in retrospect, but I was very naive and ignorant at the time when it came to investing and financial matters in general. My money still grew, but they siphoned off a whole heck of a lot in fees, commissions, etc. Looking back, I can also see that my "financial adviser" clearly did not have my best interests in mind despite being a very nice guy outwardly. This is the story over and over again about EJ.

I transferred to Vanguard around the beginning of the year and am very happy now thanks to the excellent advice and people on this forum. Thankfully, I still have many years ahead of me for my money to grow. As others have stated, Schwab, Vanguard and Fidelity are often recommended as good options. I have heard that Schwab has physical office locations that you may be able to visit when desired if that is something that is important to you. Vanguard also has a relatively low cost advisory service if that is something you desire. Good luck.
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ruralavalon
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by ruralavalon »

Don't sign anything. Don't move anything to Edward Jones.

Has a rollover of the 401k to Edward Jones already occurred or just planned?

Suggest instead a rollover to a low cost fund firm like Vanguard, Fidelity or Schwab.
Last edited by ruralavalon on Thu Aug 06, 2020 12:13 pm, edited 1 time in total.
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pedalman701
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by pedalman701 »

Another EJ escapee here. My advice would be to "Run away! Run away!"

I lost a lot of money to their fees and commissions over the years. But I finally wised up, and currently taking a DIY approach with a three-fund portfolio at Vanguard (BND, VTI, VXUS).

I recommend reading "How a Second-Grader Beats Wall Street". This was the final nail in my Edward Jones coffin lid.
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dbr
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by dbr »

lane7068 wrote: Thu Aug 06, 2020 11:28 am DBR,

She had a trusted friend for many years at EJ that took care of her account, but has since retired and moved on. Now, I just don't think she is getting a good feeling about if the new advisor(s) are more concerned with her pockets or their own. Other than that, I can't really say.

I'm compiling all these responses in an email and I'll be sending them to her in the next hour or two. So far, I greatly appreciate the responses from everyone.
I bet he was all over her when she retired with the usual rollover your 401k to our IRA pitch. In many cases the best place for the money would have been to stay in the 401k. "Trusted friend" is standard modus operandi for these companies. I am not sure the friend involved necessarily completely understands what he is doing other than being under tremendous pressure to build book by any means possible.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Stinky »

lane7068 wrote: Thu Aug 06, 2020 10:26 am My aunt has moved her 401k money to Edward Jones, has the paper to sign and return as they are requesting it to control the funds, but I've told her to wait so I could get some guidance from you Bogleheads.
I'm really, really glad that you came here before your aunt signed the papers. If EJ got hold of her money, they would immediately start creating a mess that would be difficult to untangle, with all of their fees and expensive funds. The longer she stayed with them, the more entangled she would get and the more fees she would pay.

You've gotten good advice from others. Read it, and show it to your aunt.

Stick with the firms mentioned most frequently on the Forum - Vanguard, Fidelity, Schwab, etc.
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dbr
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by dbr »

Note that apparently she is already at EJ. It is not clear if this is now new money from a 401k that is being added or the 401k was already rolled over.

That doesn't change the fact that getting out of EJ is indicated, and that the longer she has been there the worse the problem is.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Jack FFR1846 »

Clear points for your Aunt:

1) Fees: EJ charges fees to manage the account, often front end sales charge fees (loads) and advertising fees (12b-1). Their literature either neglects to show the fees, hides them or puts them into a sea of fees that may not apply. Look at their fee page. You'll see 100 different fees that don't matter and the fees that do matter hidden within. A very rough ball park....in the first year, she should not be surprised to see 5% of her portfolio going poof into fees.

2) Portfolio = cookie cutter: Have you seen the Fisher Investments tv commercial. Where one advisor asks "Do you use cookie cutter portfolios?". They are pointing right at Edward Jones. Your aunt will talk about her needs and wants and plans with her advisor and the advisor will receive a set of funds from the mother ship. The advisor will not tell the mother ship anything. Your aunt gets the best funds for revenue generation for Edward Jones.

3) Exit strategy: To leave Edward Jones costs money. On top of that, they make it difficult. When your aunt wants to leave, she can't simply tell her investment advisor. If she's going to Vanguard, in some cases, Vanguard may not be able to do all the legwork. She'll have to find the correct "Mother Ship" department to pull out. They will NOT make it easy or pleasant.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by pkcrafter »

EJ is not a good place to hold your money. Here is their fee structure. They simply will not operate in the clients best interest.

https://topratedfirms.com/brokers/fees/ ... edule.aspx


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radiowave
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by radiowave »

OP, my dad was at EJ and when he died and I was working through his investments I was heartbroken at the expensive and chaotic funds he was in. His financial advisor was his grandaughter's husband. Yes, nice guy and he took his family on several all expense paid trips to very nice places. That money comes from the accounts of retirees and other unsuspecting clients.

If your aunt already had funds at EJ, I would recommend she set up a Vanguard account (or Fidelity, Schwab) and then transfer the current assets from the new broker side and not have any interaction with EJ at all. Several posts here on the forum detail the process. A Target Date fund as mentioned above is a good set and forget and low cost fund choice. Or a Vanguard LifeStrategy Conservative Growth Fund https://investor.vanguard.com/mutual-f ... ile/VSCGX at 0.12 expense ratio would be a good alternative.
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arcticpineapplecorp.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by arcticpineapplecorp. »

run, don't walk from Edward Jones. To pile on:

here's an article that compares low cost asset management (Vanguard being the lowest 0.38%, followed by Charles Schwab at 0.44% per year, though those fees have come down, see the end of this post) vs more expensive. Ed Jones, is in the "hidden fee hall of shame" fyi:

https://www.marketwatch.com/story/is-yo ... 2017-11-16

After that, prices really jump.

Edward Jones (1.70% to 1.80%),
J.P. Morgan (1.56% to 1.86%),
Merrill Lynch (1.33% to 2.33%),
Wells Fargo (1.93% to 2.43%),
Morgan Stanley (2.42% to 2.92%),
UBS (2.94%)

In dollar terms, that means that a portfolio that costs $380 a year at Vanguard could run you as much as $1700-1800 a year at Ed Jones. (TV advertising is expensive, right?)

In life you generally get what you pay for. But "In investing you get to keep what you don't pay for." -- Jack Bogle

See how even a 1% fee can cost you 25% of your gains over 30 years:
Image

source: http://web.archive.org/web/201611100649 ... f-returns/

This doesn't even include high expensive funds ED Jones might put you in, especially if their funds carry loads (which is a commission, usually 5.75% either right off the top or on the back end, again giving some of your gains to the advisor). Vanguard is a no-load company, which means there's no way to even accidentally pick a fund with Vanguard that carries a load.

If she really wants an advisor, Vanguard only charges 0.30% per year, and has low cost funds:
https://investor.vanguard.com/financial ... r-services
Last edited by arcticpineapplecorp. on Thu Aug 06, 2020 12:46 pm, edited 3 times in total.
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lane7068
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by lane7068 »

DBR/All,

Apologies for any confusion. It seems she had her 401K at her employment and other money at EJ. When she left her employ, she transferred everything to one location, Edward Jones.
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Kintora
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Kintora »

One fee that I learned about near the end of my EJ experience I thought was particularly egregious.

For "dollar cost averaging" in or out of a stock/fund, they take 2% right off the top going in and then another 2% on the way out if you want to systematically invest and then withdraw a certain amount each month.

So, not even counting AUM fees, high expense ratio products, sales charges, etc., your money is taking a 2%-4% hit just from DCA :oops:
NotWhoYouThink
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by NotWhoYouThink »

She had a trusted friend for many years at EJ that took care of her account, but has since retired and moved on. Now, I just don't think she is getting a good feeling about if the new advisor(s) are more concerned with her pockets or their own. Other than that, I can't really say.
Her trusted friend was using her for income. She didn't know it because he was good at his job. Maybe one day the new advisor will be so good at his job that people mistake him for a trusted friend.

So, how do you expect this conversation to go now that you are seeing these responses? "Aunt Sue, Edward Jones is a company that milks you for fees and costs you 25% or more of your retirement income. They've been doing it to you for years, you just didn't have me to explain it to you until now."????

That is not a conversation that is going to go well.

Also, what would she do with her money otherwise? If EJ has been handling her non-retirement accounts up until now that means she has no experience managing her own money, no reference for whether they are doing a good or bad job, and no confidence in her ability to make better decisions on her own. As bad as EJ may be in the view of bogleheads, they are better than either:
- Keeping everything in CDs and money market funds for fear of taking risks (most years, anyway)
or
- Chasing hot tips, buying high and selling low.

So if your Aunt stays away from EJ who is going to hold her hand? That is the person who is going to take the blame if the market drops and her accounts lose value. Is that you?

Sure, let her know that other companies can manage her money just as well with lower fees. Suggest some of them. If she wants a person to trust that won't be Vanguard, as she won't have an advisor to meet with in person.

Then if she refuses your advice, which is likely, keep your mouth shut and enjoy your relationship with her.
delamer
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by delamer »

This is like writing a check to a car dealer without knowing which car they are going to deliver to your driveway.

First she gets a plan, including information on costs. That is nonnegotiable.

Have they ever heard of Zoom?

(Not that she should use EJ anyway. If she wants a local advisor, look into Fidelity or Schwab.)
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by John Z »

If you or your aunt want some EJ background reading on how they recruit and train new employees this is a great story. Knowing the background, motivation and employee requirements will set you back in your seat as you read.

http://kronstantinople.blogspot.com/p/e ... -saga.html
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celia
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by celia »

lane7068 wrote: Thu Aug 06, 2020 11:28 am I'm compiling all these responses in an email and I'll be sending them to her in the next hour or two. So far, I greatly appreciate the responses from everyone.
Instead of sending her pieces of this thread in chunks, why not just send her a link to this web page?

She had a trusted friend for many years at EJ that took care of her account, but has since retired and moved on. Now, I just don't think she is getting a good feeling about if the new advisor(s) are more concerned with her pockets or their own. Other than that, I can't really say.
When you are using EJ, you are paying them a lot of fees that could be used for your retirement. Instead, you are funding the advisor's retirement as well as your own. This may be the only advantage with using EJ,--- if you want to help fund someone else's retirement, like her trusted friend's.
Last edited by celia on Thu Aug 06, 2020 1:23 pm, edited 1 time in total.
Cheyenne
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Cheyenne »

I am by no means a financial expert. But after reading the posts on this forum for several years I can tell the OP that the words "Edward Jones" are usually used in jest.
Glockenspiel
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Glockenspiel »

Do not sign those papers! They are crooks and their fees and expenses will make you wish you had just invested in a bank CD instead.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by bloom2708 »

Opt out if you can. Very high fees from Edward Jones.

Portfolio gets too complicated. Fees are very hard to find on the website. AUM fees (Advisory Solutions) are 1.3%. High expense ratios.

Opt out now if she can.

Otherwise, down the road there will be a "how to I get out of Edward Jones" thread started.

In the end she can do what she wants. Many people pay high fees. They are unaware of the long term damage and reduction in future spending.

Good luck!
"We are here to provoke thoughtfulness, not agree with you." Unknown Boglehead
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Stinky
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Stinky »

delamer wrote: Thu Aug 06, 2020 1:10 pm This is like writing a check to a car dealer without knowing which car they are going to deliver to your driveway.
Better yet, leaving the "amount" field of a check blank, to be filled in by the car dealer.
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arcticpineapplecorp.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by arcticpineapplecorp. »

Glockenspiel wrote: Thu Aug 06, 2020 1:23 pm Do not sign those papers! They are crooks and their fees and expenses will make you wish you had just invested in a bank CD instead.
I wouldn't call the advisors crooks, but rather:

"It's difficult to get a man to understand something when his salary depends upon his not understanding it" -- Upton Sinclair
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Dottie57 »

I hope your Aunt gets away from EJ.

If she moves to Vanguard she might consider one or more of the Life Strategy funds. These are funds which contain both bonds and stocks. Good option for a simple portfolio. The link is from Vanguard so you can take a look.

https://investor.vanguard.com/mutual-fu ... estrategy/#/

Good luck!
dbr
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by dbr »

arcticpineapplecorp. wrote: Thu Aug 06, 2020 1:41 pm
Glockenspiel wrote: Thu Aug 06, 2020 1:23 pm Do not sign those papers! They are crooks and their fees and expenses will make you wish you had just invested in a bank CD instead.
I wouldn't call the advisors crooks, but rather:

"It's difficult to get a man to understand something when his salary depends upon his not understanding it" -- Upton Sinclair
I think a very real question is what the "trusted friend" thinks about having that position of trust. I agree in many cases this sort of advisor really thinks he is doing good. I am also pretty sure some of these people are sitting around laughing at the the advantage they are taking of their customers. One thing I do know is that they are under a lot of pressure to make book and family, friends, and neighbors are the hunting ground.
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arcticpineapplecorp.
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by arcticpineapplecorp. »

dbr wrote: Thu Aug 06, 2020 1:47 pm
arcticpineapplecorp. wrote: Thu Aug 06, 2020 1:41 pm
Glockenspiel wrote: Thu Aug 06, 2020 1:23 pm Do not sign those papers! They are crooks and their fees and expenses will make you wish you had just invested in a bank CD instead.
I wouldn't call the advisors crooks, but rather:

"It's difficult to get a man to understand something when his salary depends upon his not understanding it" -- Upton Sinclair
I think a very real question is what the "trusted friend" thinks about having that position of trust. I agree in many cases this sort of advisor really thinks he is doing good. I am also pretty sure some of these people are sitting around laughing at the the advantage they are taking of their customers. One thing I do know is that they are under a lot of pressure to make book and family, friends, and neighbors are the hunting ground.

sure but the advisors aren't fiduciaries. there is no fiduciary standard that all advisors have to uphold. therefore, provided they're not putting clients in unsuitable products (thereby meeting the suitability standard) they haven't broken any laws. it's unfortunate, but that's the financial industry and they're lobbying efforts at not having to put their clients' interests first. caveat emptor. banks have a "know thy customer" rule. clients need to adopt a "know thy advisor" rule. it's your money that's at stake.
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
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BL
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by BL »

Agree to find another less costly "home" for Aunt's savings.

The big three (Fidelity, Schwab, and Vanguard) mentioned all have low-cost (low Expense-Ratio) funds so if you determine what you want they can serve you well. I hesitate to suggest other than Vanguard if you want someone to advise you, as Vanguard will suggest low-ER funds and only charge 0.3% for using an advisor. Even without an advisor, V has several good balanced funds such as the Life Strategy and Target Date funds. Target Date 2020 should be down to and stay at 70% fixed income in about 7 years. Otherwise a Total Stock Market fund and a bond fund at desired ratio could be fine. It depends on each individual as to which works best. If you don't want to think about it, then either using a Vanguard PAS or buying a single balanced fun might be best.

I would suggest you both read this pdf for a quick overview:
https://www.etf.com/docs/IfYouCan.pdf

Also a good reference to have on hand is this one, written by Jane Bryant Quinn, who occasionally writes an article in AARP. I have followed her for decades in various magazines and books in the library.
How to Make Your Money Last - Completely Updated for Planning Today: The Indispensable Retirement Guide Paperback – January 7, 2020
by Jane Bryant Quinn (Author)
4.7 out of 5 stars 481 ratings
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Nate79
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Nate79 »

While you have gotten good advice I would caution you to be very careful providing advice. First, be very clear if she actually wants your advice. She has been with EJ already and probably has a trusted advisor. Who do you recommend is going to manage her money now? Are you asking her to DIY? Has she ever managed her money before? Be very careful about that. When the market has a major crash and she has lost significant amount of money is she going to blame you?

There are options like Vanguard VPAS or Schwab robo with advisor service as well.
vtjon02
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by vtjon02 »

My best friend is an EJ financial advisor. To support him I am in their lowest cost program to repeatedly buy fractional shares of ETFs. This program is almost never made available to their clients and it still is very expensive. I pay about 2% of the purchase amount per year in unnecessary commissions to invest a small trickle of money. This program exists for the advisors and their families yet it still costs a lot of money!

I hate everything about being an EJ client other than showing some support to my friend. The website is bad, there are constant solicitations from other EJ brokers and services and the advice from their corporate office is awful. Honestly, although I love my friend he doesn't have remotely enough education or oversight to handle people's money. And he is extraordinarily successful at EJ in comparison to his peers.

Tell your Aunt to run away as fast as she can.
RCL
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by RCL »

Would he still be your best friend if you moved your $$ to somewhere else?
valleyrock
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by valleyrock »

I agree about not talking at all to EJ anymore. They are clever and know very well that meeting with people, having breakfast with them, the whole relationship building thing actually works. I'm sure they are taught how to do all this.

By contacting one of the other firms mentioned here, she can initiate a full transfer of everything from EJ to them, without talking to EJ at all. Whether it's best to convert some or all of the securities in the account to cash first (keeping it within the accounts) is another question.

I've found with experience that sometimes it's best to tell a little lie when taking such steps. (A simpler example: when you want to change cable companies, tell the one you are leaving that you are being transferred overseas, and so you have to cancel. That way they're likely to stop the hard sell, and not send you to the next person up the food chain to try to keep you, etc. They might even know you're lying, but you make it easier on them to help you without jeopardizing their jobs so much.) What little lie to tell here? I'm not sure... the forum could help. She could tell them she's been diagnosed with something or other (consider what) that means she really needs to liquidate everything in the accounts and/or transfer everything to the company that you use, because you are going to have power of attorney, etc., etc. That might not be the best example, but, again, something plausible. How about, she just found out she is being appointed to some sort of posting overseas, joining the Peace Corps, and she has to put everything into accounts that someone else can manage... not there yet. Anyway, they'll kick back, but it's her money. A good excuse could make the EJ people say, well, you can't keep them all, they can tell their bosses that this is one that got away because they really, really had to do it, whatever.

(Fine points include transferring to the same types of accounts at the new firm, etc. A good firm will know to do that.)
Last edited by valleyrock on Thu Aug 06, 2020 6:29 pm, edited 3 times in total.
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Stinky
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Stinky »

vtjon02 wrote: Thu Aug 06, 2020 5:58 pm My best friend is an EJ financial advisor. To support him I am in their lowest cost program to repeatedly buy fractional shares of ETFs. This program is almost never made available to their clients and it still is very expensive. I pay about 2% of the purchase amount per year in unnecessary commissions to invest a small trickle of money. This program exists for the advisors and their families yet it still costs a lot of money!

I hate everything about being an EJ client other than showing some support to my friend. The website is bad, there are constant solicitations from other EJ brokers and services and the advice from their corporate office is awful. Honestly, although I love my friend he doesn't have remotely enough education or oversight to handle people's money. And he is extraordinarily successful at EJ in comparison to his peers.

Tell your Aunt to run away as fast as she can.
Would it be more efficient to just gift your friend some money?
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HereandNow
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by HereandNow »

Leaving EJ in 2012 was the smartest financial decision of my life. I lost thousands of dollars doing what the “financial advisers” wanted me to do while “investing.” I even filed a complaint against an EJ “financial adviser” who churned my account and sold me some of the stupidest financial products in existence, some very complicated and overpriced John Hancock funds. The compliance department then blamed me for allowing myself to be exploited by a crooked broker. Run! Run! Run!
Mr.BB
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Mr.BB »

RCL wrote: Thu Aug 06, 2020 6:16 pm Would he still be your best friend if you moved your $$ to somewhere else?
+1
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."
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lane7068
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by lane7068 »

I geatly appreciate all the responses, and sent the link of all your posts to my aunt. I will not be holding her hand nor managing her money, but I knew enough and read enough in the past to know Edward Jones probably wasn't her best bet.

I'll let her do what she wants to do with her own money, and answer any questions she may have.

Again, many thanks.
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Stinky
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by Stinky »

lane7068 wrote: Thu Aug 06, 2020 10:36 pm I geatly appreciate all the responses, and sent the link of all your posts to my aunt. I will not be holding her hand nor managing her money, but I knew enough and read enough in the past to know Edward Jones probably wasn't her best bet.

I'll let her do what she wants to do with her own money, and answer any questions she may have.

Again, many thanks.
It’s great that you’re helping your aunt out.

You should point your aunt to one article mentioned above, as follows:
John Z wrote: Thu Aug 06, 2020 1:11 pm If you or your aunt want some EJ background reading on how they recruit and train new employees this is a great story. Knowing the background, motivation and employee requirements will set you back in your seat as you read.

http://kronstantinople.blogspot.com/p/e ... -saga.html
It's a GREAT day to be alive! - Travis Tritt
palaheel
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by palaheel »

I think Fidelity might be something to consider. They have a spectrum of services, from diy, robo, hybrid to full advisor relationship. I'd think it would be easy to start with one level of service and move to another as her needs changed. There may even be a local office.
Markets crash. Markets recover. Inflation takes your money FOREVER.
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ruralavalon
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by ruralavalon »

Both Fidelity and Schwab have local customer service offices in some cities. If any are near your aunt, then that might be the better choice.
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NotWhoYouThink
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by NotWhoYouThink »

Let us know how it turns out.

My bet is that "strangers on the internet have bad things to say about Edward Jones" will not be persuasive to her, but it would be interesting to be wrong about that.
hnd
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Re: Help my Aunt decide on Edward Jones or somewhere else

Post by hnd »

my dad had an Edwards Jones account for years. I moved him over to TDA and now he uses the local TDA guy and loves him and it costs him so little comparatively its unbelievable. The EJ guy went to our church. I all but told him this was a scam. didnt' go well.

some people don't mind helping someone earn their keep if they are truly earning their keep with your money. EJ guys just plug your info in and it spits out what to do. anyone can do that. If the original advisor is gone and she's dealing with these new guys, its the perfect time to move on.

There are plenty of financial advisors out there that will still cost money but should be much easier to understand how much.
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