How to get out of Merrill Lynch brokerage advisory account?

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financial.freedom
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How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

We recently transferred our brokerage account from Vanguard to Merrill Lynch (transfer-in-kind), in order to get a better interest rate on a home loan.
On Friday, when the markets were down I logged in to do tax loss harvesting (TLH) before closing but it wouldn't allow it on my ML account.

Apparently, the brokerage account is in a personal advisory account at ML and only the advisor can place trades. I called ML and they said they thought this was already explained to me. But I remember asking if I can place trades with no fees etc. and the answer was yes. Maybe they thought "I" meant "they" on my behalf.

Regardless, I'd like to be able to have the same independence that I had before with my taxable mutual funds. Sometimes I login 30 mins before closing to TLH funds that are down, and would like to continue to have that ability. They said I can fill out a form to change it to a different account type that allows that independence. I'm also wondering if I should just transfer-in-kind after the close of escrow back to Vanguard?

Any tips or advice on how best to proceed?

Thank you in advance!
mkc
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by mkc »

financial.freedom wrote: Wed Oct 05, 2022 11:46 am We recently transferred our brokerage account from Vanguard to Merrill Lynch (transfer-in-kind), in order to get a better interest rate on a home loan.

Apparently, the brokerage account is in a personal advisory account at ML and only the advisor can place trades. I called ML and they said they thought this was already explained to me. But I remember asking if I can place trades with no fees etc. and the answer was yes. Maybe they thought "I" meant "they" on my behalf.

They said I can fill out a form to change it to a different account type that allows that independence.

Any tips or advice on how best to proceed?

Thank you in advance!
It sounds like you transferred to a wealth management account at ML. The appropriate move would have been to Merrill Edge, which is their self-directed account. You're probably paying around 1.7-1.8% AUM fees on this, so getting out ASAP is a very good idea.

You can move to Merrill Edge - that would likely be via the form they referred to.
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financial.freedom
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

duplicate
Last edited by financial.freedom on Wed Oct 05, 2022 12:14 pm, edited 1 time in total.
Topic Author
financial.freedom
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

mkc wrote: Wed Oct 05, 2022 12:02 pm
financial.freedom wrote: Wed Oct 05, 2022 11:46 am We recently transferred our brokerage account from Vanguard to Merrill Lynch (transfer-in-kind), in order to get a better interest rate on a home loan.

Apparently, the brokerage account is in a personal advisory account at ML and only the advisor can place trades. I called ML and they said they thought this was already explained to me. But I remember asking if I can place trades with no fees etc. and the answer was yes. Maybe they thought "I" meant "they" on my behalf.

They said I can fill out a form to change it to a different account type that allows that independence.

Any tips or advice on how best to proceed?

Thank you in advance!
It sounds like you transferred to a wealth management account at ML. The appropriate move would have been to Merrill Edge, which is their self-directed account. You're probably paying around 1.7-1.8% AUM fees on this, so getting out ASAP is a very good idea.

You can move to Merrill Edge - that would likely be via the form they referred to.
Thank you for the reply.

When I signed up they said there are no advisory fees.

Is there a way to look this up online?

It just says my name and advisory account.
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financial.freedom
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

I specifically asked the advisor and he says there are currently no fees or AUM fees on the account.
student
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by student »

financial.freedom wrote: Wed Oct 05, 2022 12:34 pm I specifically asked the advisor and he says there are currently no fees or AUM fees on the account.
Interesting. I am only aware of the three options described on Merrill. https://www.merrilledge.com/investing/w ... av_compare and on the Merrill Lynch most expensive side, I see https://olui2.fs.ml.com/publish/content ... utions.pdf So no AUM fees and needing the advisor to trades on your behalf does not make sense to me.
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financial.freedom
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

Weird. Maybe that's why he said "currently" no fees? On that link it says annual fee, and this account was just opened.
If anyone knows a way to check for fees on the account when I login would appreciate it -- I don't see it listed anywhere.

Since he says no fees, I'll plan to change to self-directed account on the close of escrow.
Unless others thinks it makes sense to just transfer-in-kind back to Vanguard?
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retired@50
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by retired@50 »

financial.freedom wrote: Wed Oct 05, 2022 12:48 pm Weird. Maybe that's why he said "currently" no fees? On that link it says annual fee, and this account was just opened.
If anyone knows a way to check for fees on the account when I login would appreciate it -- I don't see it listed anywhere.

Since he says no fees, I'll plan to change to self-directed account on the close of escrow.
Unless others thinks it makes sense to just transfer-in-kind back to Vanguard?
There may be a specific holding period for this account related to the loan. I'd re-read any agreements you may have signed to get the loan and/or to get the account set up. It's probably on page 79 of an 80 page prospectus or something equally "hidden".

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
mkc
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by mkc »

financial.freedom wrote: Wed Oct 05, 2022 12:48 pm Weird. Maybe that's why he said "currently" no fees? On that link it says annual fee, and this account was just opened.
If anyone knows a way to check for fees on the account when I login would appreciate it -- I don't see it listed anywhere.

Since he says no fees, I'll plan to change to self-directed account on the close of escrow.
Unless others thinks it makes sense to just transfer-in-kind back to Vanguard?
What does the agreement you signed state regarding AUM fees?

You could also look into whether you actually have to wait until close of escrow on the loan - it could be that a Merrill Edge account also qualifies for the home loan deal, and may be "no harm, no foul" for you to switch now.
dbr
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by dbr »

According to this statement:

Reduction of the Maximum Merrill Lynch Fee Rate. The Merrill Lynch
Fee Rate that applies to your Account when you are working with an
Advisor is the rate that is agreed to between you and your Advisor and is
a negotiated rate, subject to a maximum rate that can be charged in the
Program. Effective May 1, 2022, the maximum Merrill Lynch Fee Rate that
can be charged in the Program is being reduced from 2.00% to 1.75% per
annum. This change will not affect any Accounts where the current
Merrill Lynch Fee Rate is 1.75% or less. Any Account with a Merrill Lynch
Fee Rate greater than 1.75% will automatically be reduced to 1.75%. See
Item 4 at the section “The Program Fee and Other Charges.”

https://olui2.fs.ml.com/Publish/Content ... -adv2a.pdf

What did you negotiate?

I don't vouch for the source but read this and see what you think:

https://www.brokerage-review.com/online ... und%20fees.
Topic Author
financial.freedom
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

dbr wrote: Wed Oct 05, 2022 1:48 pm According to this statement:

Reduction of the Maximum Merrill Lynch Fee Rate. The Merrill Lynch
Fee Rate that applies to your Account when you are working with an
Advisor is the rate that is agreed to between you and your Advisor and is
a negotiated rate, subject to a maximum rate that can be charged in the
Program. Effective May 1, 2022, the maximum Merrill Lynch Fee Rate that
can be charged in the Program is being reduced from 2.00% to 1.75% per
annum. This change will not affect any Accounts where the current
Merrill Lynch Fee Rate is 1.75% or less. Any Account with a Merrill Lynch
Fee Rate greater than 1.75% will automatically be reduced to 1.75%. See
Item 4 at the section “The Program Fee and Other Charges.”

https://olui2.fs.ml.com/Publish/Content ... -adv2a.pdf

What did you negotiate?

I don't vouch for the source but read this and see what you think:

https://www.brokerage-review.com/online ... und%20fees.
Thank you!
I told them no fees and they agreed. So hopefully that holds true.
Will still change the account after closing escrow, since I want to place trades on my own.
Not sure whether to do self-directed and stay at ML or transfer back to Vanguard.
mkc
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by mkc »

financial.freedom wrote: Wed Oct 05, 2022 3:14 pm
dbr wrote: Wed Oct 05, 2022 1:48 pm According to this statement:

Reduction of the Maximum Merrill Lynch Fee Rate. The Merrill Lynch
Fee Rate that applies to your Account when you are working with an
Advisor is the rate that is agreed to between you and your Advisor and is
a negotiated rate, subject to a maximum rate that can be charged in the
Program. Effective May 1, 2022, the maximum Merrill Lynch Fee Rate that
can be charged in the Program is being reduced from 2.00% to 1.75% per
annum. This change will not affect any Accounts where the current
Merrill Lynch Fee Rate is 1.75% or less. Any Account with a Merrill Lynch
Fee Rate greater than 1.75% will automatically be reduced to 1.75%. See
Item 4 at the section “The Program Fee and Other Charges.”

https://olui2.fs.ml.com/Publish/Content ... -adv2a.pdf

What did you negotiate?

I don't vouch for the source but read this and see what you think:

https://www.brokerage-review.com/online ... und%20fees.
Thank you!
I told them no fees and they agreed. So hopefully that holds true.
What matters is what agreement you signed (paper or online). Do you have a copy of the agreement?
dbr
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by dbr »

mkc wrote: Wed Oct 05, 2022 4:43 pm
financial.freedom wrote: Wed Oct 05, 2022 3:14 pm
dbr wrote: Wed Oct 05, 2022 1:48 pm According to this statement:

Reduction of the Maximum Merrill Lynch Fee Rate. The Merrill Lynch
Fee Rate that applies to your Account when you are working with an
Advisor is the rate that is agreed to between you and your Advisor and is
a negotiated rate, subject to a maximum rate that can be charged in the
Program. Effective May 1, 2022, the maximum Merrill Lynch Fee Rate that
can be charged in the Program is being reduced from 2.00% to 1.75% per
annum. This change will not affect any Accounts where the current
Merrill Lynch Fee Rate is 1.75% or less. Any Account with a Merrill Lynch
Fee Rate greater than 1.75% will automatically be reduced to 1.75%. See
Item 4 at the section “The Program Fee and Other Charges.”

https://olui2.fs.ml.com/Publish/Content ... -adv2a.pdf

What did you negotiate?

I don't vouch for the source but read this and see what you think:

https://www.brokerage-review.com/online ... und%20fees.
Thank you!
I told them no fees and they agreed. So hopefully that holds true.
What matters is what agreement you signed (paper or online). Do you have a copy of the agreement?
I was going to add the same comment. Also one wants to be sure of what one is paying for expense ratios and also that there are no front end loads, which are not fees.
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galawdawg
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by galawdawg »

Was this for the $5 million house on the ocean? I thought you didn't need to borrow to purchase a home in that price range? viewtopic.php?p=6582107#p6582107

In any event, just read all of the terms and conditions, as well as all disclosures, of the Merrill Lynch account you opened. Those should answer your questions about your account.
Topic Author
financial.freedom
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

galawdawg wrote: Wed Oct 05, 2022 4:54 pm Was this for the $5 million house on the ocean? I thought you didn't need to borrow to purchase a home in that price range? viewtopic.php?p=6582107#p6582107

In any event, just read all of the terms and conditions, as well as all disclosures, of the Merrill Lynch account you opened. Those should answer your questions about your account.
Different house, good memory.

I plan to change the account either way, since I can't place trades for this account on my own.
So main question is whether to stick with ML (and change to self-directed account) or go back to Vanguard after closing.

We needed to borrow for that prior house as well, unless selling most funds in taxable which would lead to high taxes in my state (capital gains taxed at ordinary income rate).
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by galawdawg »

financial.freedom wrote: Wed Oct 05, 2022 5:41 pm So main question is whether to stick with ML (and change to self-directed account) or go back to Vanguard after closing.
That depends upon your needs and expectations for a brokerage. Compare the benefits, fees, advantages and disadvantages of both and pick the best one for you.

Be certain to read the fine print of your mortgage rate discount offer first to ensure there are no minimum holding periods or penalties if you leave ML too soon.
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financial.freedom
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by financial.freedom »

galawdawg wrote: Wed Oct 05, 2022 5:48 pm
financial.freedom wrote: Wed Oct 05, 2022 5:41 pm So main question is whether to stick with ML (and change to self-directed account) or go back to Vanguard after closing.
That depends upon your needs and expectations for a brokerage. Compare the benefits, fees, advantages and disadvantages of both and pick the best one for you.

Be certain to read the fine print of your mortgage rate discount offer first to ensure there are no minimum holding periods or penalties if you leave ML too soon.
Will do, thank you. :beer
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Re: How to get out of Merrill Lynch brokerage advisory account?

Post by remomnyc »

Make sure there are no penalties or repercussions vis a vis your existing agreement with ML or with respect to your mortgage; otherwise, cancel the advisory account. I had my 401k at ML. When I retired, I ended up rolling it into an IRA at Merrill Edge (ME) because I could not transfer my brokered CDs elsewhere. I was paid for the rollover and intended to move my money to Schwab once my CDs matured. ME assigned an advisor to me (no fee). He connected me to a Bank of America (BoA) mortgage lender who got me a sweet rate. I got a rate reduction for moving $ to BoA but I was allowed to use those $ at closing. I kept my ME account and I still have my Schwab account. I closed my Vanguard account due to the horrible customer service and clunky website, but I basically hold only Vanguard ETFs in both my ME and Schwab accounts. I don't pay any fees for anything and handle all my own trades.
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