Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

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MrMars
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Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

My wife is starting a new job that will offer a Simple IRA via Edward Jones.

I realize EJ won't offer Vanguard or Fidelty mutual funds (generally). The EJ agent is supposed to mail us some stuff. After talking to him it seems clear he's likely to push or provide info on funds that meet his objectives more than mine. He specifically mentioned American TDFs, which are fine(ish) but also carry a 0.69% ER. I don't consider that crazy but it is more than I want the ER to be.

I do realize this guy has to make some money but I'd like prioritize our financial goals over his.

So, in advance of whatever info EJ sends me, which can anybody specific recommend mutual funds they get at EJ that match up well for Bogleheads? In general, I'm looking for 3-fund portfolio or a TDF. Low ER, no load, the usual stuff.

I realize I can transfer out the sIRA balance once a year to a tIRA (we use Vanguard) although I believe you have to wait two years after the first money goes into the sIRA to do that.

Thanks for your input.
Kookaburra
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by Kookaburra »

EJ likes to offer American, Calvert, and Invesco funds. All duds in my opinion. Try to find the least dirty sheet in the laundry basket.

Also, EJ’s plan will make a lot more off your wife than simply through its high ER funds. Its funds will also have loads. And the plan may very well have a % of AUM fee leached onto it. Now that I think about it, it’s poor fund lineup is the least of the fees.
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like2read
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by like2read »

Are you expecting that you will have access to their full lineup?

It looks like they do have ETFs from Vanguard and iShares.

https://www.edwardjones.com/sites/defau ... 840D-A.pdf

May have to wait and see what they list as available to you.
nanosour
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by nanosour »

If it's just a simple IRA can't she just take the money and put it in her own IRA at a different company with much, much better options. Stay away from EJ as much as you can. And to answer your question, there are no funds offered by EJ that fit the Boglehead investing philosophy. Period dot.
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MrMars
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

like2read wrote: Tue Jan 24, 2023 6:16 pm Are you expecting that you will have access to their full lineup?

It looks like they do have ETFs from Vanguard and iShares.

https://www.edwardjones.com/sites/defau ... 840D-A.pdf

May have to wait and see what they list as available to you.
thank you for that list. If they will give me access to VG ETFs, I'm good.
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MrMars
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

nanosour wrote: Tue Jan 24, 2023 6:24 pm If it's just a simple IRA can't she just take the money and put it in her own IRA at a different company with much, much better options. Stay away from EJ as much as you can. And to answer your question, there are no funds offered by EJ that fit the Boglehead investing philosophy. Period dot.
My understanding is you have to wait 2 years from the initial investment and then you can transfer out once a year. I will absolutely do that if any my only option are high ER funds.
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CAsage
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by CAsage »

Are they giving you matching, or is there something about a Simple IRA that you cannot get by just opening an outside IRA on your own? Possibly an ignorant question..... But without matching is it worth it?

Edit to add: With different contribution limits, this is likely worthwhile only if you exceed the regular IRA limit maybe?
Last edited by CAsage on Tue Jan 24, 2023 7:22 pm, edited 1 time in total.
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tibbitts
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by tibbitts »

CAsage wrote: Tue Jan 24, 2023 6:53 pm Are they giving you matching, or is there something about a Simple IRA that you cannot get by just opening an outside IRA on your own? Possibly an ignorant question..... But without matching is it worth it?
The Simple and an "outside" IRA have separate/different contribution limits.
exodusNH
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by exodusNH »

MrMars wrote: Tue Jan 24, 2023 5:44 pm My wife is starting a new job that will offer a Simple IRA via Edward Jones.

I realize EJ won't offer Vanguard or Fidelty mutual funds (generally). The EJ agent is supposed to mail us some stuff. After talking to him it seems clear he's likely to push or provide info on funds that meet his objectives more than mine. He specifically mentioned American TDFs, which are fine(ish) but also carry a 0.69% ER. I don't consider that crazy but it is more than I want the ER to be.

I do realize this guy has to make some money but I'd like prioritize our financial goals over his.

So, in advance of whatever info EJ sends me, which can anybody specific recommend mutual funds they get at EJ that match up well for Bogleheads? In general, I'm looking for 3-fund portfolio or a TDF. Low ER, no load, the usual stuff.

I realize I can transfer out the sIRA balance once a year to a tIRA (we use Vanguard) although I believe you have to wait two years after the first money goes into the sIRA to do that.

Thanks for your input.
There are two types of SIMPLE IRAs. You should find out which one it is, as the 5304 lets you choose where the IRA is held, even if they might suggest someone. (https://www.bogleheads.org/wiki/SIMPLE_IRA).

If it's a 5305, after two years she can transfer it to a regular IRA.
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MrMars
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

CAsage wrote: Tue Jan 24, 2023 6:53 pm Are they giving you matching, or is there something about a Simple IRA that you cannot get by just opening an outside IRA on your own? Possibly an ignorant question..... But without matching is it worth it?

Edit to add: With different contribution limits, this is likely worthwhile only if you exceed the regular IRA limit maybe?
Yes, 3% match. And the simple IRA allows for $15.5k contribution
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MrMars
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

exodusNH wrote: Tue Jan 24, 2023 7:06 pm
MrMars wrote: Tue Jan 24, 2023 5:44 pm My wife is starting a new job that will offer a Simple IRA via Edward Jones.

I realize EJ won't offer Vanguard or Fidelty mutual funds (generally). The EJ agent is supposed to mail us some stuff. After talking to him it seems clear he's likely to push or provide info on funds that meet his objectives more than mine. He specifically mentioned American TDFs, which are fine(ish) but also carry a 0.69% ER. I don't consider that crazy but it is more than I want the ER to be.

I do realize this guy has to make some money but I'd like prioritize our financial goals over his.

So, in advance of whatever info EJ sends me, which can anybody specific recommend mutual funds they get at EJ that match up well for Bogleheads? In general, I'm looking for 3-fund portfolio or a TDF. Low ER, no load, the usual stuff.

I realize I can transfer out the sIRA balance once a year to a tIRA (we use Vanguard) although I believe you have to wait two years after the first money goes into the sIRA to do that.

Thanks for your input.
There are two types of SIMPLE IRAs. You should find out which one it is, as the 5304 lets you choose where the IRA is held, even if they might suggest someone. (https://www.bogleheads.org/wiki/SIMPLE_IRA).

If it's a 5305, after two years she can transfer it to a regular IRA.
I'm almost certain it's a 5305 but I'll double check that
jryan
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by jryan »

MrMars wrote: Tue Jan 24, 2023 6:47 pm
like2read wrote: Tue Jan 24, 2023 6:16 pm Are you expecting that you will have access to their full lineup?

It looks like they do have ETFs from Vanguard and iShares.

https://www.edwardjones.com/sites/defau ... 840D-A.pdf

May have to wait and see what they list as available to you.
thank you for that list. If they will give me access to VG ETFs, I'm good.
I don't have a relationship with Edward Jones, but please be sure to be aware of all of the fees, commissions, ... that will be involved (Kookaburra's comments are spot on). It appears that Edward Jones does do a good job of disclosing information about their services at Edward Jones compensation and fees.

For example, on this page you'll find Exchange-traded Funds ("ETFs") (PDF) which contains "The commissions on trades for ETFs may be up to 2.5% of the principal amount or a $50 minimum commission."

Assuming that this commission applies in your wife's case, does "I'm good" still apply? ;-)

When the Edward Jones agent suggested the American Target Date Fund with a %0.69 expense ratio, was there any mention of a sales charge? Based on Share Class Pricing Details - American Funds, there could be up to a 5.75% sales charge.

Hopefully one of the share classes with a reduced or waived sales charge will be available within the SIMPLE IRA. If you haven't already taken a look, here's the American Funds Target Date Retirement Series Prospectus (PDF) so you can become more familiar with potential options.

However, I won't be surprised to learn that only Class A (and perhaps Class C) shares are available to her.

I'm sure others would be interested in what you discover along the way.

Please congratulate MrsMars on her new position and may she experience a deep sense of fulfillment in the coming months and years!
exodusNH
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by exodusNH »

jryan wrote: Tue Jan 24, 2023 10:14 pm
MrMars wrote: Tue Jan 24, 2023 6:47 pm
like2read wrote: Tue Jan 24, 2023 6:16 pm Are you expecting that you will have access to their full lineup?

It looks like they do have ETFs from Vanguard and iShares.

https://www.edwardjones.com/sites/defau ... 840D-A.pdf

May have to wait and see what they list as available to you.
thank you for that list. If they will give me access to VG ETFs, I'm good.
I don't have a relationship with Edward Jones, but please be sure to be aware of all of the fees, commissions, ... that will be involved (Kookaburra's comments are spot on). It appears that Edward Jones does do a good job of disclosing information about their services at Edward Jones compensation and fees.

For example, on this page you'll find Exchange-traded Funds ("ETFs") (PDF) which contains "The commissions on trades for ETFs may be up to 2.5% of the principal amount or a $50 minimum commission."

Assuming that this commission applies in your wife's case, does "I'm good" still apply? ;-)

When the Edward Jones agent suggested the American Target Date Fund with a %0.69 expense ratio, was there any mention of a sales charge? Based on Share Class Pricing Details - American Funds, there could be up to a 5.75% sales charge.

Hopefully one of the share classes with a reduced or waived sales charge will be available within the SIMPLE IRA. If you haven't already taken a look, here's the American Funds Target Date Retirement Series Prospectus (PDF) so you can become more familiar with potential options.

However, I won't be surprised to learn that only Class A (and perhaps Class C) shares are available to her.

I'm sure others would be interested in what you discover along the way.

Please congratulate MrsMars on her new position and may she experience a deep sense of fulfillment in the coming months and years!
Sometimes the sales charges are waived in a retirement account.
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MrMars
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

jryan wrote: Tue Jan 24, 2023 10:14 pm
I don't have a relationship with Edward Jones, but please be sure to be aware of all of the fees, commissions, ... that will be involved (Kookaburra's comments are spot on). It appears that Edward Jones does do a good job of disclosing information about their services at Edward Jones compensation and fees.

For example, on this page you'll find Exchange-traded Funds ("ETFs") (PDF) which contains "The commissions on trades for ETFs may be up to 2.5% of the principal amount or a $50 minimum commission."

Assuming that this commission applies in your wife's case, does "I'm good" still apply? ;-)

When the Edward Jones agent suggested the American Target Date Fund with a %0.69 expense ratio, was there any mention of a sales charge? Based on Share Class Pricing Details - American Funds, there could be up to a 5.75% sales charge.

Hopefully one of the share classes with a reduced or waived sales charge will be available within the SIMPLE IRA. If you haven't already taken a look, here's the American Funds Target Date Retirement Series Prospectus (PDF) so you can become more familiar with potential options.

However, I won't be surprised to learn that only Class A (and perhaps Class C) shares are available to her.

I'm sure others would be interested in what you discover along the way.

Please congratulate MrsMars on her new position and may she experience a deep sense of fulfillment in the coming months and years!
Wow to the commission fees. No, "I'm good" definitely does not apply if those turn out to be the rates.

This looks like it will be an adventure as I try to navigate shark infested waters that are clearly designed to separate my wife from her retirement dollars. I'm definitely now curious (or is that a sense of dread?) to see what "proposals" he sends us.

I was very much looking forward to the $15,500 worth of tax deferred space. I suppose this may turn into a capture the match and invest more in taxable situation. (we aren't eligible to do a Roth).

I had read, many times, how EJ isn't investor friendly but not being a customer of theirs I just never really internalized how truly problematic they might be. I also never imagined being "forced" into using them for a retirement account.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by like2read »

jryan wrote: Tue Jan 24, 2023 10:14 pm
"The commissions on trades for ETFs may be up to 2.5% of the principal amount ...."
Yikes! :shock:
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

If it is a 5305 SIMPLE, she may be able to open a "frozen" SIMPLE IRA at Vanguard and roll her contributions to it without waiting the 2 years. I believe she can force EJ to roll it over there by trustee to trustee transfer frequently (like once a month). However, getting them to do this can be a challenge.

Awhile back, the only fund offered in the SIMPLE IRA that didn't have a load or commission was the stable value or money market fund (not sure which). So she could invest in that one and roll it to her own frozen IRA and invest as she wants.

This is old information and I'm not sure it is all still correct. You can look for some long ago threads by searching for frozen SIMPLE Edward Jones.

The 3% match makes the SIMPLE worth using, even at EJ.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by radiowave »

OP, check to see if your wife can self manage her account. If no - EJ makes all the choices - then you will be stuck with whatever EJ decides.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

retiredjg wrote: Wed Jan 25, 2023 10:26 am If it is a 5305 SIMPLE, she may be able to open a "frozen" SIMPLE IRA at Vanguard and roll her contributions to it without waiting the 2 years. I believe she can force EJ to roll it over there by trustee to trustee transfer frequently (like once a month). However, getting them to do this can be a challenge.

Awhile back, the only fund offered in the SIMPLE IRA that didn't have a load or commission was the stable value or money market fund (not sure which). So she could invest in that one and roll it to her own frozen IRA and invest as she wants.

This is old information and I'm not sure it is all still correct. You can look for some long ago threads by searching for frozen SIMPLE Edward Jones.

The 3% match makes the SIMPLE worth using, even at EJ.
hmm...this is interesting. I'll add this to the list of things to look into. Thank you.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

Here is some more information. This is the IRS designed form. The EJ form will look different but cannot be inconsistent with the rules as presented here.

https://www.irs.gov/pub/irs-pdf/f5305sim.pdf

Note particularly: Article IV—Other Requirements and Provisions

No Withdrawal Restrictions. The Employer may not require the employee to retain any portion of the contributions in his or her SIMPLE
IRA or otherwise impose any withdrawal restrictions.


No Cost Or Penalty For Transfers. The Employer will not impose any cost or penalty on a participant for the transfer of the participant’s SIMPLE IRA balance to another IRA.

However, a SIMPLE IRA balance may be rolled over or transferred on a tax-free basis to another IRA designed solely to hold funds under a SIMPLE IRA plan.

In addition, an individual may roll over or transfer his or her SIMPLE IRA balance to any IRA or eligible retirement plan after a 2-year period has expired since the individual first participated in any SIMPLE IRA plan of the Employer.
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retiredjg
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

One other thing you should know. Once you have read and understood the IRS form, you will likely know more than the EJ rep about SIMPLE IRAs. It may take some patience to get them to do what the IRS requires.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by DesertGator »

The employer offering the Simple IRA is likely also participating, & getting the 3% match. Surely if they knew the fees & poor product selection they get with EJ, they'd much rather be in a Vanguard Simple-IRA. No fees, unless the individual has less than $50k (combined accounts) at Vanguard, then a $25 flat fee per fund, per year until they are at that level. I managed a Vanguard SImple-IRA for a few years. Easy as pie to set up and manage.

I understand this is a new position, but perhaps a conversation could be had with the decision maker to make them aware of this much better option?
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

retiredjg wrote: Wed Jan 25, 2023 11:20 am Here is some more information. This is the IRS designed form. The EJ form will look different but cannot be inconsistent with the rules as presented here.

https://www.irs.gov/pub/irs-pdf/f5305sim.pdf

Note particularly: Article IV—Other Requirements and Provisions

No Withdrawal Restrictions. The Employer may not require the employee to retain any portion of the contributions in his or her SIMPLE
IRA or otherwise impose any withdrawal restrictions.


No Cost Or Penalty For Transfers. The Employer will not impose any cost or penalty on a participant for the transfer of the participant’s SIMPLE IRA balance to another IRA.

However, a SIMPLE IRA balance may be rolled over or transferred on a tax-free basis to another IRA designed solely to hold funds under a SIMPLE IRA plan.

In addition, an individual may roll over or transfer his or her SIMPLE IRA balance to any IRA or eligible retirement plan after a 2-year period has expired since the individual first participated in any SIMPLE IRA plan of the Employer.
thank you, again.
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MrMars
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

DesertGator wrote: Wed Jan 25, 2023 11:40 am The employer offering the Simple IRA is likely also participating, & getting the 3% match. Surely if they knew the fees & poor product selection they get with EJ, they'd much rather be in a Vanguard Simple-IRA. No fees, unless the individual has less than $50k (combined accounts) at Vanguard, then a $25 flat fee per fund, per year until they are at that level. I managed a Vanguard SImple-IRA for a few years. Easy as pie to set up and manage.

I understand this is a new position, but perhaps a conversation could be had with the decision maker to make them aware of this much better option?
fortunately, she and I have a very small but it does exist relationship with the business owner before she was hired. This is a thing I am thinking of approaching him about. However, I don't think that her first couple of weeks of employment is necessarily the best time.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

Wise. Nobody likes a complaining new hire. And a complaining spouse of a new hire is liked even less. :happy
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by David Jay »

MrMars wrote: Wed Jan 25, 2023 12:08 pmThis is a thing I am thinking of approaching him about. However, I don't think that her first couple of weeks of employment is necessarily the best time.
Agree completely, 6 - 12 months is likely the best time. Once your wife is fully “up to speed” and is showing herself to be a great addition to the team is a good time to discuss.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by smitcat »

David Jay wrote: Wed Jan 25, 2023 12:18 pm
MrMars wrote: Wed Jan 25, 2023 12:08 pmThis is a thing I am thinking of approaching him about. However, I don't think that her first couple of weeks of employment is necessarily the best time.
Agree completely, 6 - 12 months is likely the best time. Once your wife is fully “up to speed” and is showing herself to be a great addition to the team is a good time to discuss.
Also note that business owners can be motivated by the costs and time required to implement the benefits.
Many times they do not participate themselves.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by celia »

I wouldn’t have her talk to the employer about the custodian until she has been there 2 years. How can you complain about a service until you’ve tried it?

Meanwhile, she could leave the contributions in cash.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

celia wrote: Wed Jan 25, 2023 12:35 pm I wouldn’t have her talk to the employer about the custodian until she has been there 2 years. How can you complain about a service until you’ve tried it?

Meanwhile, she could leave the contributions in cash.
I kind of don't like the idea of leaving the contributions in cash for 2 years. That seems to be an anathema to BH investing philosophy. But it still might be a better idea than paying these fees
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by valleyrock »

+1 wait a while and get established before trying to address this in some way.

BUT if you can dig around in the outfit's HR website, you might learn more. There may be options on offer to employees that the HR person she spoke with isn't familiar with. If it's just an error of omission, it shouldn't ruffle any feathers for her to politely ask HR about some options that seem to be on the firm's website.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by ruralavalon »

MrMars wrote: Tue Jan 24, 2023 5:44 pm My wife is starting a new job that will offer a Simple IRA via Edward Jones.

I realize EJ won't offer Vanguard or Fidelty mutual funds (generally). The EJ agent is supposed to mail us some stuff. After talking to him it seems clear he's likely to push or provide info on funds that meet his objectives more than mine. He specifically mentioned American TDFs, which are fine(ish) but also carry a 0.69% ER. I don't consider that crazy but it is more than I want the ER to be.

I do realize this guy has to make some money but I'd like prioritize our financial goals over his.

So, in advance of whatever info EJ sends me, which can anybody specific recommend mutual funds they get at EJ that match up well for Bogleheads? In general, I'm looking for 3-fund portfolio or a TDF. Low ER, no load, the usual stuff.

I realize I can transfer out the sIRA balance once a year to a tIRA (we use Vanguard) although I believe you have to wait two years after the first money goes into the sIRA to do that.

Thanks for your input.
First of all, find out of this is a Form 5304 or a Form 5305 SIMPLE IRA plan.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by suemarkp »

Not sure if anyone can really answer your question, as EJ has many different account types and rules, plus some discretion is given to the rep as far as waiving fees. My wife and I each have an EJ Roth. Hers is older and has loaded funds but no AUM. Mine has an AUM fee, no loads, and lower ER share classes.

The fund choices are much less in her account. Because of the load fees, I don't want anything new. But they do allow selling one American Funds fund and buying into another without load. And dividend reinvestment is done without load.

In my AUM account, I have some one Vanguard fund and the SPY S&P 500 index fund. I tried to get VTSAX (total stock market or ETF equivalent VTI), but was told I can't have that one. He dismissed it as having too many losers with the few winners... They door a poor job of managing the funds. No rebalancing, no tilting between growth, value, intl except when the mothership says something is too out of whack. I don't think the reps even know the growth/value/intl tilts in many of the accounts, just maybe what is large, medium, and small caps.

In the end, the performance between my wife's account and mine have been similar. It was the Vanguard VYM fund that reduced my 2020 returns the most... Returns are as follows (after AUM fee in my account):
Wife 2022: -20%, 2021: 20%, 2020: 32%
Mine 2022: -19.9%, 2021: 20.8%, 2020: 20%
VTI 2022: -19.5%, 2021:25.7%, 2020: 21%

The most difficult problem is picking your US/Intl balance and value/growth balance as those ratios are built into the active funds and your choices are limited. We have too much growth versus value. My wife's is small cap heavy which did well in 2020 but added drag in 2021 and 2022.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

MrMars wrote: Wed Jan 25, 2023 2:12 pm
celia wrote: Wed Jan 25, 2023 12:35 pm I wouldn’t have her talk to the employer about the custodian until she has been there 2 years. How can you complain about a service until you’ve tried it?

Meanwhile, she could leave the contributions in cash.
I kind of don't like the idea of leaving the contributions in cash for 2 years. That seems to be an anathema to BH investing philosophy. But it still might be a better idea than paying these fees
That's the point of the "frozen" SIMPLE IRA. You don't have to wait.

It is the "...another IRA designed solely to hold funds under a SIMPLE IRA plan" mentioned in the IRS form.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

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retiredjg wrote: Wed Jan 25, 2023 3:38 pm
MrMars wrote: Wed Jan 25, 2023 2:12 pm
celia wrote: Wed Jan 25, 2023 12:35 pm I wouldn’t have her talk to the employer about the custodian until she has been there 2 years. How can you complain about a service until you’ve tried it?

Meanwhile, she could leave the contributions in cash.
I kind of don't like the idea of leaving the contributions in cash for 2 years. That seems to be an anathema to BH investing philosophy. But it still might be a better idea than paying these fees
That's the point of the "frozen" SIMPLE IRA. You don't have to wait.

It is the "...another IRA designed solely to hold funds under a SIMPLE IRA plan" mentioned in the IRS form.
I've perused a couple of the frozen SIMPLE IRA threads that were previously linked. This is a super interesting concept / possible pathway engage with. Once I get the packet EJ is sending us and can see what he's offering my wife. I'm going to dig deeper and likely attempt to get in touch with VG about setting one up. On the surface this seems like a reasonable workaround if I can figure out how to set up a frozen Simple IRA and get EJ to transfer money out.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

I do anticipate some trouble/confusion when you call Vanguard. I think the choice for "frozen" is on the regular IRA application. I do not think it is on their SIMPLE IRA form, but it could be.

It is not a unicorn or myth - I have actually seen the checkbox on the application. :D

This apparently is not common and as we all know, many of the Vanguard phone reps are not up to speed on what they do and do not do. You may need to be persistent.
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In somewhat of a shocking development, it appears DW's new job offers a 5304 plan. It's a (very) small business, DW seems to think there won't be any problem asking the HR/Payroll person to fill out the paperwork to create an account a VG. If that's how this all plays out color me relieved. As somebody who has come to embrace the BH investing philosophy the thought of paying 12b-1 fees, high ER, dividend reinvestment fees, breathing fees was, well, to be honest it made me borderline furious.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by exodusNH »

MrMars wrote: Mon Feb 06, 2023 10:16 am In somewhat of a shocking development, it appears DW's new job offers a 5304 plan. It's a (very) small business, DW seems to think there won't be any problem asking the HR/Payroll person to fill out the paperwork to create an account a VG. If that's how this all plays out color me relieved. As somebody who has come to embrace the BH investing philosophy the thought of paying 12b-1 fees, high ER, dividend reinvestment fees, breathing fees was, well, to be honest it made me borderline furious.
That's good news!

HR may be unfamiliar with the paperwork, but I can't imagine they have an option to refuse your wife's choice. The plan is set up to allow participants to choose the institution. If they forbid her, it's probably violating some federal regulation. Retirement plans are strongly regulated.
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exodusNH wrote: Mon Feb 06, 2023 10:24 am
MrMars wrote: Mon Feb 06, 2023 10:16 am In somewhat of a shocking development, it appears DW's new job offers a 5304 plan. It's a (very) small business, DW seems to think there won't be any problem asking the HR/Payroll person to fill out the paperwork to create an account a VG. If that's how this all plays out color me relieved. As somebody who has come to embrace the BH investing philosophy the thought of paying 12b-1 fees, high ER, dividend reinvestment fees, breathing fees was, well, to be honest it made me borderline furious.
That's good news!

HR may be unfamiliar with the paperwork, but I can't imagine they have an option to refuse your wife's choice. The plan is set up to allow participants to choose the institution. If they forbid her, it's probably violating some federal regulation. Retirement plans are strongly regulated.
I really don't expect there to be an issue. It is more or less a family type atmosphere And apparently she is already very friendly with the payroll person. I will update once the Vanguard account is up and running.

Thanks again to everybody for helping me navigate this
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

Good news. Thanks for the update. :happy

If she is already signed up and participating, she may have to finish the year? May depend on what payroll is willing to do. But even if she does, she can sign up for Vanguard in about October/November next year and do a rollover from EJ to the new plan next January. Not a bad outcome.
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retiredjg wrote: Mon Feb 06, 2023 10:40 am Good news. Thanks for the update. :happy

If she is already signed up and participating, she may have to finish the year? May depend on what payroll is willing to do. But even if she does, she can sign up for Vanguard in about October/November next year and do a rollover from EJ to the new plan next January. Not a bad outcome.
She hasn't contributed yet so maybe we can avoid this scenario. Even if that turns out to be the case, 1 year of EJ fees is better than a career's worth.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by ruralavalon »

MrMars wrote: Mon Feb 06, 2023 10:35 am
exodusNH wrote: Mon Feb 06, 2023 10:24 am
MrMars wrote: Mon Feb 06, 2023 10:16 am In somewhat of a shocking development, it appears DW's new job offers a 5304 plan. It's a (very) small business, DW seems to think there won't be any problem asking the HR/Payroll person to fill out the paperwork to create an account a VG. If that's how this all plays out color me relieved. As somebody who has come to embrace the BH investing philosophy the thought of paying 12b-1 fees, high ER, dividend reinvestment fees, breathing fees was, well, to be honest it made me borderline furious.
That's good news!

HR may be unfamiliar with the paperwork, but I can't imagine they have an option to refuse your wife's choice. The plan is set up to allow participants to choose the institution. If they forbid her, it's probably violating some federal regulation. Retirement plans are strongly regulated.
I really don't expect there to be an issue. It is more or less a family type atmosphere And apparently she is already very friendly with the payroll person. I will update once the Vanguard account is up and running.

Thanks again to everybody for helping me navigate this
Great news :D
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

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But has she signed the form (salary reduction agreement) that EJ/her employer provided? I think it might rest on that.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

retiredjg wrote: Mon Feb 06, 2023 10:56 am But has she signed the form (salary reduction agreement) that EJ/her employer provided? I think it might rest on that.
To my knowledge she hasn't signed anything. It's possible she did and I am not aware of it. I'll ask her tonight.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by LadyGeek »

FYI - The OP is asking about retirement plan contributions here: Can DW contribute to Simple IRA and 401K (different employers)
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

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retiredjg wrote: Wed Jan 25, 2023 3:50 pm I do anticipate some trouble/confusion when you call Vanguard. I think the choice for "frozen" is on the regular IRA application. I do not think it is on their SIMPLE IRA form, but it could be.

It is not a unicorn or myth - I have actually seen the checkbox on the application. :D

This apparently is not common and as we all know, many of the Vanguard phone reps are not up to speed on what they do and do not do. You may need to be persistent.
just wanted to confirm this is accurate. The VG Simple IRA packet has a check box for "New frozen account".
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

Since her plan is a 5304 SIMPLE, I do not believe "frozen" is what you want. "Frozen" is what she would use if she had a 5305 plan that she was rolling over to a Vanguard "frozen" SIMPLE.

However, I'm not 100% sure this is correct. If Vanguard does not actually offer their own 5304 plan (I don't know if they do or don't), maybe "frozen" is what she should use...and for her, the employer would use the IRS model 5403 salary reduction form. That seems like it might work.

I am not completely sure how to set up this account, but maybe someone else will know. Or maybe you can tell us what the other choices are on the form.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

retiredjg wrote: Mon Feb 06, 2023 7:23 pm Since her plan is a 5304 SIMPLE, I do not believe "frozen" is what you want. "Frozen" is what she would use if she had a 5305 plan that she was rolling over to a Vanguard "frozen" SIMPLE.

However, I'm not 100% sure this is correct. If Vanguard does not actually offer their own 5304 plan (I don't know if they do or don't), maybe "frozen" is what she should use...and for her, the employer would use the IRS model 5403 salary reduction form. That seems like it might work.

I am not completely sure how to set up this account, but maybe someone else will know. Or maybe you can tell us what the other choices are on the form.
I don't intend to check that box. I was just confirming that the "frozen" version does exist and it's on the SIMPLE IRA form provided by VG.
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by retiredjg »

MrMars wrote: Mon Feb 06, 2023 7:27 pm
retiredjg wrote: Mon Feb 06, 2023 7:23 pm Since her plan is a 5304 SIMPLE, I do not believe "frozen" is what you want. "Frozen" is what she would use if she had a 5305 plan that she was rolling over to a Vanguard "frozen" SIMPLE.

However, I'm not 100% sure this is correct. If Vanguard does not actually offer their own 5304 plan (I don't know if they do or don't), maybe "frozen" is what she should use...and for her, the employer would use the IRS model 5403 salary reduction form. That seems like it might work.

I am not completely sure how to set up this account, but maybe someone else will know. Or maybe you can tell us what the other choices are on the form.
I don't intend to check that box. I was just confirming that the "frozen" version does exist and it's on the SIMPLE IRA form provided by VG.
:oops: Sorry. I thought you were trying to confirm that is the box to check.

When you figure this out, can you tell the rest of us? (The IRS site I was just reading implied that it is the employer that sets up the account.)
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by MrMars »

retiredjg wrote: Mon Feb 06, 2023 7:33 pm
When you figure this out, can you tell the rest of us? (The IRS site I was just reading implied that it is the employer that sets up the account.)
after looking at the form that has the "frozen" variety as option, the form is actually in VG's Employer packet and the instructions for the form say "Use this form to establish a Simple IRA". The details under the check box for the frozen option say "this new account will be used solely for accepting SIMPLE IRA assets transferred from another financial institution. I won't make any current employee or employer contributions to this account"

So, I think you're correct about it needing to be the employer that sets up the frozen account
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Re: Edward Jones users, I'm looking for recs on funds they offer that fit Boglehead investing philosophy

Post by Mm8719 »

I went through this a couple years ago. It was a big headache but eventually it worked out.

Since your employer uses the 5304 form SIMPlE, you have the right to choose your designated financial institution. The problem I ran into was that not many institutions accepted the 5304 version.

Eventually I spoke with TD Ameritrade and they accepted 5304. It was super smooth to set up. Basically I had to set up the account with them and transfer the acct from Edward Jones. My employer did not have to set up any accts, the only thing they had to do was start sending my contributions to TDA instead of Ed Jones. They can either send a check or set up direct deposit. It’s worked like clockwork the last two years and I’ve been very pleased.

The only thing that may throw a wrench in this, TDA was acquired by Schwab. As I recall Schwab didn’t allow new accts with 5304 (it was one of the companies I tried ) so they might not allow this anymore. You’ll have to check. If they don’t just call around until you find someone that does.

Hope this helps. You could also find my old thread which discusses this in detail.
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