I should also say that this prompted me to take a look at my own retirement account (a rollover IRA, not my current employer account) and make some changes. I knew I was significantly overweight Berkshire Hathaway, but hadn’t realized how much of a US tilt I had. So I sold some BRK and VTI, put the proceeds primarily in VXUS, and also added some BND and BNDX (from 0).
So now I’m around:
I’m like 58% Total Stock Market (VTSAX), 40% S&P500 (SWPPX/FXAIX), 2% single stock. basically 60/40 if you squint a little
It seems like you’re effectively 100/0 if you’re talking about either domestic/international or equity/bonds. Owning VTSAX isn’t meaningfully different from owning the S&P 500 imo - you’re not picking up much diversification by owning both versus owning one or the other.
But I am now assuming your 60/40 comment was sarcasm.
This post resonates a lot with my personal experience, and will just say that I believe you did not only the right thing, but an extremely kind thing. I’d bet she is extremely grateful, and if she goes busto you were going to have to take care of her anyhow :)
My parents asked me to look at their portfolio, they are of course in all kinds of dogshit high fee funds, I even looked up the low fee vanguard equivalent to every one.
They confronted their advisor and…bought whatever bullshit explanation he gave. LOL then why did you ask me!?
It turns out that my mom’s account is not actually set up for any online transactions. So I had a very fun phone call today with my mom and the Merrill Lynch advisor. I tell the advisor what we’d like to do:
First one was mostly no problem. A lot of blah blah blah about what she expects the Fed to do and how that should influence rates, but I was able to quickly say that I already knew the exact fund we wanted.
Then the shit started hitting the fan. I asked if we could just execute the trades online. She said no, but that we could just tell her what to do. I asked about commissions. She said yes, there would be commissions, but she wouldn’t know exactly how much until we told her the precise trades we wanted to make - there was no formal commission schedule that we could look at.
That smelled like bullshit to me, so I googled and found this document in about 3 seconds. Here’s the punchline:
That’s right, if you purchase or sell $10,000 of stock, you pay a fucking commission of $241. So now I think we’re looking at several thousands of dollars in commissions if we want to do these sales and purchases. I suggested that this was a fairly outrageous amount, and the advisor said that of course we’d have to pay commissions if we weren’t paying the 1% annual account advisory fee. (As if Merrill Lynch hasn’t been making an assload of money off of her account already by paying her 0.3% on all of her cash.)
So I think what I’m going to do is just have those stocks transferred to another (non-ML) brokerage and execute the sales/purchases there commission free. I told my wife about this, and she was incredulous, “How do they stay in business charging those rates?” Seems obvious to me that they stay in business by taking advantage of senior citizens and other unsophisticated investors. Just utter bullshit all around and I’m much madder than I was 24 hours ago.
Yup, sounds like transferring the assets in kind is the best way to go. If you know where you want to end up, a lot of brokerages would be happy to take care of the transfer so you don’t have to interact with ML anymore.
i would just move the entire account over to Schwab or somewhere else
Out of pettiness, this is exactly what I want to do. But she has several automatic payments set up through her current ML account, so my thinking is that transferring only the assets I want to sell and maintaining the rest of the account accomplishes effectively everything I want to without any disruptions.
Go take a look at the fee schedule and commissions for Edward Jones. Your jaw will hit the floor.
In this day and age when zero commission trades is the standard for the largest players, high commissions just exist to take advantage of low info investors
You probably already know this, but be on the lookout for an account opening bonus wherever you move the funds to. Some of the bonuses are tiered based on the amount you move, so you probably want to know what the amounts and other requirements are before you move any $
When my father died, our middle brother had been named the executor, presumably because he lived fairly close to my father. Unfortunately, he isn’t as mistrustful or savvy as I am.
When he contacted my father’s broker to inform her of my father’s passing and of his will directing his accounts to be split three ways, she first tried to get him to get all of us to open accounts there with our proceeds. When he said he just wanted to have the accounts liquidated, she made an appointment for him to come in to handle the paperwork.
I found out later from him that she charged the estate a fee for meeting with my brother…and he paid it, because “I didn’t want to make a thing out of a couple hundred bucks.”
Fucking bloodsuckers.
At first I thought she meant $1 million and was wondering how she could get that much credit. But $140,000 ain’t too shabby.
i should feel mad, but i ain’t 
i dunno
Lol the banks probably just shrug that off so idk about it being a lesson for capitalists but hey I’m not gonna rain on his parade. Wish I could do that.
I’ve got 4 credit cards with something like $120k available credit. I’ve often wondered if I could max them all out in the same day and flee the country. I would assume their systems communicate instantaneously now, but maybe not.
I would hope that no bank CC would let you randomly try to max it out in a single day without at least attempting to talk to you personally to verify.
I don’t see why you wouldn’t be able to do this. Worst case is that it’s sets off alarm bells related to fraud. But if you call and explain that you are indeed the suzzer who wants to put 50K of gold coins on his AMEX, I’m not sure why they would stop you.
The problem is not so much you fleeing, your assets have to flee also. If you have domestically held assets, I think they could come after those in some way.
