Smith Barney vs. USAA investments

[Anonymous]

Any advice on which is better? We aren't too investment savvy, and have had our mutual funds/roth iras w/ Smith Barney for some time now. Our broker there hasn't been terribly involved so we are considering moving everything over to USAA. Is this a good idea? Just found out that USAA isn't FDIC insured, is that a big deal? Thanks.

[Anonymous]

Smith Barney isn't going to be FDIC insured either. FDIC insurance is for straight savings(/checking/CD) accounts at a bank, not for investment accounts holding stocks/bonds/money market securities.

Generally speaking USAA has a good reputation but I have no idea what you are planning to do. Honestly, my feeling is that you should be able to find some mutual funds and stick with them for a while-- having an investment adviser "involved" in your account on a frequent active basis sometimes just leads to generating commissions for the adviser without improving returns.

[Anonymous]

We are with USAA which I got through DH. He manages money for a living and will never leave them--is loyal in a way to this company that people aren't anymore. In addition we have other kinds of services with them (insurance, mortgage, diamonds). A top notch company.

[Anonymous]

You might also want to look into Vanguard. I find it incredibly easy to manage.

[Anonymous]

We have stuff at USAA and Fidelity plus a few dividend reinvestment programs, but DH does most of the stuff himself with Fidelity. Nothing really bad about USAA, just that he likes a lot of the mutual funds available thru Fidelity more. He was raved about a newer on-line tool at Fidelity called Full View which (once you enter all your passwords) allows you to see all in one place all account balances.

[Anonymous]

Vanguard is owned by you and anyone else who invests there. Fidelity is owned by the Johnson family. Smith Barney is owned by the shareholders of Citibank. Point is Fidelity and Smith Barney have to, overall, charge a bit more to make some profit for their extra layer of owners.

Don't know the answer, but who owns USAA?

[Anonymous]

I believe USAA is non-profit/credit union. Great company - they've always been more than fair with costs, awesome customer service. I believe any mutual fund would be available from them.

But the best way to decide is to compare costs charged by each to manage your accounts and engage in buy/sell investment transactions. USAA doesn't charge fees except for when you trade stocks/funds/ETFs - I think the amounts vary depending on either how much you trade or the amount of assets you hold with them, but they are generally low compared to other companies.

What you may lose with USAA is some level of investment advice. They have investment advisors that you can speak with to help plan and change your portfolio (I haven't done that, so I can't speak to quality), but no one is going to sit and monitor your investments for you - you're going to have to be responsible about sitting down once a year or so and looking at and possibly rebalancing your portfolio, and contacting USAA if you feel you need some guidance. But on the other hand, I suspect Smith Barney charges a good amount of money for a broker who may not be adding much to the growth of your money.

[Anonymous]

USAA is owned by its members. It started as a MUTUAL insurance company...

[Anonymous]

We use Smith Barney, our broker consistently does better for us than the market average. He also advises us (for free) on how to structure our 401k investments. Don't know the fees off the top of my head, but, they are not bad.

With SB, I think your satisfaction will depend more on which broker you use.

[Anonymous]

Anonymous wrote:We use Smith Barney, our broker consistently does better for us than the market average. He also advises us (for free) on how to structure our 401k investments. Don't know the fees off the top of my head, but, they are not bad.

With SB, I think your satisfaction will depend more on which broker you use.

Who do you use? If you don't mind giving them a plug.

[Anonymous]

The one time I really needed help with investments, many years ago, USAA was great in steared me in a profitable direction. I believe they are paid by salary not commission, although they definitely know more about the USAA funds. But, I have also used their advice to pick a sector and then not necessarily used the USAA fund in that sector. We do all of our banking and insurance with them and have been very pleased. Just easy to reach, easy to talk to, and helpful.

[Anonymous]

I have been a USAA insurance customer since 1967. No other company has beat their rates or come close to their service. I actually trust them and cannot say that about any other company. Their investment management division shares the same investor confidence as the insurance side does. I am about to transfer two 403B accounts to them after evaluating/comparing them to similar Fidelity products. I'm not one to endorse businesses but USAA is an exceptional organization. And as pointed out by another post, they are owned by the investors - not stock holders.

[Anonymous]

Another USAA costomer. Mostly, I love them. But not for investments. Investments through them are not *bad* - I would rate the 4 out of 5 stars. However, they have the *average* fund overhead.

I went with Vanguard for my investments. They have the lowest overhead costs of any broker.

And as PP stated, no investments that have any risk are FDIC insured. Only savings/checkings/CDs. And USAA is FDIC insured on those.

[Anonymous]

Anonymous wrote:We use Smith Barney, our broker consistently does better for us than the market average.

If he's consistently beating the market average in both up and down markets, then either he's been really lucky or he's the next Bernie Madoff. Be very cautious about anyone who tries to pull you in by claiming that he can consistently beat market averages.

[Anonymous]

USAA is a fantastic company, and I use them for almost everything -- except investments. They're still quite good for investments (much better than SB), but you can do even better by going with Fidelity or Vanguard.