Anonymous wrote:Get it out of there. I would definitely not send more money to this company because they are taking advantage of you.

Vanguard if you want to deal with figuring how where to invest. Betterment if you'd prefer a robot do that work for you for a slightly higher fee. Neither will be anywhere near 1%, which is insane for the level of service you are (not) getting.

NP and I would add that Vanguard's average active fund expense ratio is 0.20%.

1% is way too much.

Get it out of there. I would definitely not send more money to this company because they are taking advantage of you.

Vanguard if you want to deal with figuring how where to invest. Betterment if you'd prefer a robot do that work for you for a slightly higher fee. Neither will be anywhere near 1%, which is insane for the level of service you are (not) getting.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It depends. First, 1% is pretty standard rate which can be worth it. For me, the benefits are 1) it gets me access to less expensive institutional shares of stocks (e.g. instead of paying fee of 0.30% to Vanguard say it's 0.08%. 2) Access to shares of Dimensional Fund Advisors (DFA) or other funds that you need an advisor for 3) advice on a variety of financial topics 4) no need to spend the time rebalancing or managing the account. So I would ask for the 1% fee, how much of what I listed do you "get" and do they combined make up for the 1% fee. If they don't give you benefits, then I agree a low cost Vanguard or Schwab is probably better.

This doesn't make sense. Why pay someone 1%, so you can save 0.22% on the expense ratio. Also vanguard and Fidelity have very low expense ratio products these days, but you would need more than $8,000 to invest in them. Vanguard calls them admiral, not sure what Fidelity calls them.

In any event, I'd roll over your account just to consolidate accounts. Having $8,000 in an orphan account where you won't add more money to it seems like a waste.

DP.. certain types of accounts have more flexibility in terms of what types of stocks, funds can be purchased. The cheaper ones don't have access to some of the more aggressive funds. I just reviewed all this with my investment manager who doesn't make any commission. He is salary based.

I don't understand. Vanguard has hundreds of funds, from low risk/low return to high risk/high return. Can you give an example?

Anonymous wrote:

Anonymous wrote:It depends. First, 1% is pretty standard rate which can be worth it. For me, the benefits are 1) it gets me access to less expensive institutional shares of stocks (e.g. instead of paying fee of 0.30% to Vanguard say it's 0.08%. 2) Access to shares of Dimensional Fund Advisors (DFA) or other funds that you need an advisor for 3) advice on a variety of financial topics 4) no need to spend the time rebalancing or managing the account. So I would ask for the 1% fee, how much of what I listed do you "get" and do they combined make up for the 1% fee. If they don't give you benefits, then I agree a low cost Vanguard or Schwab is probably better.

This doesn't make sense. Why pay someone 1%, so you can save 0.22% on the expense ratio. Also vanguard and Fidelity have very low expense ratio products these days, but you would need more than $8,000 to invest in them. Vanguard calls them admiral, not sure what Fidelity calls them.

In any event, I'd roll over your account just to consolidate accounts. Having $8,000 in an orphan account where you won't add more money to it seems like a waste.

DP.. certain types of accounts have more flexibility in terms of what types of stocks, funds can be purchased. The cheaper ones don't have access to some of the more aggressive funds. I just reviewed all this with my investment manager who doesn't make any commission. He is salary based.

1% is worth it if you have an aggressive investment strategy, and want your portfolio rebalanced every so often and managed aggressively, and the amount is pretty significant. It's not worth it if you are risk averse, want to put your money in an index fund, and/or the amount is small, like $8000.

Anonymous wrote:It depends. First, 1% is pretty standard rate which can be worth it. For me, the benefits are 1) it gets me access to less expensive institutional shares of stocks (e.g. instead of paying fee of 0.30% to Vanguard say it's 0.08%. 2) Access to shares of Dimensional Fund Advisors (DFA) or other funds that you need an advisor for 3) advice on a variety of financial topics 4) no need to spend the time rebalancing or managing the account. So I would ask for the 1% fee, how much of what I listed do you "get" and do they combined make up for the 1% fee. If they don't give you benefits, then I agree a low cost Vanguard or Schwab is probably better.

This doesn't make sense. Why pay someone 1%, so you can save 0.22% on the expense ratio. Also vanguard and Fidelity have very low expense ratio products these days, but you would need more than $8,000 to invest in them. Vanguard calls them admiral, not sure what Fidelity calls them.

In any event, I'd roll over your account just to consolidate accounts. Having $8,000 in an orphan account where you won't add more money to it seems like a waste.

Roll it to Vanguard. 1% of $8,000 is $80 a year. That's not much.

But if I were paying 1% management fees, that would be the equivalent of buying my advisor a brand new car every 12 months. I certainly don't buy MYSELF a new car every year, I'm not going to do the same for someone who can't beat an index fund, anyway.

I'm not saying that to brag, just to get you to think about where you want to be some day. If you figure that an average annual return on your investments might be 6%, then giving away 1% of assets means that you're paying an advisor 17% of your gains every single year. That's huge, and unnecessary these days.

Roll it over to vanguard. The fees there are less than half a percent and you just need one total market index fund.

The fees really eat into your return after a while.

I was just in a similar boat and realized at this amount there is no need to be paying a fee so I just moved my to a robo money management system wealthfront

Put it in an index fund (or funds) in another company. No reason why you need that managed.

It depends. First, 1% is pretty standard rate which can be worth it. For me, the benefits are 1) it gets me access to less expensive institutional shares of stocks (e.g. instead of paying fee of 0.30% to Vanguard say it's 0.08%. 2) Access to shares of Dimensional Fund Advisors (DFA) or other funds that you need an advisor for 3) advice on a variety of financial topics 4) no need to spend the time rebalancing or managing the account. So I would ask for the 1% fee, how much of what I listed do you "get" and do they combined make up for the 1% fee. If they don't give you benefits, then I agree a low cost Vanguard or Schwab is probably better.

I’d move to Vanguard or Fidelity. Why pay 1% when you don’t have to.

I would move that account to vanguard.

I have a small ($8K) Roth IRA managed by a small investment management group located in California. It was set up years ago and managed for free all these years because the owner was a friend of my father; owner passed away last year and I just got a letter in the mail saying the firm will now start charging me 1%.

I had been considering rolling my 401(k) over to them and am now unsure whether I should do that or even keep the Roth IRA there. Their rep told me that any amount of money I would roll over (including my whole 401(k)) would be managed as part of their general fund because it's not enough to rate its own account. A fee of 1% seems steep to me, for that. But, maybe I don't have a good idea of the market. What would you do?