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Message
Wife rolled over her 401k with local investor
Posted on 10/25/14 at 2:02 pm
Posted on 10/25/14 at 2:02 pm
Wife changed jobs and rolled over a very small ($10k) 401k with a local investor. Asked for something fairly aggressive. He put her in Principal SAM conservative growth (SCGPX). We are both new to investing. Opinions? Good choice?
6
Posted on 10/25/14 at 2:22 pm to tigerlife00
Cart before horse? Opinions? Good Choice?
I assume you all researched this BEFORE you did it? Please God tell me you did.
In which case, I'm all about getting some emotional support and backup to my decisions.
I assume you all researched this BEFORE you did it? Please God tell me you did.
In which case, I'm all about getting some emotional support and backup to my decisions.
This post was edited on 10/25/14 at 2:23 pm
Posted on 10/25/14 at 3:15 pm to Teddy Ruxpin
Nope! Wife went alone, professional recommended SCGPX, she said ok.
Posted on 10/25/14 at 3:48 pm to tigerlife00
2.5% fees. He probably got a commission on it.
Posted on 10/25/14 at 4:27 pm to tigerlife00
No offense intended but it's such a small amount that even if she were (metaphorically) screwed, as long as the transfer was done appropriately to shield you all from a tax liability, it's not that big of a deal.
You have a bigger problem than this specific event if you and she do not talk about financial issues and agree on a joint strategy before making fiscal moves.
You have a bigger problem than this specific event if you and she do not talk about financial issues and agree on a joint strategy before making fiscal moves.
This post was edited on 10/25/14 at 4:28 pm
Posted on 10/25/14 at 4:43 pm to Layabout
quote:
2.5% fees. He probably got a commission on it.
Should he work for free? He made 1% on the sale.
This post was edited on 10/25/14 at 4:45 pm
Posted on 10/25/14 at 10:32 pm to Janky
quote:
Should he work for free? He made 1% on the sale.
Caveat emptor. Her fault for going to a salesman instead of a real financial adviser.
Posted on 10/26/14 at 12:23 am to tigerlife00
OP - why not Vanguard account?
Posted on 10/26/14 at 5:21 am to Layabout
What is a "real" financial advisor gonna do with $10k? "Real" financial advisors have minimums much higher than $10k.
Posted on 10/26/14 at 5:11 pm to Layabout
My bad, I didn't realize that "real" financial advisors did not charge for their services. I gotta find me one of those, I'm getting screwed every year evidently!
Posted on 10/26/14 at 7:38 pm to ed3303
quote:
My bad, I didn't realize that "real" financial advisors did not charge for their services. I gotta find me one of those, I'm getting screwed every year evidently!
They charge a fee for their services which may be a percentage of your portfolio annually, as opposed to those that earn a commission on a fund they are selling you. I consider Edward Jones, and all the other storefront investment providers that offer only a specific group of investment devices to which their compensation is tied as just salesmen.
Posted on 10/26/14 at 7:43 pm to EA6B
I agree, but I don't think you are gonna find a fee based advisor that will take a $10k account.
Posted on 10/27/14 at 7:57 am to tigerlife00
quote:
Asked for something fairly aggressive.
quote:
He put her in Principal SAM conservative growth (SCGPX).
Just answer his question guys, is that fund a good one to match what she asked for? Quit coming down on guys who try and make a living doing this, unless the guy led her in the wrong direction to meet her wishes.
Posted on 10/27/14 at 6:24 pm to EA6B
Thank you, I am well aware of how advisors charge for their services. I have both types of accounts, advisory (fee based) and commission based. Speaking for myself, I can see the advantage of each. For example, if an investor had a 500k portfolio and was being charged 1.25% annually for that portfolio, they may feel less than excited during a down year when they are down 5% and are still paying $6,250 in fees. That same portfolio in A share funds would pay a one time fee of 2% (at least in my funds that is the case). Again, I have both types of accounts and feel they each have advantages. I can say first hand that in good years, I don't mind advisory fees, in bad years however, I resent them. What I would like to find is an advisor that only charges a percentage of profits. No luck with that yet.
Posted on 10/27/14 at 8:02 pm to tigerlife00
quote:
Wife changed jobs and rolled over a very small ($10k) 401k with a local investor. Asked for something fairly aggressive. He put her in Principal SAM conservative growth (SCGPX). We are both new to investing. Opinions? Good choice?
Any fund with a 2% expense ratio should be automatically disqualified. That said, it's only 10K so as long as you don't stay with it long it isn't a disaster. But I'd still ask an advisor why he's recommending a fund with an expense ratio that high, and probably take my money somewhere else.
The fund itself may or may not do okay but you have no real way of knowing that in advance. What you do know is that they have a 2% expense ratio, which is ridiculously high.
Posted on 10/27/14 at 8:18 pm to ed3303
quote:
What I would like to find is an advisor that only charges a percentage of profits. No luck with that yet.
I am pretty sure FINRA would have a problem with that.
Posted on 10/27/14 at 9:00 pm to Janky
quote:
What I would like to find is an advisor that only charges a percentage of profits
quote:
I am pretty sure FINRA would have a problem with that.
it's called a hedge fund - 2% annually and 20% of profits is pretty standard
Posted on 10/27/14 at 9:02 pm to foshizzle
quote:
Any fund with a 2% expense ratio should be automatically disqualified.
he/she is referring to a front end load - not internal expenses
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