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Thoughts on Diversified Stock Income Plans (DSIP)?
Posted on 9/26/12 at 2:34 pm
Posted on 9/26/12 at 2:34 pm
Please forgive my ignorance, but I'm looking for some other perspectives here....
My financial advisor is trying to steer us into a Diversified Stock Income Plan (DSIP) within my IRA. Sounds like this is typically a mix of 40-50 blue chip type stocks that consistently pay a dividend.
He says it will be no trading fees within the DSIP, but an annual fee of 1.1% of the total balance will apply.
FWIW, I'm 33 years old looking for long term gains.
Any experiences with these?
TIA
My financial advisor is trying to steer us into a Diversified Stock Income Plan (DSIP) within my IRA. Sounds like this is typically a mix of 40-50 blue chip type stocks that consistently pay a dividend.
He says it will be no trading fees within the DSIP, but an annual fee of 1.1% of the total balance will apply.
FWIW, I'm 33 years old looking for long term gains.
Any experiences with these?
TIA
3
Posted on 9/26/12 at 5:08 pm to TigerWerm
quote:
but an annual fee of 1.1% of the total balance will apply.
Who is this fee going to?
Posted on 9/26/12 at 5:09 pm to TigerWerm
I’d check out Vanguard. Look for stock funds that include “Dividend” or “Income” in their name. Take a good look at their Vanguard 500 Index fund has annual expenses of 0.17%, a current yield of 2.07%, and holds shares of the largest US companies most of which pay dividends. If you have $10,000 or more you can get the Admiral Shares with an expense ratio of only 0.05%. Compare those expenses with what your advisor wants to charge.
Posted on 9/26/12 at 5:19 pm to TigerWerm
You could move your IRA to a self directed plan and invest in ETFs or funds like SDY, HDV, VEIRX, etc for less than half of the wrap fee the guy wants to charge you. Look at Fidelity, Vanguard, Schwab, ETrade, etc. 1.1% is ridiculously expensive as you would likely be giving up > 30% of the dividend yield on the holdings in the account. It is a good deal for the FA, not for you. You can go to bogleheads.org and parse through the Wiki or the fund discussions at morningstar.com to learn some basic info and save yourself a lot of money over the long term.
Posted on 9/26/12 at 6:30 pm to tirebiter
What tirebiter said +a billion.
A 1% annual fee is outrageously high these days.
A 1% annual fee is outrageously high these days.
Posted on 9/27/12 at 11:43 am to foshizzle
S&P 100 index will do the same thing for .15%.
No one can beat the market consistently in mega caps.
No one can beat the market consistently in mega caps.
Posted on 9/27/12 at 12:16 pm to TheHiddenFlask
quote:
S&P 100 index will do the same thing for .15%.
No one can beat the market consistently in mega caps.
Not Necessarily.
OEF is only yielding right around 2% if this guy really chases yield and gets say 4% minus his fee you are better off. That's a big IF but it's not a complete slam dunk to go with the ETF.
Posted on 9/27/12 at 1:47 pm to whodatigahbait
Yield is not return.
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