Author Topic: The Blood(money) sucking Leaches of Edward Jones ...  (Read 20403 times)

boarder42

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The Blood(money) sucking Leaches of Edward Jones ...
« on: June 15, 2016, 01:10:48 PM »
Are named 2nd on the top 30 places to retire from. From Fortune magazine

http://fortune.com/best-workplaces-for-retirement/

Obviously they arent investing in what they are recommending to others to do.

I hope this fiduciary law drives this place into the ground.  but thats just me.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #1 on: June 15, 2016, 01:24:57 PM »
also 9 of the top 30 are financial services companies.

Worst part about this .. as a normal person looking at this you would assume those are good places to have someone manage your money when in reality they are just harvesting money from you.

MgoSam

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #2 on: June 15, 2016, 01:30:52 PM »
Yup!

A good friend of mine mentioned that she uses Edward Jones because it is only about $50/year. I asked her what the commissions and loads were like and she didn't know. I did send her an email with potential questions to ask her guy and I never received a response so I won't bring it up again. I think it's shocking how little people know about their retirement, but oh well.

I know another person that uses Edward Jones and has no clue what the expense ratios of his funds are or what the commissions are like, but has memorized stats for many baseball players and NFL teams so it's not as if he lacks the brain capacity.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #3 on: June 15, 2016, 01:33:21 PM »
Yup!

A good friend of mine mentioned that she uses Edward Jones because it is only about $50/year. I asked her what the commissions and loads were like and she didn't know. I did send her an email with potential questions to ask her guy and I never received a response so I won't bring it up again. I think it's shocking how little people know about their retirement, but oh well.

I know another person that uses Edward Jones and has no clue what the expense ratios of his funds are or what the commissions are like, but has memorized stats for many baseball players and NFL teams so it's not as if he lacks the brain capacity.

i actually just had this convo yesterday.  so sad.

MgoSam

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #4 on: June 15, 2016, 01:37:38 PM »
Yup!

A good friend of mine mentioned that she uses Edward Jones because it is only about $50/year. I asked her what the commissions and loads were like and she didn't know. I did send her an email with potential questions to ask her guy and I never received a response so I won't bring it up again. I think it's shocking how little people know about their retirement, but oh well.

I know another person that uses Edward Jones and has no clue what the expense ratios of his funds are or what the commissions are like, but has memorized stats for many baseball players and NFL teams so it's not as if he lacks the brain capacity.

i actually just had this convo yesterday.  so sad.

All we can do is plant a seed and see what happens. I remember a few years ago I was talking to someone and mentioned that my weight-ed expense ratio is under .08% and my buddy was impressed and said, "You must be using Admiral funds." And I was impressed that he knew that much. Fast forward to 6 months ago, two of his friends that I know were talking about retirement and he flat out told them to call me, one of them did and set up an account at Vanguard.

I've had another friend give me the "I know what I'm doing," response and then later admit that they didn't know what a mutual fund is and later set up a Vanguard account. So who knows, I suspect that people don't want to admit that they don't know much about money, and I find this sad as they generally are compounding their mistake until they eventually do reach out to someone.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #5 on: June 15, 2016, 01:42:09 PM »
yes i did mention vanguard and he said he'd look into it.

it truly is a crime what these guys are doing.  I hope john oliver does a follow up episode to his original one since he can make crazy things happen with his popularity.  How something as important as money is that unregulated is ridiculous.  we regulate the crap out of power/utility delivery and only allow small profit margins the same should be done of the financial advising world.

Midwest

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #6 on: June 15, 2016, 01:47:25 PM »
yes i did mention vanguard and he said he'd look into it.

it truly is a crime what these guys are doing.  I hope john oliver does a follow up episode to his original one since he can make crazy things happen with his popularity.  How something as important as money is that unregulated is ridiculous.  we regulate the crap out of power/utility delivery and only allow small profit margins the same should be done of the financial advising world.

Boarder - Power/Utility delivery is regulated the way it is because it's a monopoly.  You are free to use (or not use) Edward Jones.  I use Fidelity for most of my needs because it's cheap.

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #7 on: June 15, 2016, 01:48:25 PM »
My mother in law uses them.

She is absolutely clueless about how to even balance a checkbook, and thinks her agent is a good buddy that looks out for her I'm sure. As she considers her adult son a child still, she would never listen to us anyway.

Would have helped her out with investments if she indicated any interest in being helped, but she's a nasty/sad piece of work. We don't speak to her much if ever now. So we're not really concerned with what she does or doesn't do with her money.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #8 on: June 15, 2016, 01:50:19 PM »
yes i did mention vanguard and he said he'd look into it.

it truly is a crime what these guys are doing.  I hope john oliver does a follow up episode to his original one since he can make crazy things happen with his popularity.  How something as important as money is that unregulated is ridiculous.  we regulate the crap out of power/utility delivery and only allow small profit margins the same should be done of the financial advising world.

Boarder - Power/Utility delivery is regulated the way it is because it's a monopoly.  You are free to use (or not use) Edward Jones.  I use Fidelity for most of my needs because it's cheap.

i understand the monopoly regulation.  and that this is different.  but it doesnt change the fact that it should be regulated. 

i cant sell genuine copper stampings of abraham lincoln for 3 bucks a peice plus shipping and processing the same way these people shouldnt be allowed to charge insane amount of money just b/c people arent educated.

its not hard to regulate just make everyone SELLING financial advice required to act in the best interest of their client ie as they would do with their own money (also called a fiduciary) and this all will shake out in the wash.  places like edward jones will be subject to large class action law suits and have to change business practices or die off .
« Last Edit: June 15, 2016, 01:52:51 PM by boarder42 »

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #9 on: June 15, 2016, 01:52:50 PM »
A past tenant of mine, graduated with an MBA, then joined Edward Jones. He was trying to get clients while sitting for his industry exams, so he emailed me info on how investing with EJ would lead to retirement at 67, yada yada.

Me: Concise email with the following:
1. I max out my 401k and have a company match,
2. I have Vanguard funds with low expense ratios in my 401k,
3. I use a Lazy Portfolio from the BogleHeads wiki.
His reply: OK, you seem to know what you're doing, I won't bother you again.

He moved out later and rented a house, so he must be doing well. To his credit, he was a very nice polite chap.

Midwest

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #10 on: June 15, 2016, 02:14:25 PM »
yes i did mention vanguard and he said he'd look into it.

it truly is a crime what these guys are doing.  I hope john oliver does a follow up episode to his original one since he can make crazy things happen with his popularity.  How something as important as money is that unregulated is ridiculous.  we regulate the crap out of power/utility delivery and only allow small profit margins the same should be done of the financial advising world.

Boarder - Power/Utility delivery is regulated the way it is because it's a monopoly.  You are free to use (or not use) Edward Jones.  I use Fidelity for most of my needs because it's cheap.

i cant sell genuine copper stampings of abraham lincoln for 3 bucks a peice plus shipping and processing the same way these people shouldnt be allowed to charge insane amount of money just b/c people arent educated.

What's stopping you?  People pay extra for rare coins.  I'm not aware of a law prohibiting what you just described.

If people want to overpay, that's on them.

I'm not an Edward Jones rep or anything similar.  I just think people should be allowed to make their own decisions. 

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #11 on: June 15, 2016, 03:00:01 PM »
yes i did mention vanguard and he said he'd look into it.

it truly is a crime what these guys are doing.  I hope john oliver does a follow up episode to his original one since he can make crazy things happen with his popularity.  How something as important as money is that unregulated is ridiculous.  we regulate the crap out of power/utility delivery and only allow small profit margins the same should be done of the financial advising world.

Boarder - Power/Utility delivery is regulated the way it is because it's a monopoly.  You are free to use (or not use) Edward Jones.  I use Fidelity for most of my needs because it's cheap.

i cant sell genuine copper stampings of abraham lincoln for 3 bucks a peice plus shipping and processing the same way these people shouldnt be allowed to charge insane amount of money just b/c people arent educated.

What's stopping you?  People pay extra for rare coins.  I'm not aware of a law prohibiting what you just described.

If people want to overpay, that's on them.

I'm not an Edward Jones rep or anything similar.  I just think people should be allowed to make their own decisions.

there was an epsidoe of American Greed or something similar about a guy doing it in mail order catalogs back in the day and he was imprisoned for it.  so since our legal system works off of previous cases i would say you'd likely be prosecuted assuming they arent rare coins.

and the F'n problem isnt that people WANT to overpay.  ignorant people are overpaying without knowing it b/c of how the fees are structured.  It is in the best interest of the country to not have people skimming money from others that is intended to allow them to live when they can no longer earn a wage.  a 2% vs .1% expense ratio to a layman doesnt sound like a lot and they dont really think twice about what it really means.  if the numbers were presented in what this will cost you over 20 years per 100k invested people would think twice.  you should receive money equivalent to the degree you assist society and these people are just white collar criminals who have a loop hole in stealing money from people.  The loop hole appears to be closing.

but to just say let the idiots be idiots makes no sense. 

a better example than utilities.

you go to your doctor - he thinks you have xyz that can be solved easily for 50 dollars in medicine... but there is a long shot this sympton could be zyx and its not really that threatening and if the sympton doesnt go away with the 50 dollar drugs they can run additional tests.  but those additional tests are 100k ... he decides he's gonna skip that step and run the 100k test b/c the company that administers it gives him 7% on each test they do.  this is what the financial advisor world does currently. 

so i guess you're for deregulation of the medical profession b/c you're smart enough to know whats wrong with you and dont need a doctor for that.  NO I bet you're not b/c you dont have time to educate yourself on absolutely everything ... and some people would like to choose to be ignorant about money and pay for the professional services of someone to help.  this person shouldnt be receiveing kick backs for doing something suboptimal with the client's money. 

spicykissa

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #12 on: June 15, 2016, 03:08:18 PM »
My mother-in-law lost a HUGE chunk of her retirement money following her Edward Jones advisor's "advice" to sell off crappy mutual funds at the bottom of the 2008 crash. The worst part is she doesn't blame him, still has her money there, and the asshole showed up at our wedding uninvited (this guy's MO is to socially ingratiate himself with everyone in their small town, which makes people more likely to trust him and less likely to pull their money out, even if deep down they really want to). 

Kalergie

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #13 on: June 15, 2016, 03:25:19 PM »
I did send her an email with potential questions to ask her guy and I never received a response so I won't bring it up again.

Mind to share the list of questions?

fattest_foot

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #14 on: June 15, 2016, 03:39:02 PM »
We lose a decent percentage of our portfolio with Edward Jones due to advisor turnover.

We were good savers for a while and threw a lot of savings into IRA's with them. Unfortunately, the office we were associated with changed advisors several times, and each time those advisors would recommend we change to their favorite funds. What we didn't realize was that our portfolio was being eroded away by transaction fees, in addition to all the other wonky fees common with financial advisors.

Luckily we didn't sell anything during the crash, but we were definitely burned by the experience.

TheGrimSqueaker

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #15 on: June 15, 2016, 05:04:00 PM »
We lose a decent percentage of our portfolio with Edward Jones due to advisor turnover.

We were good savers for a while and threw a lot of savings into IRA's with them. Unfortunately, the office we were associated with changed advisors several times, and each time those advisors would recommend we change to their favorite funds. What we didn't realize was that our portfolio was being eroded away by transaction fees, in addition to all the other wonky fees common with financial advisors.

Luckily we didn't sell anything during the crash, but we were definitely burned by the experience.

I'm a huge believer in alignment of interest.

Every time I do business with someone, I look carefully at what I call "how they butter their bread". As in, how do they earn their money? Agents butter their bread by selling things regardless of whether the buyer or seller make a profit. That doesn't mean I'll never do business with an agent. I just make sure the proposed transaction aligns with MY idea of what's good for me.

People always recommend things that are in line with their own interests, but that doesn't mean they necessarily align with mine.

MgoSam

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #16 on: June 15, 2016, 07:41:39 PM »
I did send her an email with potential questions to ask her guy and I never received a response so I won't bring it up again.

Mind to share the list of questions?

Sent you a PM

deadlymonkey

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #17 on: June 16, 2016, 10:30:09 AM »
It comes down to the perception of trust when asking for advice.

When I go to the Dr and ask for treatment advice, I EXPECT that he/she will give good accurate advice.  I am not a DR and can't really second guess them too much.

When I go to a lawyer for legal advice, I expect to get good competent legal advice that will benefit me.  I am not a lawyer and don't understand all the intricacies of law.

If I go to a financial advisor (I don't), I expect to receive good solid advice that is in my best interest.  People may not understand the math and complex financial products available. 

Two of the three professions have legal obligations to their clients.  Once does not.  That is wrong.

Telecaster

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #18 on: June 16, 2016, 10:57:17 AM »
It comes down to the perception of trust when asking for advice.

When I go to the Dr and ask for treatment advice, I EXPECT that he/she will give good accurate advice.  I am not a DR and can't really second guess them too much.

When I go to a lawyer for legal advice, I expect to get good competent legal advice that will benefit me.  I am not a lawyer and don't understand all the intricacies of law.

If I go to a financial advisor (I don't), I expect to receive good solid advice that is in my best interest.  People may not understand the math and complex financial products available. 

Two of the three professions have legal obligations to their clients.  Once does not.  That is wrong.

^  Great way to put it.  The financial adviser clearly has the information advantage, and all too often they use that advantage against the client.  If they client knew better she wouldn't be asking for advice in the first place. 

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #19 on: June 16, 2016, 11:59:58 AM »
I'm not a huge fan of them and some of them are probably flat out crooks (telling clients to move in and out of things to drive commission charges), but I don't think they are really overcharging for what they offer. I would never pay a 5.75% load fee and get into funds with .7% ERs, but I know what I am doing. For someone that has no clue they are better off doing that and having a stop gap between them and panic or keeping money in their savings account because they are too scared to invest in something they don't understand. You can always buy index funds through them as well. I think they charge trade fees between $30-$50, but if you go that route it's really no different than a fee only advisor.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #20 on: June 16, 2016, 03:00:20 PM »
I'm not a huge fan of them and some of them are probably flat out crooks (telling clients to move in and out of things to drive commission charges), but I don't think they are really overcharging for what they offer. I would never pay a 5.75% load fee and get into funds with .7% ERs, but I know what I am doing. For someone that has no clue they are better off doing that and having a stop gap between them and panic or keeping money in their savings account because they are too scared to invest in something they don't understand. You can always buy index funds through them as well. I think they charge trade fees between $30-$50, but if you go that route it's really no different than a fee only advisor.

correct they should be FEE ONLY. anything else is not in their clients best interest financially.  i should be able to go online and see what fees you will charge me per hour not percentage of a dollar amount.  and pay you to help me organize my financial life in an optimal way.  this is worth around 200 an hour IMO , i;d do it for 100

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #21 on: June 16, 2016, 03:02:40 PM »
It comes down to the perception of trust when asking for advice.

When I go to the Dr and ask for treatment advice, I EXPECT that he/she will give good accurate advice.  I am not a DR and can't really second guess them too much.

When I go to a lawyer for legal advice, I expect to get good competent legal advice that will benefit me.  I am not a lawyer and don't understand all the intricacies of law.

If I go to a financial advisor (I don't), I expect to receive good solid advice that is in my best interest.  People may not understand the math and complex financial products available. 

Two of the three professions have legal obligations to their clients.  Once does not.  That is wrong.

this is what i was trying to say above you put it much better thank you!


mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #22 on: June 16, 2016, 03:29:59 PM »
I'm not a huge fan of them and some of them are probably flat out crooks (telling clients to move in and out of things to drive commission charges), but I don't think they are really overcharging for what they offer. I would never pay a 5.75% load fee and get into funds with .7% ERs, but I know what I am doing. For someone that has no clue they are better off doing that and having a stop gap between them and panic or keeping money in their savings account because they are too scared to invest in something they don't understand. You can always buy index funds through them as well. I think they charge trade fees between $30-$50, but if you go that route it's really no different than a fee only advisor.

correct they should be FEE ONLY. anything else is not in their clients best interest financially.  i should be able to go online and see what fees you will charge me per hour not percentage of a dollar amount.  and pay you to help me organize my financial life in an optimal way.  this is worth around 200 an hour IMO , i;d do it for 100

But they are fee only if you use them to purchase stocks/index funds/ETFs, so I'm not sure of your point.

I'm not sure what their average assets under management per client are, but I doubt it is a ton. So let's say I pay my 5.75% load fee on $10k invested per year, or $575 per year. So using your logic to break even I would only be able to meet with my advisor for 2 hours and 45 minutes per year or it would cost me more. I know for a fact many clients call their FAs almost weekly to ask personal finance advice, about their 401ks, buying homes, buying cars, budgets, etc.

Like I said, I wouldn't pay it, but to pretend they are all robbing people because they charge a load fee, when they also provide almost unlimited access to the FAs is a little harsh.

My humble opinion is they do provide a service. In a perfect world we wouldn't need them, because everyone would be as knowledgeable about investing as the MMM crowd. But you could say the same thing about a lot of professions.

As an aside, why does everyone who rips on places like EJ assume all they do is help you invest your money in load mutual funds? They are financial advisors (or at least the good ones are) not brokers.

AND, I completely agree that they should have legal obligations to their clients.
« Last Edit: June 16, 2016, 03:33:53 PM by mizzourah2006 »

Travis

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #23 on: June 16, 2016, 04:00:41 PM »
My mother-in-law lost a HUGE chunk of her retirement money following her Edward Jones advisor's "advice" to sell off crappy mutual funds at the bottom of the 2008 crash. The worst part is she doesn't blame him, still has her money there, and the asshole showed up at our wedding uninvited (this guy's MO is to socially ingratiate himself with everyone in their small town, which makes people more likely to trust him and less likely to pull their money out, even if deep down they really want to).

EJ has this weird "we're your best friend" mentality they're supposed to keep up with their clients personal lives - as if asking about the family pet makes their financial advice better.  It also gives them an "in" to find more clients by getting to know your friends.  There was someone on the "Ask" section here a couple months ago wondering if getting a job at EJ was right for her son/grandson/nephew just getting out of the Army with degrees in finance.  In the discussion she mentioned EJ wanted him to show up with the names of dozens of people who could be potential clients.  I pointed out to her that EJ's prereq to him was all she needed to know. They weren't hiring a financial expert, they were hiring a salesman. 

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #24 on: June 16, 2016, 04:57:36 PM »
I'm not a huge fan of them and some of them are probably flat out crooks (telling clients to move in and out of things to drive commission charges), but I don't think they are really overcharging for what they offer. I would never pay a 5.75% load fee and get into funds with .7% ERs, but I know what I am doing. For someone that has no clue they are better off doing that and having a stop gap between them and panic or keeping money in their savings account because they are too scared to invest in something they don't understand. You can always buy index funds through them as well. I think they charge trade fees between $30-$50, but if you go that route it's really no different than a fee only advisor.

correct they should be FEE ONLY. anything else is not in their clients best interest financially.  i should be able to go online and see what fees you will charge me per hour not percentage of a dollar amount.  and pay you to help me organize my financial life in an optimal way.  this is worth around 200 an hour IMO , i;d do it for 100

But they are fee only if you use them to purchase stocks/index funds/ETFs, so I'm not sure of your point.

I'm not sure what their average assets under management per client are, but I doubt it is a ton. So let's say I pay my 5.75% load fee on $10k invested per year, or $575 per year. So using your logic to break even I would only be able to meet with my advisor for 2 hours and 45 minutes per year or it would cost me more. I know for a fact many clients call their FAs almost weekly to ask personal finance advice, about their 401ks, buying homes, buying cars, budgets, etc.

Like I said, I wouldn't pay it, but to pretend they are all robbing people because they charge a load fee, when they also provide almost unlimited access to the FAs is a little harsh.

My humble opinion is they do provide a service. In a perfect world we wouldn't need them, because everyone would be as knowledgeable about investing as the MMM crowd. But you could say the same thing about a lot of professions.

As an aside, why does everyone who rips on places like EJ assume all they do is help you invest your money in load mutual funds? They are financial advisors (or at least the good ones are) not brokers.

AND, I completely agree that they should have legal obligations to their clients.

You can't have legal obligations and charge a 5.75% load fee that's a criminal amount of money to take from someone. Add to that a 2% er and you're doing nothing for them except barely keeping up with inflation.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #25 on: June 16, 2016, 05:01:36 PM »
Someone shouldn't need more than one 30min how are my index funds doing convo annually with their advisor.  If they have extenuating circumstances and need another meeting that's longer ok. Just like you get one physical a year with your doctor and if you get a sickness or cancer it ends up costing more.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #26 on: June 16, 2016, 05:06:05 PM »
Have you seen the John Oliver video he interviews an EJ type guy and laughing the guy says yeah most of us advisors are in index funds. Meaning most of their clients should be as well since they should be looking out for their best interests.  They also shouldnt be recommending more time with the advisor per year than necessary and should explain that meeting with them is a detriment to their overall money health since they have to pay out

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #27 on: June 16, 2016, 05:35:50 PM »
I considered Edward Jones but backed off.   Apparently that was a smart/lucky move.   I may go with TIA/CREF since I actually have a plan I've been collecting on for 30 years  and they always pay way more than the priced amount. 

My wife had me consolidate two 401k with Wells Fargo  because she did not trust my efforts.   That was 2 years ago and I've gotten 0% returns.   In contrast,  I grew the smaller 20k fund to 30k in under 9 months.   I was doing closer to 7% on the bigger fund.  I dragged the transfer out,  selling half of my portfolio first,  then the other 2 months later.   Of course,  I did a lousy job and lost most of the profits.  In addition, several of the stocks I sold went skyward in the next 3 months.    One, BAH, that I had 7,000 stocks in,  threw off over $100k in dividends and then bounced back to higher prices within a couple months.   Another, PWER, one of my favorites got bought out for about 70% profit.   Safeway, that I been trading in the $16 range, hit $35, and RCL almost doubled.

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #28 on: June 16, 2016, 05:46:55 PM »
Someone shouldn't need more than one 30min how are my index funds doing convo annually with their advisor.  If they have extenuating circumstances and need another meeting that's longer ok. Just like you get one physical a year with your doctor and if you get a sickness or cancer it ends up costing more.

So you think FAs are just brokers? FAs handle retirement planning, home refinancing, budgets, when should I take my social security, etc. you're right, if all your FA does is review your statements of assets under their management you shouldn't need to talk more than twice a year. But like I've said earlier a good FA should be willing to do complete financial planning. We all know the people that need to visit their doctor once a month because they read symptoms and think they may have it.

But let's just assume everyone is financially savvy as you and call it a day :)

Also while I understand your disdain for EJ they offer many funds with ERs under 1 (although I still think they are high).

http://www.morningstar.com/funds/XNAS/MIGFX/quote.html
http://www.morningstar.com/funds/XNAS/MITTX/quote.html

Here are 2 that I know they have.

And remember they are charging a front end load fee not AUM, so the person that puts in $5k/yr gets a hell of a deal for a personal FA. Now the people putting in $50k not so much. It's progressive seems about as American as taxes.

So let's assume I have a 401k I max out and a Roth IRA I have with EJ and I invest in load fee mutual funds. I put away $23k/yr + match and I pay my FA $316.25/yr. they provide me guidance on my entire NW and all other financial decisions for $316/yr. you said $200/hr was fare, so for 1.5 hours of charges I can call him every week if I so feel inclined. Just saying.
« Last Edit: June 16, 2016, 05:56:42 PM by mizzourah2006 »

Travis

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #29 on: June 16, 2016, 09:23:30 PM »
Have you seen the John Oliver video he interviews an EJ type guy and laughing the guy says yeah most of us advisors are in index funds. Meaning most of their clients should be as well since they should be looking out for their best interests.  They also shouldnt be recommending more time with the advisor per year than necessary and should explain that meeting with them is a detriment to their overall money health since they have to pay out

Someone linked it here on the forums somewhere.  My favorite though was reading where a few years ago someone did the math on what if your FA invested his cut of your portfolio from expenses and commissions in a Vanguard index while keeping you in his company's front-loaded mutual fund.  I can't recall which funds were used in the example, but over a 30 year horizon the FA soundly beat the client.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #30 on: June 17, 2016, 05:44:38 AM »
if EJ is so ethical in their current fee structure as you think mizzourah then why arent they the first firm to make all their FAs, fiduciaries without being forced to by the govt.  here is an article that has many quotes from people that work/ed for EJ and once they understood finance the ethical delimma they were forced into choosing between working for their current empolyer and continuing to steal money or leave.

http://www.ibtimes.com/obamas-conflict-interest-rule-could-rattle-edward-jones-investment-giant-2348134

think of the marketing campaign a company like EJ could have put together to teach america what fiduciaries were and to earn tons of business.  but they didnt do it and if they werent forced to they wouldnt have b/c they arent acting in their clients best interest plain and simple. 

I can only assume from your staunch defence of them and being from mizzou that you or someone in your family must work for this Devil of a company, seeing as they are based out of St. Louis. 

The next trick out of EJs hat is going to be to push people to taxable accounts so they can still collect stupid commissions b/c this rule only applies to qualifying retirement accounts.  Using phrases like "you never know when you could need that money, a house, an earthquake, you dont want it tied up in a locked up retirement account you cant touch"  I'm sure they are holding meetings right now to teach this and continue to poach hard earned wealth. 

All my point is - is that anyone giving financial advice should be a fiduciary just as a doctor/lawyer/engineer has to abide by ethical codes ... so should the guy mananging your money. 

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #31 on: June 17, 2016, 07:12:31 AM »
You are inferring a lot aren't you?

1. I don't live in Saint Louis.
2. I never said they shouldn't act as fiduciaries, I agree with you. I think that many of the ways they make their income can force their hand when it comes to driving more commissions (i.e.  moving customers in and out of load funds to generate commissions). On that I completely agree with you.

All I was saying is financial advisors provide a lot more services than simply acting as your broker (which you can't seem to comprehend). I know many financial advisors that provide full financial planning. This would include modeling savings for retirement, helping with taxes, helping with life insurance policies (if you or your spouse were to die before you hit your goal # how much term do you need? how long?), helping understand the best 529s to save for your kids' college (some states offer income tax deductions,  but have terrible plans so it may make sense to go with another state's plan for the better investment options and lose the state income tax deduction) and on and on and on. You seem incapable of admitting that not everyone can work through this complicated process. I think for the services they provide the load fee they charge their average client (someone probably investing between $2-$10k/yr) is not excessive. HOWEVER, I don't agree with the way the company operates and rewards FAs as it is not in the client's best interest. IMO if they move to an hourly  rate (which maybe they should) it will be a net negative for the type of client they attract. How many people that have a few K to invest per year are going to be willing to pay $2-300/hr to meet with their FA? At least now it is a sunk cost and they don't have to think about getting hit with a $100 charge when they call because they are panicking (think August of last year) as several of their coworkers freaked and moved all their 401k to cash (Yes I know people that did that last August).

I'd like to see what happens if we force all FAs to move to hourly. IMO most people wouldn't be willing to pay for the advice. If they are like most everyone on this forum and it drives them to do 20-30 hours of research to understand it themselves that would be great, but I know some pretty smart people that just can't understand the complexities of finance. What does that say about the chances your average Joe with a HS education is going to understand compound interest, Roth vs. Traditional, 529s, etc., etc.

P.S. Thanks for assuming you know me :) I learned a lot about myself from your silly inferences!
« Last Edit: June 17, 2016, 07:14:58 AM by mizzourah2006 »

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #32 on: June 17, 2016, 07:20:39 AM »
i completely understand they provide other services as can be seen in my post where i said

"Someone shouldn't need more than one 30min how are my index funds doing convo annually with their advisor.  If they have extenuating circumstances and need another meeting that's longer ok. Just like you get one physical a year with your doctor and if you get a sickness or cancer it ends up costing more."

You dont need to meet annually to talk about buying a home etc.  if you choose to you know what you're paying for the advice.  pretty simple.

Getting their fees out in the open as an hourly rate gives people the ability to choose how and when they pay for services vs FA's using smoke and mirrors to make you think finances are hard. 

if most people wouldnt be willing to pay then so be it.  people keeping their money in a bank CD they feel safe in is probably better than paying one of these money thieving idiots at EJ. idiots was strong b/c they have obviously found a way to legally steal money so they are pretty smart.  and at the expense of others.

since the rule ONLY applies to retirement accounts i expect to see lots of "Financial advice", flooding the markets about how much better taxable accounts are when saving for retirement. they blocked one income stream now they just need to block the other.  and i think i'll see it in my lifetime.  the financial advising industry will figure out how to make a respectable wage for the services they perform and still act in the best intersts of their clients.
« Last Edit: June 17, 2016, 07:24:21 AM by boarder42 »

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #33 on: June 17, 2016, 07:35:39 AM »
if most people wouldnt be willing to pay then so be it.  people keeping their money in a bank CD they feel safe in is probably better than paying one of these money thieving idiots at EJ.

This is simply false and there is data to prove it.

You can easily go pull the historical data on Yahoo and look at the adjusted close price which adjusts the share price for the expense ratio and any distributions.

If I had invested $10k in MIGFX 10 years ago. I would have had an initial investment of  $9,425 (after the load fee) which would have bought me 875.92 shares. Yesterday at close those 875.92 shares would have been worth $20,987.04. Which equates to a CAGR of 7.69% after load fees and expense ratios. You show me a CD that would have had a CAGR like that over the past 10 years and I want in.

Perhaps I should be charging you for advice :)

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #34 on: June 17, 2016, 07:41:04 AM »
give me a minute to go selectly pick a mutual fund that will support my claim

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #35 on: June 17, 2016, 07:48:17 AM »
give me a minute to go selectly pick a mutual fund that will support my claim

I'm sure I'll be waiting for a while.

Here is another just for fun :)

MITTX: initial investment of $10k today worth $19,739 or a CAGR of 7.04%.

I want in on these CDs.
« Last Edit: June 17, 2016, 07:53:09 AM by mizzourah2006 »

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #36 on: June 17, 2016, 08:08:03 AM »
that took for ever... (i'm joking it was a very simple google search)

RYNMX 10k - 7850
sgdax 10k - 7900
CRSAX 10k - 5456
RYESX 10k - 6800


and ALL of this still ignores the fact that EJ advisors and the like arent letting money sit in one fund for 10 years ... as was indicated above the advisors turnover and they recommend new funds which charge new loading fees.  so you're paying loading fees not just on your initial investment but constantly year after year as they move your money around.

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #37 on: June 17, 2016, 08:16:22 AM »
that took for ever... (i'm joking it was a very simple google search)

RYNMX 10k - 7850
sgdax 10k - 7900
CRSAX 10k - 5456
RYESX 10k - 6800


and ALL of this still ignores the fact that EJ advisors and the like arent letting money sit in one fund for 10 years ... as was indicated above the advisors turnover and they recommend new funds which charge new loading fees.  so you're paying loading fees not just on your initial investment but constantly year after year as they move your money around.

lol, you went the commodities and energy services route ( I actually figured that's the angle you would take). Is that what you invest in with your index funds? I was more going the equity route and trying to find MFs that are similar to the S&P 500, but sure...let's assume they tell all their clients to invest in energy services and precious metals/commodities. Also, can't find your first ticker.

I'm sure some advisors do consistently recommend new funds, but do you know for a fact that every EJ advisor always recommends new funds year in and year out or are you just making that up?
« Last Edit: June 17, 2016, 08:20:36 AM by mizzourah2006 »

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #38 on: June 17, 2016, 08:30:10 AM »
that took for ever... (i'm joking it was a very simple google search)

RYNMX 10k - 7850
sgdax 10k - 7900
CRSAX 10k - 5456
RYESX 10k - 6800


and ALL of this still ignores the fact that EJ advisors and the like arent letting money sit in one fund for 10 years ... as was indicated above the advisors turnover and they recommend new funds which charge new loading fees.  so you're paying loading fees not just on your initial investment but constantly year after year as they move your money around.

lol, you went the commodities and energy services route ( I actually figured that's the angle you would take). Is that what you invest in with your index funds? I was more going the equity route and trying to find MFs that are similar to the S&P 500, but sure...let's assume they tell all their clients to invest in energy services and precious metals/commodities. Also, can't find your first ticker.

I'm sure some advisors do consistently recommend new funds, but do you know for a fact that every EJ advisor always recommends new funds year in and year out or are you just making that up?

look at the quote above from fattest foot above.  i dont think he is alone in his experience.

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #39 on: June 17, 2016, 08:39:25 AM »
that took for ever... (i'm joking it was a very simple google search)

RYNMX 10k - 7850
sgdax 10k - 7900
CRSAX 10k - 5456
RYESX 10k - 6800


and ALL of this still ignores the fact that EJ advisors and the like arent letting money sit in one fund for 10 years ... as was indicated above the advisors turnover and they recommend new funds which charge new loading fees.  so you're paying loading fees not just on your initial investment but constantly year after year as they move your money around.

lol, you went the commodities and energy services route ( I actually figured that's the angle you would take). Is that what you invest in with your index funds? I was more going the equity route and trying to find MFs that are similar to the S&P 500, but sure...let's assume they tell all their clients to invest in energy services and precious metals/commodities. Also, can't find your first ticker.

I'm sure some advisors do consistently recommend new funds, but do you know for a fact that every EJ advisor always recommends new funds year in and year out or are you just making that up?

look at the quote above from fattest foot above.  i dont think he is alone in his experience.

I'm sure he is not. But that does nothing to prove your point that all people are better off investing in CDs than having an EJ advisor. That would be like me finding an unemployed millennial and using that as evidence that all of us are lazy.

I live in a world with shades of gray enjoy your black and white world where everything is either evil or good. There certainly can't be EJ advisors that actually act as a fiduciary despite the fact they aren't legally obligated to, can there? I guess all doctors must have been evil before they were legally obligated to care for patients.

So which commodities and sector specific index funds are you invested in? You seem to really know what you are doing, so I'd be interested in looking into those funds myself.

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #40 on: June 17, 2016, 08:41:57 AM »
there actually cant be EJ advisors that do this b/c of how they are graded based on what they SELL.  did you read that whole article i posted above... multiple advisors left EJ b/c they werent able to act in the best interest of their clients

EJ and EJ type firms would just be fiduciaries if that was their actual goal ... its clearly not and they dont allow their people to act as such EJ is employee owned... so that furthers the want in their advisors to leach money since they own part of the company.
« Last Edit: June 17, 2016, 08:48:09 AM by boarder42 »

boarder42

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #41 on: June 17, 2016, 08:58:59 AM »
the goal of a company is to make money.

in EJ's case they use high fee funds to make commission kick backs.

A successful employee at a company helps them increase the bottomline (esp. at an ESOP i work for one we are all about that bottom line)

an employee that isnt pushing the highest earning funds for EJ to his clients isnt doing his job as well as the guy who is... and therefore he is reviewed worse. 

its about numbers and if you dont push the funds you dont get promoted or paid the same and i would wager to guess they try to push you out if you were to start putting people into vanguard ETFs.

frugalnacho

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #42 on: June 17, 2016, 09:00:28 AM »
if most people wouldnt be willing to pay then so be it.  people keeping their money in a bank CD they feel safe in is probably better than paying one of these money thieving idiots at EJ.

This is simply false and there is data to prove it.

You can easily go pull the historical data on Yahoo and look at the adjusted close price which adjusts the share price for the expense ratio and any distributions.

If I had invested $10k in MIGFX 10 years ago. I would have had an initial investment of  $9,425 (after the load fee) which would have bought me 875.92 shares. Yesterday at close those 875.92 shares would have been worth $20,987.04. Which equates to a CAGR of 7.69% after load fees and expense ratios. You show me a CD that would have had a CAGR like that over the past 10 years and I want in.

Perhaps I should be charging you for advice :)

So you cherry picked a single fund with the benefit of hindsight?  What would that balance be if you had invested in the underlying funds and didn't pay that ridiculous load fee?  It would be 5.75% higher, or $22,193.79.  That's $1206.75 more!

What if you decided to cherry pick that fund at a different point in history, like 2009? Would the results still stack up so favorably against a cd?

Or what if you still cherry picked a fund today, but you chose one of the poorest performing funds they had.  Oh wait you can't, because your selection pool is made up entirely of funds that have performed well enough to survive while the poorer performing funds have folded and are forgotten.  Survivorship bias.

EJ and all it's associates are evil parasites. 

This song is about the record industry, but I feel sums up my attitude towards the financial industry as well:

NOFX - Dinosaurs Will Die
https://www.youtube.com/watch?v=TPKQSQSVVos

Telecaster

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #43 on: June 17, 2016, 09:14:30 AM »

I'm sure he is not. But that does nothing to prove your point that all people are better off investing in CDs than having an EJ advisor. That would be like me finding an unemployed millennial and using that as evidence that all of us are lazy.

I think the real point is that most people, and by most, I mean the vast, vast majority, would be hugely better off seeing an hourly fee only advisor instead of an EJ advisor. 

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #44 on: June 17, 2016, 09:31:33 AM »
if most people wouldnt be willing to pay then so be it.  people keeping their money in a bank CD they feel safe in is probably better than paying one of these money thieving idiots at EJ.

This is simply false and there is data to prove it.

You can easily go pull the historical data on Yahoo and look at the adjusted close price which adjusts the share price for the expense ratio and any distributions.

If I had invested $10k in MIGFX 10 years ago. I would have had an initial investment of  $9,425 (after the load fee) which would have bought me 875.92 shares. Yesterday at close those 875.92 shares would have been worth $20,987.04. Which equates to a CAGR of 7.69% after load fees and expense ratios. You show me a CD that would have had a CAGR like that over the past 10 years and I want in.

Perhaps I should be charging you for advice :)

So you cherry picked a single fund with the benefit of hindsight?  What would that balance be if you had invested in the underlying funds and didn't pay that ridiculous load fee?  It would be 5.75% higher, or $22,193.79.  That's $1206.75 more!

What if you decided to cherry pick that fund at a different point in history, like 2009? Would the results still stack up so favorably against a cd?

Or what if you still cherry picked a fund today, but you chose one of the poorest performing funds they had.  Oh wait you can't, because your selection pool is made up entirely of funds that have performed well enough to survive while the poorer performing funds have folded and are forgotten.  Survivorship bias.

EJ and all it's associates are evil parasites. 

This song is about the record industry, but I feel sums up my attitude towards the financial industry as well:

NOFX - Dinosaurs Will Die
https://www.youtube.com/watch?v=TPKQSQSVVos

I picked a broad based equity fund that EJ offers (2 actually). I picked 10 years because I figured that would be a common investment horizon that allows enough time for compounding, but not to much that it is ridiculous. Find me a broad based equity fund that EJ offers that wouldn't have beaten a CD over a decent investment horizon. Unless of course you think they are so evil that they actually put people in stuff no one would recommend (like commodities and precious metal funds)......Considering they get the same amount of money whether they put them in a reasonable diversified equity fund like MIGFX or MITTX or a commodities fund I'm not sure why you would believe they would choose the latter. So you want to look at 6/16/2009 to date? Well MITTX would have had an annual CAGR of 12.34% over that time frame MIGFX would have been 13.6%. Find me a CD that returned that annually over that time frame and I am in.

Do you truly believe a person would be better off investing in CDs than using an EJ advisor? That's a pretty small bar to get over.

And yes without the load fee it would  have been worth more. But remember, you know nothing about investing which is why you pay an FA in the first place, so how are you going to decide what to invest in? Pay an hourly fee FA? Ok let's assume you meet with them once a year for those 10 years just to make sure your money is still in the right place. They charge $250/hr. $250*10=$2.5k. So.....does the $1.2k extra the investment would have generated had you not paid a load fee seem all that expensive now?

I think the real point is that most people, and by most, I mean the vast, vast majority, would be hugely better off seeing an hourly fee only advisor instead of an EJ advisor.

Sure if they would be willing to fork over the money. It's a little bit easier to part with $10-20/month than it is to part with $250 for an hour of time. The vast majority of people don't have $400 to their name, how are they going to come up with $250 for an hour of this FAs time?

I think people on finance based forums tend to think everyone is as good with money and has as much money as them. The average person using EJ likely has limited funds invested and is putting in small amounts every month. If instead they kept their "load fee" in a savings account to add up to the hourly fee of the fee only advisor they would absolutely be better off.

So... yes in a perfect world almost everyone would be better off with a fee only advisor. On that I completely agree.
« Last Edit: June 17, 2016, 09:56:34 AM by mizzourah2006 »

frugalnacho

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #45 on: June 17, 2016, 10:01:02 AM »
if most people wouldnt be willing to pay then so be it.  people keeping their money in a bank CD they feel safe in is probably better than paying one of these money thieving idiots at EJ.

This is simply false and there is data to prove it.

You can easily go pull the historical data on Yahoo and look at the adjusted close price which adjusts the share price for the expense ratio and any distributions.

If I had invested $10k in MIGFX 10 years ago. I would have had an initial investment of  $9,425 (after the load fee) which would have bought me 875.92 shares. Yesterday at close those 875.92 shares would have been worth $20,987.04. Which equates to a CAGR of 7.69% after load fees and expense ratios. You show me a CD that would have had a CAGR like that over the past 10 years and I want in.

Perhaps I should be charging you for advice :)


So you cherry picked a single fund with the benefit of hindsight?  What would that balance be if you had invested in the underlying funds and didn't pay that ridiculous load fee?  It would be 5.75% higher, or $22,193.79.  That's $1206.75 more!

What if you decided to cherry pick that fund at a different point in history, like 2009? Would the results still stack up so favorably against a cd?

Or what if you still cherry picked a fund today, but you chose one of the poorest performing funds they had.  Oh wait you can't, because your selection pool is made up entirely of funds that have performed well enough to survive while the poorer performing funds have folded and are forgotten.  Survivorship bias.

EJ and all it's associates are evil parasites. 

This song is about the record industry, but I feel sums up my attitude towards the financial industry as well:

NOFX - Dinosaurs Will Die
https://www.youtube.com/watch?v=TPKQSQSVVos

I picked a broad based equity fund that EJ offers (2 actually). I picked 10 years because I figured that would be a common investment horizon that allows enough time for compounding, but not to much that it is ridiculous. Find me a broad based equity fund that EJ offers that wouldn't have beaten a CD over a decent investment horizon. Unless of course you think they are so evil that they actually put people in stuff no one would recommend (like commodities and precious metal funds)......Considering they get the same amount of money whether they put them in a reasonable diversified equity fund like MIGFX or MITTX or a commodities fund I'm not sure why you would believe they would choose the latter. So you want to look at 6/16/2009 to date? Well MITTX would have had an annual CAGR of 10.71% over that time frame MIGFX would have been 11.81%. Find me a CD that returned that annually over that time frame and I am in.

Do you truly believe a person would be better off investing in CDs than using an EJ advisor? That's a pretty small bar to get over.

And yes without the load fee it would  have been worth more. But remember, you know nothing about investing which is why you pay an FA in the first place, so how are you going to decide what to invest in? Pay an hourly fee FA? Ok let's assume you meet with them once a year for those 10 years just to make sure your money is still in the right place. They charge $250/hr. $250*10=$2.5k. So.....does the $1.2k extra the investment would have generated had you not paid a load fee seem all that expensive now?

I think the real point is that most people, and by most, I mean the vast, vast majority, would be hugely better off seeing an hourly fee only advisor instead of an EJ advisor.

Sure if they would be willing to fork over the money. It's a little bit easier to part with $10-20/month than it is to part with $250 for an hour of time. The vast majority of people don't have $400 to their name, how are they going to come up with $250 for an hour of this FAs time?

I think people on finance based forums tend to think everyone is as good with money and has as much money as them. The average person using EJ likely has limited funds invested and is putting in small amounts every month. If instead they kept their "load fee" in a savings account to add up to the hourly fee of the fee only advisor they would absolutely be better off.

So... yes in a perfect world almost everyone would be better off with a fee only advisor. On that I completely agree.


You are being ridiculous, obtuse, and disingenuous.  Your argument is basically that yea they are anally raping customers, but the customers are still technically better off financially that they would otherwise be by putting money in the bank or under their mattress, so it's totally justifiable.  A much better system for everyone (except EJ) is to just stop anally raping customers.
« Last Edit: June 17, 2016, 10:03:09 AM by frugalnacho »

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #46 on: June 17, 2016, 10:21:40 AM »


You are being ridiculous, obtuse, and disingenuous.  Your argument is basically that yea they are anally raping customers, but the customers are still technically better off financially that they would otherwise be by putting money in the bank or under their mattress, so it's totally justifiable.  A much better system for everyone (except EJ) is to just stop anally raping customers.

Show me where I am being ridiculous or disingenuous and I never said the bolded. If you look at everything through this lens a lot of people are being raped in everything they do as there are cheaper ways to get to the same point. The bank that lends you $10k at 5% interest to buy your car is raping you. You would be far better off saving up the money and paying cash.

IF EJ and their ilk moved to fee only the branches would cease to exist. That may be a good thing, but to pretend you know for sure is ridiculous (i.e. they are all evil). The value added these places offer is the ability to have face to face interaction with their clients. That would most definitely go away if they moved to fee only, so what you would have is people calling the corporate offices to talk to advisors through phone or skype. I live in a relatively small town and I doubt many people would feel comfortable calling an advisor in New York or Saint Louis and paying them for advice on what they should do with their money here. Most advisors that make a living doing it either charge a % of AUM or load fees like EJ. There are very few that can generate a sufficient income by just meeting with clients on an hourly basis.

IF we are going to paint everything with a broad brush on a dichotomy of evil or good they would fall on evil in my book. But I live in a world of continuums, I'm a quant : after all :) and I see the value they can provide in certain circumstances. So if that makes me obtuse and disingenuous so be it.

samustache

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #47 on: June 17, 2016, 10:51:59 AM »


You are being ridiculous, obtuse, and disingenuous.  Your argument is basically that yea they are anally raping customers, but the customers are still technically better off financially that they would otherwise be by putting money in the bank or under their mattress, so it's totally justifiable.  A much better system for everyone (except EJ) is to just stop anally raping customers.

Show me where I am being ridiculous or disingenuous and I never said the bolded. If you look at everything through this lens a lot of people are being raped in everything they do as there are cheaper ways to get to the same point. The bank that lends you $10k at 5% interest to buy your car is raping you. You would be far better off saving up the money and paying cash.

IF EJ and their ilk moved to fee only the branches would cease to exist. That may be a good thing, but to pretend you know for sure is ridiculous (i.e. they are all evil). The value added these places offer is the ability to have face to face interaction with their clients. That would most definitely go away if they moved to fee only, so what you would have is people calling the corporate offices to talk to advisors through phone or skype. I live in a relatively small town and I doubt many people would feel comfortable calling an advisor in New York or Saint Louis and paying them for advice on what they should do with their money here. Most advisors that make a living doing it either charge a % of AUM or load fees like EJ. There are very few that can generate a sufficient income by just meeting with clients on an hourly basis.

IF we are going to paint everything with a broad brush on a dichotomy of evil or good they would fall on evil in my book. But I live in a world of continuums, I'm a quant : after all :) and I see the value they can provide in certain circumstances. So if that makes me obtuse and disingenuous so be it.


Even after EJ's fees an EJ adviser could still do good for their client. The adviser could put them in the funds and leave them there and they'd come out ahead. I'll even grant you the advice they'd receive is a good deal for people without a lot of money - IF they have an adviser that does this.

The problem is that EJ adviser incentives do not align with buy and hold a low fee fund; that adviser is likely out of business if they did. They get paid more the more they move the customer around to new funds. It's all the switching that unnecessarily eats into returns, and I think the evidence points to this behavior being pervasive. On net the fiduciary rule is probably better, but hardly perfect.

There is a problem with the new fiduciary rule: there's a vacuum in fooling people without a lot of assets into thinking they aren't paying for advice.


Telecaster

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #48 on: June 17, 2016, 11:14:19 AM »
IF EJ and their ilk moved to fee only the branches would cease to exist. That may be a good thing, but to pretend you know for sure is ridiculous (i.e. they are all evil). The value added these places offer is the ability to have face to face interaction with their clients. That would most definitely go away if they moved to fee only, so what you would have is people calling the corporate offices to talk to advisors through phone or skype. I live in a relatively small town and I doubt many people would feel comfortable calling an advisor in New York or Saint Louis and paying them for advice on what they should do with their money here.

That's ridiculous.  There are plenty of fee only advisers.    And if you eliminate the bottom feeders like EJ, there would be even more room in the market for them. 

mizzourah2006

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Re: The Blood(money) sucking Leaches of Edward Jones ...
« Reply #49 on: June 17, 2016, 11:37:32 AM »


Even after EJ's fees an EJ adviser could still do good for their client. The adviser could put them in the funds and leave them there and they'd come out ahead. I'll even grant you the advice they'd receive is a good deal for people without a lot of money - IF they have an adviser that does this.

The problem is that EJ adviser incentives do not align with buy and hold a low fee fund; that adviser is likely out of business if they did. They get paid more the more they move the customer around to new funds. It's all the switching that unnecessarily eats into returns, and I think the evidence points to this behavior being pervasive. On net the fiduciary rule is probably better, but hardly perfect.

There is a problem with the new fiduciary rule: there's a vacuum in fooling people without a lot of assets into thinking they aren't paying for advice.

I agree. This is essentially the  point I was making. I guess I'd need evidence that proves that churning clients through funds to generate commission is pervasive. I know it certainly happens, but I'd need to see evidence that it is actually the norm. If it's the norm I say shame on EJ corporate as that would be insanely easy to track.


Quote
That's ridiculous.  There are plenty of fee only advisers.    And if you eliminate the bottom feeders like EJ, there would be even more room in the market for them.

I am sure there are advisors that offer fee only as an option, I find it very hard to believe there are a ton of advisors making a living by just charging hourly rates for advice.

From what I have seen most of the advisors that offer fee only advice also offer services where they invest the money for you and take a % of AUM. In order for a fee only advisor that charges $250 hourly to generate $50k in revenue they would need to have 200 appointments throughout the year. If you only need to meet with your FA once a year for an hour, that is 200 clients they would need, 400 clients if they are interested in actually making a good  living.

I did a quick google search in my area and found a website titled financial-advisors.credio.com. It looks like you can search it for FAs in your area. Not one of them is listed as strictly fee only. All of the one's that list fee only as an option also list percentage of assets as a "type of fee".

So if we move to where we make it illegal to be anything but a fee only FA (the only way that isn't insanely EVIL) how many FAs would maintain that as their career? It seems like you would either need to charge an insane hourly rate, have a ton of clients, sell your clients on coming to check in with you more, or do it part time.