First of all, I would like to thank everyone who contributes on this forum. Your insights and advice have been very helpful in learning the basics of investing. I also read a ton of the Bogleheads wiki and mad FIentist posts to convince myself that I am ready to self-manage my retirement accounts. I realize that this post is preaching to the choir, but I just want to throw this out there for anybody who might be on the fence in a similar situation.
After discovering MMM in January I have finally made the move to roll an old tIRA and Roth at Edward Jones into my company 401K and a Roth at Vanguard, respectively. The tIRA was set up by a previous employer, I was talked into the Roth by the EJ adviser. The tIRA was in an actively managed program called "advisory solutions" that costs 1.36% above and beyond the expense ratios and up front fees of the funds it buys. Plus a $40 annual account fee. Plus a $95 fee to liquidate and rollover the account. Plus fees I am probably unaware of. You get the picture.
When I first brought up the idea of rolling assets away from EJ the adviser told me a few things that made me chuckle. First, without asking or knowing anything about my 401k, he said I could not roll a tIRA into a 401k. Proved that one wrong. Then he claimed that an actively managed fund will always outperform an index fund over time. He said buying a front loaded fund (5.75%) will look bad for the first few years, but after 5, then 10 years, it will outperform the index funds. I brought up the fees and expense ratios - basically saying that moving to low cost index (vanguard) funds is an instant ROI of the difference in expenses. He then wanted to talk about the new DOL fiduciary standard - claiming that all brokerage firms will soon be subjected to a standard, gov't mandated fee structure.
It all amounted to the typical hand waving to distract people from the simplest truth - paying for active management is an unnecessary expense. Just for shits and giggles, I pulled up the accounts in Mint to compare how they've done over the past few months. Granted, a 3 month window is only a snap shot, and past performance does not guarantee future results, but I would be laughing even harder if it wasn't my money. The attached screen grab is just a snip of what I was buying with "advisory solutions". The HSA and Vanguard account circled (and marked green with up arrows next to them LOL)are invested in index funds. All of the other funds are from the advisory solutions (lots of red down arrows). The 2 best funds in the EJ portfolio outperformed the index funds by a whopping ~.5% - not even close to covering the 1.36% management fee.
So now I have the old EJ tIRA in my company 401k, invested in vanguard funds. The roth is in vanguard. I can rebalance either account in a matter of minutes from my phone - no need to call the EJ office and exchange pleasantries about kids and dogs and the weather with the criminally pleasant secretary and adviser. A year ago, the prospect of managing my own retirement accounts would have terrified me, but like most things, common sense, good advice, and a little nudge can go a long way. Thanks again for all of the knowledge shared on this forum.
