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I am in a dillema and unsure what to do as I am not very good with finance. I have my ROTH with Edward Jones and lately because of the new rule by DOL, my advisor informed me that they introduced a new flat fee of 1.35% annually of my total fun in my portfolio. Right now, each year I contribute the money, Edward Jones takes 5% commission. So for example, I contribute $10k, EJ takes $500. With the new fee structure, I would pay 1.35% of that $10k plus whatever balance I have in my portfolio. I can't decide what to do. My advisor at EJ said several people prefer that flat fee, but in a long run I just don't feel good about it. If I decide to convert to this new flat fee, EJ will refund the past commission to help pay for the 1.35%. It looks tempting from the sound of it in a short term. To add to it, with the flat fee it will allow my advisor to sell/buy new fund without having to worry about the 5% commission.
So what you all think? Should I stick with the 5% commission each time I contribute or go with this new flat fee? The 5% seems steep, but my fund has been doing okay to a point that I already earn money and break even. I am not sure really and again I am not very good with finance.
Neither transfer your money to Vanguard or Fidelity and stop getting robbed. Just pick a target date fund at Vanguard or Fidelity if you don't know what you are doing. If you feel you need to have an adviser, Fidelity and Vanguard both charge ~0.3% of your total assets under management.
I am in a dillema and unsure what to do as I am not very good with finance. I have my ROTH with Edward Jones and lately because of the new rule by DOL, my advisor informed me that they introduced a new flat fee of 1.35% annually of my total fun in my portfolio. Right now, each year I contribute the money, Edward Jones takes 5% commission. So for example, I contribute $10k, EJ takes $500. With the new fee structure, I would pay 1.35% of that $10k plus whatever balance I have in my portfolio. I can't decide what to do. My advisor at EJ said several people prefer that flat fee, but in a long run I just don't feel good about it. If I decide to convert to this new flat fee, EJ will refund the past commission to help pay for the 1.35%. It looks tempting from the sound of it in a short term. To add to it, with the flat fee it will allow my advisor to sell/buy new fund without having to worry about the 5% commission.
So what you all think? Should I stick with the 5% commission each time I contribute or go with this new flat fee? The 5% seems steep, but my fund has been doing okay to a point that I already earn money and break even. I am not sure really and again I am not very good with finance.
I think you are off a bit, I think the commissions are 5.75% and the fee is 1.25%. If you are keeping your funds in an account for 5+ years the 5.75% is almost certainly cheaper, especially if you aren't jumping in and out funds.
One thing that is important to note is that all new contributions will need to be automated or will have to go under the guided solutions framework (1.25%). This will only impact adding new funds to your account though.
Haha, just had a long discussion with a buddy that is an FA for EJ and we talked about what he is going to do as this is an issue he is going to face as an employee too as they are subject to a slightly discounted AUM, .9%, but have the same type of decision to make.
Weird, but we just pay a $40 @ annual IRA fee at Edward Jones.
Yes I have to pay for that too but each time you buy or sell fund, you are paying at least 5% commission plus % for funds management fee I believe depending on what fund you purchase.
Yes I have to pay for that too but each time you buy or sell fund, you are paying at least 5% commission plus % for funds management fee I believe depending on what fund you purchase.
If you are paying a 5% commission on the front end you shouldn't be paying it to sell also
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