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Deb19

Ira Input

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Hope it's acceptable to post an IRA question.....you all have been immensely helpful in the past and I would greatly appreciate your help again....

 

IRA held at Edward Jones....(the last thing there since I have moved everything and have been doing it on my own) ......because of the large termination fee and not fully understanding how to move it, I just had not made the move yet. I am ready now. Planning on moving to TD Ameritrade (any input on this??), then I am planning on getting rid of a fund I no longer have faith in. Currently, his IRA is in a stock and 2 funds. Edward Jones guy wants us to move all to stocks for better ability to make the most money possible. Any input on this? I know it is difficult to provide insight when you don't know our entire portfolio, but if no new money is being added to this.....any advice on using just stocks, just mutual funds, or a combination? We have at least 10 -12 years for this money to grow.

 

Finally, I think I have kept this tie to Edward Jones because it is like a security blanket to me.....I have someone to bounce stuff off of.....HOW DO YOU DO THAT WHEN YOU TOTALLY DO IT ON YOUR OWN? I do not have any fee-based financial specialists near me. Thanks for your time and help.

Deb

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Yes, IRA questions are OK on this forum. I don’t recommend Edward Jones. They are unnecessarily expensive and their advice is likely to benefit EJ and not so much you. Instead of paying someone to hold your hand, you would be better off learning more about investing so that you didn’t need face to face hand holding. Advice costs money which is better put in your retirement account. Firms like EJ are very good at making investing look very complex in order to make you think you can’t do it on your own.

You can always ask for opinions on this forum and on the Boglehead forum, and you can decide what makes the most sense. Have you read any books on investing? Have you read all the good information on this website? A lot of it applies to investing in general, not just 403b and 457 accounts. Check out the “ Investment Tips and Tools”, especially Key Terms, Asset Allocation and Target Date Funds. http://403bwise.com/k12/content/21

TD Ameritrade has a good reputation as a discount broker (unlike EJ). I believe you can buy ETF versions of of Vanguard or Fidelity low-cost index funds there. I prefer to buy mutual funds directly at Vanguard or Fidelity and I don’t use ETFs. We believe in investing in the whole market, not just a part of it that did well in the past or is predicted to do better in the future. If you invest in Total Stock Mkt, Total International Stock Mkt and Total Bond Mkt, you have all you need—you’ve covered it all. And using a Target Date fund covers it all in one fund!

Most of us think that buying individual stocks for your retirement accounts is not a good idea. I’ve done it in the distant past, and it didn’t turn out well. Mutual funds with their 1000s of stocks are diversified—not relying on a single company’s success. Diversification is something you can control, unlike the direction of the market. You should be investing in the US and world economies, not guessing** on a single company’s future success. (**this website won't let me use the word "gam-bling"??)

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Deb19,

 

Your question is interesting because this site favors low-cost index investing and usually doesn't include brokerage houses. However, since you asked....

 

1. I suggest contacting TDAmeritrade (800#) about the termination fees at EJ......oftentimes they will pay the fees.

 

2. TD has an excellent mutual fund screener for active management....hundreds of no-load, no transaction fee funds but this will require work on your part. It might be cleaner to liquidate the EJ account before the transfer. They also have funds for indexers and make sure to pay close attention to expense ratios.

 

3 .Individual stocks mean more risk, more work and more monitoring and potentially more profit. Nobody knows your risk tolerance and your retirement demands other than you.

 

4. A diversified, balanced portfolio can consist of actively-managed funds, individual stocks and bonds, etf's etc. but most people do not want to do the work. Bob

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