MiB Smarter Money » Mutual Funds

Should I Buy a Loaded Mutual Fund?

hank — Wed, 13 Feb 2008 08:01:48 +0000

My mother is not very financially savvy – and when I try to explain anything to her; it can often times take the better part of an hour. It may be her age or the fact she never had any financial education being a stay at home mom, but I like to try to give her the best info possible. This was a specific instance of that time.

She mentioned that she was heading into an Edward Jones investment rep this afternoon and wanted me to chime in with a few questions to help her make a good decision. Like I said, she is 55 with no retirement money aside from about 20k she cashed out of a universal life insurance policy she had out on my dad that was taking payments out of the equity it had built up.

That’s another conversation, but for this one, we’re focusing on how her conversation went.So the rep called me up and we had a conversation about what my mom had, and what she was doing now, and where she was headed. The first thing he mentioned was that “we need to start making your Mother’s money work for her NOW!” I obviously agreed and mentioned to him, “what funds do you recommend she get in?”

He came back with a handful of loaded mutual funds and I just stopped him in the middle of it and ask him why he wanted to put my mother in loaded funds. He actually was very up front about why. He said, “Clearly because that is how I make my money.”

I agreed and proceeded to tell him that we weren’t interested in his services and thanks for his time. He proceeded to tell me how “scary” and “difficult” and “dangerous” it was to be investing on your own. He said, “There are a lot of pitfalls along the way. Wouldn’t it be nice if you had someone to help you?”

I responded, “Yes, that would be nice to have someone that would warn me about financial advisors like yourself.”

That stopped him in his tracks and my mother took off.

New to the blog? Asking yourself, “what are loaded mutual funds exactly Hank?”

When I say “loaded mutual fund,” I mean a mutual fund that carries a sales load. A sales load is a mutual fund commission paid to brokers like this Edward Jones rep for selling you something you don’t need their help in buying. Sales loads do not benefit you, they benefit, and ONLY benefit the person selling them to you, much like an insurance policy.

Load fees typically range from four to eight percent and the way they are paid varies:

1. Front-end load (usually class A shares) – you pay the sales fee up front to the helpful broker.
2. Back-end load or deferred load (usually class B shares) – you pay the sales fee on your way out to your helpful broker.
3. Constant load fund (usually class C shares) – you pay the sales fees every year and might even have to pay a full load when you sell to the fine person selling you this.

Well Hank, I really like paying extra money for things I can do for myself (joking) what else is it costing me?

Well, think of it this way. By purchasing a loaded fund, you’re starting two steps behind. Let’s use simple numbers, say you bought a loaded fund with $10,000 that carried a 5% front end load. Well, as soon as you sign on the dotted line, you’ve just lost $500, so you’re starting with $9,500.

Think of the same guy that has the entire $10,000 to run on – who is going to be ahead in 1 year? 2 years? You can’t catch up because you’re starting behind. Think of it like an oval race track. If you are both running in the same lane, you are starting 5% of the way behind them, and will likely not catch up.

But Hank, they broker told me that these funds were spectacular and that I should make more from them than a no-load fund. Isn’t that worth it?

If a broker really did tell that to you; you are in a bad situation. Turn and run immediately. Do not pass go, do not collect $200. I can almost guarantee if you give me a loaded mutual fund ticker symbol, I can find a very similar NO-load fund out of the 12,000+ funds out there.

Feel free to contact me if you don’t believe me; I’ll find one for you. How many different ways can a sales guy scare you into buying the fund? Anyone else have some wise lines brokers have used to get you in their grasps and in to your pockets? I think if I wouldn’t have figured it out on my own, I’d still be playing Poker to take care of my retirement.
Photo by: Snap@

What Does It Mean When The Federal Reserve Cuts Interest Rates?

hank — Sun, 03 Feb 2008 08:01:39 +0000

Photo by: gerrietWe hear all this talk about how the “Feds are lowing rates again today” on the news a lot recently, and that we’re falling into a recession. But what does all that mean? How does that help me in the situation I’m in? What do I do now as far as investing?Well, to put it simply, when the feds lower federal fund rate, it reduces what it costs banks to borrow money from them. When the banks costs go down, banks typically trim rates for consumers and business borrowers. That encourages businesses to expand and households to spend. Homeowners with adjustable mortgages and consumers with credit cards linked to the prime rate often see their rates move down, which is good.

Why is The Fed pushing rates down hard and fast?

Because the government is seeing a danger that troubles them. The housing market could create a downward spiral that would do widespread damage to consumers and businesses. The main problem comes from several things that get started when home prices start the fall. When home prices fall, it inherently fosters large numbers of foreclosures. That throws a bigger supply of houses onto the market, which in turn push prices down further.

Another problem happens when falling home prices force banks and other lenders to take losses on housing-related investments. They certainly don’t want that because it takes a bite out of their capital and reduces the amount of money they have to lend. That in turn makes it harder for home buyers to borrow, and lending banks to lend. If this housing problem continued for an extended period of time, the damage to banks and consumers could become so profound that the economy plunges into a recession the likes of which we don’t want to see.

How is the government planning on fixing this?

Well, they’ve hacked the interest rate 1.25% over the last 11 days. With this drop in interest rates, combined with a stimulus package from Congress, the hope is that they can stave off the looming recession, which isn’t fun. The goal of doing this isn’t pretty in the short term, but it can significantly limit the damage and keep things from falling into the ocean.

So do I want the Feds to cut interest rates or not?

Well, if you are a homeowners with an adjustable-rate mortgages, you like it. If you have an adjustable rate home equity loans, you like it. If you are a homeowners with a good credit rating and can refinance at lower rates, you like it. If you are a business with a loan tied to the prime Fed rate, you like it. However, if you are investing in CD tied to the prime rate, you DON’T like it. If you have a money market account, which is likely tied to that rate at which banks can borrow, you DON’T like it. If you have a savings account at a bank, you DON’T like it.

Overall there are a lot of pieces to the pie, and a lot of people complain about the setup and what the government is doing, but that is what people do, they disagree a lot. You don’t have a lot of choice in the matter so make the best of it and take advantage of the lower priced stocks, and mutual funds you find when the economy is slow.

What Do I Do During a Bear Market? What Do I Invest In?

hank — Wed, 30 Jan 2008 08:19:09 +0000

Photo by: artct45If you’re between 20-40 years old, don’t do anything. Stay where you’re at, markets fluxuate. That is their nature and that should have been something you learned before you got it. If this is your first time hearing about it, don’t worry and more importantly, don’t run. Let the traders panic. That is their job. They’re pounding down 15 cups a coffee per day and enjoy the stress. Let them deal with it. You’re paying a person that the traders are relaying information to in your mutual funds. You’re 3rd tier on that – sit back and enjoy the cheap stocks you’re getting into.If you haven’t sold, you haven’t lost. Stick to your guns and don’t get scared out of the market, recessions happen. But they always come back. As long as you still have a job, you shouldn’t be worrying. If you HAVE lost your job, you should probably not be reading this blog, try this one.

Buy technology stocks and fund. They’ve done really well this year, and think about it. We’re in the technology era; people WANT technology and are willing to pay for it still. As long as you’ve got a good time horizon for investing (10+ years left till retirement) I think you’ve got a good shot to get in at the bottom floor during the recession.

There are special recession ETFs geared towards recession. Look at medical, people always need to go to the doctor. Look at Claymore Securities.

Ultimately, my recommendation is to keep your money headed towards your investments as long as you’ve got a job. Keep your portfolio on track, this is the time when many people are getting out of the game, and as long as you’ve got time on your side, a perfect time for you to capitalize on the low prices being tossed around.

Do you have any secrets you’d like to share? Anything you’ve done in the past? Advice for the future?

Keep Your Investments Separate For Different Goals

hank — Wed, 16 Jan 2008 15:30:14 +0000

Photo by: Daquella maneraHow many of you use your 401k for your everything bucket? I’ve overheard friends and family talk about their 401k like their “all for one long term savings account” saying things like, “I’m going to use my 401k for my kids education” or “my 401k is used for both me and my wifes retirements” or the worst to date, “I really need to get a car, I’ll probably borrow against my 401k”. The last one is clearly the worst because a car is a depreciating investment. You’ll never get that one back.

I can see the other 2 MAYBE working; but when you start to dabble the same investment for other pieces you often times lose site of what it is there for. A 401k is there for YOUR retirement; a ROTH IRA is for YOUR retirement. Unless you’re dumping TWICE as much in your 401k, it shouldn’t be set for yourself and your wife. Keep it for you and start something ELSE up for her.

Using it for your kids college education isn’t a HORRIBLE idea either, but take into account that you’re going to likely retire AFTER they go to college. So if you’re double-timing your 401k to education AND retirement, it’s going to look awfully small after the kids take it to school. By that time, it might be too late to know where you want to get with it. I offer the same advice for the person wanting to use the 401k for both he and his wife, make sure you’re dumping a lot into it then.

Just the visual aspect of seeing my kids 529 plans, my 401k, and my ROTH IRA are enough to keep me in line. I know what the investments are for, and what money is going where, and more importantly, why. Simplifying the process can often times remove that “investing blur” that you may have when it comes to saving for your future.

If that isn’t enough to convince you to keep them separate, think of how life is always changing; you have another kid, you have an accident at work forcing you to retire early, big medical bills come up. If you plan on your ROTH covering you in retirement (after 59 1/2) and you have to retire early, is there anything set up for that aspect? Might not be a bad idea to have that emergency fund fired up in that case.

Over time, your investments will change, your mindset will change, your timeframes will change. For those reasons you shouldn’t keep all your (investment) eggs in one basket. Spread them around to different baskets for different goals. If nothing else, it trains you on another aspect of investing when you jump to another ship and increases your financial education significantly.

What Is A 12-b-1 Fee And Is It Included In An Expense Ratio Of a Mutual Fund?

hank — Wed, 26 Dec 2007 13:00:25 +0000

Photo by: Ricky Irvine

Hank – quick one for you. Are 12-b-1 fees included in an expense ratio of a mutual fund? – Jay from Kansas

Hey Jay – quick answer back to you. No. Click the image below to enlarge:

You’ll notice it is a SEPARATE fee. But also keep in my that all published mutual fund gains/losses percentages are net of operating cost. So if you see a fund that has 12-b-1 fees of 1.0% and an expense ratio of 1.0%, the fund really kicked out 12% overall, but took that 2% off the top.

How Do I Plan To Reach My Investing Goals For Retirement?

hank — Sun, 23 Dec 2007 13:00:50 +0000

Photo by: emdot

Only 0 days 5 hours 2 minutes left until Hanks Holiday Handout drawing!

To make my goal of having my net worth be $1,000,000USD by 2020 I need to have a plan laid out. Yes it will change through the years, My wife and I will get raises; we won’t get the return we’re shooting for with investments in some of the years, but as a base goal if we take our current principal of $75,000 and continue to invest $21,500 per year for the next 13 and that will put us just over the 1MIL mark. That first MIL is the hardest, Pinyo lays it out here.

Where do I find $21,500 per year to invest? We’re currently contributing 10% of each our salaries for about $16,000 per year to our 401k plans, then add in $4,000 each for our ROTH IRA accounts and we’re well over the limit there. We’re planning on bumps in the road, so that’s why I’m giving the $21,500 number. There are a lot of calculations that need to taken into account, but that is the same with any investment plan. At 10% return with those calculations we’re looking at just under 840k, and at 12% that puts us over the 1MIL mark.

We could have a year where we can’t pay contributions to either our 401k or ROTH, but on the same note, there could be years where we’d contribute MORE to those accounts, For instance, we’re planning on trying to bump the 401k contributions up to 15% in 2008 and that would be $24,000 in itself; add in the ROTH IRA contributions and we’re looking at $32,000 invested per year and in 13 years, that will be worth 1.33MIL.

Numbers are numbers – sticking to the path of just getting money in is the key. In 13 years I’ll still be nowhere near retirement, but the first million is always the hardest to make, after that, it is quite ridiculous how fast it grows. In 35 years on this same $21,500 per year at 10% return we’re looking at 8.5MIL. Which is dreaming, and a lot can happen in 35 years, but there is no time like the present to start planning on it!

Time, as usual, is the key piece of this financial pie; variables are always tossed in to make it interesting. As long as we’re putting in the $21,500 we’ll be on a good pace. I’m sure there will be other investment opportunities, more job promotions, more raises, maybe more kids, but staying on this basic path is the key to our specific financial goal. What’s your path?

What Is A Target Date Mutual Fund And Should I Use It?

hank — Mon, 17 Dec 2007 15:00:22 +0000

Only 5 days 5 hours 02 minutes left until Hanks Holiday Handout drawing!

Hank – I have a few “target date” mutual funds in my 401k plan from Fidelity. They are:
Fidelity Freedom 2010 FFFCX
Fidelity Freedom 2015 FFVFX
Fidelity Freedom 2020 FFFDX
Fidelity Freedom 2025 FFTWX
Fidelity Freedom 2030 FFFEX
Fidelity Freedom 2035 FFTHX
Fidelity Freedom 2040 FFFFX
What exactly are they, and should I use them? Thanks! – Penelope from Maine

Hey Penelope, thanks for the question, I can help answer that one. Target date funds, or lifecycle funds as their sometimes called are there for the very novice investor. They are a fit for some, but for someone willing to put time in, might not be the best choice -

The point of these funds is to automatically adjust the asset allocation as you approach retirement. For example, the Fidelity Freedom 2030 fund features 80% stocks, 15% bonds, and 5% cash, while the Fidelity Freedom 2010 fund features around 50% stocks, 35% bonds, and 15% cash (which is what will happen to Fidelity Freedom 2030 around 2028).

But the problems with it? Well if Investor “A” is a single, high risk tolerance, millionaire and set to retire in 2020 and Investor “B” is a single father raising 4 kids set to retire in 2020 that needs to be conservative, do you think they have the same tolerance or goals by then? Not likely that they’ll have similar portfolio needs.

Another problem with these funds is that they’re pretty much all LargeCap U.S. based funds. Most invest very little overseas or in the Small and MidCap funds, reducing your exposure.

Or how about if you want to retire in 2043? Not 2040 or 2045, what fund do you choose? Kind of a coin flip and you don’t want your assets being finicky when it is time to hit retirement. Another thing to watch out for is that the funds are generally based on that particular companies OTHER funds. There are 10,000-ish funds out there, but most target date funds stick to their own mutual funds, instead of using index funds.

So Penelope, basically if you’re looking for a “set it and forget it” type of fund that you don’t have to worry about, they’re not bad. You’re at least in the market and they’ll likely turn a profit. However, if you’re willing to spend some time on your retirement, I’d try to find better funds in your 401k.

I’m Ditching My Edward Jones Deferred-Loaded, “B” Shares ROTH IRA

hank — Wed, 12 Dec 2007 15:52:56 +0000

So after writing about how my Edward Jones ROTH IRA was invested in “B shares” of NFPBX and no response back from my Edward Jones rep questioning him if I could get out without paying the 5% deferred load or reallocate the funds elsewhere, I figured it was time to do something about it, and I have. As of yesterday at 9am, I turned off the faucet to funding that account. We’ll see if he calls me back now.

Either way I wasn’t very happy with the service he was giving me. He’s a nice guy, but it just seems to me like he is selling me a product instead of investing my money, very similar to my Universal Life Insurance policy I was sold on 5 years ago (of which I have also turned off the faucet, more on that later). But an advisor should be someone that is there to ADVISE you of where your money should go to help for YOUR retirement, not theirs. I am confident enough now to select my own funds and choose my own investing path, but it is nice to have someone to ping questions off if I DO have questions and for second opinions.

The personal finance blog network is one resource, but I like to have the option to ask a question to a certified financial planner if I can as well. It’s advantageous to have as many resources in your investing bullpen to help along the way with any decisions. So I will keep the Edward Jones account open for nothing more than to utilize the resource he’s given me; I won’t close the account because he’s not the one holding the bag for the 5% deferred “ladder approach” to investing, it is the actual fund, NFPBX. The ladder approach the Edward Jones rep refers to is that the 5% deferred load on the fund will decrease each year I stay in it, up until the 5th year, at which time my account will be converted into “A” shares and the load will be gone.

His explanation of the reasoning behind this is that “it will keep me honest in my investing, and force me to invest for my future”. Well, duh, I know I need to stay in for the long haul, but I don’t need to be investing in HIS future, nor the futures of the fund managers. I think they’ll do just fine without me. I also don’t mind keeping the cash in with NFPBX because it IS a decent fund; repeat, DECENT fund. I hate the deferred load, and the expense ratio of 1.48% isn’t in my sub 1.0% range, but it HAS returned 16% this year, and I can’t balk at that. But I think I can find better ways to manage the $.

In comes Charles Schwab – Honestly, it is the infancy stage, and I’m sure there may be bumps along the way. But they’ve been nothing but cordial in my journey thus far. Yea, I know, they want me for my money. If I find they’re not doing me a service, I have no qualms leaving them either; after all, I can open as many ROTH IRAs as I’d like if I really feel like it. But I am very happy so far. The one sticker so far I’m dealing with then is the fact that I’m NOT transferring my current ROTH or cashing it out (for $400 via the 5% deferred load is what I’d have to pay to get out now) so I don’t have any capital or $ to be sending to a ROTH right now, so I’m starting with the payments I PREVIOUSLY had going to Edward Jones of $100.

The payments will now be headed towards my new ROTH with Charles Schwab under one of their funds, SWEGX. SWEGX has been doing alright this year and it’s basically a mutual fund of mutual funds because it’s holdings are smaller funds, also held by Schwab. Morningstar gives it a 5 star rating. It has a 0.80% expense ratio that I like, and is a no-load fund. Finally it’s got a 12.4% rate of return so far this year, which isn’t too bad either. We’ll see how it does over the next few months, but as a starter fund and only have 100$ to start investing with, it is going to do the trick nicely I think.

Welcome to the family SWEGX!

How Many ROTH IRA Accounts Can I Have Open? Can I Have Multiple?

hank — Sun, 09 Dec 2007 16:23:19 +0000

Short answer, yes.

I was considering just leaving this at that, but I figured I’d add a few extra lines to better seal the deal. So in writing My Edward Jones ROTH IRA account is invested in B shares – Is that good? I researched that same question because I was fed up with getting tossed in the “B” share pool, and wanted to get out, but thought (for whatever reason) that I could only have 1 ROTH IRA account open, but no, you can have 10,000,000 ROTH IRA accounts open if you’d like, as long as you don’t go over the $4,000 limit ($5,000 for those over 50) in any given tax year. However, I recommend NOT doing this because with each account, you’ll be buying into a fund for whatever amount your brokerage charges to make a trade, usually between $10 and $50, and that’s really going to eat at the principal, especially if you’re in 10,000,000 accounts.

But under my “bad investing decision #8 now I guess, it makes more sense for me to open another account up, as I won’t be paying the 1st one anymore for transactions, and will have to suck up and choose 2 or 3 stellar ones for the new ROTH…

My Edward Jones ROTH IRA Account Is Invested Nn B Shares – Is That Good?

hank — Wed, 28 Nov 2007 23:41:08 +0000

So I met with my Edward Jones rep 2 weeks ago and he informed me that my ROTH IRA is being invested 100% in NPFBX. Keep in mind, 9 months ago, my goal was to just get a ROTH IRA started again. Now that I’m a bit futher along in my journey, I figured I’d dig in on exactly what I’m was putting cash in to; starting with my 401k, and now on to my ROTH.

So obviously the first step was to assess the fund NPFBX; it looks like a good fund, over the last 5 years it has gone up 15+ points, has a decent expense ratio (1.48%) and is a 3-star on Morningstar. With my 401k I have been trying to keep the expense ratios low, and the Morningstar ratings at 4 or 5 star, so that is was initially got on my bad side. Investingating further I figured ask my rep why he’s got me in the “B” shares as opposed to the “A” shares. It essentially comes down to him telling me that he wants me to “stay in the market” for 5-10 years. I agree, I want to stay in for the long haul for sure.

So I figure we’re on the same page. So I ask him about the 5.00% back-end load the fund charges with the “B” shares. He tells me that I don’t have to worry about it if I plan on staying in the for the long haul, because I WILL be in the market for 5+ years. The “B” shares have a step down structure to keep me in the fund for at least 5 years. After this year, the back-end load will drop to about 4.25%, the next year to 3.25%, then 2.25% and 1.25% in the final year, and in the 6th year, my shares will be converted to “A” shares. That doesn’t sound too bad, does it?

Well, actually it does sound bad. Right now (Nove 28, 2007 @ 2:50pmPST) the “A” shares of American Funds New Perspective (ANWPX) are selling at 36.32 vs 35.51 for the “B” shares (NPFBX). They are invested in exactly the same setup of a LargeCap Blend, but with a few key differences:
1. The expense ratio on the “A” shares is 0.71% vs the “B” share of 1.48%.
2. The Overall Morningstar rating of “A” shares is 4star, vs. the 3star of “B” shares.
3. The “A” share has a frontload of 5.75%, which isn’t cool, and the “B” share has the deffered ladder dropping from 5.00%, which also isn’t cool.

I’m starting to not like the fund more and more. But I figure I’ll give it the benefit of the doubt and research a little deeper to see what I can find. What is the real difference between the “A” shares and “B” shares. Isn’t it difficult enough to find what mutual funds in general to invest in? And now on top of it I have to decided, after I choose a fund, what type of shares I want? How does that work? So I did some more digging…

From the International Herald Tribune, they say the rule of thumb for shares is as follows:

A, or front-load, shares are the least costly way to own a fund, provided the investor is long-term;

B, or back-load, shares are more likely to fit a five- to seven-year time frame;

C, or level-load, shares are for short-term investors who like to trade in and out of funds.

Makes sense, but why deal with it?

Other investors take their business to fee-only advisers, who recommend portfolios of no-load funds, often with other financial-planning advice. These advisers are paid not by a fund company, but by the client. Typically, the fee is equivalent to a percentage of the client’s assets.

Not surprisingly, the array of options has left many investors at a loss as to whom they should pay, how they should pay, and for what.

I did some more digging on the differences between “A”, “B”, and “C” shares and actually found an article directly FROM an Edward Jones associate where he says:

In the US “a” share funds have a maximum 5% initial commission and a annual expense fee. “B” shares have a zero initial commission, typically a 7 year holding period and a higher annual expense fee than “a” shares. “C” shares have no initial commission, one year or less holding period and a higher annual expense fee than “a” shares.

Our [Edward Jones] feeling is that our customer at Edward Jones, the serious long term investor, is better off buying “a” share funds, paying the one time commission and getting the lower annual expense fee. Our average client holds a mutual fund 18 years. It makes good economic sense for them to hold the A shares.

In Canada because “a” share front load commissions are fully negotiable, there really isn’t the equivalent of the US “c” share.

Also, most fund groups in Canada charge the same annual expenses for their “a” or “b” shares. ie; xyz fund company Canadian growth fund A and B shares have the same annual expense charge.

The savings the fund company has on the A shares vs B shares, because they don’t have to fund the salespersons commission on A shares, like they do on B shares, they pay out in the form of a higher trailing commission to the salesperson on the A shares.

The key piece I see there is the last paragraph where he says that the FUND COMPANY (American Funds) doesn’t have to pay the seller of the share (Edward Jones rep) when they buy the “A” share. When the customer buys the “B” share, they’re paying the Edward Jones rep as well when you buy that.

AH HA! So I’m buying into the “B” shares from my reps perspective to “stay in the market for the long haul”, but in actuality, I’m buying into “B” shares to hook him up with a few extra $ off me that he’s getting instead of applying it to my best interests. A handy way of hiding it I guess.

So the next step I decided to do was to cut off the $ being sent to him and get out of that fund ASAP. But, as I’ve already invested almost $2,000 this year and it is the first year I am in it, I am going to be charged the 5% back-end load to get OUT of the fund now. Well crap, right? Not necessarily, I can just stop funding this ROTH IRA account, keep the $2,000 in there, and wait for 5 years to go by before they’re turned into “A” shares (at which time the 5.75% front load doesn’t matter, because I’ve already been in the fund before and road the step ladder from “B” share-land.

Is it worth it though to stay in for those 5 years with the 1.48% (NPFBX) expense ratio, and miss out on the 0.71% (ANWPX) expense ratio from being out of the “A” share box? Well, let’s run the numbers:
1. 1.48% of $2,000 over 5 years raking a modest 10% return would mean 8.52% real return putting it at about $3,007 over 5 years (not adding any more).
2. 0.71% of $2000 over 5 years raking a modest 10% return would mean 9.29% real return putting it at about $3,120 over 5 years (not addign any more).

No HUGE deal, $113.00 saving over the 5 years to be in the “A” share bucket, but still, that’s $113 I could put to work elsewhere. So it is probably no HUGE skin off my back to keep it in there, but I need to realize that if I were to leave that in there until retirement in 40 years for me, that $113 without adding anything more would relate to $70,119 in the “A” shares, and $52, 266 for “B” shares over that timeframe meaning $17,853 whittled away on fees for being in the “B” bucket. Furthermore, if I take out the $2000 I have in there now, I’m going to be giving the fund another 5% getting out now and giving them another $100 to pull it out and go elsewhere, ugh. I figure the best way around it is to keep the $ in there, keep the financial advisor assistance (whatever he DOES give) on board and wait 5 years to let that $ simmer. If nothing else, I keep the rep honest and onboard at the same time if I have other questions.

Right now that $2000 wasjust a bad decision overall, but a good decision to get back into the ROTH IRA realm. I should have looked elsewhere before jumping, but I jumped and ultimately this is water under the bridge, and can be tacked on to my “bad decisions I’ve made investing“. I’ll not let it happen again. I’m going to stop payments to that Edward Jones account and open up my own ROTH IRA elsewhere, and contribute, at least the rest of my ROTH amount for this year in that bucket, and heading forward doing the same. I am going to let the Edward Jones pot boil over the next 5 years, and open another ROTH likely with Charles Schwab. More on that later…