Small Investors Get Big Fees

[jeffrey]

Come to the Vanguard Group with $1 million or more, and you get portfolio advice, low fees and a personal representative to attend to your investment needs.

Come to Vanguard with $10,000, and you get a guy on the other end of the phone.

Come with less than $1,000, you get turned away.

Vanguard is typical. Increasingly, the message from Wall Street is that small investors need not apply. Merrill Lynch, which once bragged about bringing Wall Street to Main Street, requires a $100,000 ante to sit down with a broker. And Charles Schwab, pioneer of discount brokerage, pushed up fees on small accounts in an effort to make them be profitable — or go elsewhere.

Nearly every brokerage, brokerage house and bank has a special team that caters to the wealthy. Small savers, on the other hand, pay more for their investments, get little advice and often get the raw end of investment scams.

All of which could be dismissed as the way the world works, except for one thing: Today's small investors aren't the stock dabblers of a few decades ago, who bought and sold stocks for the thrill of playing the market. They're investors because they have to be. Their retirement depends on it... [read more at usatoday.com]