Edward Jones Dilemma, Opinions please

**zetta** · 03-13-2009, 09:12 AM

I am familiar with Edward Jones. They are a conservative firm and focus on long-term investing, promoting buy-and-hold of various families of loaded mutual funds. You're unlikely to get churned or put into risky investments with them.

As I understand it, the SEC fines resulted from not disclosing to the customers all the details of how mutual funds were compensating the company -- because most of their customers hold funds for many years, the mutual funds pay them for amount of assets held rather than just on commissions on each buy and sell transaction. I believe other brokerage firs receive this type of compensation as well.

While many here would argue you are better off with a do-it-approach yourself using no-load funds on ETrade, if you would prefer to have a full service broker advising you and are ok with using loaded funds, Edward Jones is a reputable firm.

**sweeps** · 03-13-2009, 09:16 AM

I would tell him that you greatly appreciate his advice but that you've been doing a lot of research and have found that Vanguard (or Fidelity or T.Rowe Price) is highly recommended because of its lower expenses and no commissions, so you are going to take that route.

The SEC thing is a non-issue to me. My opinion is that full-service brokers have an inherent conflict of interest (wanting you to trade more and buy exotic investments so they get paid more in commissions and fees) and that is why I recommend avoiding them.

**disneysteve** · 03-13-2009, 09:26 AM

Originally posted by sweeps View Post

I would tell him that you greatly appreciate his advice but that you've been doing a lot of research and have found that Vanguard (or Fidelity or T.Rowe Price) is highly recommended because of its lower expenses and no commissions, so you are going to take that route.

I agree. There is nothing they will do for you (and charge you for) that you can't do just as well yourself.

zetta makes a valid point that IF you want a full-service broker and are willing to pay the costs involved, Edward Jones is a perfectly good choice. I just see no reason to sacrifice so much of your money to loads and fees and commissions.

**noppenbd** · 03-13-2009, 09:31 AM

Originally posted by isthisused View Post

Here is my dilemma, I have an elder in my church who I have a great deal of respect for and had spoke with him about opening a roth , He works for Edward Jones, I am now about to open the roth as the April deadline is fast approaching. However, I have since learned a lot more about personal finance and I now realize that Edward Jones has much higher fees than say Vangaurd or Trowe price, I also have read a few alarming things about Edward Jones getting nailed by the SEC for some pretty shady practices. So now Im thinking that if it weren’t for my friend I wouldn’t even consider putting my money with this company. Does anyone have any experience with Edward Jones or any thoughts on my situation?

If you are convinced not to open the account at Edward Jones, I would just open the account at Vanguard or similar and tell him you didn't want to bother him with your "small potatoes" account. I had a similar situation where I had invested with a friend who worked at brokerage, and I told him I was planning to consolidate my accounts so I would have less paperwork. I don't think he minded in the least. In fact I think he felt he was doing me a favor by holding the account anyway since most of his clients are probably much wealthier than I am.

**maat55** · 03-13-2009, 10:14 AM

Never be afraid to hurt someones feelings when it comes to your money. I would thank him and move on.

**zetta** · 03-13-2009, 10:22 AM

I agree. There is nothing they will do for you (and charge you for) that you can't do just as well yourself.

I personally use a full-service broker for the bulk of my investing. I don't find it that all that easy to evaluate and choose funds for myself. Sure, I can plug parameters into etrade search to narrow the choices down from thousands to a dozen, but I still am not confident that I understand the details well enough to make the final selection and commit my money. Yes, I'm paying a price for the advice, but I feel it also potentially sheilds me from making some really large mistakes. (And load vs no-load is a debate that would merit a thread of its own!)

**isthisused** · 03-13-2009, 10:27 AM

I just opened a Roth with vanguard and went with the target date fund. I am almost sure I don�t want to go with EJ mostly because of the fees. I just don�t believe they will beat the market enough to make up for a 5% front load. My original thought was to open my roth with Vangaurd and my wifes with EJ and make identical contributions and after five years I would move the poor performer. But I now realize that it wouldn�t be a true comparison because the EJ roth would be more conservative.

**disneysteve** · 03-13-2009, 10:46 AM

Originally posted by zetta View Post

I'm paying a price for the advice, but I feel it also potentially sheilds me from making some really large mistakes.

We'll have to agree to disagree on that point. I don't believe that using a full-service broker or paying a load shields you from anything at all. I think you are just as likely to make mistakes that way as you are doing it on your own. The only difference is the mistake is bigger with the load fund since the costs are so much higher.

**Ima saver** · 03-13-2009, 10:52 AM

I agree with investing on your own. However, Edward Jones is an excellent firm and I have used them for buying stocks and am still a customer with them. I would stick with Vanguard or Fidelity funds that you can pick on your own.

**disneysteve** · 03-13-2009, 11:48 AM

Originally posted by Ima saver View Post

I agree with investing on your own. However, Edward Jones is an excellent firm and I have used them for buying stocks and am still a customer with them. I would stick with Vanguard or Fidelity funds that you can pick on your own.

Julie raises a good point. I would NOT use a broker for investing in mutual funds. That should be done with a low-cost, no-load company. If, however, you want to buy individual stocks, ETFs or bonds, you need a broker. Most of us stick with a discount broker like E-trade or Scottrade, but some choose a full-service broker like Edward Jones. As long as you understand that there are cheaper options, if you don't mind paying more, you will get more personal service from the full-service companies.

**GREENBACK** · 03-13-2009, 01:33 PM

Originally posted by isthisused View Post

I just opened a Roth with vanguard and went with the target date fund.

I have a TD roth with vanguard as well. I think You will definitely do better with this approach for a roth. Maybe look at EJ if you want to do serious investing down the road

**bear** · 05-19-2013, 10:39 AM

Is it wise to used Edward Jones

I just inherited an Edward Jones account that my Mother set up years ago. I don't know anything about Edward Jones but I do know that to use their services they are going to taking over 1K a year from me.

I will have a phone conversation on Friday to figure what I want to do. Any suggestions as to what I should be asking or just steer clear of EJ.

I do have Fidelity IRA account set up. Should I transfer my EJ to Fidelity?

Totally lost!!!

**SeanH** · 05-19-2013, 12:17 PM

They have an expression over at the bogleheads forum - you get what you DON'T pay for. They've also graphed fees against account returns and the results are jaw-dropping. Easy double-digit losses on total account value over its lifetime as the fees climb above 1%. You have the opportunity to be in control and maximize your return. Its one thing to be trapped at a 401k with bad fees because you are trying to get a company match. Its another thing to deliberately choose to give up percentage points of your return for the pleasure of someone in a suit.

**bear** · 05-19-2013, 02:32 PM

Thank you for the little tidbit. Muy Mother's accounts were a little more ocmplicated than the 401K - she was EJ's Advisory Solutions funds. I received a bunch of literature from the company rep and realize that he knows I don't know anything about that. I figure that he is dazzling me with BS so I would stick with the program. I have no idea at this point the length of time she's had her portfolio and how much it has growth. Of course, with the StockMarket going bonkers right now it would seem a lot of stocks would do good. He also much annuities but I don't know if that would be a good idea.

At pointers as to where I should start my research. I am so overwhelmed by all this I don't know where to start. When I talk to him, I don't know what questions I should ask since I don't have any experience dealing with Financial Planners. I just don't want to make a mistake because I trusted somebody. I could accept it if I made the mistake because of my own action but to rely upon someone else who might must be in it for the $$$$ .....

Edward Jones Dilemma, Opinions please