Help do i cut my mom's losses?

[LivingAlmostLarge]

AMER ELECTRIC PWR CO	100	$84.29	-$1.04	$8,429.00	-$104.00-1.22%	$6,570.96 2	+$1,858.04 2	C	No	2.34%
AMERICAN FINL 5.875%PFD DUE 03/30/59SUBJ TO XTRO REDEMPTION	300	$24.215	+$0.105	$7,264.50	+$31.50+0.44%	$7,744.59 2	-$480.09 2	N/A--	No	2.02%
AMAZON.COM INC	340	$129.78	+$1.42	$44,125.20	+$482.80+1.11%	$56,830.92 2	-$12,705.72 2	C	No	12.26%
HAWAIIAN ELEC INDUST	175	$36.24	+$0.07	$6,342.00	+$12.25+0.19%	$4,723.11 2	+$1,618.89 2	B	No	1.76%
JPMORGAN CHAS 5.75% PFDPFD	500	$24.91	-$0.03	$12,455.00	-$15.00-0.12%	$13,016.65 2	-$561.65 2	N/A--	No	3.46%
KRAFT HEINZ CO	166	$35.46	-$0.20	$5,886.36	-$33.20-0.56%	Incomplete	N/A	C	No	1.64%
MONDELEZ INTL CLASS A	200	$72.00	-$0.88	$14,400.00	-$176.00-1.21%	$4,532.19 2	+$9,867.81 2	B	No	4%
ALTRIA GROUP INC	100	$45.98	-$0.11	$4,598.00	-$11.00-0.24%	$6,293.65 2	-$1,695.65 2	A	No	1.28%
MICROSOFT CORP	100	$337.22	-$4.05	$33,722.00	-$405.00-1.19%	$13,824.95 2	+$19,897.05 2	B	No	9.37%
NEXTERA ENERGY 5.65%PFD DUE 03/01/79SUBJ TO XTRO REDEMPTION	500	$25.20	+$0.00	$12,600.00	+$0.000%	$12,826.65 2	-$226.65 2	N/A--	No	3.5%
PFIZER INC	250	$35.53	-$0.10	$8,882.50	-$25.00-0.28%	$5,178.64 2	+$3,703.86 2	C	No	2.47%
PRUDENTIAL FIN 5.625%PFD DUE 08/15/58SUBJ TO XTRO REDEMPTION	500	$24.60	+$0.12	$12,300.00	+$60.00+0.49%	$12,907.70 2	-$607.70 2	N/A--	No	3.42%
A T & T INC	200	$15.61	-$0.26	$3,122.00	-$52.00-1.64%	$5,485.70 2	-$2,363.70 2	B	No	0.87%
AT&T INC. 5.625%PFD DUE 08/01/67SUBJ TO XTRO REDEMPTION	500	$24.94	+$0.06	$12,470.00	+$30.00+0.24%	$12,833.41 2	-$363.41 2	N/A--	No	3.46%
VIATRIS INC	31	$9.86	+$0.02	$305.66	+$0.62+0.2%	$285.43 2	+$20.23 2	B	No	0.08%
VERIZON COMMUNICATN	102	$35.90	-$1.23	$3,661.80	-$125.46-3.31%	$4,713.43 2	-$1,051.63 2	B	No	1.02%
WARNER BROTHERS DISCOVER	48	$12.54	-$0.13	$601.92	-$6.24-1.03%	$1,669.14 2	-$1,067.22 2	D	No	0.17%
				$191,165.94	-$335.73	$169,437.12	+$15,842.46 3			53.11%
ETFs & Closed End Funds
BLACKROCK TAXABL MUNI BN	1,000	$16.34	+$0.14	$16,340.00	+$140.00+0.86%	$21,130.00 2	-$4,790.00 2	Ratings	No	4.54%
ISHARES CORE S&P MID-CAPETF	150	$259.65	+$2.42	$38,947.50	+$363.00+0.94%	$43,217.25 2	-$4,269.75 2	Ratings	No	10.82%
ISHARES CORE S&P SMALL-CAP ETF	365	$98.39	+$0.96	$35,912.35	+$350.40+0.99%	$42,902.10 2	-$6,989.75 2	Ratings	No	9.98%
VANGUARD S&P 500 ETF	55	$402.89	-$0.94	$22,158.95	-$51.70-0.23%	$23,182.49 2	-$1,023.54 2	Ratings	No	6.16%
VANGUARD TOTAL STOCK MARKET ETF	180	$218.04	-$0.27	$39,247.20	-$48.60-0.12%	$43,018.02 2	-$3,770.82 2	Ratings	No	10.9%

This is my mom's mess of a raymond james Roth IRA. I've finally gotten control and moved it. Some of it I did with manuvering which means I made the best suggestions I could with my mom sitting there with her "investment advisor". Literally with my mom repeating "i don't care about making money, I just don't want to lost any money.

So the ETFs at the bottom are what I did since she had a $200k in cash just sitting making 0% and paying 3% in fees for over 10 years. That is what the raymond james advisor did. The ONLY reason I got control now is because my mom's advisor is retiring and my mom freaked out at having a new person maange it that she didn't know if they were from a "good family." Yes that's how hawaii and probably any "small town in the US" works. If you grew up in a small town anywhere you know how my mom is "talking" about people and why she decided I was the "lesser" of two evils. The guy taking over we know nothing but his name SO that was a big NO, not because she really believes anything I say about fees.

So do I cut losses and sell off blackrock taxable muni? Do I sell most of the individual stocks and buy ETFs? i'm mostly bogelhead myself and i have a few stocks here and there. I'm cool keeping say MSFT, AMZN but I'm not sure about anything else.

This is my mom's roth and she's not touching it ever. It'll go to my kids if it matters in the discussion. No RMDs and she's 71 and in excellent health. FWIW, her mom is still alive at 95. So the chances are high she'll live a long time. And no she doesn't ever need the money.

I am working on moving my dad's as well. They don't have a ton invested mostly because my mom has a large pension and SS and low expenses. I manage her single taxable account and majority about $200k out of $250k in CDs and T bills for the next 5 years earning 5%. Not the greatest but I am trying to move her slowly to being okay with investing.

Do I cut losses and just sell everything and rebalance?

[disneysteve]

The huge benefit here is that this is a Roth so there is no tax to deal with if you sell anything. You can make a fast clean break from the mess the sleazy salesperson created. My cousin had the same mess - 23 funds - when I inherited his IRA which was with Wells Fargo, another set of crooks. I quickly got it into 3 funds with Vanguard.

I would sell it all. Just the settlement account at Vanguard is going to earn her more than she was making with this portfolio. What to do from there depends on the desired asset allocation. The total stock market ETF can replace all of the individual stocks. What to do with the bond allocation depends on how hands on you want to be. A total bond market index isn't a bad choice but you can probably do better with a ladder of brokered CDs and Treasuries and be less exposed to interest rate risk.

First step is to sell everything you don't want. As I said, just the settlement account will be an improvement.

[disneysteve]

Another even simpler option would be to sell everything and buy a good balanced fund with an AA that you're comfortable with. My 401k is 100% in a 60/40 fund, for example.

[kork13]

Another even simpler option would be to sell everything and buy a good balanced fund with an AA that you're comfortable with. My 401k is 100% in a 60/40 fund, for example.

Simple is definitely preferable. Selling everything & going into just 1-3 broad-market MFs (maybe even a target-date fund synched to your kids, since it's effectively for their benefit).

Have you successfully gotten them away from the financial "advisor" hack yet?

[LivingAlmostLarge]

I guess i feel guilty selling everything at losses even knowing it's in a Roth IRA. I would prefer simple. I am working on moving everything over from the crooks yet. It's been ridiculous my parents have paid over $100k for advice to make no money.

My dad literally had a whole life insurance policy in his IRA. I also want to mention that they were sold 1 share of Home Depot stock as part of churn. It'll get worse as I post more. I'm moving all accounts slowly. It's been slow because i've had to "discuss" with my mom in person a lot of stuff. She is extremely nervous about everything and until now I've been unable to sell anything and simply, more like redirect free cash into more reasonable ETFs, but not actually made changes to bad prior decisions.

So now I can correct the bad decisions and I feel guilty.

[disneysteve]

I guess i feel guilty selling everything at losses even knowing it's in a Roth IRA.

It’s better than the alternative which is to watch it lose even more. Those losses are never coming back.

[LivingAlmostLarge]

you probably are right

[Like2Plan]

I’m having trouble understanding the information you have here as I don’t see labels on the columns. For example, Microsoft has -4.05. But, I think that is because it closed -4.05 for the day. I can’t tell what the original basis is. But, really stock prices have no memory. So, there is no need to wait.
Anyway, if you want to align it with the 1, 2, or 3 fund portfolio. Turn off dividend reinvestment (if that feature has been selected).
I would sell every thing except VTI and possibly the muni bond fund. After the trades settle buy VTI and possibly a bond fund and an international fund.

If there is a big correction in the market, you might get some feedback from your Mom. So, you might want to keep track of the current portfolio to compare.

I can tell you that I am just a few years younger than your Mom and I have similar goals for my Roth (hopefully an inheritance). It is 100% VTI. I am not expecting this money to be touched for at least 20 years, so I think we can afford a little more risk. And, I have bonds in a traditional IRA. But, I’m not sure your Mom would be comfortable with this allocation— so, you have to go with what makes her the most comfortable.

[Jluke]

I would sell everything in the top table with a positive return (4 column count from right to left).

if a fund has a loss of 700 or less I would sell that too.

for funds that have a more negative loss I would set a limit order at a price you would be comfortable selling at a loss. IF you believe the stock can rebound.

if any of those funds distribute dividends or capital gains which are reinvested, that action might be why you are seeing a loss. You may need to look closely at each individual transaction/lot purchase to see where the losses are coming from.

finally sort of contrary to what I said above, I would probably hold Amazon and Microsoft since your timeframe is many years.

if I look at the top table and the last row, the overall return of the entire portfolio is positive at least.

[LivingAlmostLarge]

I’m having trouble understanding the information you have here as I don’t see labels on the columns. For example, Microsoft has -4.05. But, I think that is because it closed -4.05 for the day. I can’t tell what the original basis is. But, really stock prices have no memory. So, there is no need to wait.
Anyway, if you want to align it with the 1, 2, or 3 fund portfolio. Turn off dividend reinvestment (if that feature has been selected).
I would sell every thing except VTI and possibly the muni bond fund. After the trades settle buy VTI and possibly a bond fund and an international fund.

If there is a big correction in the market, you might get some feedback from your Mom. So, you might want to keep track of the current portfolio to compare.

I can tell you that I am just a few years younger than your Mom and I have similar goals for my Roth (hopefully an inheritance). It is 100% VTI. I am not expecting this money to be touched for at least 20 years, so I think we can afford a little more risk. And, I have bonds in a traditional IRA. But, I’m not sure your Mom would be comfortable with this allocation— so, you have to go with what makes her the most comfortable.

Sorry it's hard to cut an paste. I have turned off dividend reinvestment. It is a Roth IRA. I think i'm going to sell most stuff and keep Amzn and MSFT and then sell all other stocks. The muni bond fund is a bad idea in a roth ira with no taxes anyway. I'm getting over the fear of "losses".

[bjl584]

I'd think that if you moved it, then you probably had to liquidate everything to cash first. Or am I wrong about that?

[LivingAlmostLarge]

I moved all positions and you can do that.move in kind

[scfr]

Just wanted to say that I hear you on how hard it is to go at your mom's pace, and to sit and patiently explain things to her that to you seem obvious and easy. Hang in there. Please continue to respect her wishes, and even if it's not what you would do, if she says that she doesn't care about making money just doesn't want to lose any, that's the path you need to take. It's still her money.

[LivingAlmostLarge]

WHat's interesting is that they were bleeding money and she could see it in the positions they put her in but she still kept telling me "it's not going down too much" because they have been paying 3% for the privilege of sitting in a money market for 50% of her portfolio. She now can see that the person isn't qualified and can't do better. She is starting to see that just tossing it in something simple and not paying the $10k a year to not make money comes out ahead. Even leaving it in a money market earning now 5% is hard if you are paying 3%.