So I have about 11k in a rothIRA. Not a huge chunk of change. Still, I thought it was prudent to move it into a lower cost account. So I called my advisor at MorganStanley, who happens to be a family friend. I told him I want to move my account to Vanguard because of the lower costs. And he countered with the following arguments:
- My account fee right now is only 1%, plus a 75 dollar account fee per year.
- There's "no way" vanguard can offer a target date retirement fund with a .16% expense ratio and a 25 annual fee. He said there must be some kind of other expenses in "asset management sleeves".
- I won't have anyone to talk to at Vanguard, whereas I can call him whenever I want.
- The vanguard target date fund I'd want to invest in has 10% bond allocation, which he says is way too high for a market w/ rising interest rates. He said no one at vanguard is going to suggest I move assets around based on what's happening in the market. However, I've read a lot about how active asset mgmt doesn't always beat out set it and forget it strategies...
So what do you guys think... should I move accounts? What's the move here.
EDIT: I've opened up a vanguard account and asked them to initiate a transfer. They then told me that I need to call Morgan Stanley to liquidate my assets since theyre in funds vanguard doesn't offer. When I called they gave me the same story. TBH I'm not sure why they're trying so hard to keep my account. There's only 11k in it! It's not like i'm keeping their business afloat...
Submitted January 06, 2017 at 11:52AM by Cleardesign http://ift.tt/2ikbn3T
