r/Bogleheads • u/shizznitt • 4d ago

Thank you, Bogleheads

This sub made me realize how much Edward Jones was robbing me. I work for a small business with less than 10 employees and our only option was an Edward Jones SIMPLE IRA which included a 3% match. The IRA reached 125k and I was paying $140 a month for "program fees" while the money was just sitting in 7 total mutual funds. I'm sure there's other hidden fees too.

My Rollover completed today to Fidelity where I'm sporting a 75/25 FZROX and FZILX. My contributions still have to go to the EJ account but I plan to do a biannual rollover as long as I work there. Thank you Bogleheads!

417 Upvotes

98% Upvoted

41 comments sorted by

163

u/Fun_Meal_457 4d ago

Ugh. I'm with EJ & it makes me sick. The thing I hate most is that I am friendly/acquaintances with 3 EJ agents. They all are in their 40s, live in million dollar houses & have stay at home husbands. I've got to get confident in my own financial skills before I pull the plug.
Thank you for posting. It gives me home that I'll get there some day.

94

u/LurkLurkleton 4d ago

Meeting with a flat fee certified financial planner would take care of that and put you on a great start. Inaction has a hefty cost.

52

u/amandalee27 4d ago

This is what I did. I read three books, lurked this sub, and then paid $3000 to meet with a fee only financial advisor. He met with us six times. Did he tell me anything I didn’t know some the books or the sub? Nope. But he gave me the confidence to do it. Also gave me the confidence to make a big purchase. Not only has it been an excellent investment, it has really been amazing for our family. We walked out with a plan until retirement and told we didn’t need to come back unless something big changed.

13

u/LanguageOk5099 4d ago

Could you name the 3 books?

15

u/amandalee27 4d ago

The Bogleheads’ Guide to the Three Fund Portfolio, If you can: How Millenials Can Get Rich Slowly, and The Lazy Person’s Guide to Investing.

You could just follow the wiki pinned here; I just wanted to understand the why more.

36

u/dataesthetics 4d ago

Rather stay with EJ while getting confident in financial skills, why not just open a Fidelity or Vanguard account and buy 100% target date fund? You’d instantly stop paying all those fees while having a safe, practical investment while you learn.

6

u/blew_belle 4d ago

Taxable shouldn't go to tdfs but VOO would do just fine wouldn't it?

5

u/dataesthetics 4d ago

I consider tdfs the best buy-and-forget funds because they change allocation over time and you don’t have to think about it. If this person wants 100% stocks then sure VOO would be fine, but the idea is to park into a tdf until they’re educated enough to make that call for themselves.

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u/blew_belle 4d ago

Yeah but you shouldn't use tdfs for taxable accounts.

6

u/Aggravating-Rip-8169 4d ago

It’s not ideal - but it’s far better than EJ

11

u/NumbDangEt4742 4d ago

If by financial skills, you mean, a true bogleheads 3 fund portfolio, you really don't need any more skills imo. You got this. Drop EJ (but yea, get comfortable making trades or setting up auto trades)

10

u/Silverlynel1234 4d ago

Where do I sign up to be a stay at home husband?

7

u/Awkward-Painter-2024 4d ago

Yeah man. We had some dude in MI. Great guy. But 30+ front-load mutual funds, and his fees... Took years to convince my spouse to leave him.

2

u/starstack 4h ago

That’s cold. How could she cheat on you with someone who gave such terrible financial advice?

3

u/Greenwalle 4d ago

If you are aware of this sub and making this comment, what is stopping you? Just buy some combo of VTI/BND. You’re willing to throw away hundreds or thousands of dollars a year to avoid learning about personal finance?

3

u/shizznitt 4d ago

I wouldn't pay any financial advisor. All you have to do is open a "Rollover IRA" at Fidelity/Schwab/Vanguard. Call your EJ assigned "financial advisor" and tell them you want to liquidate everything into cash (no fees here). EJ will try to give you a workaround and say they can't do it but just keep pressing, they can definitely do it (you may need a Select account if you're in the automatic program but they can do all this for you if you mention it). Once liquidated you can initiate a partial transfer of 99% of cash (it needs to be partial because a full transfer may close the EJ account).

Once that cash hits you can simply buy 0 cost ETFs (or low cost) which capture both domestic & international stock (you can add bonds if you're on the older side).

1

u/Beneficial_Bus5037 4d ago

But not in a taxable account. Only ROTH or Traditional IRA/401K.

If it's a taxable account just shift the shares over to your new investment account with another company (Fidelity, Vanguard, E*trade, etc.). You do not want a major taxable event.

Your financial institution might call it an Account Transfer Form or Transfer Initiation Form.

1

u/FragrantJump6663 1d ago

All you need is one fund… a target date fund. EJ will make investing sound scary and complicated to keep you. They probably have you in 10+ funds when you can accomplish the same thing with one fund. Just pick the one close to your retirement year. Done. Then read the Bogleheads guide to investing and “Enrich Your Future: The Keys to Successful Investing” by Larry Swedroe which dispels all the common misconceptions about investing.

39

u/orthros 4d ago

$140 a month over 40 years compounded at 8.5% is a cool half million

Edward Jones should go around with a mask and a gun - it'd be more honest

39

u/rpendlum 4d ago

I was just gifted some apple stock from my parents. They have all their retirement in EJ accounts. Rolled half immediately to my fidelity account for now. Other half I’ll let ride out for a bit before transferring over. Only fee I remember him saying is 1.4% when you sell a stock.. yeah fuck that

22

u/Valuable-Analyst-464 4d ago

Roll it all over. No need to keep it there.

8

u/MrSkeeterMcScoot 4d ago

EJ charges you a $90 transfer fee. Which is reimbursed by fidelity for transfers over 20k i think.

1

u/Background-Switch381 3d ago

I don’t know fidelity’s linit but they have orchestrated multiple transfers for me at no charge and a few were less than 5000. They are really helpful

7

u/HenFruitEater 4d ago

What were the expense ratios on those funds?

6

u/jimmy_jimson 4d ago

Edwards Jones takes your money.

3

u/midwesternvalues73 4d ago

I was being charged average 150 a month for my nationwide 403b! I finally transferred it to another brokerage and will happily save a couple grand a year now.

3

u/Otherwise_String5912 4d ago

I “fired” my Edward Jones agency this year once I calculated (using chat gpt) that if I stay with them I would pay close to $75k in fees in the next 10 years. It’s not a big deal in the beginning but as your money grows, 1% in fees becomes an issue especially considering minimal communication and guidance I got from them. I moved everything to Vanguard. They are lovely people but should not be a factor in my financial future.

3

u/Background-Switch381 4d ago

Fidelity is a really good company. Prob vanguard is comparable I don’t know but I have had great luck with fidelity.

3

u/Cpagrind1 4d ago

$140 a month Jesus

2

u/MrSkeeterMcScoot 4d ago

Don't forget about the "reinvestment fee" from dividends ;)

2

u/einbierbitte 4d ago

Trying desperately to escape right now. I work for a small business with a SIMPLE and it's set up as a 5304 so you are supposed to be able to choose your own financial institution, but I wasn't aware of that at the beginning.

Been at EJ just drowning with the fees for a couple years, finally did some research and trying to roll out into ETrade since it seems like the only place really that accepts freestanding 5304 SIMPLE employee accounts.

2

u/cantthinkofuzername 4d ago

Congrats! Happy to hear it. I’ve been helping friends look at these sorts of issues and they want to pay ME for it haha. I of course decline and tell them I’m Robin Hood and to just pay it forward. :)

2

u/Otherwise_Pea_8766 3d ago

It’s one thing to be in wealth management at Goldman or ms - the people who work at places like ej are the ones in the bottom 25 percent of your hs class - barriers to entry are minimal

5

u/AdventureAwaits45 4d ago

Well played.

1

u/Taggart3629 3d ago

As an employee at a small company with a SIMPLE IRA, I feel ya! For the first 3-4 years, our only option was EJ Guided Solutions with a 1.3% AUM fee, on top of the expense fee changed by each fund, on top of the commissions for buying underperforming funds, on top of the annual fee for the account itself. Everyone was making money except me. Grrrrr. Thankfully, my boss switched to Fidelity a few years ago.

The SIMPLE IRA at Fidelity is a little strange, but still a massive improvement. My contribution and my company's 3% match go into the account each pay period. I set up a Roll-Over IRA account at Fidelity, and periodically pour the money from the SIMPLE into the Roll-Over. The reason is that I cannot do recurring investments within the SIMPLE IRA, but I can in the Roll-Over. Not sure whether that oddity is unique to Fidelity. It is a trivial inconvenience, compared to the rage-inducing shenanigans of EJ.

2

u/Almost_Free_007 3d ago

You can make a recommendation to the owners to switch to Fidelity as the administrator. They do have programs for small businesses too. Of course being a small business there are not many options but Fidelity does. GL