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Author: gurdison Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 19224  
Subject: Re: My folks need help... please advise Date: 2/16/2000 11:44 PM
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<Tranfer them out ASAP at all costs. No problem with traditional or rollover IRAs, just don't mix them. Unfortunately you'll have to go through the process 15 times, but you are on the right track>

I agree with you and most of the other posters. The parents have really gotten hammered here. If they bought the "A" funds, they got hit with a hefty front end load, high annual management fees and probably a 12b-1 fee. If they bought the "B" funds they avoided the front loads, but got clobbered even harder with MUCH higher annual management fees and higher 12b-1 fees as well as a reducing back end fee.

The pattern ends up with the investor in last place. The order of finish in this race is:

1. The Fund. They collect all the fees.
2. The brokerage firm. The "loads" go back to them for "finding" the investor.
3. The broker. They collect incentives by "providing" the investor.
4. The investor. Provides 100% of the money and risk. They are the last one in the chain to get paid.

Note that even in a year where the fund loses money for the investor, #1, 2 & 3 still collect ALL of their fees.

Take the time to go through the prospectus of the Vanguard funds you were talking of switching to. Then compare the numbers in the prospectus from the current funds your parents have. I think it will open your eyes! Good luck!!!

BRG
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