Skip to main content
No. of Recommendations: 5
Brett.

Oh my God. You sound like me. My mom is the same way. Just be thankful yours is only 46 -- mine is 79. Good for you for getting a handle on this.

The way that I handled it was to get her out of the claws of her Merrill Lynch broker "tout suite." The move we made easier in that I initially put her into Schwab where I told her that she would still have the opportunity to have advise from a broker, but she wouldn't be paying a commission. In reality she never used it, and they pushed Schawb funds anyway, but if your mom is really stubborn, it might be a way to go. Keep in mind, however, that they charge a transaction fee to buy Vanguard funds there.

Your other option is Scottrade, which I think you've asked about before. Don't expect the level of service that you would get at Schwab, but you won't be paying the price either.

As far as the loaded funds go, if it were me, I'd dump 'em. The first two you listed, at first glance, look very similar. So combine your expense ratios and she's paying in the neighborhood of 3.37% -- yikes!

Choose a good index fund for her -- VTSMX or something like that, and maybe a bond fund when the market recovers, or even a Lifestrategy fund of funds from Vanguard -- and get the IRA working for her where you don't have to think so much about it.

As far as selling now, think of it this way, "yes, the funds you're selling may be on the low side but, then again, so will be the stock fund you're buying into." Just a thought.

Good for you for getting her CC interest reduced. She really needs to rid herself of that. Is there any way you can make sure she's making over and above the minimum payments? That's the only way that's going to happen.

As far as the individual stocks go, first of all, see what you think of the companies. Are they good solid investments? If so, why not talk her into keeping a small portion and selling the rest. That way she has some investment in them, but the bulk of her savings isn't tied up in 4 stocks. ( I didn't look them up so, except for SEBL, I have no idea what they are.)

And get an emergency fund going for her. I have my mom set up with an AIP (Automatic Investment Plan) which is adding $250 to her money market everymonth. The emergency fund is really important. You might look into Netbank (www.netbank.com). They have a good MMkt. I don't know if they AIP or not, you'll have to search around or call them.

My mom's is at Vanguard where she keeps some of her stocks, so she doesn't have to pay low balance fees on her MMkt. If you go for a straight MMkt account there, watch the fees. I hear ING is good too, but I have no first hand knowledge. Whatever the case, an AIP might do her very well since she doesn't really have the drive to save on her own. (FYI - Scottrade does not have a MMkt account, and their cash account pays very poorly.)

Well, I'm sure there's more, but I can't think of it right now. I hope this helps.

Caat
Print the post  

Announcements

The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.