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Not sure if this is the right board for this question, but I will start here....my investment advisor informed me that he is leaving Fidelity and taking all his accounts to TDAmeritrade.

This threw me for a loop as I have had my accounts with Fidelity for many years and my retirement info/medicare insurance from my company is also with Fidelity which made my finances symbiotic.

My advisor assures me the move will be smooth and I will be getting a better deal? and he will be getting better investing advice/programs through Ameritrade.

So my question is does anyone know anything about Ameritrade..good/bad? Will I be better off with them than Fidelity? If I choose not to move, I probably may have to find a new advisor...ugh.

Birgit
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So my question is does anyone know anything about Ameritrade..good/bad? Will I be better off with them than Fidelity? If I choose not to move, I probably may have to find a new advisor...ugh.

There are good and bad points about both, IMO. TD's trading platform is really nice - better than Fido's, IMO. However, about 2 years ago (I think), with not very much warning, TD significantly changed their list of no fee ETFs, and a lot of the ETFs that were previously free to trade began incurring commissions to trade. That annoyed Joel enough that he moved his accounts to Merrill Edge.

Fido has a nice selection of no fee ETFs and mutual funds that they sponsor, with expense ratios as low as 0%. However, Fido has, at times, not allowed me to buy stocks that they consider 'too risky' or 'too complex' - even though I completely understood the complexity, and the fact that the general market didn't understand the complexity made the stock a good buy. One example is JBK, a thinly traded trust preferred stock originally issued by Lehman Brothers that was trading at less than 50% of par. When Lehman went BK, the trust reverted to being a direct passthrough of the underlying issue (debt issued by Goldman Sachs), and changed from paying dividends quarterly to paying every 6 months. People thought that the Nov 2008 dividend payment had been missed because they didn't understand that the change had occurred. It now trades over par at about $26.75 and has never missed a dividend payment.

I would check TD's list of no fee ETFs to be sure that the ETFs you own in taxable accounts are on the list. If they are not, find out how much it will cost to trade those positions vs. how much it costs at Fidelity. Also, if your advisor has you in any Fidelity sponsored ETFs or mutual funds, especially low/no cost ones, find out what he's going to do about those. If he suggests that you sell before leaving Fido, and they are in taxable accounts, you will incur tax consequences, which you may not want to do. And if the equivalent funds that he will recommend when you get to TD have higher expense ratios, you probably want to question that, too.

AJ
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Thank you, AJ.

I do not think I own any Fidelity proprietary ETFs and I own no mutual funds. I am reading on the TD site that they have such a long list of no fee ETFs!

Customer Service with FID has been stellar for me and I am nervous about moving my accounts. But moving to another advisor at this late stage in my life is almost unthinkable.....my guy is at least honest and has been around for a while. I hope TD is good to deal with, especially since I am taking MRD and right now, FID handles all that for me, including paying the taxes.

Birgit
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I am reading on the TD site that they have such a long list of no fee ETFs!

Be sure to check that the ETFs you already hold are on the list. If they aren't, then ask your advisor how he's going to handle them. If he wants to replace them, because they're in an IRA and you won't have tax consequences, be sure you are comfortable with the replacement. If he's not going to replace them, be sure you understand how much it's going to cost to trade.

Check the expense ratios on the ETFs. Only a small portion of their ETFs have low expense ratios. And, as far as I can tell, they don't have index ETFs, like the S&P 500 or the Russell 2000. They do appear to have some 'semi-managed' ETFs like 'Value 500', 'Growth 500' and 'Large Cap' with low expense ratios. But, as an example, they used to have IVV, which is iShares S&P 500 index, but that was taken off the list of their fee-free ETFs.

AJ
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I have some iShares with free commission and .... one ETF at.075% expense ratio.

Nothing proprietary. For some reason, TD is giving clients cash to invest with them.

Birgit
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I think that I would focus on the advisor first and the respective products second. Do you rely heavily upon that advisor, and have the suggestions and results met or exceeded your goals? I am a bit concerned that he / she says that Ameritrade will improve his / her performance - that seems like a sales pitch, and also makes me wonder about capability.

D
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I am a cynic, but I think the advisor changing houses is better for them than for you. I have no way to prove that, of course, but I do know that a brokerage will reward me nicely if I move $1,000,000 (or more) to them, and I would not be at all surprised to find that there are similar incentives for “advisors.” And moving a whole list of clients would make for a handsome payday payout, I should think.

Yes, it’s possible that it will be better for you too, but that is not my first thought. It’s also possible that the advisor is caught up in some sort of political machination or is unhappy with some aspect of his current contract, but again that should have nothing to do with you.

As others have noted, if you are required to sell ANYTHING to move to another brokerage, you (not the advisor) will incur the tax consequences, or if there are declining load fees on mutual funds or early redemption penalties on bonds that is also on you. Be careful, and avoid those fees; they give you nothing but minus signs.
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Birgit,

Color me cynical also. I would ask your advisor for a written statement directly comparing all the fees you currently incur or could incur (commissions per trade, advisor fees, load fees, etc) with what you will pay at TDA. I would also ask for in writing what incentives you will receive and he will receive for transfering your account. I would also talk to a branch manager or someone similar at Fidelity to see what incentives they would give you for remaining with them.

I transfered almost all my accounts and partner's and kids accounts out of TDA several years ago because TDA was intractable about lowering their commissions when Schwab and the rest of the world practically all lowered their's. I did like TDA's online and mobile interface much better.

The Schwab people by the way offered free trades for ten years in most of my family's accounts. Also some cash incentives. Turned out also the advisor they assigned to me was great!

I don't know what your fees are like at Fidelity but I am extremely skeptical that they will be lower at TDA and I am wondering EXACTLY how it will be a better deal or how you will directly benefit from this better investment advice and programs.

Get everything in writing...

David
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Not sure if this is the right board for this question, but I will start here....my investment advisor informed me that he is leaving Fidelity and taking all his accounts to TDAmeritrade.

This part is UP TO YOU, it's not his decision in any way.

My advisor assures me the move will be smooth and I will be getting a better deal? and he will be getting better investing advice/programs through Ameritrade.

Make the advisor work a little. You should be provided with all these details and specifics IN WRITING. What exactly is the deal (fees, etc) now, and what exactly will they be at the new place. Line by line, with each one clearly shown for all your holdings.

Finally, in general, when moving a large sum of money from one company to another, there are various incentives. Often those incentives are in the form of a cash bonus, perhaps even up to 1/4-1/2% of the assets transferred in some cases. Sometimes the bonus is in the form of some period of free trading, or number of free trades, etc. Ask what bonus you will receive if you eventually choose to move your account.

For example, right now TD Ameritrade has an incentive of $2,500 cash if you move $1M in assets to their firm - https://www.tdameritrade.com/offer/2500/index.html
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aj485,

You wrote, Fido has a nice selection of no fee ETFs and mutual funds that they sponsor …

I left TD Ameritrade in large part because they changed their NTF list for both ETFs and Mutual Funds. Before the change their ETF list mirrored Fido's and included a lot of low-cost iShares and Vanguard ETFs.

After the change all of the replacement funds had expense ratios that were about 10x their predecessors. I was told by an advisor that they did this to attract advisors and their clientele. There was something about them receiving a payment for the business they drive to TDA. The higher cost NTF funds subsidized these payments through higher expense ratios.

Personally I think TDA has a great website with really good research and other tools. But the switch and the high expense ratio NTF funds really turned me off. In fact I'd procrastinated leaving E*TRADE when they did something similar a few years before so I was rather ticked at TDA for doing much the same thing just a year or two after I'd rolled my E*TRADE accounts over to them. At least I got the account bonus for the move. And since I was entirely in ETFs and individual issues I could roll those over to Merrill Edge and trade them for free there...

BTW, if I used an advisor (not likely) I probably wouldn't follow them to TDA. I can't imagine anything good coming of that. At least not for me. Maybe for them, but not me.

- Joel
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When my last adviser moved and wanted me to move with him I asked him to lower his fee. No brainer to ask, and he he pretty much had to. Not everyone is going to move. If he/she wants me to help them start their new shop etc, then I want more of the cut :)

And its a great time to ask yourself how your adviser is doing. Its easier and easier now to do it yourself, if you are on TMF, you are probably a DIY to some degree. Another thing you might want to do, is only give him/her half and move the other half somewhere where you can management and see who does better.

I am with Schwab, and 100% love them. Great products, easy of use, help if you want it, but they leave you along if you don't.

Good Luck.

CFD
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For example, right now TD Ameritrade has an incentive of $2,500 cash if you move $1M in assets to their firm

I did not see that amount...will need to follow your link. I saw in the neighborhood of $600 or less and I am moving more than 1M.

WooHoo...yes, and I am informing my I.M. of this nice deal for me.

I have given this move a lot of thought. I've been with this Investment Manager for many years and I believe him to be honest and to have "both" our best interests up front. He has done pretty well for my investments...mostly in dividend stocks. Sometimes he comes up with an idea that I say NO! I am sure that he is getting nice incentives to move to TD....and I hear that TD does cater to individual investment advisors and perhaps gives a better deal than Fidelity.

Finding new, experienced honest, advisor would not be easy and most important, my fee with him is just .05% which I could not easily get anywhere else. I made this deal with his dad and it better not change. I mentioned to him about the $6.95 trading fees and he told me that was not going to be the amount for him..so he must be getting a deal. I will be receiving a packet and hopefully it will have trading info.

Thank you all for your excellent input!!

Birgit
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