What type of retirement service am I looking for?
October 25, 2014 7:27 PM Subscribe
I have too many retirement accounts at too many institutions (7 going on 9). I dislike managing them all and would like to hire someone. I don't need help planning or making decisions. I need an administrator to buy my already chosen funds as money is deposited and to give me consolidated reports once per year. Does anyone know is this type of service exists?
__Background__
The number of financial accounts I have under management has grown too large. Between my wife and I, we have 7 going on 9 accounts that we have accumulated over the years. Because there are fees to withdraw, we just leave existing funds where they are when we move on, and direct new deposits to the new accounts.
All accounts are under my personal management (self directed). I am _not_ an active investor. I invest on a fixed monthly schedule in to the same funds. I do not intend to change my investment plan.
__Predicament__
Because of the fact that I have so many accounts, I would like to hire someone to manage all of this for me. I’m not sure what type of service that even falls under or what types of companies serve this type of request. This would be an ongoing business relationship. I am not rich or have a lot of money to invest, I simply have a complicated setup.
I don't need anything more than someone who will periodically log in to make sure contributions are continuing to accrue, rebalance the funds on a yearly basis, buy stock in my chosen funds using the automatic contributions that are deposited.
I do not want
- Advice, such as what I should invest in
- To meet in person regularly
- Financial planning
- Someone to answer questions from me
- A broker
- To make changes to my accounts
- Get new account with a different brokerage company
- Cancel my current accounts unless this can be done without fees or taxes
Does anyone have any experience in migrating their retirement funds from institution to institution over the years? Should I just suck it up and pay the fees on the old accounts? Are there any companies out there that will take the complexity out of managing all this?
Thanks!
__Background__
The number of financial accounts I have under management has grown too large. Between my wife and I, we have 7 going on 9 accounts that we have accumulated over the years. Because there are fees to withdraw, we just leave existing funds where they are when we move on, and direct new deposits to the new accounts.
All accounts are under my personal management (self directed). I am _not_ an active investor. I invest on a fixed monthly schedule in to the same funds. I do not intend to change my investment plan.
__Predicament__
Because of the fact that I have so many accounts, I would like to hire someone to manage all of this for me. I’m not sure what type of service that even falls under or what types of companies serve this type of request. This would be an ongoing business relationship. I am not rich or have a lot of money to invest, I simply have a complicated setup.
I don't need anything more than someone who will periodically log in to make sure contributions are continuing to accrue, rebalance the funds on a yearly basis, buy stock in my chosen funds using the automatic contributions that are deposited.
I do not want
- Advice, such as what I should invest in
- To meet in person regularly
- Financial planning
- Someone to answer questions from me
- A broker
- To make changes to my accounts
- Get new account with a different brokerage company
- Cancel my current accounts unless this can be done without fees or taxes
Does anyone have any experience in migrating their retirement funds from institution to institution over the years? Should I just suck it up and pay the fees on the old accounts? Are there any companies out there that will take the complexity out of managing all this?
Thanks!
Yes, agree, rollover.
posted by rabbitrabbit at 7:54 PM on October 25, 2014
posted by rabbitrabbit at 7:54 PM on October 25, 2014
I just migrated a 401K retirement fund from my old job to my existing retirement account. It was a pain in the ass, but then it was done and now I don't have two accounts, I have one. That said, is there a reason you don't consolidate the ones you have? Are they from employers you are still actively involved with? I just rolled all mine into one and I'm very happy with that (no fees associated with that in the US, the googleable term is "401K rollover" not sure where you are). So I now have three: one 401K, one regular IRA and one Roth IRA.
OK, but you said you just want a person and you can get that. I usually start here. Find one that is fee based. You will probably have one "get to know you" meeting and then the rest of it should be able to take place over email. There's an annoying amount of upfront paperwork since to allow this person to administer all these funds will involve signing crap for each of them. After that, they should be able to just go in and do this and you can talk to a few people and make sure they are charging you what you perceive to be a reasonable fee. In my experience there are maybe three kinds of people you're likely to encounter
- wealth manager people - these people want to be a part of your family and charge you some percentage of what you have and are not what you need. I have one that "came with" an inheritance and I really dislike him.
- the person who works for Fidelity or wherever but is "your person" there. This only works if all your stuff is at one place. Would involve up front headache for you but after that you're really barely paying them at all since this is part of what they do. You said you do not want this and I respect that but it's worth understanding that it's the most efficient and cost effective solution
- individual "hang out a shingle" type people that you can find via NAPFA. Often small firms with a few people in therm. These are more likely to be what you want but there may be one expensive "let's make a plan" meeting ($500-750) and then you can do what you want. Interview a few people and I bet you can find one who is in line with your preferences.
So the short answer is, these people exist but you want something narrowly specific and may have to pay for people who are trained to do more than that in order to get those people. You could also just have a personal assistant/accountant type (think "we do your payroll" types of companies) if there is really no thinking involved but you need someone bonded/insured for this sort of thing if it's literally just clicking buttons but when you say "rebalance" that sounds like something that might involve thinking?
So I'm not a person with a finance background but I do manage a stupid-complicated number of accounts thanks to this inheritance situation and I think the hassle involved in upfront simplifying will return itself to you tenfold over the next few decades.
posted by jessamyn at 7:55 PM on October 25, 2014
OK, but you said you just want a person and you can get that. I usually start here. Find one that is fee based. You will probably have one "get to know you" meeting and then the rest of it should be able to take place over email. There's an annoying amount of upfront paperwork since to allow this person to administer all these funds will involve signing crap for each of them. After that, they should be able to just go in and do this and you can talk to a few people and make sure they are charging you what you perceive to be a reasonable fee. In my experience there are maybe three kinds of people you're likely to encounter
- wealth manager people - these people want to be a part of your family and charge you some percentage of what you have and are not what you need. I have one that "came with" an inheritance and I really dislike him.
- the person who works for Fidelity or wherever but is "your person" there. This only works if all your stuff is at one place. Would involve up front headache for you but after that you're really barely paying them at all since this is part of what they do. You said you do not want this and I respect that but it's worth understanding that it's the most efficient and cost effective solution
- individual "hang out a shingle" type people that you can find via NAPFA. Often small firms with a few people in therm. These are more likely to be what you want but there may be one expensive "let's make a plan" meeting ($500-750) and then you can do what you want. Interview a few people and I bet you can find one who is in line with your preferences.
So the short answer is, these people exist but you want something narrowly specific and may have to pay for people who are trained to do more than that in order to get those people. You could also just have a personal assistant/accountant type (think "we do your payroll" types of companies) if there is really no thinking involved but you need someone bonded/insured for this sort of thing if it's literally just clicking buttons but when you say "rebalance" that sounds like something that might involve thinking?
So I'm not a person with a finance background but I do manage a stupid-complicated number of accounts thanks to this inheritance situation and I think the hassle involved in upfront simplifying will return itself to you tenfold over the next few decades.
posted by jessamyn at 7:55 PM on October 25, 2014
Response by poster: > Is it possible to rollover these accounts into two (yours and hers) IRAs?
I don't think so because the accounts are with different institutions. For instance, 1 of the accounts was opened for me by my parents. Another 2 accounts are from my employer.
posted by jackquack at 7:55 PM on October 25, 2014
I don't think so because the accounts are with different institutions. For instance, 1 of the accounts was opened for me by my parents. Another 2 accounts are from my employer.
posted by jackquack at 7:55 PM on October 25, 2014
Response by poster: > Yes, agree, rollover.
> I just rolled all mine into one and I'm very happy with that (no fees associated with that in the US, the googleable term is "401K rollover" not sure where you are)
I will Google to see if that's possible. I am actually Canadian, so maybe it's different here. I have read the fine print at at least one of the institutions where my wife and I have accounts, and it says that there are fees for withdrawing the funds to another institution. That's why I haven't closed old accounts.
> In my experience there are maybe three kinds of people you're likely to encounter
Thanks, that breakdown of what's out there is actually pretty helpful. I will look in to what the NAPFA equivalent is in Canada.
Option #2 only sounds like it's possible if I can someone consolidate without paying fees. If I recall, they wanted to charge me like $75/account. I would honestly love to have this situation if possible.
> if there is really no thinking involved
There really is no thinking involved. Rebalancing is just a calculation. I suck at explaining so here
posted by jackquack at 8:07 PM on October 25, 2014
> I just rolled all mine into one and I'm very happy with that (no fees associated with that in the US, the googleable term is "401K rollover" not sure where you are)
I will Google to see if that's possible. I am actually Canadian, so maybe it's different here. I have read the fine print at at least one of the institutions where my wife and I have accounts, and it says that there are fees for withdrawing the funds to another institution. That's why I haven't closed old accounts.
> In my experience there are maybe three kinds of people you're likely to encounter
Thanks, that breakdown of what's out there is actually pretty helpful. I will look in to what the NAPFA equivalent is in Canada.
Option #2 only sounds like it's possible if I can someone consolidate without paying fees. If I recall, they wanted to charge me like $75/account. I would honestly love to have this situation if possible.
> if there is really no thinking involved
There really is no thinking involved. Rebalancing is just a calculation. I suck at explaining so here
posted by jackquack at 8:07 PM on October 25, 2014
You mention that there are fees to withdraw, but are you talking about cashing out the investments held in those accounts, withdrawing in cash, and repurchasing in a new account at a different institution?
Assuming you're in the US, you should be able to roll over any 401(k) accounts into an IRA at any institution you like -- in some cases they can transfer directly and in others they will cut you a check which has to be mailed to the new institution within a certain amount of time to avoid tax liability.
For other accounts, you should be able to transfer the assets to a new institution without selling the investments. Typically there is a form to fill out, and you may have to call both institutions; a conference call where people from both firms are on the line may be the easiest, since they'll know what information they need from each other and you'll just need to be there to confirm it.
If you know where you'd like to move everything, call them up and tell them the situation, and they'll likely help you figure out how to get everything moved there.
posted by Blue Jello Elf at 8:07 PM on October 25, 2014
Assuming you're in the US, you should be able to roll over any 401(k) accounts into an IRA at any institution you like -- in some cases they can transfer directly and in others they will cut you a check which has to be mailed to the new institution within a certain amount of time to avoid tax liability.
For other accounts, you should be able to transfer the assets to a new institution without selling the investments. Typically there is a form to fill out, and you may have to call both institutions; a conference call where people from both firms are on the line may be the easiest, since they'll know what information they need from each other and you'll just need to be there to confirm it.
If you know where you'd like to move everything, call them up and tell them the situation, and they'll likely help you figure out how to get everything moved there.
posted by Blue Jello Elf at 8:07 PM on October 25, 2014
Response by poster: > You mention that there are fees to withdraw, but are you talking about cashing out the investments held in those accounts, withdrawing in cash, and repurchasing in a new account at a different institution?
I am in Canada actually, so maybe it's different here, or maybe I read the fine print wrong. I do not want to withdraw, but simply move the money from one institution to another. I am in the process of Googling to see what the rules are for transferring. The CRA doesn't seem to specify anything about fees...
posted by jackquack at 8:14 PM on October 25, 2014
I am in Canada actually, so maybe it's different here, or maybe I read the fine print wrong. I do not want to withdraw, but simply move the money from one institution to another. I am in the process of Googling to see what the rules are for transferring. The CRA doesn't seem to specify anything about fees...
posted by jackquack at 8:14 PM on October 25, 2014
Response by poster: __Update__
I have looked in to it, and yes, fees may be charged by one or both institutions when moving money from one RRSP (I think that's the Canadian equivalent of a 401k) to another. Source
posted by jackquack at 8:16 PM on October 25, 2014
I have looked in to it, and yes, fees may be charged by one or both institutions when moving money from one RRSP (I think that's the Canadian equivalent of a 401k) to another. Source
posted by jackquack at 8:16 PM on October 25, 2014
Your new bank may be willing to cover some or all of the transfer fees charged by the old bank.
posted by jeather at 8:32 PM on October 25, 2014
posted by jeather at 8:32 PM on October 25, 2014
You'd have to check the exact numbers, of course, but it seems extremely likely that paying a handful of fees up front will be a far better deal than paying someone on an ongoing basis to manage your accounts. It will feel like a big hit now, but probably much cheaper in the long run.
posted by ktkt at 9:41 PM on October 25, 2014 [5 favorites]
posted by ktkt at 9:41 PM on October 25, 2014 [5 favorites]
Response by poster: > You'd have to check the exact numbers, of course, but it seems extremely likely that paying a handful of fees up front will be a far better deal than paying someone on an ongoing basis to manage your accounts
I looked in to it, and the fees are 150 for two of the accounts, 135 for another two. So that would get me down to 4 accounts (2 IRA equivalents and 2 401k equivalents), plus another 2 that I'm about to get from my job (and I have to keep for the benefits they provide). :(It would be an improvement, but not much.
I do like the idea of simplifying quite a bit, but I don't think it really solves my problem. The old accounts don't even cause too much trouble because no new money is coming in to them. But I do like to know their balance and get a total accounts summary.
posted by jackquack at 9:51 PM on October 25, 2014
I looked in to it, and the fees are 150 for two of the accounts, 135 for another two. So that would get me down to 4 accounts (2 IRA equivalents and 2 401k equivalents), plus another 2 that I'm about to get from my job (and I have to keep for the benefits they provide). :(It would be an improvement, but not much.
I do like the idea of simplifying quite a bit, but I don't think it really solves my problem. The old accounts don't even cause too much trouble because no new money is coming in to them. But I do like to know their balance and get a total accounts summary.
posted by jackquack at 9:51 PM on October 25, 2014
I don't use this function myself, but my (fairly standard, I believe) Vanguard account allows you to link in all your other accounts, so you have the convenience of being able to see the performance of all your accounts simply by logging into one. And I'm sure Vanguard isn't the only financial entity who offers such a service. Not a total solution to your issue, but might get you part of the way there.
posted by carrienation at 10:57 PM on October 25, 2014
posted by carrienation at 10:57 PM on October 25, 2014
If you're just after tracking balances and such, you may want to look into mint.com, which works in Canada. I'm not sure it'll support all of your accounts (my guess is that it's not as robust as it is in the US, where my family uses it to track all of our retirement, school savings, and so forth), but it's worth checking out.
posted by hought20 at 3:57 AM on October 26, 2014
posted by hought20 at 3:57 AM on October 26, 2014
Find out if the institution that you are planning on moving your accounts to will cover the fees that the other banks are charging you for moving your money out. Often they will.
posted by quaking fajita at 5:31 AM on October 26, 2014
posted by quaking fajita at 5:31 AM on October 26, 2014
If you have automatic deposits, do you have the option of an automatic investment plan?
posted by Ruki at 9:07 AM on October 26, 2014
posted by Ruki at 9:07 AM on October 26, 2014
If you pool your money together, maybe you'll get better service? Some companies (definitely Vanguard, but probably others too) give you better service when your total balance exceeds certain levels.
Also, by pooling your money together, you might remove the need to hire someone to manage it all. Most large institutions have "Target Retirement" funds that shift your money to more conservative investments automatically as you get older. I'm guessing the transfer fees would be much smaller than paying someone to manage all your money.
posted by sarah_pdx at 7:34 PM on October 26, 2014
Also, by pooling your money together, you might remove the need to hire someone to manage it all. Most large institutions have "Target Retirement" funds that shift your money to more conservative investments automatically as you get older. I'm guessing the transfer fees would be much smaller than paying someone to manage all your money.
posted by sarah_pdx at 7:34 PM on October 26, 2014
This thread is closed to new comments.
posted by michaelh at 7:35 PM on October 25, 2014 [7 favorites]