There is an enormous difference between working on individual retail accounts and working with the tools a professional custodian gives me.
Benefits to you include:
- Better access to institutional-class funds. Because of my fiduciary business model and professional credentials, I’m authorized to use DFA funds (Dimensional Fund Advisors). I can only access them through my professional custodian, though. These are generally acknowledged to be as good as (or better) than Vanguard funds.
- No-load access to otherwise-loaded mutual funds. I can get the Calvert Socially Responsible funds with just a $20 fee to purchase rather than the 4.75% sales load.
- Better consolidation. Instead of having one SRI/ESG fund in one place, and a Rollover IRA in another, and a SEP for your business in yet another, we can gather these all into one location, simplifying your life.
- Better tools to manage your account. I can quickly spot changes that need attention, and access everyone’s accounts at the same time rather than having to individually pull up each person’s file. If I’m in there working on someone else I slide over and check out your account, too, just glancing in without intending to do anything. That’s what you want me to be doing.
- Better privacy. I have set up Limited Trading Authorities with many people at Vanguard (and until recently, Fidelity), but that means when I log in I see all your accounts on the home page. If I’m working with a client it becomes challenging to keep the client from seeing the other accounts on the screen. Professional Custodians just understand the need for confidentiality and it’s baked into the cake.
- Vastly superior service. See an article I wrote about my thoughts on various retail Custodians.
- Fewer sales calls! (See my rant about Fidelity in the article referenced above.)
I work with two different custodians. Both of them were chosen for their commitment to the fee-only fiduciary model. Neither requries me to have a minimum asset level. My business model isn’t based on accumulating wealth, it’s based on building prosperity. For many of us that’ll mean rolling your IRA into your workplace 401(k) or using an inheritance to pay off the mortgage. I do not want to be put in a position of chasing assets to manage.
Shareholders Service Group (SSG) is the front end to Pershing, LLC, which is owned by BNY Mellon Bank. BNY Mellon/Pershing is the largest clearing firm in the world. It’s culture is East Coast / Global Big Money. SSG staff, based in Southern California, are super-easy to talk to on the phone, though. They are geared up to work well with me, but they can also serve you as a backup to me if you can’t reach me. Call (800) 380-7370 and one of them will help you. Basically, you have Fort Knox with wonderful tellers. Worst case, you can also call Pershing, but don’t try this first. You will get a software interface to Pershing, called NetXInvestor, that you can use to login in and see your accounts and statements. (If you’re trying to get set up online you need to know that SSG is Financial Organization #47Y with Pershing.)
TD Ameritrade (TDA) is the custodian that works better with my technology. It’s culture is Techy Adventurer Having a Good Life. I love how SSG services us over the phone – they’re the best in the field. But TDA allows me to do more stuff without having to call. It interfaces better with my rebalancing software and financial planning software, among other things. I love how they’ve staked out a position supporting the fiduciary investment advisor movement, too. (Check out the Human Finance Project.) They somehow have a culture of having fun with this stuff.
In general, I’ll probably recommend more techy people use TDA, and people who prefer to call on the phone for service use SSG.