Hello everyone, new guy here. I would like to start investing and I’m looking for a professional financial advisor to help me accomplish my goals. I know there are plenty of options out there, but at the moment I’m leaning towards Edward Jones since they have at least three offices in my city and it’s important to me that I can speak to someone face to face because I hate doing things online. So my question is, what is their overall reputation, both for success, and also just for being good to deal with. If anyone has first hand experience, that would be great. Thank you!

I recently inherited a trust and partnership worth about 8 million, and my lawyer who has been with the family for 15 years at this point set me up with a financial advisor and I ended up putting all of the money into Edward Jones. Is this a mistake?

I have 50k in a Roth there. Is it a bad idea to keep my money with them? I’ve heard a lot of negatives online and in other Reddit communities.

Mainly a lurker on this sub, but keep seeing posts advising folks against using Edward Jones. I’m a mid-30’s IT nerd, who’s got a couple accounts with them currently, and have so far been happy.

I’ve had, I think, pretty good returns and results from my advisor. I don’t feel like I’ve been up sold or forced into any specific products. Are folks here upset with individual people there or EJ as a company?

Disclaimer: I do not work for any financial institutions (I’m in Higher Ed), and I’m legitimately curious about people’s experiences, as they seem to differ from my own.

Thanks in advance for a good discussion with factual/experience based evidence! I am happy to provide verification to a Mod if people want proof I’m not a shill! - M4

EDIT: thank you all for the detailed thoughts and replies. I have a lot to look into and evaluate. Much appreciated, friends!

Okay people, give me the honest truth about Edward Jones. Everyone I talk to LOVES it, but what are they hiding?

Hi r/investing, I'm here to talk about something a little different - the role and faithfulness of fiduciaries in handling the investment accounts of your investing-ignorant family members. Warning in advance: this is long, breaking down the portfolio, the fees, and diving into where the adviser truly makes their money.

We all have a family member (or 5) that, while being intelligent in their own right, simply have never had an inclination to understand investing, both in the mechanics of it or the strategies behind it. As a result, they outsource this role to a financial adviser. They will trade off a fee for peace of mind; something that's a very reasonable and sensible decision. They put their trust in this adviser implicitly. After all, they've earned the title "fiduciary," and thus legally cannot make decision that aren't in the best interest of their client, right? Well, recently my parents asked me to review their portfolio. This was not in an intent to pull them away from Edward Jones, nor their financial adviser; It was an exercise to see where they stood and have an honest light shone on something that they didn't really understand.

Please note that this took place in February, prior to the volatility caused by COVID-19.

Portfolio Breakdown

• Total Account Balance: $1,270,000

• Investments: 42 Mutual Funds / ETFs. Many of them are duplicated over the multiple accounts within the portfolio.

• 64% Stock, 36% Bond

• Compound Average Return (5 year): 6.34%

• Compound Average Dividend Yield (5-year): 2.57%

• Compound Average Total Return (5-year): 8.91% (Stock: 10.2%, Bond: 6.5%)

Stock Breakdown:

• 76% Domestic

• 15% Foreign

• 9% in blended funds

Morningstar square breakdown for all investments.

Foreign/Domestic Morningstar square breakdowns.

Fees Breakdown

Fees come from two sources: Fees to Fund Manager and Fees to Portfolio Managers. Fund managers make their money through two main avenues: Expense Ratios and Load Fees. Portfolio Managers, such as the Edward Jones Investment Adviser, often make their money by taking a percentage of the value of the managed assets (similar to an expense ratio).

Now, when presented with similar investment vehicles, you always act to minimize fees. You'd never pay a load fee if you don't have to. However, this portfolio has many funds both stock and bond, that have significant load fees. A bond fund with a 4.5% load fee? Even if you said that a bond fund would overperform in the long run by 0.5% (it won't), that'd take NINE YEARS to get back to even with that load fee. Why in the world would you EVER enter that? To answer that question, we need to dig into how EJ makes its money.

Edward Jones charges 1.25% of the total value of all "Advisory Solutions" accounts. I will note that my parents had 7 accounts with EJ, and 2 of them were Advisory Solutions accounts. The remaining were Traditional IRAs, ROTH IRAs, and Individual Investing accounts. Regardless, all of them were controlled by the Adviser. They also have profit sharing set up with many companies. The ones highlight in black were their big revenue sources. Profit sharing accounted for 22% of their net revenue in 2018. Finally, they have shareholder accounting /networking payments set up with practically every firm. This accounted for 5% of their net revenue in 2018.

The table below highlights the holdings of the account cross referenced with the way that EJ makes its money. Orange is an EJ owned asset, such as their Bridge Builder funds (which are great funds, honestly), so they make money directly off of the expense ratio. Light Orange are funds that are with companies that have a profit sharing agreement with Edward Jones. Light Yellow are funds where EJ receives a small kickback for shareholder accounting / network payments. Finally, White are funds that do not profit Edward Jones.

Where Edward Jones is making its money.

What's important to note here is that 94% of the dollar value of the accounts is used to profit Edward Jones. The financial adviser, despite being a fiduciary, chose to invest my parents' money into vehicles which profited Edward Jones.

"But wait, why would he invest in high fee funds when he makes a percentage of the account's value?" Great question! Remember how I said that only 2 of the funds were Advisory Solutions funds? It just so happened that, in both of those, there was not a single fund with a load fee. They were all in the Bridge Builder funds - yes, they're EJ owned, but no load fee, low expense ratio, overall good funds. This isn't random; this conveys the fact that the adviser knew that structuring the portfolios this way would yield the best return for his company. It was not acting in the best interest of his client, which is a required duty of a fiduciary, but rather in the best interest of the company.

Per the SEC on direction to fiduciaries: "As an investment adviser, you are a “fiduciary” to your advisory clients. This means that you have a fundamental obligation to act in the best interests of your clients and to provide investment advice in your clients’ best interests. ... You must eliminate, or at least disclose, all conflicts of interest that might incline you — consciously or unconsciously — to render advice that is not disinterested. If you do not avoid a conflict of interest that could impact the impartiality of your advice, you must make full and frank disclosure of the conflict." A conflict of interest, in this case, is when the adviser profits more if a client uses one investment instead of another.

Further: "Departure from this fiduciary standard may constitute “fraud” upon your clients (under Section 206 of the Advisers Act)."

It's hard to paint what happened here as anything other than fraud. It was happening in plain view, taking advantage of those who trusted others. I suspect that many, if you begin digging, will find similar results.

Final Thoughts

While all of the above may sound like a condemnation of EJ and their adviser, it is not. Yes, I'll condemn them for taking advantage of my parents, but, at the same time, they did create a portfolio designed to achieve the aligned goals of my parents. As I explained to them, they did that by accepting increased risk without even knowing it. We all know of the adage "Your portfolio stock % should be 100-age." At 70 years old, my folks should have been 30% stock, 70% bond as a baseline. Instead, they were 64% stock, 36% bond. Are fees alone enough to swing that? No, not at this point due to their level of capital and retirement goals. But by removing the fees, I was able to get it to 51% stock, 49% bond. If this analysis had been done earlier

TL;DR - Just because an adviser is a fiduciary does not mean that they will not try to take advantage of you or your loved ones. Make sure you ask questions and do your own due diligence.

I have been researching posts about hidden fees from Edward Jones. I met with my advisor and asked for a summary of cost report and other things. He said he would get that report to me. He said our Guided solution flex funds that include a traditional IRA and Joint Tenants With Right of Survivorship are wiped from all front and back load fees. On average, in the last 10 years, one made 5.5% and the other 7%. I specifically asked about fees Edward Jones might have in buying or selling, I had the fee schedules printed out and pointed to several things. He still said that our accounts specifically did not include these fees. They are not stock accounts but mutual funds and bonds. On average, in the last 10 years, one made 5.5% and the other 7%. Not that great of a return. How can I verify that there truly are no additional fees? He is a friend and gives us a 20% discount on the annual fee.

Pretty new to financial planning or at least putting effort into gaining knowledge on the subject. I started a Roth IRA with EJ about 4 years ago as that is what my parents use for their retirement. I’ve maxed it out all 4 years and after doing some recent research it seems I could be doing far better if I were to invest the money myself in a fidelity account. Is Edward Jones really that bad? I’ve not noticed high fees or poor returns in the past 4 years. If I do switch to Fidelity how bad might that hurt the progress I’ve made this far?

Recently one of my relatives (who is retired) asked me to look over his Edward Jones statements. First, I noticed something saying the risk tolerance was "low to moderate", which seems fair for a retired person I suppose. Then, there was a table comparing the portfolios performance to the S&P. So for the last 5 years, it showed the S&P returning about 10% annualized. For the edward jones portfolio, this number was about 3.6%. But again, I thought "maybe this is acceptable for a retired person". Then the next number I saw seemed particularly troubling: Year to date performance of the S&P was at -15%; Year to date performance of the EJ portfolio was -20%. So for what is supposed to be a conservative portfolio for a retired person, I wouldnt think you should see drawdowns that are larger than the S&Ps drawdowns, especially given the lousy rate of return the last 5 years. (and by the way, the last 5 years was the maximum time frame I could look at. I wish I had data from further back in time)

I know this subreddit is already biased against financial advisors (and probably rightfully so). But, putting that aside, am I correct for thinking that something is wrong here, when my relative is seeing lower 5 year returns and a higher YTD drawdown compared to the S&P? Is this the red flag I think it is?

My partner and I have been with our Edward Jones advisor for about 3 years. We got involved with him because he is a family member's advisor. We basically had all of our money sitting in our bank accounts and I knew we needed to do something with it. Our experience with him has been good, and we've made money and are on track with our financial goals. I have obviously read about how terrible and predatory EJ fees can be and don't want to be naïve. We work hard for our money and I want us to be in the best financial position possible.

A little bit of background: my partner and I have virtually no investing experience between us. Neither of us took any personal finance classes in college so we don't know anything about mutual funds, stocks, etc. Maybe 5-7 years ago I could've spent time learning, but now we both work full time jobs and have a baby with very little free time. Although I read our EJ statements and don't live in the dark, I do like the hands-off nature of not having to do the investing myself.

I guess my question is - for a duo like us, is EJ really so bad? We seem to have a good return on our investments. How would we know if our advisor is taking advantage of us? I feel so clueless and just want to feel like we are doing the right thing. Any advice or insight would be appreciated.

I have been with Edward Jones for about 3 years now and my dad switched to Charles Schwab and said he has had a better time with them. I was wondering if anyone has made the switch and dramatically saw a difference. I don’t like the Edward jones app as I find it hard to view the information I see in the desktop view and I heard EJ has higher fees. But then there’s also fidelity to look at too and heard it’s better than EJ atleast. Any advice is appreciated

Edit: I have moved to Charles Schwab and it is infinitely better. Much easier to see everything in the app and the fees are significantly less

For someone making a career change from teaching to being a brand new financial advisor first starting out, which firm do you believe is better to work for - Edward Jones or Fidelity? Or somewhere else? I’d like to get my foot in the door somewhere, and hopefully stay if it is a good fit, but at the very least have a place to get started and learn the ropes at.

Update 2/5: Appreciate everyone’s comments and PM’s. They actually helped me a lot! After speaking with some of yall and my wife. I’ve decided to stick it out with EJ, work on managing my burnout and changing up my prospecting strategy to reflect that. If in 2-3 years I can’t manage the burnout or am not happy with where I am, I’ll look at going independent or joining an RIA as I will have my CFP by then and a larger runway.

To begin, I have been working as an FA at Edward Jones for over a year. The training has been great and it’s one of the few places I could get licensed with no financial experience and no finance degree. I came from a background in sales for 7 years and have a degree in sociology.

I was recently offered a job at Fidelity as an Investment Consultant.

I am considering making the switch as I am tired of outside sales, knocking on doors, networking events, etc. my whole career has been outside sales and I am feeling the burnout. I also do not have a large personal or professional network to lean on for bringing in new clients, all my clients have been brought in through door knocking or community events.

From my understanding the IC role at fidelity is essentially a cold calling role (inside sales), which is my preferred sales style. I can grind in the phones much longer than I can walking around neighborhoods, knocking on doors.

Last year I made 89k with Jones for reference. Fidelity said a year one IC consultant will make around 100-130k the first year.

Would love to get everyone’s opinions and thoughts on what to do. I would eventually like to go independent but that is at least 5-years away as I have a family to support and don’t have the runaway yet to be independent. I am working towards my CFP, having completed to first two courses so far.

Also, has anyone left Jones and had to deal with paying back the “training costs” (50k stepped down over a five year period). I have no intention of bringing any clients with me if I leave.

Hey all, I know you guys all know. I got started with Edward Jones because a buddy was just getting started and so was I in my career. I finally made the jump to fidelity. My buddy sold me some mutual funds with huge management percentages and selling costs. 1% etc. He was charging me 1% a year too.

Leave as fast as you can.

My new wife showed me her retirement account information recently. I was curious to see her returns with the professional who helps manage her account with a 1% fee. Although not horrible, it seems that there has been some $ left on the table over the years. He has her in umteen different types of investments, well balanced I'm sure. A splattering of MFs, Individual Stock Picks, etc.

After reading so many posters discuss arguments for All In on funds like VOO and FXAIX, what would you consider doing in this situation. I'm half temped to transfer over to Fidelity and to allocate the majority into one of the above and include something like FSELX or FTEC which have both done very well for me. I've included a screen shot of her returns since inception. She is 52 and we both don't plan on retiring for another 16-18yrs. TIA

https://imgur.com/a/lg8rZ0o

I already have a Trad and Roth IRA through them.. I inherited some money when my dad died when I was a kid. I finally started making some decent money last year (I’m 25) and have been adding 500 to my Roth every month for the past year through EJ

Anyway, I guess what I’m asking is- can I start buying new stock through EJ or should I start a new account through the companies I’ve seen recommended here: ie Fidelity, Schwab, etc. I’m getting to the point where I’m starting to get more money saved and just want to put some money in a good place… is $2000 a good starting point to start buying some stock? I just want to get the ball rolling on this and start making as much money as I can now

I’m trying to remember- so I feel like the problem I was seeing with EJ is their fees. So if I ever need to sell stock or whatever, is the penalty larger with a company like EJ v say Fidelity?.. forgive me for my ignorance. Any advice on what I should do or how to maximize how much I earn would be appreciated

Hello,

Met with a local Edward jones agent recently to help manage my accounts. He stated their fee is 1.2% of assets managed annually. My question is… is that average? Does anyone have experience with other brokerages, at different rates. Appreciate any insights.

Thank you!