Closing my WellsTrade account

Kaspa

I have decided to close all my accounts with WellsTrade and move to Schwab or Fidelity. I have already helped my daughter open an account with Schwab and was very happy with the customer service. This is in contrast to all kinds of confusing information I received about PMA accounts from Wells Fargo (board members here provided better information!). With this experience, I called WellStrade to find out about any fees to transfer assets. I was calmly told about $95 fee for asset transfer, without even a single question about the reason I want to transfer. Clearly, they are more interested in charging fees vs. retaining a customer. Considering everything (a) poor customer service at WellsTrade, (b) nickel-and-diming with fees for some other household accounts, (c) much better experience at Schwab and Fidelity (I have an IRA with them) so far, (d) scant research tools at Wells, I will eat the transfer fee and move out. The 100 free trades were the only thing keeping me there, but I have not made any non-NTF trades there anyway. Good bye, Wells Fargo!

msf

Fidelity may make you whole on the $95 transfer fee, though they won't touch it if it's an IRA. Not as familiar with Schwab, though I'd expect similar white glove treatment.

Given that one can make $5 TF trades at Fidelity, the savings at WT do not seem worth it. It used to be that you had access to a good number of "advisor class" funds (e.g. Templeton Global, to name a popular thread), but no more. If you don't have any funds that won't transfer to another brokerage, there are few reasons for staying:

- free checking account at WF (with free check printing, wow)

- free misc. bank services (cashier's check, money orders)

- if you want to trade mutual funds frequently (avoid Fidelity's 60 day short term trading fee)

Only reason why I still have an account is that it's literally set-and-forget. Haven't done anything with it for several years, except occasionally used it as a tertiary checking account (and should have used it the one time I needed a cashier's check in the past three years). That, and it gives me a web interface that let's me try to guess what funds were left that I could have gotten through them.

kevindow

We continue to hold most of our funds at WT. Granted, the customer service is very poor. But 100 free trades/year for qualifying accounts, and no minimum holding period other than that specified by the mutual fund companies make WT appealing to me. Furthermore, I have been able to link my qualifying account to the non-qualifying accounts of my 7 children so that they are able to have 100 free trades/year. Right here, right now, WT has the best deal IMO.

Kevin

[Deleted User]

How do you get $5 transaction fees from fidelity?

msf

The best deal for you, but perhaps not for others.

It depends on what you're using them for. Bonds? You have to go through customer service (cannot purchase online, just search). Costs? $50 for Treasury auction (many of the other brokers give this away for free), and for other bonds, it's in the markup. I did a spot check comparing with Fidelity, and the price out the door (mark up and commission) is around $6.50 - $9 more per bond at WT. I won't even get into variety (20x as many muni bonds at Fidelity).

Margin? WT may be good for the sizeable investor - its rates are cheaper than Fidelity's (by a bit under 1/2%) in the $100K to $500K range. But for smaller amounts, it costs about 1/2% to 1% more at WT, and for higher balances, 1% to 1.75% more. (Assuming all my arithmetic is correct.)

ATM access? At least with a PMA account, WF won't tack on that $5 fee for international withdrawals for the first two. But unless you have $250K, they won't reimburse for surcharges. Fidelity reimburses all charges; Chuck goes a step further, and waives the 1% currency exchange fee that Visa/MasterCard tack on to international withdrawals.

Very little of this likely matters to you, but it may matter to others. Which is why, even considered on a pure fee basis (i.e. ignoring quality of service, range of offerings), WT may not be the best. It depends upon how one is using it.

Kaspa

I agree with Mark. In fact, I used to be a proponent of Wells Fargo accounts and have recommended them on this board and fundalarm before for the very same reason Kevin mentioned (free trades). Certain recent interactions with them have rubbed me the wrong way (or my expectations about customer service have increased). It was not a single event, just a series of less than professional behavior (curt dismissive replies to polite requests, incompetence of technical support, virtually no knowledge about brokerage in the local branch, unnecessary paperwork to change minor things, etc.)

In addition, they hardly have any other perks besides the free trades, which I hardly use (cash back cards, ATM reimbursement, better rates in financing, whatever). The ATM reimbursement and waiving the 1% fee was a factor in my choice as my global travel has increased.

For my daughter, who is a beginning investor, availability of good customer service (at a minimum, explanation of how the different accounts work in a simple language) and research to make investment decisions, was significantly more important. I can't hold her hands forever. She could hardly understand anything Wells Fargo was telling her, but the Schwab representative explained everything very well. So far so good.

kevindow

Reply to @Anonymous:

This $5 fee applies only to scheduled purchases of TF funds in their Automatic Investment Plan after the initial position is purchased for a $75 transaction fee.

Kevin

msf

The only requisite for the $5 AIP purchases is that one have an initial position. One does not have to pay $75 for that initial position. The shares could have been purchased from the fund company and transferred in (no charge), or even purchased at WT using their free trades, and then transferred from WT (even having Fidelity cover the cost of the WT account closing). They work fine - I've done both.

Note that sometimes when a fund company closes a fund to new accounts through brokerages (a "very" soft close, where they'll let you open accounts directly with them), they will prohibit transfers to a brokerage within, say, six months of opening the account. No big deal, just wait it out.

I should have added that there's the rare fund at Fidelity which does not allow AIP purchases; for those funds, you are stuck paying $75/purchase. Again, I speak from experience. In my particular case, the fund supposedly relented about a year later, and permitted automatic purchases. I don't know for certain, since I haven't verified that.

[Deleted User]

Would there be a fee for simply taking the entire balance out of my WellsTrade account and putting it back into my Wells Fargo checking, with no intention of using WellsTrade again?

Kaspa

Reply to @Anonymous:
If you have funds/stocks/ETFs in your WellsTrade account, you would need to sell, which can incur taxes. I don't think they have a fee to transfer cash between different WellsFargo accounts. You can ask.