New Retiree question. Use more than one retail brokerage for whatever reason ???

catch22

From a conversation on Sunday. Should they use more than one brokerage for any good reason(s)?
The direct question was whether to use Fidelity or GS/E-Trade, OR both? I also expressed that although Fidelity is a private organization; any serious market or economic conditions to the 'large negative' should not impact Fidelity anymore than the other large retail investor companies.
I'm fully biased as we've used Fidelity since 1978. But, we have stayed abreast of those here using other organizations and the pros and cons.
I expressed Fidelity as my choice for decent customer service, more investment choices than would ever be needed for the 'regular person', low or no fees for some investments; which includes very low ER's for just about everything and a decent 'online' interface. They would also have an investment office about 20 minutes from their home.
To the best of my knowledge, the initial new accounts would be for 'rollover' of 401k's IRA's.

Thank you for your thoughts,
Catch

Crash

Fidelity certainly has a top-drawer reputation. I'm with Schwab. I wonder whether Fidelity plays that silly game that Schwab plays? When I move money into the account from my bank, it is impossible to just set-it-and-foget-it so that the transferred money can be earmarked to be added as a deposit into my chosen MMkt. At Schwab, I must make a manual buy order to get that money into the MMkt, every time.

If that nonsense can be avoided at Fidelity, that would be a plus.
I DID NOT enjoy Schwab's website at the start, especially. Everything you might need is mis-named, mis-located, disguised or hidden behind something else. Now I'm used to it.

But when deciding whether to go with Schwab or Fidelity, I found Fidelity's website to be simply abominable. So, there's THAT.

Old_Joe

Hey there Catch- We use Schwab primarily because there is a Schwab office one block away, and my wife doesn't drive. By concentrating everything at Schwab she can get assistance if I'm no longer around.

Crash

Old_Joe said:

Hey there Catch- We use Schwab primarily because there is a Schwab office one block away, and my wife doesn't drive. By concentrating everything at Schwab she can get assistance if I'm no longer around.

Yes, by the way: Schwab is the only major brokerage who thinks that Oahu is worth an actual brick and mortar office. (Well, excuse me: I remember now that Edward Jones is around in a few locations, by appointment only, I suppose. But isn't that a different sort of animal?) Just try and get Schwab/Honolulu on the phone. That's just not gonna happen. Unconscionable. I suppose if there were something I needed personal help with, I could stop in to make a f*****g APPOINTMENT for another day, requiring an additional trip downtown. So, they get an "F" from me for customer service.

Sven

We have been Fidelity and Vanguard customers since the 90’s. Both firms were my 401(K) administrators with different jobs we had. Two years ago, we consolidated most of our Vanguard’s IRA accounts to Fidelity for ease of management. While Vanguard offers many low cost index funds and ETFs, we prefer Fidelity since it has many more financial planning tools than that of Vanguard. Don’t think any large brokerage is perfect, but Fidelity able to meet 90% of our needs. Although we are not their Wealth Management client, there is a private number that you can call them directly.

We rollover our 401(K) to Fidelity. They make the 3-way phone call arrangement ahead of time, where the process is completed over the phone. The rollover took about 5-7 business days to complete, and Fidelity will keep you informed along the way.

msf

Do you mean GS or MS?

Unless there's a service that you can't get at your main brokerage, I don't think there's a big need (perhaps reliability?) to use multiple brokerages. For simplicity in the future (when RMDs kick in) we've consolidated T-IRAs at Fidelity. But we have Roths (that we typically leave alone) spread out for other benefits.

E*Trade sells all its fund offerings no-load & NTF (except for three RE funds with loads) and they offer a good selection of third party MMFs like VUSXX and WMPXX. So E*Trade has its distinctive plusses.
https://www.etrade.wallst.com/Research/Screener/MutualFund

Even at Fidelity, you have to move deposited money from "checking" (core fund) into other funds manually. In this sense, the other MMFs are not different from, say, WCPNX. If you deposit money in person, you can instruct Fidelity to make a fund purchase rather than put the money into "checking".

I don't find walking into a brokerage office of any value - the rep just calls the back office anyway to get answers to my questions. But for others a physical presence is important.

My situation with office locations is similar to others', at least if one takes my warped perspective. There's a Schwab office four blocks (1/4 mile) from me. But there's no Fidelity office in the county where I live, the most populous in the state, nor in the adjoining county, second most populous in the state. Instead, I have to travel to a rinky-dink 23 sq mile island that has seven, count 'em, seven(!) Fidelity offices.

Originally called Manhatta (or some similar variant), that island is now known as Manhattan, where MS is headquartered. And we've come full circle.

fundly

Two things I would consider. SIPC coverage is 500k on any one account at any brokerage so I would want to know all the details regarding how to set up the accounts with this in mind. No company IMHO is absolutely free of possible hacking and inability to access an account for a period of time. Therefore having accounts at 2 brokerages possibly protects against inability to access your funds if this occurs. We use 3 brokerages with the above in mind.

yogibearbull

@Crash, I do recurring transfers at Schwab. I just checked Fido too and under Transfers, it also offers recurring transfers.

Unfortunately, Schwab doesn't offer m-mkt fund as core, so money have to be shifted as T+1. Fido offers SPAXX as core, Vanguard VMFXX as core.

@Sven, those 3-way calls are standard for transfers/rollovers from 401k/403b. But IRA transfers/rollovers don't require them and the target broker can take care of all of the paperwork - and there has been some stories about fraudulent transfers.

I have multiple brokerage a/c - Schwab, Fido, Vanguard. Among these, I like Vanguard the least. In fact, I was quite happy with Vanguard mutual fund only account, but a few years ago, it forced me to change to brokerage.

Fido and Schwab compare well, both have physical offices nearby.

Each brokerage has some aspects that you can complain about, but things are vastly better than before the discount brokerage revolution was launched by Charles Schwab (yes, the same old fellow that you may see on TV). I had BAD experiences in that old era too. US brokerages are also much better than those overseas.