How can we grow our funds without a broker?

We have about $100,000, or I should say we HAD $100,000. In less than a month, our broker has managed to lose $10,000 of it on poor decisions. We would like to take the remainder from them and invest it into a blue chip stock that offers membership to the public. We would then like to reinvest the dividends back in to the stock on a regular basis. My wife thinks that if we cash out from the broker, we will get taxed on all that money. What is the best way to get this money to where we want it without using a broker?

Investing, Stocks, Taxes
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February 2017
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Well, if the account lost 10% in a month, it was either invested in very risky and volatile assets or something with a large commission, like an annuity, REIT, or life insurance contract. If invested in a risky asset, it is possible that it was meant as a long-term investment. If invested in the high commission product, it may be impossible to get it back. If it is in an insurance product and you are not age 59.5, then there would be a 10% penalty too, in addition to the surrender fee.

There are many ways to invest without a broker. You can do it yourself with most discount brokerage houses. My clients have had good luck with TD Ameritrade, Etrade, and Schwab. The only one that I have had bad feedback from is Fidelity; they seem to practice some of the Wells Fargo sales techniques. There are also robo advisors, they are more asset allocation models than real advisors and there is still risk with them, especially since it is still a one-size-fits-all model.

I would offer a word of caution. "Blue chip stocks" can be very volatile and very risky. The fact they are large companies does not mean they cannot lose value, even 10%.

If you do need advice again, please look to someone that sells advice and not products. The National Association of Personal Financial Advisors, or, is a group of advisors that sell advice, not products. We pride ourselves on putting the client's interest first.

Good Luck!

Mark Struthers CFA, CFP®

February 2017
February 2017
February 2017
February 2017