New Schwab Trad IRA

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Topic Author
emmagator
Posts: 29
Joined: Thu Apr 08, 2021 11:42 am

New Schwab Trad IRA

Post by emmagator »

Im in the process of transferring accounts from Ed Jones to Schwab. I was hoping to get some advice on my first transfer and what to do with it. My next transfer will be my Ed Jones brokerage account. Im 41 and a very inexperienced investor, not an active investor, and dont plan on becoming one. Im looking to maximize growth with a fairly "hands off" approach. What do you guys recommend. Do i just let it do its thing? This IRA came from a previous employer and has about 143K in it.

Positions:

STOCKS
JD - 7.98%

MUTUAL FUNDS
ANCFX - 22.9%
AGTHX - 28.15%
AMECX - 14.17%
ANWPX - 26.77%

CASH - THIS CAME OVER FROM THE TRANSFER. NOT SURE WHAT IT IS
$40.00
anil686
Posts: 1182
Joined: Thu May 08, 2014 12:33 pm

Re: New Schwab Trad IRA

Post by anil686 »

Not probably going to be a popular answer but if you have no inclination to learn about investing and you want to be hands off and "let it do its thing" - I would have recommended Vanguard PAS at Vanguard or Schwab intelligent portfolios (digital advisor only) at Schwab. Your costs will be significantly lower, it will be well diversified and on autopilot. If you have a retirement date in mind, you could also use a Schwab Target Retirement index fund (the ER is only like 0.09%) and just set it and forget it. Those would be my recommendations - and I would think would be far superior to EJ...

The difference between the two Schwab strategies will be the interface. With intelligent portfolios - you will get the bells and whistles of the cool dashboard and how "fancy" all the little sections fit together. If that floats your boat - cool. With the TR index fund, you will get the typical login page and standard balance amount - that actually floats my boat more - but take it fwiw....
Topic Author
emmagator
Posts: 29
Joined: Thu Apr 08, 2021 11:42 am

Re: New Schwab Trad IRA

Post by emmagator »

anil686 wrote: Thu Apr 22, 2021 11:03 am Not probably going to be a popular answer but if you have no inclination to learn about investing and you want to be hands off and "let it do its thing" - I would have recommended Vanguard PAS at Vanguard or Schwab intelligent portfolios (digital advisor only) at Schwab. Your costs will be significantly lower, it will be well diversified and on autopilot. If you have a retirement date in mind, you could also use a Schwab Target Retirement index fund (the ER is only like 0.09%) and just set it and forget it. Those would be my recommendations - and I would think would be far superior to EJ...

The difference between the two Schwab strategies will be the interface. With intelligent portfolios - you will get the bells and whistles of the cool dashboard and how "fancy" all the little sections fit together. If that floats your boat - cool. With the TR index fund, you will get the typical login page and standard balance amount - that actually floats my boat more - but take it fwiw....
I am learning and plan to learning more, and am interested in some of the advisory options Schwab has, but hear a lot about "cash drag" and am just starting to learn about that, and will continue to learn the basics. But i will not be watching my investments daily and actively trading or consistently rebalancing my portfolios. Once i have my brokerage account transferred, i figure that will take a little more effort on my part, to get it invested correctly and set in the right direction, but still dont want to actively manage it.
MishkaWorries
Posts: 823
Joined: Wed Aug 14, 2019 4:39 pm

Re: New Schwab Trad IRA

Post by MishkaWorries »

emmagator wrote: Thu Apr 22, 2021 1:25 pm
anil686 wrote: Thu Apr 22, 2021 11:03 am Not probably going to be a popular answer but if you have no inclination to learn about investing and you want to be hands off and "let it do its thing" - I would have recommended Vanguard PAS at Vanguard or Schwab intelligent portfolios (digital advisor only) at Schwab. Your costs will be significantly lower, it will be well diversified and on autopilot. If you have a retirement date in mind, you could also use a Schwab Target Retirement index fund (the ER is only like 0.09%) and just set it and forget it. Those would be my recommendations - and I would think would be far superior to EJ...

The difference between the two Schwab strategies will be the interface. With intelligent portfolios - you will get the bells and whistles of the cool dashboard and how "fancy" all the little sections fit together. If that floats your boat - cool. With the TR index fund, you will get the typical login page and standard balance amount - that actually floats my boat more - but take it fwiw....
I am learning and plan to learning more, and am interested in some of the advisory options Schwab has, but hear a lot about "cash drag" and am just starting to learn about that, and will continue to learn the basics. But i will not be watching my investments daily and actively trading or consistently rebalancing my portfolios. Once i have my brokerage account transferred, i figure that will take a little more effort on my part, to get it invested correctly and set in the right direction, but still dont want to actively manage it.
Schwab has great low expense target date index funds. Just pick the target date fund that matches your desired asset allocation and be done with it.

Be sure to look for the word "INDEX" in the funds name. Schwab offers both passive and active managed target date funds. The index funds have rock bottom ER of .08% and out perform the actively managed!
We plan. G-d laughs.
anil686
Posts: 1182
Joined: Thu May 08, 2014 12:33 pm

Re: New Schwab Trad IRA

Post by anil686 »

MishkaWorries wrote: Thu Apr 22, 2021 1:40 pm
emmagator wrote: Thu Apr 22, 2021 1:25 pm
anil686 wrote: Thu Apr 22, 2021 11:03 am Not probably going to be a popular answer but if you have no inclination to learn about investing and you want to be hands off and "let it do its thing" - I would have recommended Vanguard PAS at Vanguard or Schwab intelligent portfolios (digital advisor only) at Schwab. Your costs will be significantly lower, it will be well diversified and on autopilot. If you have a retirement date in mind, you could also use a Schwab Target Retirement index fund (the ER is only like 0.09%) and just set it and forget it. Those would be my recommendations - and I would think would be far superior to EJ...

The difference between the two Schwab strategies will be the interface. With intelligent portfolios - you will get the bells and whistles of the cool dashboard and how "fancy" all the little sections fit together. If that floats your boat - cool. With the TR index fund, you will get the typical login page and standard balance amount - that actually floats my boat more - but take it fwiw....
I am learning and plan to learning more, and am interested in some of the advisory options Schwab has, but hear a lot about "cash drag" and am just starting to learn about that, and will continue to learn the basics. But i will not be watching my investments daily and actively trading or consistently rebalancing my portfolios. Once i have my brokerage account transferred, i figure that will take a little more effort on my part, to get it invested correctly and set in the right direction, but still dont want to actively manage it.
Schwab has great low expense target date index funds. Just pick the target date fund that matches your desired asset allocation and be done with it.

Be sure to look for the word "INDEX" in the funds name. Schwab offers both passive and active managed target date funds. The index funds have rock bottom ER of .08% and out perform the actively managed!

Agree with the Target Retirement fund - I do the same thing and I have read a ton of books and have an interest in investing. It is really simple, it is well diversified and you do not need to do anything - it’s actually pretty cool to see after many years....
typical.investor
Posts: 2620
Joined: Mon Jun 11, 2018 3:17 am

Re: New Schwab Trad IRA

Post by typical.investor »

emmagator wrote: Thu Apr 22, 2021 10:57 am Im in the process of transferring accounts from Ed Jones to Schwab. I was hoping to get some advice on my first transfer and what to do with it. My next transfer will be my Ed Jones brokerage account. Im 41 and a very inexperienced investor, not an active investor, and dont plan on becoming one. Im looking to maximize growth with a fairly "hands off" approach. What do you guys recommend. Do i just let it do its thing? This IRA came from a previous employer and has about 143K in it.

Positions:

STOCKS
JD - 7.98%

MUTUAL FUNDS
ANCFX - 22.9%
AGTHX - 28.15%
AMECX - 14.17%
ANWPX - 26.77%

CASH - THIS CAME OVER FROM THE TRANSFER. NOT SURE WHAT IT IS
$40.00
There is a simple online calculator to figure out market weighting using Schwab ETFs.

https://docs.google.com/spreadsheets/d/ ... sp=sharing

It's public facing to either log in to google and download your own copy or don't put any personally identifiable information.

As for your allocation (Stocks/bond US/Intl), you may want to stick with something close to what you have now.
backpacker61
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Joined: Wed May 20, 2020 6:36 am

Re: New Schwab Trad IRA

Post by backpacker61 »

You can also just invest in Schwab's broad market index fund; SWTSX.

https://www.schwab.com/public/schwab/in ... ol%3Dswtsx
“Now shall I walk or shall I ride? | 'Ride,' Pleasure said; | 'Walk,' Joy replied.” | | ― W.H. Davies
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SD2SR
Posts: 39
Joined: Thu May 23, 2019 6:25 pm

Re: New Schwab Trad IRA

Post by SD2SR »

backpacker61 wrote: Thu Apr 22, 2021 5:21 pm You can also just invest in Schwab's broad market index fund; SWTSX.

https://www.schwab.com/public/schwab/in ... ol%3Dswtsx
Seconded, especially if you just want to sit back and let it do the work over the long-term. A target-date index fund like SWYHX is a great choice as well, for automated allocation.

OP, I know you've stated you're not especially interested in learning in-depth about investing per se, but might I recommend (if just for your own edification and confidence going forward) "The Elements of Investing" by Charles Ellis and Burton Malkiel; exceptionally straight-forward and approachable. Taylor Larimore has it listed as one of his "gems" here:

viewtopic.php?t=47462
User avatar
FiveK
Posts: 11334
Joined: Sun Mar 16, 2014 2:43 pm

Re: New Schwab Trad IRA

Post by FiveK »

See some suggestions (both mutual funds and ETFs) for Schwab under Other than Vanguard, Boglehead-style.
Topic Author
emmagator
Posts: 29
Joined: Thu Apr 08, 2021 11:42 am

Re: New Schwab Trad IRA

Post by emmagator »

backpacker61 wrote: Thu Apr 22, 2021 5:21 pm You can also just invest in Schwab's broad market index fund; SWTSX.

https://www.schwab.com/public/schwab/in ... ol%3Dswtsx
Im leaning towards a target date fund, seems very simply. Is there and investment strategy/goal difference between Schwab's Market Index Fund vs a Target Date fund?
retiredjg
Posts: 43980
Joined: Thu Jan 10, 2008 12:56 pm

Re: New Schwab Trad IRA

Post by retiredjg »

It would be a good idea to make a plan for your portfolio, not just your IRA. People here can help with that. See the format we use in the link at the bottom of this message.

Also suggest that you click on the Wiki link above and find "getting started" so that you can start your investing education.

A target date fund may or may not be your best long term solution, but it can certainly be used for awhile as you plan and implement the brokerage move.

Getting away from Edward Jones is a good decision.
Topic Author
emmagator
Posts: 29
Joined: Thu Apr 08, 2021 11:42 am

Re: New Schwab Trad IRA

Post by emmagator »

retiredjg wrote: Fri Apr 23, 2021 10:38 am It would be a good idea to make a plan for your portfolio, not just your IRA. People here can help with that. See the format we use in the link at the bottom of this message.

Also suggest that you click on the Wiki link above and find "getting started" so that you can start your investing education.

A target date fund may or may not be your best long term solution, but it can certainly be used for awhile as you plan and implement the brokerage move.

Getting away from Edward Jones is a good decision.
yep will do. I just initiated a transfer of my taxable account from ED, so once i get over ill update with my portfolio.
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retired@50
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Re: New Schwab Trad IRA

Post by retired@50 »

emmagator wrote: Thu Apr 22, 2021 10:57 am Im in the process of transferring accounts from Ed Jones to Schwab.
This act alone, leaving EJ, and moving to a low-cost custodian will be far more important in the long run than whether or not you use a target date fund or choose to manage and re-balance a simple 3-Fund Portfolio.

Regards,
This is one person's opinion. Nothing more.
backpacker61
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Joined: Wed May 20, 2020 6:36 am

Re: New Schwab Trad IRA

Post by backpacker61 »

emmagator wrote: Fri Apr 23, 2021 10:30 am
backpacker61 wrote: Thu Apr 22, 2021 5:21 pm You can also just invest in Schwab's broad market index fund; SWTSX.

https://www.schwab.com/public/schwab/in ... ol%3Dswtsx
Im leaning towards a target date fund, seems very simply. Is there and investment strategy/goal difference between Schwab's Market Index Fund vs a Target Date fund?
The target date fund is a balanced portfolio of US and international stocks, and bonds.
The Market Index Fund is US stocks only, so you would need to buy international stock and bond funds separately.

The expense ratio is usually a little smaller on the "pure play" stock index funds versus the "pre-mixed" Target Date funds. And you can choose to hold bond funds in your tax advantaged accounts and stock market index funds in taxable brokerage accounts, if you want to be a little more tax efficient. Neither decision is really "wrong".

I agree; the best decision you've made is to switch to a low cost provider and "do it yourself". The choice between a Target Date Fund and Total Stock Index fund is minor in comparison.
“Now shall I walk or shall I ride? | 'Ride,' Pleasure said; | 'Walk,' Joy replied.” | | ― W.H. Davies
Topic Author
emmagator
Posts: 29
Joined: Thu Apr 08, 2021 11:42 am

Re: New Schwab Trad IRA

Post by emmagator »

Would a target date fund be a better choice that how im currently invested? This is how its been invested at EJ for years.
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retired@50
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Re: New Schwab Trad IRA

Post by retired@50 »

emmagator wrote: Mon Apr 26, 2021 9:59 am <snip>
But i will not be watching my investments daily and actively trading or consistently rebalancing my portfolios. Once i have my brokerage account transferred, i figure that will take a little more effort on my part, to get it invested correctly and set in the right direction, but still dont want to actively manage it.
</snip>

Would a target date fund be a better choice that how im currently invested? This is how its been invested at EJ for years.
Based on the above comments, I'd say you should use a low-expense ratio target date fund. Paying any attention to the decisions that were made at EJ won't help you. EJ makes decisions about portfolios that help them, not their clients.

Target date funds offer a globally diversified portfolio that (when using index funds) is low-cost, age-appropriate, and re-balanced to change the risk profile over your lifetime. You can really do worse in so many ways, and may not be able to do much better, assuming you're willing to pay any attention at all, (which it appears you don't want to).

Pick a Schwab target date index fund and just worry about filling the account up.

Regards,
This is one person's opinion. Nothing more.
Topic Author
emmagator
Posts: 29
Joined: Thu Apr 08, 2021 11:42 am

Re: New Schwab Trad IRA

Post by emmagator »

retired@50 wrote: Mon Apr 26, 2021 10:10 am
emmagator wrote: Mon Apr 26, 2021 9:59 am <snip>
But i will not be watching my investments daily and actively trading or consistently rebalancing my portfolios. Once i have my brokerage account transferred, i figure that will take a little more effort on my part, to get it invested correctly and set in the right direction, but still dont want to actively manage it.
</snip>

Would a target date fund be a better choice that how im currently invested? This is how its been invested at EJ for years.
Based on the above comments, I'd say you should use a low-expense ratio target date fund. Paying any attention to the decisions that were made at EJ won't help you. EJ makes decisions about portfolios that help them, not their clients.

Target date funds offer a globally diversified portfolio that (when using index funds) is low-cost, age-appropriate, and re-balanced to change the risk profile over your lifetime. You can really do worse in so many ways, and may not be able to do much better, assuming you're willing to pay any attention at all, (which it appears you don't want to).

Pick a Schwab target date index fund and just worry about filling the account up.

Regards,
I think thats what ill do.
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