401(k) with Ameriprise

[stillmovingforward]

DH's company is starting a 401(k) with Ameriprise. We'll invest enough to get the match but he wants to invest more and I'm thinking of him staying with his IRA for the majority of his retirement, which is at Vanguard. Tell me about Ameriprise.

[justme]

I think the funds and fees offered are more important. Is your income low enough to qualify for whatever ira he'd use? How much would you be saving - more than match + ira max contribution or less?

[Deleted]

Dec 28, 2019 15:00:05 GMT -5 justme said:

I think the funds and fees offered are more important. 

I agree.  Ameriprise has a reputation for aggressively selling high-commission products regardless of whether they're a good fit for the client but their 401(k)s may be different and may even be influenced by the size and bargaining power of the employer.  Do you know yet what the fund options are?

[Value Buy]

Dec 28, 2019 15:52:32 GMT -5 @athena53 said:

Dec 28, 2019 15:00:05 GMT -5 justme said:

I think the funds and fees offered are more important. 

I agree.  Ameriprise has a reputation for aggressively selling high-commission products regardless of whether they're a good fit for the client but their 401(k)s may be different and may even be influenced by the size and bargaining power of the employer.  Do you know yet what the fund options are?

I agree. Vanguard has amazingly cheap costs, but if the company match is a good number, you should go with at least that amount in possibly a S&P 500 fund if they have it. Maybe a bond fund if you do not have one now, but need more info on what you have now before saying anything else.

Keep in mind, the stock market will not keep going up for years into the future without a correction....
Good luck!

[stillmovingforward]

We make $150,000 combined. He makes $40,000. We haven't heard anything about fees yet. No details at this point. But it's good to know that it's an aggressive group. I'll be on the lookout for that.

[Deleted]

The aggressive selling is more on the part of individual "financial advisors"- totally different function from the 401(k) people.  I wouldn't let one of their financial advisors anywhere near me.  You definitely need to make your decision based on the funds available when you can get that information.

[stillmovingforward]

Thanks everyone! That helps a lot. What it really says is that I should go with DH. A nice guy but not really financially savvy.

[hoops902]

I worked for Ameriprise for a full day as a financial advisor.  In that day they basically:

-Told me that they weren't going to honor my employment contract in terms of what I was going to make in training (I was a financial advisor, they decided I had to give more of my first clients over before taking future ones as my own and were going to pay me less during that time than I had agreed to in writing).
-Gave me a list of things they do which I was NOT to tell any regulators about, and gave me another list of what I should say if regulators came around.
-Lost multiple people's money and couldn't seem to figure out in the system where that money had gone (I think later in my career this wouldn't have jumped out as much at me after seeing how big companies screw stuff up and figure it out, but the mania around it made it seem at the time like a HUGE issue).
-Told the guy that I'd started with and who I shared an office with that his wife would probably leave him and his kid would be homeless if he quit this job after he expressed concerns and made it clear he was reconsidering after hearing about the decrease in pay vs what he'd agreed to.

Granted, this was one branch of one office in one city, but it was enough I'd never come near them again.  The home office did seem concerned when I quit, and they paid me out what I was owed (I had done all the self-study to pass licensing tests and they offered to transfer me to another office but that office was several hours away).

[Deleted]

Dec 30, 2019 8:42:48 GMT -5 hoops902 said:

I worked for Ameriprise for a full day as a financial advisor.  In that day they basically:

-Told me that they weren't going to honor my employment contract in terms of what I was going to make in training (I was a financial advisor, they decided I had to give more of my first clients over before taking future ones as my own and were going to pay me less during that time than I had agreed to in writing).

A lot of this is consistent with what I've read.  They pressure you to recruit all your friends and relatives as clients (at least those who have money!) and if you get discouraged and quit they still have those accounts.  I'd also read that their "tailored" advice is usually the same for everyone- a "Happy Meal" of mutual funds, life insurance and LTC insurance.  No, thanks.

[hoops902]

Dec 30, 2019 8:53:37 GMT -5 @athena53 said:

Dec 30, 2019 8:42:48 GMT -5 hoops902 said:

I worked for Ameriprise for a full day as a financial advisor.  In that day they basically:

-Told me that they weren't going to honor my employment contract in terms of what I was going to make in training (I was a financial advisor, they decided I had to give more of my first clients over before taking future ones as my own and were going to pay me less during that time than I had agreed to in writing).

A lot of this is consistent with what I've read.  They pressure you to recruit all your friends and relatives as clients (at least those who have money!) and if you get discouraged and quit they still have those accounts.  I'd also read that their "tailored" advice is usually the same for everyone- a "Happy Meal" of mutual funds, life insurance and LTC insurance.  No, thanks.

Yes, their "tailored" advice is essentially to plug a dozen numbers into their program, and then the program kicks out some allocations.  I was drawn to them initially because they were fee-only and I had a pretty solid list of people with decently significant wealth who wanted me to be their adviser.  It ended up being about 50% me hating the people working there, and 50% me feeling like I'd be putting a bunch of people I knew in a bad situation by bringing them in.  

It honestly turned me off to the entire career of being a financial advisor.  Most places I talked to were so big on cold-calling and running these fake sweepstakes for people who would never "win" the real prize, but would "win" a free consultation.  Too many just felt seedy.  They seemed very focused on wanting to go out and pitch new clients...when I probably should have been a gold mine for them walking in with tens of millions of dollars to manage on day 1.  I wasn't there because I wanted to cold-call people, i was there because a bunch of people I'd known over a decade wanted me to help them manage their wealth.

[thyme4change]

Dec 30, 2019 8:42:48 GMT -5 hoops902 said:

I worked for Ameriprise for a full day as a financial advisor.  In that day they basically:

-Told me that they weren't going to honor my employment contract in terms of what I was going to make in training (I was a financial advisor, they decided I had to give more of my first clients over before taking future ones as my own and were going to pay me less during that time than I had agreed to in writing).
-Gave me a list of things they do which I was NOT to tell any regulators about, and gave me another list of what I should say if regulators came around.
-Lost multiple people's money and couldn't seem to figure out in the system where that money had gone (I think later in my career this wouldn't have jumped out as much at me after seeing how big companies screw stuff up and figure it out, but the mania around it made it seem at the time like a HUGE issue).
-Told the guy that I'd started with and who I shared an office with that his wife would probably leave him and his kid would be homeless if he quit this job after he expressed concerns and made it clear he was reconsidering after hearing about the decrease in pay vs what he'd agreed to.

Granted, this was one branch of one office in one city, but it was enough I'd never come near them again.  The home office did seem concerned when I quit, and they paid me out what I was owed (I had done all the self-study to pass licensing tests and they offered to transfer me to another office but that office was several hours away).

Yikes. I'm glad you had the strength to bail out.