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  1. #1
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    Self Directed Brokerage Account Wells fargo

    My company offers an option of Self Directed Brokerage through our 401K plan, can anyone offer up pros and cons on such an account. I also tried to attach a copy of the fee schedule, which was unsuccessful . What kind of fees are typical of a self directed account? Just a thought but since its through my work place and a 3rd party"wells Fargo" knowing palms with have to be greased in all business transactions the fees and any other charges you can imagine would be higher. I just don't see the benefit of something like this. Would be better off opening a brokerage account outside of 401K and the work place with fidelity, vanguard etc. Just spit balling here, work is slow this morning. Anyone have any thoughts?

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  3. Stocks/Investments Moderator boneil's Avatar
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    #2
    The benefits are that you can buy into things that are not offered through the companies plan. MY wife's work uses Charles Schwab for their retirement account. There are only a dozen or so funds that we can buy into, but they also offer a self directed account. There's nothing that gives me exposure to metals in the funds they offer. But in the self account I could buy whatever I want. I was looking into it but the cost of commissions can add up quick with bi-weekly buys. The other problem is being too active. When you actively manage money, you have to learn to ignore the daily headlines. When you're watching your money it's very easy to get scared out and make bad decisions, because of different headlines. Just think about all the different headlines this year. Would you have been able to ignore everything. I know I have a hard time ignoring them.

    If you open a brokerage account, on your own, you won't get any company matching in that account. So what we do is have a 403b (same as 401k), where the company matches 50%, we leave that alone in the most aggressive funds available. And I have an account with Etrade and TD Ameritrade for actively investing and trading. Any brokerage will offer many different accounts for what you want to do.
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  4. Member
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    #3
    You will have to invest wherever your company decides to do business to get their matching funds. Many companies offer conservative groups of funds so their employees cannot make too many poor investment decisions.

    Wells Fargo has a somewhat dubious reputation in their services. But you don't have to leave your non-401k business there. I use their checking services but find Fidelity, Vanguard and other big discount brokerages better for my uses. But don't think a 401k will be sufficient to retire on as that is just the start to building a sufficient retirement portfolio.

  5. Member
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    #4
    Several good points, I tried to upload a copy of fee/commission schedule but couldn't get it to upload. I am no warren buffet but it did seem high. In my opinion the company match In any 401K type plan Is great. I contribute 11% from my bi-weekly pay and the company kicks in4%. I feel like I am winning @ 15%. That's a good question, not sure I could ignore the headlines. I typically stick to areas/industries I am educated on or have some knowledge in. Also a good point about access to other areas of investing

  6. Member
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    #5
    Bamaman I remember Wells Fargo being in the news with some issues. I understand my 401K will not be sufficient enough income to retire on, I am a little hesitant to believe I will be able to retire at some point. I am just not all that confident in the actual investing part, it can be an expensive learning experience.

  7. Member RazorCat's Avatar
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    #6
    Here’s a comparison chart for Charles Schwab and a few others. $4.95 per transaction up to 999,999 shares (see footnotes in second link).
    https://www.schwab.com/public/schwab...wab/compare_us
    https://www.schwab.com/public/schwab/nn/agreementse/schwab_pricing_guide_for_individual_investors.html

    I’m looking at Schwab to move some of my available cash from a flat interest account into so I can start buying individual stocks, or ETFs. I invested 50% of my retirement funds (FED TSP) in a company that pays me a flat 12% per year on money I loan them for startups. The monthly interest payments go back into my IRA and was used in the past to buy additional shares. With no more shares available in the future I’m going to move that cash into a self directed brokerage account so I can have it earning interest all year. I can reinvest in TSP, but you have limited funds you can invest in with a monthly interfund transfer limit of 3 per month, and you have to complete the transfer by noon EST with no option to change after it goes through.
    TSP administrative costs are the lowest anywhere, but I don’t like the restrictions on IFTs, hence I’m looking at Schwab to move at least a portion of my cash in to.
    Personally, if Wells Fargo was my only choice I would forego it. There are much better options out there.
    Maybe this information will give you some ideas.
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