Move to cash?

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Sep 29, 2008 9:11 pm

I've been asking my Edward Jones man for a few weeks whether I should change my IRA to all cash rather than watch it sink in value.   He tells me "That would be an absolutely stupid thing to do"

My question is;  Does he make more money off of me by keeping me in mutual funds rather than cash?
Yes, I'm in the American funds & Lord Abbett funds that paid him the bigger kickback a few years ago.
When times are bad he says "You better put more money in your IRA.  It's a great buying opportunity"
When times are good he says "You better put more money in your IRA.  You're missing the big runup"
I'm starting to question whether or not he knows what he's doing or if he's just a salesman looking out for himself
I'd like opinions on what are the safest investments at this time
Thanks for your time.
PJG
Sep 29, 2008 9:58 pm

If you are not comfortable with your advisor I suggest you go talk to another one as opposed to asking investment advice on an internet board.

Sep 29, 2008 10:01 pm

Getting out of the equity markets and into 'safe' investments at times like these is a good recipe for making a small fortune.....

....as long as you start with a large one.

As for your Jones guy always being bullish, that's a whole different ball of wax.

Sep 29, 2008 10:03 pm

I agree with bondo

Sep 29, 2008 10:16 pm

Don't you wish Bobby was here to set this guy straight?

 
Ice, you'll just have to tell him we don't work for free.
Sep 29, 2008 10:25 pm

Advisory Solutions.



Sep 29, 2008 10:59 pm

Your advisor does make a small % to keep you invested. It is such a small amount it wouldn't be enough to make a big difference. If the advisor has you in good diversified investments then he is right in advising you to stay invested and add money. Most clients want to bail in a down market and it is the best time to buy. If the market is going down your dollars buy more. It sounds like you don't trust him. If he is truly trying to help you achieve your goals and you don't trust him then don't waste his time.    

Sep 29, 2008 11:02 pm

For US equities since WW2:

 
Average bear market lasts 14 months with 33% loss 
Average bull market lasts 70 months with 185% gain
 
There is an insane amount of cash waiting on the sidelines.  Much of it is money that's supposed to be long-term money; there's no way that investors will sit earning 1% on long-term monies forever.
 
As a very general rule of thumb, I suggest keeping minimum 5 years' expenses in cash/bonds - then you don't need to risk selling stocks while they're down.
 
 
 
 
Sep 29, 2008 11:44 pm

Why is anyone on this board giving any kind of investment information to someone who is clearly not in our industry?

Sep 30, 2008 1:49 am

Bravo!

Sep 30, 2008 6:12 am

I didn't even consider that I would be asking for free advice from the professionals.


I realize this is how you make your living and I sincerely apologize.
 
I appreciate your time and I thank you.
 
PJG
Sep 30, 2008 7:54 am

Ice.  I want to marry you.  Wait, that isn't legal in my state (we are both male?).  Yet.  When I retire (20-30 years?), I am moving my account to you.

Sep 30, 2008 8:21 am

...(instructing my oldest son to name his first-born male "ICECUBE" in tribute)

           Spoken like a true professional advisor!
 
Sep 30, 2008 10:46 am

Sep 30, 2008 1:54 pm

Ice:

 Great post .. but where did those numbers come from?  The "bear" figures sound right, but 185% average gain in 70 months in a bull market?  Sounds a little high to me.  Thank you, though, for the wonderful post.
Sep 30, 2008 2:59 pm

To be completely fair on the kickback issue, I would guess he's referring to revenue sharing, not commission. 

Sep 30, 2008 3:26 pm

Ice, good post man, but the Bengals still suck.

Sep 30, 2008 3:54 pm

Sorry .. my question should have been directed to Unsure ,.. still am curious on the answer, though.  Any ideas?

Sep 30, 2008 5:28 pm

I didn't really mean to post here again, but I'd like to clear something up if I may

I became a little suspicious of Edward Jones when I heard that certain companies were giving bigger commissions to reps that promoted their funds.  I checked my portfolio and all the funds I held in my Roth (seven of them) were on the "preferred" list.   It led me to question whether my "friend" actually had my best interest at heart.
I'm not a youngster and my Roth holds about $50,000 - small potatoes to many, but it's mine and I'm anxious about protecting it.
Thanks for allowing me to intrude - I'll read the replies, but probably not post again.
Thank you very much for your time. JPG
Sep 30, 2008 5:33 pm

Discuss this CONFIDENTIAL matter with your Edward Jones Advisor. If you have issues with the Advisor and the Company this is something you should address privately and not via this Forum. I say this respectfully.