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Featured Advisor

Srbo Radisavljevic
Managing Principal/Investment Advisor

Edge Portfolio Management


State: IL

At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, following Chicago sports, enjoying ethnic cooking, and serving as a school board member for Norridge School District 80.

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Firms Most Likely to Capture IRA Accounts

If you are thinking of rolling over the money in your 401(k) plan, where should you think about opening your IRA account?

In research recently conducted by Millionaire Corner/Spectrem Group with almost 1,000 individuals who recently rolled over, or had the opportunity to rollover, their 401(k), it was found that Fidelity was considered by 38% of all individuals looking to open an IRA accountOther providers considered by investors included Charles Schwab (25%), Vanguard (24%), ING (18%) and American Funds and J.P. Morgan Chase (tied at 15%). 

While the companies named above were considered by investors, the providers that actually won the IRA accounts included Fidelity (30%), Vanguard (11%), American Funds (9.2%), Edward Jones (7.1%) and Morgan Stanley Smith Barney (6.6%).

Why did investors like yourself choose these companies?    Why are the companies considered not necessarily the companies chosen by investors?  In many cases, investors will research many companies prior to seeking additional advice.

  • One of the primary reasons is that almost 70% of investors turn to their financial advisor for advice concerning their rollover.  Not surprisingly, in many cases, the advisory firm (i.e. Morgan Stanley, Edward Jones) offers an IRA account solution of their own.  American Funds, for example, is a popular fund family for advisors not affiliated with a large firm.  It is likely that independent advisors assisted investors in choosing American Funds. Therefore, if you feel more comfortable discussing your IRA account options with an advisor, don’t be surprised if he or she discusses the alternatives offered by their own firm with you.
  • Another important selection factor identified by investors is “Low investment management fees”.  Sixty nine (69%) percent of those rolling over an IRA look for low investment management fees.  Vanguard is known for its low investment fees.
  • “Customer service from a person, not a VRS” is the most important selection factor for 70% of investors.  To the extent that an individual is relying upon their advisor to choose a provider, it is not surprising that they already feel they have a person and not a system.

Why is Fidelity so popular?  There are many reasons, the largest of which may be brand familiarity.  Many investors are familiar with Fidelity’s “green line”.  Once an investor is familiar with a brand name, they will go to the website and find many of the selection criteria which drive decisions; a quick and easy process to open an account (68%), access to account 24/7 (56%), assistance in setting up the account, availability of multiple fund types, etc. For those investors that choose to make their own decisions, investing with Fidelity is easy.   It may also be that firm stability has become increasingly important to investors in Millionaire Corner’s existing research and Fidelity is seen as a large stable firm.

While opening an IRA account is a personal decision, sometimes it is helpful to understand how and why other investors made the same decision.