Is Stifel a scam?

[The_Jeff]

My grandpa set up a 529 college fund for my kid when he was a baby, using a local financial advisor, probably some guy in a mall, LOL.

It did well and is paying for everything, so I'm not too upset.

It was with "American Funds" and just got sold to Stifel, while my enterprising kid's a rising junior. Wish it could have waited another couple years.

Here's the thing. I got the online stuff set up and they wanted to worm into my real bank accounts. All of them. And access all my statements and know all about my money. That's none of their darn business! They should verify that the account belongs to someone with rights to the money and leave it at that.

So because I have a credit union, I have a dopey savings account with $200 in it that does nothing. I only gave them the rights into that. They can move tuition into that and I can then move it where it belongs.

Am I overreacting?

 

[ctechbob]

Nothing wrong with being cautious.

 

[97prizm]

Can you speak with an advisor about the account? If so it might help.

 

[bdc101]

Stifel is probably just a scummy provider.

To my understanding you can move a 529 to a different provider -- with a few limitations. You are probably paying a lot of fees with Stifel (if they are indeed a scummy provider) so this might make good financial sense as well as not having to give them unreasonable access.

I don't live in ME but I believe that you can do this generally in most or all states and a quick google search also agrees.

 

[The_Jeff]

^ Yeah that's the nuclear option.

This investment has been a great "set and forget" experience so I'll give the guys a chance, particularly if everyone else does the same shenanigans.

My IRA with Schwab doesn't though, so they're a runner-up.

 

[Hermann]

Stifel is a shirt sleeve sponsor of the St Louis Cardinal MLB team.

 

[Rand]

They have been in the news in a bad way but its more isolated dirtbags.

 

[cheech279]

Stifel is not a major bank or investment house, but that's no reason to worry. Give them the minimum personal information and ask the right questions. If you don't like the answers, consider a custodian transfer.

 

[SC Maintenance]

They likely need to verify your identity (SSN, etc). As for banking info - routing number and account should be all they need I would think.

Everyone is collecting information on everyone. I went to city hall to transfer a title (you have to pay county property tax first before DMV will do anything). They demanded my phone number. Realize I was paying cash. I said no thanks. They insisted. I asked what they needed my phone number for, and they said "in case you leave something here". Two different people - same answer. I declined both times. Scumbags all of them.

 

[wwillson]

Tell Stifel that you are not interested in sharing any other financial information with them. That's it, you don't owe them any other explanation. Investment houses are all trying to get more deposit funds so they can make fees.

 

[Gyro Gearloose]

Stifel is very much a reputable mid tier advisory firm. They offer everything that the other big brokerages and investment banks offer, just smaller scale.

It seems every financial firm wants to know the complete picture of your finances so they don't miss an opportunity to sell you more services. I decline to share with any of them.

 

[doitmyself]

My parents (RIP) were satisfied with Stifel managing their retirement portfolio, with my dad being somewhat savvy about this stuff. Stifel communicated well and handled the transfer of their accounts post death o.k..

 

[RhondaHonda]

My kids have 529s setup by grandparents held at Stifel as well. No issues for me. They are a pretty big firm now, based here in St. Louis. Maybe the fees are higher than what I could’ve found at Vanguard or Fidelity but I’m just thankful they set them up, regardless of where they are held.

The accounts have grown so much that I’m now thinking of what to do with the money once the kids are through college, assuming that’s where they end up.

 

[ATex7239]

My kids have 529s setup by grandparents held at Stifel as well. No issues for me. They are a pretty big firm now, based here in St. Louis. Maybe the fees are higher than what I could’ve found at Vanguard or Fidelity but I’m just thankful they set them up, regardless of where they are held.

The accounts have grown so much that I’m now thinking of what to do with the money once the kids are through college, assuming that’s where they end up.

The SECURE 2.0 Act of 2022 allows a lifetime maximum of $35,000 to be rolled over from a 529 plan into the beneficiary’s Roth IRA.

 

[bdc101]

The SECURE 2.0 Act of 2022 allows a lifetime maximum of $35,000 to be rolled over from a 529 plan into the beneficiary’s Roth IRA.

Yeah, this is a big deal! And @RhondaHonda should consider doing this sooner rather than later, even if the kids aren't in college yet.

If you roll $35k over to a Roth, you can save it for retirement or use it for college (since you can take out Roth contributions at any time, tax free). It will continue to grow in a Roth and you can even carry it in the same investments as your 529. But if you leave it in 529, and it grows to way more than you need (which it definitely could be doing in this market!) or if your kids don't end up needing to pay for college (either because they don't go, or because they get scholarships) you will be in a pickle. You can easily pay a ton of it in taxes and fees -- a lot more than you're expecting too (it could be as bad as 40% of the account is wasted, depending on your state and income!).

 

[ATex7239]

Yeah, this is a big deal! And @RhondaHonda should consider doing this sooner rather than later, even if the kids aren't in college yet.

If you roll $35k over to a Roth, you can save it for retirement or use it for college (since you can take out Roth contributions at any time, tax free). It will continue to grow in a Roth and you can even carry it in the same investments as your 529. But if you leave it in 529, and it grows to way more than you need (which it definitely could be doing in this market!) or if your kids don't end up needing to pay for college (either because they don't go, or because they get scholarships) you will be in a pickle. You can easily pay a ton of it in taxes and fees -- a lot more than you're expecting too (it could be as bad as 40% of the account is wasted, depending on your state and income!).

We blended some cash savings and some 529 savings for the kids. I figure use the 529 and any scholarships up first and cash is there for any remainder. The cash may not have the growth, but nobody can tell us what to do with it.

 

[RhondaHonda]

Yeah, this is a big deal! And @RhondaHonda should consider doing this sooner rather than later, even if the kids aren't in college yet.

If you roll $35k over to a Roth, you can save it for retirement or use it for college (since you can take out Roth contributions at any time, tax free). It will continue to grow in a Roth and you can even carry it in the same investments as your 529. But if you leave it in 529, and it grows to way more than you need (which it definitely could be doing in this market!) or if your kids don't end up needing to pay for college (either because they don't go, or because they get scholarships) you will be in a pickle. You can easily pay a ton of it in taxes and fees -- a lot more than you're expecting too (it could be as bad as 40% of the account is wasted, depending on your state and income!).

They don’t have any earned income so I can’t start yet. I’ll roll it into a Roth as they start earning money. The balance can just get used for their kids if the $35k limit doesn’t change.

Also, the account has to be open 15 years too. Definitely better than it being stuck in the 529 forever.