Best Brokerage Account to Open Now (and Hold Stock)

[stlcole]

I have about $60k of a NYSE-listed stock which I am required to hold. The stock is currently at a transfer company. Where is the best place to open a brokerage account for a cash or points reward? I will not be doing any trading in this account, so I don't care about the cost of the trades.

This question occurred to me after I learned I could put these shares at Merrill Lynch to get Preferred Reward Status for my Cash Rewards Card.

 

[Free-quent Flyer]

You can get a one-time 25,000 mile deposit to American, United, or Delta by depositing it into a Fidelity brokerage account.

Or 50% bonus on BankAmericard Travel Rewards by qualifying for Platinum Preferred Rewards, turns the card into 2.25% cash back everywhere.

So basically, do you MS a lot or a little? If a lot, go with Merrill Lynch. If a little, take the one-time Fidelity bonus.

 

[stlcole]

I was doing some surfing today and this is what I figured:

With Merrill, I get $150 using code ME600, if I hold those securities in a Merrill account for 3 months, which effectively becomes 4 or 5 months, because I won't move them until the cash is delivered. So with Merrill, I get both cash and the boost to my cash-back bonus.

With Fidelity, the shares have to be held at Fidelity for 9 months. E*Trade gives $200 over 6 months.

Depending on home much value I generate from the Preferred Reward Status, I could move these shares in 5 months to generate another little spiff.

 

[Gloobnib]

Piggy-backing on the question here. I'm about to rollover a neglected 401K from a previous employer. I have somewhere between $175k and $210k to rollover (will find out for sure tomorrow when the brokerage opens so they can unlock my online access).

My question: which brokerage is offering the best signup bonus for 401K rollovers at the moment? A little googling and clicking around, and I came up with this list. Anybody have other suggestions?

• Cap1 Investing - $300 bonus for 100K, $600 bonus for 200K
• Merrill edge - $250 for $100K, $600 for $200K
• Scottrade - $300 bonus for 100K, $600 bonus for 200K
• Fidelity - $200 for $50K, $300 for 100K, $600 for $250K
• Etrade - $200 for $25K, $300 for 100K, $600 for 250K
• Bankwest - $200 for 50K, $300 for 75K, $700 for 250K

I currently have brokerage accounts (previous rollovers and a Roth) with TD Ameritrade, who strangely doesn't want to give me a bonus for transferring in a fairly tidy sum into an existing Rollover IRA. The 401K in question is with Vanguard as the custodian, so I wouldn't be eligible for any 'transfer in outside money' bonuses through them.

Anyone have better suggestions?

 

[stlcole]

Do you know if you get Preferred Reward Status with Merrill for your rollover? Do you care? You would likely be Platinum Honors level which among other things, boosts reward payouts by 75%; i.e. Bankamericard Cash Rewards goes from a base of 1% to 1.75%, gas goes from 3% to 5.25% and groceries goes from 2% to 3.5%.

 

[Gloobnib]

Do you know if you get Preferred Reward Status with Merrill for your rollover? Do you care? You would likely be Platinum Honors level which among other things, boosts reward payouts by 75%; i.e. Bankamericard Cash Rewards goes from a base of 1% to 1.75%, gas goes from 3% to 5.25% and groceries goes from 2% to 3.5%.

Wow. I honestly always thought "I don't have that kind of money to qualify" so I never really paid attention to that program. You're right, it has definitely piqued my interest. I need to sleep on it and then re-read and/or get confirmation from BofA/Merill.

Here's what caught my eye:

• Free ETF trades (Check. I was already planning on only holding ETFs in this account).
• Unlimited ATM fee refunds when withdrawing from the linked checking account. (very nice. I travel for work and wind up paying non-network ATM fees at airports and hotels way more often than I should).
  
• .5% Auto loan discount. May come in handy next year when I buy a car, but then again I 'belong' to a bunch of CUs who (hopefully) already have the lowest rates.
  
• Rewards booster for Cash Rewards. Relatively paltry payout, but better than nothing (limited to $1500 per quarter in spend

That's certainly some food for thought. Thanks for the suggestion!

 

[Matt]

Piggy-backing on the question here. I'm about to rollover a neglected 401K from a previous employer. I have somewhere between $175k and $210k to rollover (will find out for sure tomorrow when the brokerage opens so they can unlock my online access).

My question: which brokerage is offering the best signup bonus for 401K rollovers at the moment? A little googling and clicking around, and I came up with this list. Anybody have other suggestions?

• Cap1 Investing - $300 bonus for 100K, $600 bonus for 200K
• Merrill edge - $250 for $100K, $600 for $200K
• Scottrade - $300 bonus for 100K, $600 bonus for 200K
• Fidelity - $200 for $50K, $300 for 100K, $600 for $250K
• Etrade - $200 for $25K, $300 for 100K, $600 for 250K
• Bankwest - $200 for 50K, $300 for 75K, $700 for 250K

I currently have brokerage accounts (previous rollovers and a Roth) with TD Ameritrade, who strangely doesn't want to give me a bonus for transferring in a fairly tidy sum into an existing Rollover IRA. The 401K in question is with Vanguard as the custodian, so I wouldn't be eligible for any 'transfer in outside money' bonuses through them.

Anyone have better suggestions?

All pretty much in the same ballpark. I'd suggest look at 3 factors:

• Cost to ACAT away, close acct. EG Fido looks like it might charge $50 to close IRA accounts..
• Trade fees
• Expense Ratios

Look closely at Bankwest ( I'm unfamiliar with it) while one might see it being the highest bonus for $700, if you have 4 funds inside that IRA and they charge you the most to enter (and rebalance) positions, you'd quickly lose out.

ER wise, check that you aren't giving up ultra low cost institutional funds - some Vanguard 401(k) plans have ERs of 0.02%.. eg
VIIIX which tracks the SP500. While you can get that cheap still, you might pay double for it, bake that into the rebate, and decide if it is worth the hassle of chasing bonuses.

 

[Gloobnib]

All pretty much in the same ballpark. I'd suggest look at 3 factors:

• Cost to ACAT away, close acct. EG Fido looks like it might charge $50 to close IRA accounts..
• Trade fees
• Expense Ratios

Look closely at Bankwest ( I'm unfamiliar with it) while one might see it being the highest bonus for $700, if you have 4 funds inside that IRA and they charge you the most to enter (and rebalance) positions, you'd quickly lose out.

ER wise, check that you aren't giving up ultra low cost institutional funds - some Vanguard 401(k) plans have ERs of 0.02%.. eg
VIIIX which tracks the SP500. While you can get that cheap still, you might pay double for it, bake that into the rebate, and decide if it is worth the hassle of chasing bonuses.

Good points, all! I'm very much in the "invest it in ETF index funds, then try to forget about it" camp of long-term investing. It's served me fairly well in that I've managed to amass a few years of annual salary so far with minimal heartburn (that would result if I actually paid attention to short term fluctuations).

However, you do raise very good points here. When I was getting started, the dollar difference between a .02% ER and a $.1% ER on $20K investment was "only" $16 per year, so the other account costs (trade fees, account open/close fees) were a much more significant factor in terms of where I should be parking my money. Fast forward a decade(ish) and all of a sudden I'm looking at those same ERs being $400ish per year, which as a "buy and hold" investor constitutes the bulk of my portfolio overhead.

That's all a long way of saying thanks for getting me to take a close look at this again. I'm re-examing my epenses and as a result will likely to be moving the bulk of my portfolio over the next 6 months or so.

Gloob