We received 4 lettters from Schwab this week. I thought they were year-end junk and I almost shredded them. Turns out each was a check; one for each robo account we had 2 years ago. More than $1,000 total. Thanks for explaining this so clearly.
If the client got the .5% on their cash they were promised, they really had nothing to complain about. Its hardly unusual that a bank uses cash deposits to do loans, its the basic way they make money.
@@akin242002 True but if you read the fine print of your agreement it states this, that is the reason for the fine. If you watch the video he states this.
This is the exact reason I pulled my money out from their hands and now do my own. I'm still with Schwab, but handle my own investing. I got tired of seeing so much cash just sitting there not in the market, and I figured that was what they were doing with it. This was just over a year ago that I pulled it. Hopefully I will get a little bit of this :)
It wasn't a hidden fact they had a large allocation in cash. It was out in the open. I'm surprised the case was won against Schwab. I say this as someone with a Schwab account that refuses to use their robo-advisor.
If the bank promises you 0.5% and they give you 0.5%then you have nothing to complain about. That's none of your concern what they're doing with your money. This is what you signed up for.
You must be in finance? Banker? Trader? If Schwab claims to act in a fiduciary capacity on behalf of their customers then they need to act in that manner. The world is a cesspool due to that attitude. If people were selfless and generous there would be more for everyone instead of more for one jerk.
@@SneekySecrets The amount Schwab is pocketing is equivalent to $75 per $10,000 invested on their average allocated portfolio. That's 7.5 basis points. A steal! Most investment managers charge 85 to 125 basis points. You will not find a better deal anywhere. Current sweep account rates (Aug 2023) are 4.75%. Schwab reinvests that cash to get 5.5% in corporate paper and T-bills. They pocket a 0.75% spread on just the cash portion of the portfolio, which if less than 10% cash, is going to be .075% (7.5 bp) or less. You don't think a business deserves to generate revenue or what?
If the cash is insured (which it is), what is wrong with this? Nothing. If disclosure is common, then yes, they should have stated that. I think there is more to the fine unless not disclosing is a big no.
I elected my sweep and naturally assumed Schwab made money on it. I'm self directed which is the super intelligent option. Why pay somebody to make mistakes when I can make them myself for free? 🙂
I got approved my Scharles Schwab credit card 2021 and I almost convincing to use their AI for 5K, then I decide not to do it after I read so many reviews they’re not really making money that how they promised.
I have a Schwab IP and was not aware of this, though I thought this was "bus. as usual " with the big guys. My issue with them right now is that recently they've rebalanced my account and every time thus far have realized a loss. This has occurred a few times this year, I have always been under the impression that most of the time in "rebalancing" you would sell those positions that increased in value so much that it materially changed the original allocation and thus you would realize a gain. Spoke to someone from Schwab and they mentioned some "tax harboring" issue which frankly did not make sense to me, I got into this portfolio for preservation and growth not for tax planning. Do they know if I already have booked losses that I can apply for future gains. Any insight on this?
It's called "Tax loss harvesting". The rebalancing act is selling off ASSET CLASSES (not specific shares) that have disproportionately increased in market value and using the proceeds to buy underperforming assets. However, that actual SHARES of any specific asset class being sold are the ones you overpaid for in the past, which yes, realized a paper loss. That loss is used to reduce your tax burden on any dividends and interest paid throughout the year. It consequently lowers your cost basis which will theoretically increase taxable gains later in life, but at a time when most people are in a lower tax bracket. They are trying to help people.
It Does Feel different this time? Like it is All Happing at same time? I wanted to get out in Feb and March? My advisor said NO! Thanks Vickie! But now that we are down 30% mite as well ride the Bear? I expect it will go back up eventually?
I got the same scam talk. They went through gymnastics persuading me to keep the investments. Now I realize that their goal was to just keep making their commissions. I’m in the process of switching my money out of their clutches and doing my own investments.
@@evenbiggeral5089 To your own detriment. Investments are forward looking. What is the long term earnings expectation of the Schwab Intelligent Portfolio vs the S&P 500? If you can't answer that, I would hesitate to take control of your own destiny. Don't fall victim to recency bias.
I have two brokerage accounts in Schwab. The one managed by myself has 11.25% yearly return. Another one is Schwab Intelligent Portfolio which has 7.34% yearly return. Because of capital gain tax, I do not know how to get rid of this Intelligent Portfolio account.
There's no cap gains from moving from one account to another. Give them a call. Or you can just follow the procedure on the website for moving between accounts.
Schwab IP is good for beginners. Once you start rolling, get out and build your own investment portfolio. Instead of leaving your money idle in a bank account, Schwab IP would put your money to work. I admit that I am Schwab IP customer and I have seen good returns on my investment with excellent diversity across Schwab and non Schwab ETFs with 2.5%+ annual dividends. I M planning to exit it now in Jan 2023.
I put all of my retirement savings in Schwab “Intelligent” Portfolios in 2017. Since that time, the S&P 500 increased by 78%. The etfs in my portfolio increased by 0%. Perhaps I was stupid for not paying enough attention to where they were putting my money, but I knew nothing about investing and I thought I could trust them. I have taken my money out now, but I should have had a lot more! My portfolio actually had more money in emerging market stocks, which lost money, than in U.S. stocks. Most of the ETF’s were losers.
Are you making the argument that you should have invested all your money in the S&P 500 based on hindsight knowledge? The Schwab Intelligent Portfolio is allocated across global equities and bonds. A balance portfolio, by definition of being balanced, will underperform top performers (US large cap equity) and outperform underperformers (EM equity). The goal of a globally balanced portfolio is to reduce short term volatility while capturing long term growth, which this portfolio does. If you wanted to chase the top performing asset at any one moment, you should have employed a momentum strategy portfolio and have been prepared to incur heavy losses along the way. You were not psychologically prepared going in. You are the type of investor that is heavily influenced by recency bias (FOMO) and will tend to throw your money at concentrated assets that have already appreciated beyond their fundamental values. What you needed was to keep your money in the fund and used their Premium service ($30.month) to talk to a certified financial planner about expectations management and other psychological management techniques.
Minimize, save and invest that's the only proven way to financial independence. When you save and invest you're saving a day you do not have to work and don't need to apply any form of minimalism ever again, I'm successful today, thanks to this tick!! You can try it out: Good luck!!!
Minimize, save and invest that's the only proven way to financial independence. When you save and invest you're saving a day you do not have to work and don't need to apply any form of minimalism ever again, I'm successful today, thanks to this tick!! You can try it out: Good luck!!!
We received 4 lettters from Schwab this week. I thought they were year-end junk and I almost shredded them. Turns out each was a check; one for each robo account we had 2 years ago. More than $1,000 total. Thanks for explaining this so clearly.
If the client got the .5% on their cash they were promised, they really had nothing to complain about. Its hardly unusual that a bank uses cash deposits to do loans, its the basic way they make money.
I disagree, if it is my money it`s not theirs.
The entire system is a ponzi scheme though. Just because it’s institutionalized doesn’t make it right.
Yep! Every bank does that with people's checking and savings account money. Chase, BOA, Citi, and your local credit union.
@@akin242002 True but if you read the fine print of your agreement it states this, that is the reason for the fine.
If you watch the video he states this.
I'm very unhappy with the performance of my schwab managed account. What is a better alternative?
The better alternative is not not compare your portfolio returns to the recently best performing asset at any given time.
This is the exact reason I pulled my money out from their hands and now do my own. I'm still with Schwab, but handle my own investing. I got tired of seeing so much cash just sitting there not in the market, and I figured that was what they were doing with it. This was just over a year ago that I pulled it. Hopefully I will get a little bit of this :)
they also put the money is stupid etfs with high expense rations that just languished.
It probably would’ve benefited you in 2022! Lol
It wasn't a hidden fact they had a large allocation in cash. It was out in the open. I'm surprised the case was won against Schwab. I say this as someone with a Schwab account that refuses to use their robo-advisor.
Dustin, thank you for these short hit videos. I appreciate the time and effort you take to do this.
No 'admission of guilt'...so they must not have done anything wrong-...correct?? Wells Fargo must be proud of Schwab
If the bank promises you 0.5% and they give you 0.5%then you have nothing to complain about. That's none of your concern what they're doing with your money. This is what you signed up for.
You must be in finance?
Banker? Trader?
If Schwab claims to act in a fiduciary capacity on behalf of their customers then they need to act in that manner.
The world is a cesspool due to that attitude. If people were selfless and generous there would be more for everyone instead of more for one jerk.
@@SneekySecrets The amount Schwab is pocketing is equivalent to $75 per $10,000 invested on their average allocated portfolio. That's 7.5 basis points. A steal! Most investment managers charge 85 to 125 basis points. You will not find a better deal anywhere. Current sweep account rates (Aug 2023) are 4.75%. Schwab reinvests that cash to get 5.5% in corporate paper and T-bills. They pocket a 0.75% spread on just the cash portion of the portfolio, which if less than 10% cash, is going to be .075% (7.5 bp) or less. You don't think a business deserves to generate revenue or what?
What’s the intro music please… heard it in NOLA once and don’t know who the artist is. Thanks.
If the cash is insured (which it is), what is wrong with this? Nothing. If disclosure is common, then yes, they should have stated that. I think there is more to the fine unless not disclosing is a big no.
At this time I feel the fine print is vague in the Sweep Account area.
Wow it’s crazy that every bank does this what a goon! Who really thinks there money just sits in a safe!
It's 94% stocks and 6% cash
I predict that commissions will make a come back now that the establishment has returned to power. No more commission free trading on the horizon.
I was almost thinking about setting up an Intelligent Portfolio today. So glad I researched.
that's fine to me cause it's expected my big question is how was the returns on the stocks etc
No honor amongst thieves. If legal, still not just.
I elected my sweep and naturally assumed Schwab made money on it. I'm self directed which is the super intelligent option. Why pay somebody to make mistakes when I can make them myself for free? 🙂
Should my first question when searching for a private financial advisor be "Are you a fiduciary"?
I got approved my Scharles Schwab credit card 2021 and I almost convincing to use their AI for 5K, then I decide not to do it after I read so many reviews they’re not really making money that how they promised.
do you know if i'm able to take my self off the Intelligent Portfolio and amig it my self ?'
and this my friends is why I moved my dough to Dustin and Jazz. Straight forward talk and data-driven analysis.
Hell, I have 1. I'm a have to look into this. Anywhere I can find this information?
I have a Schwab IP and was not aware of this, though I thought this was "bus. as usual " with the big guys. My issue with them right now is that recently they've rebalanced my account and every time thus far have realized a loss. This has occurred a few times this year, I have always been under the impression that most of the time in "rebalancing" you would sell those positions that increased in value so much that it materially changed the original allocation and thus you would realize a gain. Spoke to someone from Schwab and they mentioned some "tax harboring" issue which frankly did not make sense to me, I got into this portfolio for preservation and growth not for tax planning. Do they know if I already have booked losses that I can apply for future gains. Any insight on this?
It's called "Tax loss harvesting". The rebalancing act is selling off ASSET CLASSES (not specific shares) that have disproportionately increased in market value and using the proceeds to buy underperforming assets. However, that actual SHARES of any specific asset class being sold are the ones you overpaid for in the past, which yes, realized a paper loss. That loss is used to reduce your tax burden on any dividends and interest paid throughout the year. It consequently lowers your cost basis which will theoretically increase taxable gains later in life, but at a time when most people are in a lower tax bracket. They are trying to help people.
How much do you guys charge to manage the portfolio ?
No answer. Nice. Certainly it's more than the spread Schwab keep from the sweep account.
I switched from Schwab to Vanguard to avoid fees and scams.
Schwab doesn't have scams outside of the robo-advisors. Even the robo-advisor cash allocation is well known.
It Does Feel different this time? Like it is All Happing at same time? I wanted to get out in Feb and March? My advisor said NO! Thanks Vickie! But now that we are down 30% mite as well ride the Bear? I expect it will go back up eventually?
I got the same scam talk. They went through gymnastics persuading me to keep the investments. Now I realize that their goal was to just keep making their commissions. I’m in the process of switching my money out of their clutches and doing my own investments.
@@evenbiggeral5089 To your own detriment. Investments are forward looking. What is the long term earnings expectation of the Schwab Intelligent Portfolio vs the S&P 500? If you can't answer that, I would hesitate to take control of your own destiny. Don't fall victim to recency bias.
I have two brokerage accounts in Schwab. The one managed by myself has 11.25% yearly return. Another one is Schwab Intelligent Portfolio which has 7.34% yearly return. Because of capital gain tax, I do not know how to get rid of this Intelligent Portfolio account.
There's no cap gains from moving from one account to another. Give them a call. Or you can just follow the procedure on the website for moving between accounts.
@@erniekeller1093 That is good to know. Thanks.
Schwab IP is good for beginners. Once you start rolling, get out and build your own investment portfolio. Instead of leaving your money idle in a bank account, Schwab IP would put your money to work. I admit that I am Schwab IP customer and I have seen good returns on my investment with excellent diversity across Schwab and non Schwab ETFs with 2.5%+ annual dividends. I M planning to exit it now in Jan 2023.
Why exit and to where? What part about the Schwab Intelligent Portfolio did you not like and want to change?
Nothing to see there.
Nice scam thanks Dustin
whhhatttt?
How did they get caught? Brilliant but dumb at the same time.
I put all of my retirement savings in Schwab “Intelligent” Portfolios in 2017. Since that time, the S&P 500 increased by 78%. The etfs in my portfolio increased by 0%. Perhaps I was stupid for not paying enough attention to where they were putting my money, but I knew nothing about investing and I thought I could trust them. I have taken my money out now, but I should have had a lot more! My portfolio actually had more money in emerging market stocks, which lost money, than in U.S. stocks. Most of the ETF’s were losers.
Are you making the argument that you should have invested all your money in the S&P 500 based on hindsight knowledge? The Schwab Intelligent Portfolio is allocated across global equities and bonds. A balance portfolio, by definition of being balanced, will underperform top performers (US large cap equity) and outperform underperformers (EM equity). The goal of a globally balanced portfolio is to reduce short term volatility while capturing long term growth, which this portfolio does. If you wanted to chase the top performing asset at any one moment, you should have employed a momentum strategy portfolio and have been prepared to incur heavy losses along the way. You were not psychologically prepared going in. You are the type of investor that is heavily influenced by recency bias (FOMO) and will tend to throw your money at concentrated assets that have already appreciated beyond their fundamental values. What you needed was to keep your money in the fund and used their Premium service ($30.month) to talk to a certified financial planner about expectations management and other psychological management techniques.
GET OUT OF SCHWAB. THEY CHEAT!
YOU WOULD NOT believe their games!
Minimize, save and invest that's the only proven way to financial independence. When you save and invest you're saving a day you do not have to work and don't need to apply any form of minimalism ever again, I'm successful today, thanks to this tick!! You can try it out: Good luck!!!
Minimize, save and invest that's the only proven way to financial independence. When you save and invest you're saving a day you do not have to work and don't need to apply any form of minimalism ever again, I'm successful today, thanks to this tick!! You can try it out: Good luck!!!