I have an investment account with an investment company and a separate 401k account from the company I worked for. And I have accounts with other banks and credit unions which I have managed on my own.
the advisor at the investment company always asks me to turn over part or all of my 401k to them. And at times suggested I move all my assets to this investment company. I transferred a modest amount maybe 10 years ago. This advisor keeps asking me to transfer more, saying others with same 401k have done that and are happy. Last time I met this advisor wanted to see the 401k statement.
I’m looking for a way to effectively end this conversation. Like is this type of conversation normal?
advisor annually asks me to turn over my 401k to their investment company.
byu/Alarming_AF_8075 inpersonalfinance
Posted by Alarming_AF_8075
30 Comments
Someone whose livelihood depends on siphoning a % of your money will always do what is in the best interest of themselves.
Make sense?
Like, a car salesperson, living off of commission, is going to recommend buying a car *completely regardless* of whether or not the car makes sense for you.
Follow me?
May I start the conversation with you by asking why it is you are maintaining this business relationship with this (likely salesperson) “advisor” if you are already wary of giving them more money?
No is a complete sentence.
You probably don’t even need an FA in the first place.
I didn’t even know you could do that. 401ks aren’t locked to the company you work for!? I would transfer mine immediately if I could.
Honestly, I would move everything out of the company that keeps pestering you. You can do all of your non 401 k management yourself at Vanguard, Fidelity, Schwab, etc. It is very likely the fees are too high with this company and you can do better.
I would ask your investment advisor what the benefit to moving your 401(k) is. Many 401(k)s do not allow in service transfers and you have to wait until you leave the company in order to transfer the funds to a IRA that your financial advisor would manage. So the whole discussion may be a moot point.
My concern with an advisor that is pushing you to move more assets to their purview is that they may be charging you excessive fees based off of the assets managed and that this recommendation may not be in your best interest. The nice thing is, you literally pay this person to be familiar with your finances and have 10 years of side by side data of their management vs your 401(k). Ask them to prove their case to you and demonstrate why this option is in your best interest not theirs (obviously you can do this in a less blunt way, but that is your end goal.)
There are some red flags here, and you are omitting details.
What is this “other investment” he is touting? Are they well-known OTC securities? Bonds? Have you seen a statement? Reassurance that “others … have done it and are happy” is entirely irrelevant.
This sounds a lot like the stories of people who trust advisors but then after ten years find out that they stole everything.
Pressuring you to put everything into his investment is not the type of conversation you should have. They should be asking you what you want to do, what your retirement goals are, what kind of risk appetite you have, what kind of retirement income you seek.
I would not even be able to sleep at night knowing this was happening. I would not just end the conversation; I would move everything out immediately.
Your “advisor” is actually a salesman, consider finding an actual advisor. They will charge by the hour instead of taking a percentage of your money. This assumes that you actually need an advisor, most people really don’t.
I’ve had almost the same experience, and yes — this kind of repeated pressure is pretty common with commission-based advisors, even if they present it as “just a suggestion.”
What helped me was getting very clear and direct. You don’t owe them explanations. Something like: “I’m not looking to consolidate or make changes to my 401k. Please stop bringing it up.” Repeat it if needed, without engaging in the comparison stories about “others did it.”
Also, I stopped sharing statements or full account details in meetings. Once they see numbers, the conversation tends to shift toward sales.
If you’re unsure, it can be worth checking whether they are acting as a fiduciary when giving advice — because the behavior you’re describing feels more like asset-gathering than neutral advising.
For me personally, I keep my 401k separate and only move things when I initiate it, not when it’s pushed on me.
“No” is a complete sentence.
Your advisor is a salesman. He will ask. You say no.
He is probably trying to get you to move it to a rollover IRA. There are some minor disadvantages to an IRA compared to a 401k as far as asset protection. Ask him to explain the disadvantages.
Roll over the money that he is managing to Vanguard, Fidelity, or Schwab, and DIY.
What are you getting out of the relationship as it stands? What is the advisor claiming they would do for your 401k that you are not already getting.
Just do what we did with our kids, after the 2nd or 3rd ask, you just go, “I need you to accept no and move on.” Then whatever they say, repeat the phrase like a broken record.
If you’re getting a company match it doesn’t make sense to give him the 401k. Even then there are certain rules around doing partial or full rollover from ERISA.
He sounds like he is associated with a firm call LPL. I would tell him point blank that you would like to interview other wealth managers from various companies. One thing that I found out is that the person who wants to manage your funds never show their portfolio. They are only interested in making money off your money. Companies like Fisher, LPL I read horror stories on some of their clients have lost a lot of their savings. My neighbor lost 100K in his account but they still receive their fees. If you can read. Learn to manage your own account
Just curious do you have whole life insurance with this advisor
Sure, send them this.
“We’ve had this conversation before and I don’t wish to continue repeating it. I won’t being transferring my 401K and I would appreciate if you respect that choice and not bring this up in the future.”
If they ask again, or if you’ve communicated it like this, and they continue to ask, then you should know that they don’t respect you. I wouldn’t do business with anyone that doesn’t respect me or my choices, even if they disagree.
Are you paying this person an hourly rate or are they getting some kind of commission?
Has the advisors portfolio outperformed your self directed assets? I doubt it, the only reason to have an advisor is if you can’t effectively or don’t want to manage it yourself. The main reason I see for getting an advisor is for tax strategy.
Most of these guys aren’t that good and don’t do proper research and get set in their ways. Many just use high cost ETFs, which you could find cheaper equivalents for yourself.
Just say your employer doesn’t allow inservice rollovers.
Is he asking to move your funds? Or to just manage the funds in your existing 401k account? I have an advisor who has offered to manage the funds in my 401k account, but this feels different
Ask him if they will lower their fees if you move money over.
Say no and get rid of the advisor or end the relationship all together. You sound like you do not need an advisor but are paying the management fees anyway.
Move all your assets out and self manager them yourself or use a different company if you need an advisor.
Just by them asking is all that should be required to not only say No, but no and I’m taking my money and business elsewhere. Run.
One possible answer and mine did this yesterday
The concern is what stock verses bond allocation you have
Option 1 is you can sometimes set it up that they can rebalance for you or (for a fee) I said no to that it represents about 3% of my holdings
Option 2 they suggest to you what percentage you should have and you must do this manually by your self they only give you that suggestion during the yearly client review meeting mine was simple 65% stock 35% bonds is my target
Maybe the guy does not think you would follow through on that and wants to insure compliance
Or he is a greedy pig
In theory, nothing wrong with doing a rollover IRA so your accounts are in one place. I have done that, but my “investment company” is Vanguard. Their advisor (which I get due to high holdings) doesn’t even know my personal situation outside Vanguard, and wouldn’t ask that. As a Rollover IRA in Vanguard, I can choose the mutual funds it holds just like my other accounts. Sounds like you have some investment company where you don’t pick your own holdings. I don’t know why, I wouldn’t do that, I bet they have high fees or something.
Doesn’t really sound like an “advisor.” What is their compensation model?
If they used the phrase, “others who did this have been happy,” to me, that is a HUGE red flag. That means, in their mind, the average person at first blush would refuse the offer and need convincing. Seems like the “advisor” has incentives which are orthogonal to your own investment goals.
Also, what, specifically, are they asking you to do? Change brokerage housing, or change actual investment strategy? Either is odd, but the former does seem to have some merit. The latter does not have much merit at all.
You are incapable of saying No? That’s the most effective and normal way to end the conversation.
I guess I would say: “You know, I’m tired of having this conversation. Perhaps I need to move the funds you are managing to another company that will respect my wishes. Is there someone you recommend?”
🤣
Tell them “no, not interested.” I had some money with an “advisor” years ago that kept trying to sell me whole life insurance. I kept saying no, but not in a direct way. I could have saved myself a lot of pitch time by just telling them I would never do it and if they kept asking, I’d move companies. Plenty of places are happy to take your money.
It’s a weird question to ask, honestly. I’ve never heard of an advisor asking to move an active 401k account. Former 401k, sure, but it me you’re still contributing to?