Yes, most investors should switch from Edward Jones to Schwab because the fee difference can cost you hundreds of thousands of dollars over time. Edward Jones charges advisory fees starting at 1.35% annually on the first $250,000, plus fund expense ratios averaging 0.61%, plus hidden 12b-1 fees. In contrast, Schwab charges zero commissions on stocks and ETFs, offers commission-free trading, and provides robo-advisor services with no advisory fees for self-directed accounts.
The governing regulation creating this problem is SEC Regulation Best Interest and FINRA Rule 2111, which allow Edward Jones to operate under a suitability standard rather than a full fiduciary duty at the brokerage level. This means Edward Jones advisors only need to recommend investments that are “suitable” for you—not necessarily the best option for your financial situation. The immediate negative consequence is you pay substantially higher fees for products that may earn Edward Jones kickback commissions through 12b-1 fees while your returns get eaten alive.
According to recent data, Schwab users save an average of $1,500 per year compared to traditional brokers like Edward Jones. Over 30 years, that difference compounds dramatically.
What you’ll learn in this article:
đź’° Exact fee breakdowns showing how Edward Jones’ 1.35% fee plus fund expenses can cost you 25-40% of your retirement wealth
🔄 Step-by-step ACAT transfer process to move your money in 5-7 days without triggering taxes or losing investments
⚖️ Fiduciary duty differences explaining why Schwab advisors must put your interests first while Edward Jones operates under looser standards
đź“Š Real investor scenarios with concrete examples showing when switching saves money and when staying makes sense
🚨 Critical mistakes to avoid during the switch that could trigger taxes, penalties, or account delays
The Hidden Cost Structure At Edward Jones vs Schwab’s Transparent Pricing
Edward Jones uses a tiered fee structure that appears reasonable on the surface but compounds into massive wealth destruction over time. Understanding the exact mechanics of how these fees work reveals why switching matters.
Edward Jones Fee Breakdown: The Triple Tax On Your Money
Edward Jones charges fees in three separate layers that most investors don’t fully understand. The first layer is the advisory fee for Guided Solutions and Advisory Solutions accounts. This fee starts at 1.35% on your first $250,000 and decreases as your assets grow—1.30% on the next $250,000, then 1.20% on the next $500,000.
The second layer consists of underlying fund expenses. Edward Jones typically places clients in American Funds and other actively managed funds with expense ratios averaging 0.61% to 0.76% annually. These fees come directly out of the fund’s returns before you even see the performance numbers.
The third layer is the most insidious: front-end load fees and ongoing 12b-1 distribution fees. American Funds commonly carry front-end loads of 5.75% on Class A shares. Even if you’re in a fee-based advisory account, the 12b-1 fees still generate kickbacks to Edward Jones from the fund companies.
When you add these layers together, many Edward Jones clients pay total annual costs of 2.0% to 2.5%. One advisor who analyzed client transfers found the average Edward Jones client was paying 2.37% annually before switching.
Schwab’s Fee Structure: What You Actually Pay
Schwab’s pricing model operates on radical transparency with zero commissions on online stock and ETF trades. Options trades carry a $0.65 per-contract fee, which is industry standard. Mutual fund fees depend on whether the fund participates in Schwab’s Mutual Fund OneSource program.
For self-directed investors, Schwab charges no account fees, no annual fees, and no inactivity fees. Your only costs are the underlying expense ratios of the investments you choose. Schwab’s own ETFs have expense ratios averaging 0.03% to 0.16%.
For investors who want professional management, Schwab Intelligent Portfolios charges zero advisory fees for robo-advisor service with a $5,000 minimum. The average portfolio expense ratio is 0.12%. The Premium version costs a flat $30 monthly ($360 annually) plus a one-time $300 setup fee and requires $25,000 minimum.
For high-net-worth investors, Schwab Wealth Advisory charges up to 0.8% on managed accounts starting at $1 million. This is still significantly lower than Edward Jones’ starting rate of 1.35%.
The 30-Year Wealth Destruction Calculator
The compound effect of high fees destroys wealth in ways most investors never calculate. Consider two identical investors who each start with $100,000 and add $500 monthly for 30 years, earning 7% annual returns before fees.
Investor A stays with Edward Jones paying 2.0% total annual fees. After 30 years, their account grows to approximately $596,000. The fees consumed roughly $206,000 of potential wealth.
Investor B switches to Schwab paying 0.15% total annual fees. After 30 years, their account grows to approximately $782,000. That’s $186,000 more wealth—nearly 32% higher than staying at Edward Jones.
The Reddit user who documented their actual 10-year experience leaving Edward Jones found similar results. Starting with $41,305 in 2009, had they stayed in Edward Jones funds, they would have had approximately $97,074 by 2019. Instead, by switching to Fidelity’s FXAIX index fund, they actually had $136,219—saving approximately $39,000 over just one decade.
American Funds At Schwab: The Loophole Nobody Tells You
Many Edward Jones clients believe they must sell their American Funds positions to switch to Schwab, triggering capital gains taxes. This is false. American Funds now offers no-load share classes available commission-free on Schwab’s platform.
When you transfer American Funds from Edward Jones to Schwab, you have two choices. First, you can transfer the shares “in-kind” as is. Schwab will accept American Funds Class A shares and Class F shares through their system.
However, if you want to trade these funds later, Schwab may charge transaction fees on non-OneSource funds. Second, you can wait until the transfer completes, then sell the American Funds shares at Schwab and immediately reinvest in lower-cost alternatives. Since this happens within the same IRA or brokerage account type, you avoid triggering taxable events if done properly within retirement accounts.
The Fiduciary Duty Gap: Why Your Edward Jones Advisor Isn’t Legally Required To Put You First
The regulatory framework governing financial advisors creates a massive protection gap that costs investors billions annually. Most Edward Jones clients believe their advisor has a legal duty to act in their best interest. This belief is dangerously incorrect.
Suitability Standard vs Fiduciary Standard: The $100,000 Difference
Edward Jones operates as both a broker-dealer and investment advisor, depending on the product or service being offered. At the brokerage level, Edward Jones advisors follow FINRA’s suitability standard under Rule 2111. This standard requires recommendations to be “suitable” based on your financial situation, but doesn’t require the advisor to choose the best option.
A 2021 federal court case highlighted this distinction when Anderson v. Edward Jones examined whether Edward Jones violated fiduciary duties by pressuring advisors to move clients from commission-based to fee-based accounts without proper suitability analysis. The court found that Edward Jones’ alleged breach of fiduciary duties was not “in connection with the purchase or sale of a covered security.”
In contrast, fiduciary advisors registered with the SEC under the Investment Advisers Act of 1940 must legally put client interests ahead of their own. Schwab’s advisors in their advisory programs operate under this higher standard when providing investment advice. The practical difference means a fiduciary must recommend the lowest-cost option that meets your needs, while a suitability-standard advisor can recommend higher-cost products as long as they’re “suitable.”
Consider a real scenario. Both Edward Jones and Schwab offer S&P 500 exposure. Edward Jones might place you in American Funds Growth Fund of America (Class A) with a 0.67% expense ratio plus potential front-end loads. Schwab would likely recommend SWPPX (Schwab S&P 500 Index Fund) with a 0.02% expense ratio. Both are “suitable” investments for S&P 500 exposure, but one costs 33 times more annually in fees.
SEC Regulation Best Interest: The 2019 Compromise
In 2019, the SEC adopted Regulation Best Interest (Reg BI) to narrow the gap between suitability and fiduciary standards. Reg BI requires broker-dealers to act in clients’ “best interest” when making recommendations, which sounds strong but contains significant loopholes.
Reg BI still allows broker-dealers to earn commissions and sell proprietary products, as long as they disclose conflicts of interest. Edward Jones’ business model relies heavily on revenue-sharing agreements with mutual funds. In 2025, Edward Jones paid $17 million to settle state regulator investigations into overcharging certain customers for mutual fund sales fees when transitioning from brokerage to fee-based advisory accounts.
The settlement revealed gaps in Edward Jones’ supervisory process regarding customers who sold or moved mutual fund shares sooner than anticipated after paying front-load commissions. These customers essentially paid twice—once through the front-end load and again through advisory fees—without receiving appropriate refunds.
CFP and CFA Designations: The Fiduciary Loophole
Edward Jones advisors who hold CFP or CFA designations face an interesting conflict. Both the CFP Board and CFA Institute require their members to uphold fiduciary standards as part of their professional ethics code. In 2019, the CFP Board’s revised professional standards created tension with Edward Jones’ business model.
Nearly 2,000 CFP professionals at Edward Jones had to ask the CFP Board if they could continue using the CFP marks since the firm does not act as a fiduciary at the brokerage level. The CFP Board ultimately allowed Edward Jones advisors to keep their designations, creating a situation where the individual advisor may have a fiduciary duty through their professional designation, but the firm does not.
This creates confusion for clients. If your Edward Jones advisor has a CFP designation, they personally must follow fiduciary standards according to CFP Board rules. However, Edward Jones’ compliance systems, product offerings, and compensation structure still operate under the lower suitability standard.
What This Means For Your Investment Decisions
The fiduciary gap affects three critical areas: product selection, fee transparency, and conflict-of-interest management. Under the suitability standard, Edward Jones can offer a limited menu of investment products, often favoring proprietary options or those paying revenue-sharing.
Fee transparency suffers because advisors operating under suitability standards must only provide “reasonable” disclosure, not complete itemization of all costs. Many Edward Jones clients discover hidden fees only when preparing to transfer accounts or after requesting a detailed cost analysis.
Conflict-of-interest management differs fundamentally. Fiduciary advisors must avoid conflicts or disclose and mitigate them. Suitability-standard advisors can maintain conflicts as long as the recommendations remain “suitable.” Edward Jones advisors earn production bonuses for bringing in assets and may face pressure to recommend higher-fee products that generate more firm revenue.
The ACAT Transfer Process: Moving Your Money In 5-7 Days Without Triggering Taxes
Transferring your account from Edward Jones to Schwab uses the Automated Customer Account Transfer Service (ACAT), a regulated system designed to make switching brokers simple and tax-efficient. Understanding each step prevents delays and protects your investments during the transition.
Step 1: Open Your Schwab Account First (Same Account Type Required)
Before initiating any transfer, open the appropriate Schwab account that matches your Edward Jones account type exactly. If you have a Traditional IRA at Edward Jones, open a Traditional IRA at Schwab. Roth IRAs transfer to Roth IRAs, taxable brokerage accounts transfer to taxable brokerage accounts.
Account type mismatches cause rejection and delays. The ACAT system requires identical registration names. If your Edward Jones account is registered as “John Smith” but you try to transfer to “J. Smith” at Schwab, the system will reject it.
Opening a Schwab account online takes approximately 10-15 minutes. You’ll need your Social Security number, driver’s license, employment information, and bank account details for funding. Schwab requires no minimum deposit for accounts, though you’ll need $5,000 to use Schwab Intelligent Portfolios robo-advisor.
Step 2: Gather Your Edward Jones Account Documentation
Log into your Edward Jones account or retrieve your most recent statement (ideally less than 60 days old). You’ll need your exact account number, the full legal registration name, and a complete list of holdings with ticker symbols and share quantities.
Pay special attention to the account registration name. Minor variations in names are the most common reason for transfer rejections. If your account is registered with a middle initial, include it. If it’s registered without, don’t add it.
Document any pending transactions or unsettled trades. The ACAT system will reject transfers if you have trades that haven’t settled. Stock trades settle in two business days (T+2), while mutual funds can take longer depending on the fund company.
Step 3: Initiate The Transfer From Schwab (Pull, Don’t Push)
Never contact Edward Jones to push your account out. Instead, log into your Schwab account and initiate the transfer request to “pull” the account from Edward Jones. Schwab handles the ACAT paperwork and submits the request electronically.
In your Schwab account, navigate to “Transfers & Payments” then select “Transfer an Account.” Choose Edward Jones from the list of firms. You’ll enter your Edward Jones account details exactly as they appear on your statement. Schwab will ask you to choose between a full transfer (moving everything) or a partial transfer (moving selected positions).
Full transfers are cleaner and faster. Partial transfers require Edward Jones to split the account, which can add 2-3 extra business days to the process.
Step 4: Choose In-Kind or Liquidation Transfer
The “in-kind” transfer option moves your investments exactly as they are without selling anything. This is the preferred method for taxable accounts because it avoids triggering capital gains taxes. Your cost basis and holding period transfer with the securities.
Liquidation transfers sell everything at Edward Jones first, then transfer cash to Schwab. This option makes sense only when you hold investments that Schwab cannot accept or when you want to immediately reinvest in different securities. The downside is potential tax consequences in taxable accounts and temporary market exposure during the liquidation process.
Most standard securities transfer in-kind without issues. Publicly traded stocks, ETFs, bonds, and most mutual funds transfer smoothly. However, some proprietary Edward Jones products or non-traded securities may require liquidation before transfer.
Step 5: Upload Verification Documents If Requested
Schwab may request a copy of your Edward Jones statement to verify account ownership and holdings. Upload this document through Schwab’s secure portal or fax it to their transfer department. Clear, legible copies prevent processing delays.
Some transfers require a signature guarantee rather than simple notarization, especially for large accounts over $100,000. Signature guarantees can be obtained at most banks, credit unions, or brokerage firms. Schwab branches offer this service free to account holders.
Step 6: Wait 5-7 Business Days (Don’t Trade During Transfer)
The standard ACAT transfer timeline is 5-7 business days after submission, assuming all paperwork is correct and no complications arise. Complex transfers involving non-standard securities may take up to 10 business days.
Edward Jones has 1-3 business days to validate the transfer request after receiving it. They verify the account information matches their records and that the assets are eligible for transfer. If everything checks out, they approve and the transfer proceeds. If discrepancies exist, Edward Jones rejects the request with a reason code explaining the problem.
During the transfer period, avoid placing any trades in either the Edward Jones or Schwab account. Trading during an active ACAT transfer can cause rejections, delays, or securities to get stuck in limbo. Both firms typically restrict trading access on the transferring account automatically.
Step 7: Verify Positions and Cost Basis at Schwab
Once the transfer completes, log into Schwab and verify that all positions transferred correctly. Check share quantities, ticker symbols, and cash balances. Sometimes dividends or interest payments arrive a few days late if they were paid during the transfer window.
Cost basis data typically updates within 30 days of the transfer completion. Don’t panic if your Schwab account initially shows “cost basis not available” for transferred securities. The delivering firm has regulatory deadlines to send this information electronically.
If Edward Jones fails to provide cost basis data after 30 days, you may need to contact both firms to request manual submission. Keep your old Edward Jones statements showing original purchase dates and costs as backup documentation for tax purposes.
The $95 Edward Jones Exit Fee (And How Schwab May Reimburse It)
Edward Jones charges a termination fee of $95 for “total transfer or termination of an account.” This fee applies per account, not per household. If you have multiple accounts (Traditional IRA, Roth IRA, and taxable brokerage), you’ll pay $95 for each account transferred, totaling $285.
Some Edward Jones clients report being charged multiple $95 fees for what they considered one account with multiple “sub-accounts.” Edward Jones considers each registration type a separate account subject to its own exit fee. Additionally, Edward Jones may attempt to charge annual maintenance fees at account closure, even if you paid them recently.
Schwab frequently offers transfer bonus promotions to reimburse exit fees from other firms. Check Schwab’s current promotions page or ask your Schwab representative about fee reimbursement programs. These promotions typically require minimum account balances ($25,000 to $100,000 depending on the offer) and may require the account to stay at Schwab for a specified period.
Investment Options Compared: Edward Jones’ Limited Menu vs Schwab’s Open Architecture
The range of investment choices available fundamentally impacts your ability to build an optimal portfolio. Edward Jones operates a limited menu approach favoring specific fund families, while Schwab provides open architecture access to thousands of securities.
Edward Jones’ Preferred Provider Relationships
Edward Jones maintains revenue-sharing agreements with select mutual fund companies, creating financial incentives to recommend certain products. American Funds, in particular, appears frequently in Edward Jones portfolios because of favorable compensation arrangements.
These preferred provider relationships aren’t inherently illegal or unethical under the suitability standard. However, they create situations where your advisor may recommend American Funds Capital Income Builder (expense ratio 0.58%) when a lower-cost Schwab or Vanguard alternative accomplishes the same investment objective at 0.03% expense ratio.
Edward Jones’ Select Account operates on a commission-based structure where advisors earn sales charges ranging from 0.75% to 5.75% depending on investment type and amount. This compensation structure naturally steers recommendations toward products paying higher commissions.
Guided Solutions and Advisory Solutions accounts use fee-based structures that theoretically reduce conflict of interest. However, the underlying fund selection still tends toward higher-cost actively managed funds rather than low-cost index alternatives. Even in advisory accounts, Edward Jones typically doesn’t offer direct access to Vanguard funds or Fidelity index funds.
Schwab’s Open Architecture: Access To Everything
Schwab provides access to thousands of individual stocks, over 3,000 ETFs, more than 4,000 no-transaction-fee mutual funds, bonds, options, futures, and even fractional shares of S&P 500 stocks. This open architecture means you can build a portfolio using any strategy—active, passive, value, growth, or combinations.
Schwab’s Mutual Fund OneSource program includes funds from multiple families: Fidelity, T. Rowe Price, Dodge & Cox, and many others, in addition to Schwab’s own fund lineup. You can buy these funds with zero fees online. Funds outside OneSource carry a $49.95 to $74.95 transaction fee.
For ETF investors, Schwab offers commission-free trading on all ETFs purchased online. This includes competitor products like Vanguard ETFs (VTI, VOO, BND) and iShares ETFs (IVV, AGG, QQQ). You’re not locked into Schwab-branded products.
Options traders benefit from Schwab’s advanced platforms including thinkorswim, acquired through the TD Ameritrade merger. This platform offers sophisticated options analytics, strategy builders, and risk analysis tools that Edward Jones simply doesn’t provide.
Index Funds vs Actively Managed: The 96% Reality
Academic research and empirical data demonstrate that 96% of actively managed funds fail to beat their index benchmarks over 15-year periods after accounting for fees. Yet Edward Jones portfolios typically hold 80-100% actively managed funds.
Consider a typical Edward Jones portfolio containing American Funds Growth Fund of America (AGTHX) with a 0.67% expense ratio. Over the past 10 years, this fund has underperformed the S&P 500 index after fees. A Schwab client could instead invest in SWPPX (Schwab S&P 500 Index Fund) with a 0.02% expense ratio, capturing nearly the full market return.
The expense ratio difference of 0.65% annually compounds devastatingly over decades. On a $100,000 investment over 30 years earning 7% annually before fees, the high-cost fund grows to approximately $574,000 while the index fund grows to $661,000—a difference of $87,000 from expense ratios alone.
Alternative Investments and Expanded Asset Classes
Schwab provides access to alternative investment options that Edward Jones clients cannot easily access. These include individual bonds purchased on the secondary market, Treasury securities bought directly through TreasuryDirect integration, certificates of deposit from multiple banks, and even cryptocurrency exposure through Bitcoin and Ethereum futures (for qualified investors).
Edward Jones does offer some fixed-income products and CDs, but the selection is limited compared to Schwab’s bond trading platform. Schwab’s bond screener lets you search thousands of corporate, municipal, and government bonds by maturity date, credit rating, and yield.
For investors interested in socially responsible investing (SRI) or environmental, social, and governance (ESG) criteria, Schwab offers dozens of ESG-focused ETFs and mutual funds. Edward Jones has begun offering some ESG options but the selection remains narrower.
The Proprietary Product Trap
Edward Jones offers proprietary products including the Edward Jones Money Market Fund and certain private investments. These products cannot transfer to Schwab and must be liquidated before account transfer.
The Edward Jones Money Market Fund charges fees if your average monthly balance falls below thresholds ($2,500 for Investment Shares, $1,500 for Retirement Shares). In contrast, Schwab’s cash features typically earn competitive interest rates through their banking affiliate with no monthly fees.
Private investments and non-traded REITs occasionally appear in Edward Jones accounts, particularly for higher-net-worth clients. These illiquid investments create transfer complications because Schwab cannot accept them. You must either leave these positions at Edward Jones in a separate account or liquidate them (potentially triggering tax consequences and early redemption penalties).
Service Model Showdown: Full-Service Hand-Holding vs Self-Directed Freedom
The advisor relationship model fundamentally distinguishes Edward Jones from Schwab. Neither approach is universally “better”—the right choice depends on your financial knowledge, time availability, and desire for control.
Edward Jones: The Local Branch Advisor Model
Edward Jones operates approximately 15,000 branch offices across North America, typically located in suburban strip malls and small-town main streets. Each branch houses one financial advisor and support staff who build personal relationships with local clients.
This high-touch model appeals to investors who want face-to-face meetings, prefer phone calls to apps, and value having a dedicated person who knows their financial situation intimately. Edward Jones advisors typically call clients proactively for portfolio reviews and life event check-ins.
The firm scored highest in investor satisfaction in multiple J.D. Power satisfaction studies, particularly in the categories of trust, convenience, and problem resolution. Clients appreciate the personalized service and relationship continuity.
However, this model has significant drawbacks. You cannot execute trades online through Edward Jones—all transactions must go through your advisor. This creates delays and reduces your autonomy over timing. If you want to buy a stock that’s dropped significantly on Tuesday morning, you can’t act immediately; you must call your advisor and wait for execution.
Edward Jones advisors earn production bonuses and face pressure to grow assets under management. Internal meetings and training sessions reportedly emphasize moving clients into higher-fee advisory accounts. Some former Edward Jones clients report feeling pushed toward products that generated more firm revenue rather than serving their best interests.
Schwab: The Hybrid Model With Options For Everyone
Schwab operates multiple service tiers allowing you to choose your level of advisor interaction. At the most independent level, you can manage everything yourself through Schwab’s website and mobile app with no advisor contact at all.
Self-directed investors get powerful tools including real-time research from Morningstar and Zacks, customizable screeners for stocks and ETFs, advanced charting with technical indicators, and streaming market data. The thinkorswim platform provides institutional-grade analytics previously available only to professional traders.
For investors wanting some guidance, Schwab Intelligent Portfolios offers automated portfolio management with zero advisory fees. The robo-advisor asks questions about your goals, time horizon, and risk tolerance, then builds a diversified portfolio of ETFs. The system automatically rebalances and can provide tax-loss harvesting for accounts over $50,000.
Schwab Intelligent Portfolios Premium adds unlimited access to Certified Financial Planners for $30 monthly plus a $300 initial planning fee. These CFP professionals provide comprehensive financial planning advice covering retirement, tax strategies, estate planning, and insurance needs—not just investment management.
Accounts over $250,000 typically receive assignment to a Financial Consultant at Schwab who provides personalized service similar to Edward Jones but without the product restrictions. These consultants can help with complex transactions, retirement planning, and portfolio reviews while allowing you to retain online trading access.
For ultra-high-net-worth investors ($1 million+), Schwab Wealth Advisory offers dedicated advisor teams providing comprehensive wealth management services for fees up to 0.8% of assets—still significantly below Edward Jones’ 1.35% starting rate.
Technology Gap: 1990s vs 2020s Infrastructure
Edward Jones’ technology platform remains a frequent complaint among advisors leaving the firm. Clients cannot view real-time account balances, execute immediate trades, or access sophisticated planning tools through Edward Jones’ online portal.
The mobile app provides basic account viewing but lacks functionality compared to competitors. You cannot trade through the app, cannot set up automatic rebalancing, and cannot run scenarios testing different investment allocations. For tech-savvy investors under 50, this feels like using a flip phone in a smartphone world.
Schwab’s mobile app earned high rankings in J.D. Power’s digital experience studies. You can deposit checks by photo, transfer money instantly between accounts, trade securities with real-time quotes, and set up price alerts for stocks you’re watching.
The platform integrates comprehensive tools including retirement planning calculators, tax-loss harvesting reports, portfolio X-ray analysis showing asset allocation across all accounts, and education resources with articles, videos, and webcasts on investing topics.
Real Investor Scenarios: When Switching Makes Sense (And When It Doesn’t)
Different investor situations call for different solutions. Understanding where you fall on the spectrum helps you make the right choice for your specific circumstances.
Scenario 1: Young Accumulator With $75,000 Portfolio
Profile: Sarah is 32 years old, earns $85,000 annually, and has accumulated $75,000 in her Edward Jones IRA through consistent contributions over eight years. She has basic investment knowledge from reading personal finance blogs. She works full-time and doesn’t want to spend hours managing investments but feels comfortable with technology.
Current Edward Jones situation: Her account holds five American Funds in a Guided Solutions arrangement paying 1.35% annually ($1,012 per year) plus fund expense ratios averaging 0.65% ($488 per year). Total annual costs: $1,500.
Schwab alternative: She could transfer to Schwab Intelligent Portfolios, select a growth-oriented portfolio, and pay $0 advisory fees plus approximately 0.12% in underlying ETF expenses ($90 annually). Total annual costs: $90.
| Action | Consequence |
|---|---|
| Stay at Edward Jones for 30 years | Total fees paid approximately $132,000; final portfolio value around $485,000 |
| Switch to Schwab Intelligent Portfolios | Total fees paid approximately $18,000; final portfolio value around $612,000 |
Recommendation: Sarah should definitively switch to Schwab. The $127,000 difference over 30 years represents 20% of her final portfolio value. At her age and income level, she doesn’t need expensive active management. Index-based investing through Schwab’s robo-advisor provides appropriate diversification at a fraction of the cost.
Scenario 2: Pre-Retiree With $850,000 And Advisor Relationship
Profile: Michael is 58 years old with $850,000 saved for retirement between his IRA, Roth IRA, and taxable account. He meets quarterly with his Edward Jones advisor who he’s known for 15 years. His advisor helped him through the 2008 financial crisis when Michael nearly panic-sold everything. Michael values the personal relationship and doesn’t enjoy technology. He plans to retire at 65 and needs income planning guidance.
Current Edward Jones situation: Advisory Solutions account paying 1.20% on the first $500,000 and 1.00% on the next $350,000 = $9,500 annually plus fund expenses of approximately 0.60% = $5,100 annually. Total annual costs: $14,600.
Schwab alternative: Schwab Wealth Advisory would charge 0.80% on $850,000 = $6,800 annually plus ETF expenses of approximately 0.10% = $850 annually. Total annual costs: $7,650.
| Action | Consequence |
|---|---|
| Stay at Edward Jones until retirement | Pay approximately $102,200 in fees over 7 years |
| Switch to Schwab Wealth Advisory | Pay approximately $53,550 in fees over 7 years; save $48,650 |
Recommendation: Michael faces a nuanced decision. The fee difference of $48,650 over seven years is substantial. However, the value of his 15-year advisor relationship and his behavioral tendencies matter significantly.
If Michael’s Edward Jones advisor genuinely provides comprehensive retirement income planning, Social Security optimization strategies, and tax-efficient withdrawal sequencing, the higher fee might be justified if these services are worth $7,000 annually. However, if the advisor primarily manages investments and provides quarterly check-ins without sophisticated planning, Michael should switch to Schwab. A middle path exists: Michael could request a fee reduction from Edward Jones by threatening to leave.
Scenario 3: Active Trader With $125,000 Wanting More Control
Profile: Jennifer is 44, tech-savvy, reads financial news daily, and wants to actively manage a portion of her portfolio. She’s frustrated that Edward Jones won’t let her execute trades online. She wants to trade individual stocks, use options for income strategies, and rebalance her portfolio without calling an advisor.
Current Edward Jones situation: Select Account paying commissions of 2.5% per trade on stocks plus transaction fees on mutual funds. She trades approximately 4 times per quarter, costing her roughly $3,125 annually in commissions alone (assuming $31,250 traded per transaction).
Schwab alternative: Self-directed brokerage with $0 stock and ETF commissions. Options trades at $0.65 per contract. She could trade as frequently as desired without paying transaction fees.
| Action | Consequence |
|---|---|
| Stay at Edward Jones | Continue paying $3,000+ annually in commissions; lack trading flexibility |
| Switch to Schwab self-directed | Pay $0 in stock commissions; gain complete trading autonomy and advanced tools |
Recommendation: Jennifer should immediately switch to Schwab. Active traders and investors wanting control receive no benefit from Edward Jones’ restrictions. The commission savings alone justify the switch, and she gains access to better technology, research tools, and options strategies that Edward Jones cannot provide.
Scenario 4: Retired Couple With $1.4 Million Needing Tax Planning
Profile: Robert and Linda are 68 and 66 respectively with $1.4 million across Traditional IRAs, Roth IRAs, and taxable accounts. They need complex tax planning including qualified charitable distributions, Roth conversion strategies, minimizing Medicare IRMAA surcharges, and coordinating Social Security claiming strategies. Their Edward Jones advisor primarily focuses on investment selection but outsources tax planning to their CPA.
Current Edward Jones situation: Advisory Solutions paying 1.00% on first $1 million and 0.80% on next $400,000 = $13,200 annually plus fund expenses of 0.60% = $8,400 annually. Total annual costs: $21,600. They pay their CPA separately $2,500 annually for tax preparation and planning.
Schwab alternative: Schwab Wealth Advisory at 0.80% on $1.4 million = $11,200 annually plus ETF expenses of 0.10% = $1,400 annually. Total annual costs: $12,600. They could work with a fee-only NAPFA advisor for comprehensive tax planning at approximately $5,000 for an initial plan and $2,000 annually for updates.
| Action | Consequence |
|---|---|
| Stay at Edward Jones | Pay $24,100 annually in total fees ($21,600 to EJ + $2,500 to CPA) |
| Switch to Schwab plus fee-only planner | Pay $14,600 annually after initial year ($12,600 to Schwab + $2,000 planning) |
Recommendation: Robert and Linda should switch to Schwab but add specialized tax planning. The fee savings of $9,500 annually more than covers hiring a qualified fee-only CFP who specializes in retirement tax strategies. They get better investment costs plus superior tax planning expertise.
This scenario illustrates an important principle: Edward Jones advisors typically provide generalist advice but aren’t tax specialists, estate planning attorneys, or insurance experts. For complex situations, you often get better results by unbundling services—using Schwab for low-cost investing and hiring specialists for specific planning needs.
Scenario 5: Inheritance Recipient With $300,000 And Zero Investment Knowledge
Profile: David just inherited $300,000 from his late father. He’s 52, works as a teacher, has never invested before, feels overwhelmed by financial decisions, and is terrified of making mistakes. He needs someone to explain everything in simple terms and guide him through initial investment setup.
Current situation: The inheritance is in cash. David must decide where to invest it for retirement in 13 years.
Edward Jones option: Open an advisory account, meet with a local advisor who explains options in person, pay 1.35% initially (decreasing as assets grow). The advisor handles everything while David learns gradually. Total annual costs on $300,000: $4,050 plus fund expenses.
Schwab option: Open Schwab Intelligent Portfolios Premium, pay $30 monthly ($360 annually) plus one-time $300 setup fee. Get unlimited access to CFP professionals via phone or video. Total annual costs: $660 (or $960 in year one) plus minimal ETF expenses.
| Action | Consequence |
|---|---|
| Use Edward Jones for 3 years, then switch | Pay $12,150 in advisory fees over 3 years; receive in-person guidance and education |
| Start with Schwab Intelligent Portfolios Premium | Pay $2,280 in fees over 3 years; receive remote CFP guidance; save $9,870 |
Recommendation: This scenario has the most personal variation. For David, the question isn’t purely mathematical—it’s psychological and educational. If he strongly prefers face-to-face meetings and the physical presence of a local branch provides peace of mind, Edward Jones might be worth paying for temporarily.
However, I recommend a hybrid approach: David could use Edward Jones for the first year only while he learns investing basics ($4,050 cost). During that year, he should read personal finance books, take online investing courses, and build confidence. In year two, transfer to Schwab Intelligent Portfolios Premium, saving $3,690 annually thereafter. Alternatively, David could work with a fee-only advisor for a one-time comprehensive plan ($2,000-$4,000), then implement that plan himself at Schwab with ongoing robo-advisor management.
Mistakes To Avoid: The Seven Costly Errors When Switching Brokers
Transferring accounts appears straightforward but contains numerous pitfalls that can trigger taxes, generate penalties, or leave your money in limbo. Understanding these mistakes protects your wealth during the transition.
Mistake 1: Selling Investments Before Transfer (Triggering Unnecessary Taxes)
The most expensive mistake is liquidating your Edward Jones portfolio to cash, withdrawing it, then depositing the cash at Schwab. This “cash out and restart” approach triggers immediate capital gains taxes on all appreciated positions in taxable accounts.
Consider an investor with $200,000 in a taxable account at Edward Jones. If $80,000 represents cost basis and $120,000 represents gains, selling everything triggers capital gains tax on the $120,000 gain. At a 15% long-term capital gains rate, that’s $18,000 in unnecessary taxes.
The correct approach is transferring securities “in-kind” through ACAT without selling. Your stocks, ETFs, and mutual funds move to Schwab with their original cost basis and purchase dates intact. No taxable event occurs. You can then decide which positions to sell and when, maintaining control over the timing of tax consequences.
Mistake 2: Initiating Transfer During A Trading Hold Or Restriction Period
Edward Jones (and all brokers) place temporary holds on accounts for specific reasons: recent deposits that haven’t cleared, unsettled trades, pending corporate actions (mergers, splits, dividends), or compliance reviews. If you initiate an ACAT transfer while any restriction exists, the request gets rejected.
These rejections add 5-10 business days to your timeline because the system must restart from the beginning after you resolve the issue. The most common culprits are unsettled mutual fund trades (which can take 2-3 business days to settle) and pending dividend payments scheduled within three days of the transfer request.
Before initiating your transfer, call Edward Jones and ask if any holds, restrictions, or pending transactions affect your account. Wait for everything to clear completely before submitting the ACAT paperwork to Schwab.
Mistake 3: Mismatching Account Types Or Registration Names
The ACAT system requires exact matches between the delivering firm (Edward Jones) and receiving firm (Schwab) regarding account type and registration name. Transferring a Traditional IRA to a Roth IRA gets rejected immediately because they’re different account types.
Registration name variations cause frequent rejections. If your Edward Jones account is registered as “John A. Smith” but you open your Schwab account as “John Smith” (without the middle initial), the system rejects it. Similarly, joint accounts must match exactly—”John Smith and Mary Smith” is different from “John Smith or Mary Smith” legally.
Verify your exact registration name by looking at your most recent Edward Jones statement. Use that exact name when opening your Schwab account, including middle initials, suffixes (Jr., Sr., III), and conjunction words (and, or) for joint accounts.
Mistake 4: Trading During The Active Transfer Window
Once your ACAT transfer begins processing, both Edward Jones and Schwab typically restrict trading activity on the accounts involved. If you attempt to trade anyway—perhaps calling your Edward Jones advisor to sell a position—you create complications that can delay or cancel the entire transfer.
The practical consequence is your money sits “frozen” for 5-7 business days during the transfer. If you’re concerned about market volatility during this period, consider these strategies.
First, time your transfer strategically. Avoid transferring immediately before major economic announcements (Federal Reserve meetings, employment reports, earnings season for stocks you own). Transfer during relatively calm market periods if possible. Second, maintain some liquid assets outside the transfer. If you have $300,000 at Edward Jones, consider transferring $250,000 while keeping $50,000 accessible in a money market fund or cash at Schwab.
Mistake 5: Failing To Update Beneficiary Designations At The New Firm
When accounts transfer to Schwab, beneficiary designations usually transfer electronically, but not always. Some firms don’t send beneficiary data through ACAT, requiring you to manually re-enter beneficiaries at the receiving firm.
The catastrophic consequence of neglecting this is probate. If you die without proper beneficiary designations on retirement accounts, those accounts go through your estate instead of passing directly to heirs. This creates months of delays, legal fees, and potential creditor claims that beneficiary designations would have avoided.
Immediately after your transfer completes, log into your Schwab account and verify beneficiary designations on all retirement accounts (IRAs, Roth IRAs, inherited IRAs). Update or add beneficiaries if needed. This takes five minutes and could save your heirs tens of thousands in legal costs.
Mistake 6: Ignoring The 60-Day Indirect Rollover Rule
If you receive a check made payable to you from Edward Jones (rather than “Charles Schwab FBO Your Name”), you’ve triggered an indirect rollover subject to strict 60-day rules. You must deposit that check into an IRA at Schwab within 60 calendar days or the entire amount becomes taxable income plus potential early withdrawal penalties if you’re under 59½.
Edward Jones may withhold 20% for federal taxes on indirect rollovers from employer plans. If they send you a $100,000 check but withhold $20,000, you only receive $80,000. To avoid taxes, you must deposit the entire $100,000 into your Schwab IRA—meaning you must come up with the $20,000 they withheld from your own funds. You’ll get that $20,000 back as a tax refund when you file your return, but you need liquidity to bridge the gap.
The solution is always requesting a direct rollover where Edward Jones sends the check directly to Schwab made payable to “Charles Schwab & Co., Inc., FBO [Your Name].” This bypasses the withholding and 60-day rule entirely.
Mistake 7: Forgetting About Required Minimum Distributions (RMDs) During Transfer Year
If you’re age 73 or older (or 75 if born in 1960 or later), you must take Required Minimum Distributions from IRAs annually. The RMD deadline is December 31 each year. If you transfer your IRA from Edward Jones to Schwab during a year when an RMD is due, you must take that RMD before the transfer or immediately after—but you cannot skip it.
The penalty for missing an RMD is 25% of the amount you should have withdrawn (reduced to 10% if corrected within two years). On a $15,000 RMD, that’s a $3,750 penalty plus you still owe income tax on the distribution.
Track your RMD obligations carefully during transfer years. Many investors initiate January transfers to get it done early in the year, then take their RMD from the Schwab account later in the year. Alternatively, take your RMD from Edward Jones in January before initiating the transfer in February.
Dos And Don’ts: Quick Reference Guide For Your Decision
Dos
Do calculate your total all-in fees at Edward Jones including advisory fees, fund expense ratios, and any 12b-1 fees. Most Edward Jones clients underestimate their true costs by 50-100% because they focus only on the advertised advisory fee.
Do request a “Summary of Cost” report from your Edward Jones advisor showing fees charged over the past year. Advisors must provide this disclosure upon request. Compare this to what you’d pay at Schwab for similar services.
Do open your Schwab account first before initiating any transfer. This ensures proper account setup and lets Schwab guide the ACAT process smoothly.
Do verify cost basis transfers within 30 days of account transfer completion. Contact both firms if cost basis data doesn’t appear in your Schwab account after the deadline.
Do keep paper copies of your final Edward Jones statements showing positions, cost basis, and account values immediately before transfer. This documentation protects you if disputes arise.
Do check for Schwab transfer bonuses or fee reimbursement programs before moving your account. Schwab frequently offers $100-$600 bonuses for accounts meeting minimum balance requirements.
Do update beneficiary designations on all retirement accounts at Schwab immediately after transfer completion. Never assume beneficiaries transferred correctly.
Do time your transfer strategically avoiding late December (complicates tax reporting), periods when you expect large dividend payments, and within two weeks of options expiration dates if you hold options.
Do maintain an emergency fund outside your investment accounts during the transfer. Your money will be inaccessible for 5-7 business days.
Don’ts
Don’t cash out investments to transfer them. Always use in-kind ACAT transfers to avoid triggering unnecessary capital gains taxes.
Don’t assume your Edward Jones advisor will help with the transfer process. Most advisors strongly discourage leaving and some may try to delay or complicate the process.
Don’t initiate transfers if you have unsettled trades, pending deposits, or holds on your Edward Jones account. These cause rejections and delays.
Don’t trade in either account once the ACAT transfer begins. Trading during active transfers creates complications and can cause the transfer to fail.
Don’t expect to transfer proprietary Edward Jones products like the Edward Jones Money Market Fund or non-traded securities. These must be liquidated before transfer.
Don’t forget about the $95 exit fee per account at Edward Jones. Budget for this cost or ask Schwab about reimbursement programs.
Don’t mix account types during transfer. Transfer Traditional IRAs to Traditional IRAs and Roth IRAs to Roth IRAs—never cross-transfer different account types.
Don’t miss RMD obligations during the transfer year if you’re over age 73. Take required distributions before initiating the transfer or immediately after completion.
Don’t rely on verbal promises from Edward Jones regarding fee reductions or service improvements to convince you to stay. Get any proposed changes in writing before deciding.
Don’t ignore the relationship value if your Edward Jones advisor provides genuine comprehensive planning beyond investment management. Sometimes personalized service justifies modestly higher fees.
Pros And Cons: Comprehensive Comparison
| Edward Jones Pros | Edward Jones Cons |
|---|---|
| Some advisors offer discounts for large accounts or long-term clients; fees decrease as assets grow above $1 million | Starting advisory fee of 1.35% on first $250,000; fund expense ratios average 0.61%; front-end loads up to 5.75% on some funds; total costs often exceed 2% annually |
| Dedicated local advisor who knows you personally; face-to-face meetings at convenient branch locations; proactive phone calls and relationship continuity over decades | Cannot switch advisors easily without transferring entire account; advisor quality varies significantly by individual; if advisor leaves, you’re reassigned to replacement |
| Simple, curated selection prevents decision paralysis; advisor pre-screens options for suitability | Extremely limited menu heavily weighted toward American Funds; lack of index fund options; no access to low-cost Vanguard or Fidelity funds in most accounts; advisor may steer toward higher-commission products |
| Simple interface may suit older investors uncomfortable with complex platforms; personal advisor handles technical aspects | Cannot trade online or through mobile app; antiquated platform lacks real-time data; no automated rebalancing or tax-loss harvesting; advisors sometimes slow to execute time-sensitive trades |
| Ranked #1 in J.D. Power investor satisfaction multiple years; highest scores in trust, convenience, and problem resolution; strong culture of client service | Service quality depends entirely on your specific advisor; some clients report pushy sales tactics or inadequate planning beyond investments |
| Schwab Pros | Schwab Cons |
|---|---|
| $0 commissions on stocks and ETFs; Schwab Intelligent Portfolios charges no advisory fees; transparent pricing with no hidden 12b-1 fees; Wealth Advisory fees max at 0.8% for $1M+ accounts | Intelligent Portfolios holds 6-8% cash allocation which slightly reduces returns; some mutual funds charge transaction fees if not in OneSource program |
| Multiple service tiers let you choose your level of advisor interaction; access to CFP professionals through Intelligent Portfolios Premium for $30 monthly; accounts over $250K get dedicated Financial Consultant | No guaranteed local advisor unless you specifically seek branch-based service; phone/video consultations may feel less personal than in-person meetings |
| Access to thousands of stocks, 3,000+ ETFs, 4,000+ no-transaction-fee mutual funds; open architecture lets you invest in any public security; includes Vanguard, Fidelity, and competitor funds | Overwhelming choices for beginners; requires more investor education and decision-making; easy to make allocation mistakes without guidance |
| Industry-leading mobile app and website; thinkorswim platform for advanced traders; automated rebalancing and tax-loss harvesting; real-time data and research from Morningstar, Zacks, Schwab Equity Research | Learning curve for advanced features; so many tools that beginners may feel overwhelmed; thinkorswim specifically requires time investment to master |
| Multiple service channels including 24/7 phone support, chat, email, and in-person branch visits at 300+ locations; generally responsive customer service | Not ranked quite as high as Edward Jones in some satisfaction studies; may require more self-service for basic questions |
| Full fiduciary duty when providing advisory services; transparent fee structure reduces conflicts; open architecture eliminates product bias | In self-directed accounts, you receive no fiduciary advice at all—you’re fully responsible for your own decisions |
When You Should Stay With Edward Jones (Yes, This Exists)
Despite the fee disadvantages, specific circumstances justify remaining with Edward Jones rather than switching to Schwab. Understanding these scenarios prevents making a change you’ll regret.
You’re Over 70 With Limited Tech Comfort And Value In-Person Meetings
Older investors who strongly prefer face-to-face meetings at a local branch may find Edward Jones worth the premium. If technology frustrates you, if you’ve never used a smartphone app, and if the thought of managing investments through a computer screen causes anxiety, the higher fees might be acceptable.
The key question is value received per dollar paid. If your Edward Jones advisor provides comprehensive retirement income planning, coordinates with your CPA and estate attorney, proactively calls you about portfolio reviews, and has successfully guided you through market volatility without panic-selling, that relationship has tangible worth.
Calculate whether the premium is reasonable. If Edward Jones charges you $8,000 annually and Schwab would cost $2,000, you’re paying a $6,000 premium for the personalized service. Does your advisor provide $6,000 worth of value? Some do; most don’t.
Your Edward Jones Advisor Truly Provides Comprehensive Financial Planning
The Morningstar study on why people fire advisors found that clients value quality of advice and relationship more than purely investment returns. If your Edward Jones advisor goes beyond investment selection to provide estate planning coordination, insurance needs analysis, education funding strategies, business succession planning, and tax-efficient withdrawal sequencing, that comprehensive planning justifies higher fees.
However, most Edward Jones advisors focus primarily on investment product selection rather than holistic planning. They defer tax questions to your CPA and estate questions to your attorney. If your advisor says “ask your CPA” whenever you pose tax strategy questions, that’s a red flag indicating you’re not receiving comprehensive planning.
Perform an honest assessment: In the past year, has your Edward Jones advisor done any of the following: analyzed whether Roth conversions make sense for your situation; calculated the optimal age to claim Social Security; reviewed your estate documents and beneficiary designations for alignment with your goals; analyzed whether your current insurance coverage is adequate; created a written financial plan with specific action steps? If the answer is no to most of these, you’re paying for investment selection only—a service Schwab provides better and cheaper.
You’re Mid-Transfer Process To Edward Jones From Another Firm
If you recently moved your accounts to Edward Jones (within the past six months), you may have paid front-load fees on mutual fund purchases or account setup costs. Immediately transferring again means those costs were wasted.
In this scenario, consider waiting 6-12 months before switching to Schwab unless the fee drain is so severe that immediate action is warranted. Use the waiting period to research Schwab’s offerings, open a new account there, and plan your transition carefully.
You Own Highly Appreciated Low-Cost-Basis Positions In A Taxable Account
This scenario is rare at Edward Jones, but if you do hold individual stocks with enormous unrealized gains in a taxable account, the capital gains tax upon selling may exceed the fee savings from switching, at least in the short term. For example, imagine you own $500,000 of Microsoft stock with a $50,000 cost basis ($450,000 in gains). Selling triggers $67,500 in capital gains tax at 15% rates. If Edward Jones costs you $8,000 annually more than Schwab, you’d need 8+ years for the fee savings to overcome the tax hit.
However, this argument only applies if you plan to sell immediately. You can transfer the appreciated stock in-kind to Schwab through ACAT without triggering taxes, then hold it at Schwab indefinitely. The transfer itself is tax-free. You only pay capital gains tax when you eventually sell, and you can control that timing.
Your Estate Is In Active Probate Or Trust Administration
If you’re a beneficiary or executor dealing with a deceased person’s Edward Jones accounts currently in probate or trust administration, don’t initiate transfers until the legal process completes. Estate accounts have special rules, restrictions, and paperwork requirements that complicate transfers.
Wait until the estate closes and assets distribute to beneficiaries. Then transfer the inherited IRA or taxable account from Edward Jones to Schwab following normal ACAT procedures.
FAQs
Can I transfer my Edward Jones account to Schwab without selling my investments?
Yes. Use an ACAT in-kind transfer to move stocks, ETFs, and most mutual funds to Schwab without selling. This avoids triggering capital gains taxes in taxable accounts.
How long does transferring from Edward Jones to Schwab take?
5-7 business days. The ACAT system typically completes standard transfers within one week. Complex transfers involving non-standard securities may take up to 10 business days after validation.
Will I pay taxes when transferring my IRA from Edward Jones to Schwab?
No. Direct transfers between same-type retirement accounts trigger no taxes. Transfer Traditional IRAs to Traditional IRAs and Roth IRAs to Roth IRAs to avoid taxable events.
Does Schwab charge fees to open an account?
No. Schwab charges $0 to open standard brokerage accounts, IRAs, and Roth IRAs. There are no account minimums for basic accounts, no annual fees, and no inactivity fees.
What is Schwab Intelligent Portfolios and how much does it cost?
No advisory fee. Schwab’s robo-advisor charges $0 management fees with a $5,000 minimum. You pay only underlying ETF expense ratios averaging 0.12%. Premium version costs $30 monthly plus one-time $300 planning fee.
Will Edward Jones charge me a fee to close my account?
Yes. Edward Jones charges $95 per account for total transfer or termination. If you have multiple accounts (Traditional IRA, Roth IRA, taxable brokerage), you pay $95 for each account.
Can I keep my American Funds at Schwab?
Yes. American Funds shares transfer to Schwab through ACAT. However, trading them later may incur transaction fees if they’re not in Schwab’s Mutual Fund OneSource program. Consider converting to lower-cost alternatives.
Is Edward Jones a fiduciary?
No. Edward Jones operates under the suitability standard at the brokerage level, not full fiduciary duty. However, Edward Jones advisors with CFP or CFA designations follow fiduciary standards through their professional organizations.
What happens to my Edward Jones advisor when I transfer to Schwab?
Nothing. Your Edward Jones advisor retains their position at the firm. You simply close your account with them. Edward Jones typically assigns your former account to another advisor for management.
Can I transfer just part of my Edward Jones account to Schwab?
Yes. Partial ACAT transfers move selected positions while leaving others at Edward Jones. However, full transfers complete faster and avoid complications of maintaining accounts at both firms.
Will Schwab reimburse the Edward Jones exit fee?
Sometimes. Schwab offers periodic transfer promotions that may reimburse exit fees for accounts meeting minimum balance requirements. Check Schwab’s current offers or ask when opening your account.
How do I avoid paying the 20% withholding when rolling over a 401(k)?
Request direct rollover. Instruct your 401(k) administrator to send funds directly to Schwab made payable to “Charles Schwab FBO Your Name.” This avoids mandatory 20% withholding and 60-day rules.
Do I need to tell my Edward Jones advisor I’m leaving?
No. You don’t need Edward Jones’ permission to transfer. Schwab initiates the ACAT request and handles communications with Edward Jones. However, courtesy dictates informing your advisor about your decision.
What if some investments at Edward Jones can’t transfer to Schwab?
Liquidate first. Non-transferable securities like proprietary Edward Jones products must be sold before initiating the ACAT transfer. Schwab will identify these during the transfer setup process.
Can I transfer my Edward Jones account to Schwab myself or do I need help?
You can do it yourself. The ACAT transfer process through Schwab’s website is straightforward. Schwab’s transfer specialists are available by phone if you need guidance.
Will my cost basis transfer from Edward Jones to Schwab?
Yes. Edward Jones must send cost basis data electronically within 30 days of transfer completion. If it doesn’t appear at Schwab after this deadline, contact both firms to request manual submission.
Should I transfer my Roth IRA and Traditional IRA separately?
Yes. Transfer each retirement account type to its matching account type at Schwab. Roth IRAs go to Roth IRAs and Traditional IRAs go to Traditional IRAs to avoid tax complications.
Can I trade while my Edward Jones account is transferring to Schwab?
No. Both firms restrict trading during active ACAT transfers. Your investments are frozen for 5-7 business days during the process to prevent complications and ensure accurate position transfer.
What if I change my mind after starting the transfer?
Contact Schwab immediately. You may be able to cancel the ACAT request if it hasn’t completed validation. Once the transfer reaches certain processing stages, cancellation becomes impossible.
Does Schwab offer in-person advisor meetings like Edward Jones?
Yes. Schwab operates over 300 branch locations offering in-person consultations. Accounts over $250,000 typically receive dedicated Financial Consultant access. However, availability varies by location compared to Edward Jones’ extensive branch network.
Related reading
- Are Edward Jones Fees High? (w/Examples) + FAQs
- Is Schwab Actually Better Than Edward Jones? (w/Examples) + FAQs
- Are Schwab Index Funds Good? (w/Examples) + FAQs
- Should I Switch From Edward Jones to Vanguard? (w/Examples) + FAQs
- Should I Switch From Edward Jones to Fidelity? (w/Examples) + FAQs
- Should I Switch From Edward Jones to J.P. Morgan? (w/Examples) + FAQs
- Are UBS Advisors Actually Better Than Fidelity? (w/Examples) + FAQs