How I Chose My New Custodian

How I Chose My New Custodian

To recap, in mid-2008 my current custodian made a corporate decision to double its minimum requirement for assets under management. I was over the minimum at the time, that is, until they raised it. Being under the custodian's minimum was not the problem. Paying the $1,200 quarterly fee because of it was. To be clear, I don't harbor any ill feelings at all. In fact, I firmly believe that everything will work out for the best. If anything, this process has opened my eyes to what's available.

So I began my search. I contacted six or seven different custodians. One had a $25 million minimum, but the others had no such requirement. I viewed Web demos from five firms before narrowing it down to two. Then I went through another round of discussion with these two companies and made my decision. As it came down to the wire it became increasingly more difficult. The final two custodians were Shareholders Service Group and Trade PMR.

Trade PMR was initially recommended to me by someone whom I trust very much. Shareholders Service Group was recommended by several satisfied advisors who are also readers of this blog. To keep things straight, I created a spreadsheet with various metrics which I considered important. I included transaction fees, account fees, quality of their statements, and their technology platforms. How easy was it to place trades, deduct fees, and get research? I also considered their breadth of products. Here's what I discovered in a nutshell.

People who use Shareholders Service Grou, really love their service. I believe they would be a great firm to work with, but alas, I chose Trade PMR. Trade PMR has one the very best technology platforms I have seen. For instance, all you have to do with the fee deduction is set the account parameters and it's very easy from there. Flat fee or tiered? In advance or in arrears? Monthly or quarterly? Once these are set, you simply click a few buttons, it reads the ending account balance, and deducts the fee. Very, very simple. It will save much time and increase efficiency. There are several more advantages like this, but I'm out of room for now.

Several readers of this blog have asked about this issue. They wanted to know who I chose and why. If you're in this group just send me an e-mail or leave a comment here and I'll be happy to reply.

I hope you all enjoy your holiday season and thanks for reading!

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