Some advisors are shifting all of their clients’ assets to another custodian, while others are spreading new and existing dollars among a variety of firms. Each of these methods is designed to achieve the same goal: to avoid being handcuffed to one firm’s service offerings.
Tom Gryzmala, president of Alexandria Financial Associates in Alexandria, Virginia, is transferring all his 165 clients and their $80 million in assets from Schwab to Waterhouse. He’s become disenchanted with Schwab’s new service model because it targets clients that he’s trying to serve. But it’s not just disappointment that’s prompting the switch; Gryzmala likes Waterhouse’s service attitude, technology, and lower prices. He’s particularly impressed with Waterhouse’s VEO platform, which provides trading, “superior” research offerings from Goldman Sachs, market overviews, and a range of mutual fund offerings. Waterhouse’s prices are cheaper too. “Stock trades cost $15 [at Waterhouse] as opposed to $29.95 at Schwab,” he says. Gryzmala is also anticipating the rollout of Waterhouse’s 401(k) relationship with Financial Engines.
What about the headache of shifting custodians? Gryzmala says that’s not an issue because Waterhouse handles all the details. Tom Bradley, president of TD Waterhouse Institutional, says the firm has employees whose only job is to “live and breathe moving assets from another broker into Waterhouse.”