FGRXX vs AFAXX

[TysonCook]

Hello,
My fin advisor wants me to go through his co and use AFAXX for my short term investments/MMA...while I have no problem with that, my other accounts are with Fidelity, and they recommend their FGRXX fund for short term/MMA.

While I don't really have a strong preference, I'd rather keep my accounts all in one place if possible (i'm getting overloaded on paperwork and websites)...

Anyone have experience with AFAXX or FGRXX for a short term MMA? I already have a fidelity, BOA, Wachovia, and student loan accounts...seriously how many does one need?

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[southerndoc]

Hopefully your financial advisor is not making a commission off your purchases.

 

[TysonCook]

I'm sure there is a small one, which I'm not a big fan of...I guess that is how they make $. Relly great group and all of the meetings have been "free" (yes, I understand the costs)...just was wondering if anyone uses either for a MMF, or any others for that matter?

 

[southerndoc]

Which financial advisor are you using? Mine takes a percentage of my overall portfolio (0.5%). They have to make money somehow, but I feel like by taking a percentage of my portfolio, they have more incentives to increase my wealth instead of selling me something regardless of its performance history/potential.

 

[Histiocytosis X]

Fellow MD here who has invested with Fidelity for years (I don't own shares in either fund discussed). Considering FGRXX has a lower expense ratio AND is otherwise free for you to invest in why would you consider moving your money? Money market accounts should have similar performanc because they make money by lending your money out. To get significant returns they would have to invest in riskier assets which, as we have seen recently, can be dangerous. It's much easier to keep your short term/cash in the same institution where you have your brokerage account/401k because you can invest your money immediately and free (rather than dealing with the transaction fees and potential 3-day waiting period to invest it).

Hello,
My fin advisor wants me to go through his co and use AFAXX for my short term investments/MMA...while I have no problem with that, my other accounts are with Fidelity, and they recommend their FGRXX fund for short term/MMA.

While I don't really have a strong preference, I'd rather keep my accounts all in one place if possible (i'm getting overloaded on paperwork and websites)...

Anyone have experience with AFAXX or FGRXX for a short term MMA? I already have a fidelity, BOA, Wachovia, and student loan accounts...seriously how many does one need?

 

[The White Coat Investor]

How did you select your financial advisor? How do you pay him? When you understand that you may realize you selected poorly and may not want one at all.

 

[TysonCook]

His group does all the disability, 401k, roth, and advising for the resident staff at CMC, their firm doesn't get any $ back and doesn't charge a fee, in turn they have the contract with housestaff and hospital system.

I may not want one in the future, but for now I need one as I've got a million things going on 7 different loans, 5 retirement accounts, 2 mortgages on 2 different properties (one rental)...eventually I'll step away from the advisor, but right now I'm working >200hrs/mo and don't have the time to do much more 🙂

 

[wagrl]

Hi,
I have that American Funds account - avoid it!!!! They have a high expense ratio 0.48%. I earned absolutely no interest in all of 2009 and still was charged an annual fee so it would have been better to stuff the money under a mattress! They do have hidden "load fees" also.
Wagrrl

 

[blanche]

i have FSLXX (Select Money Market) and FTEXX (municipal Money Market). over the past year, yields have been low. one thing to think about, if you don't mind putting $ in another place, is the Schwab checking acct which if linked with a brokerage acct (no min balance on either) might be a decent. something like 1% on all balances, not great, but better than the MMFs these days. no expense ratio (its a checking acct)

 

[sam1999]

American fund is a load and 12b-1 fees fund family. My guess is American fund would have some 12b-1 fees. So check the prospectus. I have one trading account with a very low cost brokerage firm and they use a money market fund (it is by default and I have no control over it) which charges 1% 12b-1 fees. I assume that's how they make money.

For what purpose do you need money market account? I would stick with Fidelity. Suggestions mentioned above are great. Fidelity Select is one of good one. If you intend to keep money for few months then I would suggest you should look into Fidelity short duration Muncipal fund. Fidelity has only one fund in this category and it is NOT money market fund. So far this fund has done great even in last 2 years to protect principal plus it has some decent yield as well.