Merrill Lynch Review: Their Financial Advisor Services

merrill_lynchAs one of the largest consumer financial services companies, Merrill Lynch offers investment and retirement advice for individuals and small business customers. The company encourages investors to diversify as much as possible, with a portfolio that features stocks and bonds, ETFs, and Mutual Funds. Merrill Lynch has a close relationship with Bank of America (BOA), and an investor who isn’t keen on working with BOA might want to think twice before getting in too deep with Merrill Lynch. Investors should also know that the Merrill Lynch Select Portfolios come with a 1% annual management fee.

Financial Services for Individuals

It’s hard to ignore Merrill Lynch’s longstanding reputation for solid financial advice. Honored by both J. D. Powers and Barrons, the company has a tradition to be proud of. For individual investors, offers an attractive flat $6.95 fee for all online stock exchanges and ETFs. The company offers a full range of investment options that includes stocks, mutual funds, annuities, options, ETFs, and fixed income options.

The company takes pains to clearly outline their products for individual investors. Unlike their competitors, they don’t assume an first time investor brings a substantial amount to invest, which makes the company’s low transfer fee more attractive. Beginners are encouraged to look at a mix of stocks, mutual funds, fixed income bonds and ETFs.

The company pushes its own products for what it calls “simplified investing.” These products include:

  • BofAML US 1 List:
  • Merrill Edge Select Fund
  • Merrill Edge Select® ETFs

Merrill Edge Select Portfolios: For clients who want the most direction in their investing needs, this product requires a $20,000 minimum investment and includes a 1% annual account management fee.

Retirement Services

The company heavily promotes IRAs, including Traditional and Roth IRAs. For customers looking to roll over an existing 401(k), the company offers to do so with a $600 fee, which could prove to be too hefty for many customers.

In their investment products, Merrill Lynch heavily promotes their own products. For those close to retirement, the first suggestion is check out the Merrill Lynch Select Portfolio with the company’s “pre-screened” investment options. For investors who are interested in long term retirement planning, the company heavily promotes IRA contributions- along with Merrill Lynch’s own Select Portfolios. Given how heavily the company promotes their own products, it’s hard to know how earnest the retirement advice would be for a naive investor.

Small Business Customers

The company targets small business owners starting with a Business Investor Account that includes fixed income products, stocks and bonds. These accounts include automatic sweeps into FDIC insured (Bank of America) accounts. Reflecting the company’s partnership with BOA, Merrill Lynch offers small banking solutions but only accounts that are housed with BOA. Small business owners will have to accept that when doing business with Merrill Lynch, they are also doing business with Bank of America. It may be possible to link non- BOA accounts with Merrill Lynch services, but that would probably require in in person meeting with Merrill Lynch staff.

Business owners can open a Health Savings Account (HSA) which like other Merrill Lynch products is branded under the Bank of America name. The contribution limits for individuals max out at $3300 for individuals and $6500 for families.

Using Merrill Lynch as a financial advisory means indirectly doing business with Bank of America. Some investors and small businesses may choose to do business with both companies for the diversity of services each company offers. Customers who have existing non-Bank of America accounts may, however, find the constant co-branding annoying and limiting.

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