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Author Topic: Private Banking  (Read 462 times)

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Albert Swinestein

Private Banking
« on: September 04, 2019, 09:54:00 pm »

My bank is trying to get us to work with their private banking division.  It operates under a separate name than the bank, but is supposedly fully owned by it.  The fees look very high, but they do a nice job of selling the personalized attention and services.  Anyone have experience with this that can offer some advice?

Thanks in advance.
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onebadrubi

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Re: Private Banking
« Reply #1 on: September 05, 2019, 07:22:50 am »

Is this for wealth management or just day to day personal banking stuff?
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Re: Private Banking
« Reply #2 on: September 05, 2019, 10:08:52 am »

I frequently receive offers from my bank, Regions, for personalized banking services. Outside of free checking, a small savings account and a safe deposit box the only thing I've used them for is a free Cashiers check to pay a Yazoo City speeding ticket.

Like you, I think the fees they charge are higher than I pay elsewhere for the same services.
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je100

Re: Private Banking
« Reply #3 on: September 05, 2019, 10:22:17 am »

I think you'd be paying for free coffee and Corinthian leather in the waiting room.  The advisors there wear pointy shoes.
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ricepig

Re: Private Banking
« Reply #4 on: September 05, 2019, 10:31:41 am »

Like everything, it would depend on the cost and the services, without knowing those, it would be hard to make a recommendation.
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Albert Swinestein

Re: Private Banking
« Reply #5 on: September 05, 2019, 09:52:53 pm »

Is this for wealth management or just day to day personal banking stuff?

Overall management, including an assigned relationship manager that works with you across all specialists/teams.

It is highly customized and costs vary greatly depending on what offerings you require/want, and total amount under management.

They bring a lot of services (services even include personalized services for your family members with a high focus on the children), and it is intriguing to have all of this in a single-sourced manner.  Quite frankly, I have little to no experience in this area. 
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Albert Swinestein

Re: Private Banking
« Reply #6 on: September 05, 2019, 10:02:56 pm »

Is this for wealth management or just day to day personal banking stuff?

By the way, I am just looking to learn from any experiences you may have had with something similar.  I probably will not do it as I do not even know what questions to ask...which I suspect means I am not right or ready for this.

For example, I am looking at a chart they gave me.  It has me in the center of a circle "Client" with all of these lines coming out of it representing the services they offer.  The services include such things as:

Private Banking
Institute for Family Culture
Asset Management
Legacy and Wealth Planning
Trust, Fiduciary and Administrative Services
Foundations and Endowments

Some of these words have five or more syllables, such as "fiduciary", which scare me...:)
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widespreadsooie

Re: Private Banking
« Reply #7 on: September 05, 2019, 10:27:58 pm »

Trust and Fiduciary are basically synonyms. I don't see much on that list of items a CPA and lawyer haven't been doing for years. Maybe besides institute a family culture. I don't really know what that means.

Edit: Would also add financial planners/advisors. Sounds like a one stop shop.
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ricepig

Re: Private Banking
« Reply #8 on: September 06, 2019, 07:10:59 am »

By the way, I am just looking to learn from any experiences you may have had with something similar.  I probably will not do it as I do not even know what questions to ask...which I suspect means I am not right or ready for this.

For example, I am looking at a chart they gave me.  It has me in the center of a circle "Client" with all of these lines coming out of it representing the services they offer.  The services include such things as:

Private Banking
Institute for Family Culture
Asset Management
Legacy and Wealth Planning
Trust, Fiduciary and Administrative Services
Foundations and Endowments

Some of these words have five or more syllables, such as "fiduciary", which scare me...:)

I have a Stephen account, it has all of that, fwiw. My regular banking account has most of it too, so it depends what you want.

A fiduciary account means they only act for your benefit, not for theirs or their company, all of your brokerage accounts should be with a fiduciary, if they are acting on your behalf. In this case Trusts, are legal entities you have set up, be it revocable, irrevocable, charitable, etc.
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onebadrubi

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Re: Private Banking
« Reply #9 on: September 06, 2019, 08:28:25 am »

Iíd have to ask myself if I have a money manager already?  A well rounded CPA firm along with a money manager would already handle all of those things, so why allow the bank to double dip from you?  That would be the the way I look at it.

My little bit of experience in this world.  I chose a bank with a personal experience, bank of Little Rock.  I can call them and get a person, for both corporate or personal.  They ya doe my banking.  I use my CPA and money manager for their respective duties.  The only thing Iím not certain isnít under my umbrella is ďfamily cultureĒ, however I have I pretty much have that with my bank and CPA, not money manager though. 

je100

Re: Private Banking
« Reply #10 on: September 06, 2019, 08:35:24 am »

Good post Rubi.

Albert, just think of this as product bundling, where the crown jewel is your investment account.  That's what they really want, and the services that surround those assets are designed to keep those assets in house.  It's the bundling from their point of view that the independent advisor can't offer you.  You have to decide if the other stuff (in house legal work, private banking - sounds exclusive doesn't it?) is worth their additional cost.  Remember, from their point of view, this is marketing 101 and those fancy charts are designed to get your signature.

I personally prefer unbundling just about everything in my life - I don't like cash value insurance, TV/Internet bundles, or premixed coleslaw.  As far as that crown jewel (the investment account) find a fee-only (non-commission and 1% or less on assets under management) advisor in your area who likes to work with you and your CPA.  After that, the advisor and your CPA will recommend trust work, if you need that as well.

None of this means that you can't get great service at this bank.  Just be aware that you're paying a premium for things that may not benefit you at all.

onebadrubi

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Re: Private Banking
« Reply #11 on: September 06, 2019, 01:14:53 pm »

Good post Rubi.

Albert, just think of this as product bundling, where the crown jewel is your investment account.  That's what they really want, and the services that surround those assets are designed to keep those assets in house.  It's the bundling from their point of view that the independent advisor can't offer you.  You have to decide if the other stuff (in house legal work, private banking - sounds exclusive doesn't it?) is worth their additional cost.  Remember, from their point of view, this is marketing 101 and those fancy charts are designed to get your signature.

I personally prefer unbundling just about everything in my life - I don't like cash value insurance, TV/Internet bundles, or premixed coleslaw.  As far as that crown jewel (the investment account) find a fee-only (non-commission and 1% or less on assets under management) advisor in your area who likes to work with you and your CPA.  After that, the advisor and your CPA will recommend trust work, if you need that as well.

None of this means that you can't get great service at this bank.  Just be aware that you're paying a premium for things that may not benefit you at all.

Iíd add also, when it comes to a tax question, if you have a relationship built with history of trust, your going to get that CPAís inoit anyways.  Same goes with say setting up a 529 plan, going to defer the guy you have history with per say even if using this private banking.   If like me, they would have to earn the trust and I would be vetting everything they say.  Iím a fan of separation, that way each can monitor each other kind of thing.  All under one roof, never really know because vested interest might be to cover coworkers butt.

Albert Swinestein

Re: Private Banking
« Reply #12 on: September 06, 2019, 02:15:00 pm »

Wow.  Thank you all for your help.  This was outstanding.

I feel like I owe onebadrubi and je100 both checks for their consulting services, but thank you all for your input.  Very helpful.

I jumped on here as I am talking to the group by phone at 3PM Central today (about 45 minutes).
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onebadrubi

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Re: Private Banking
« Reply #13 on: September 06, 2019, 03:32:44 pm »

Wow.  Thank you all for your help.  This was outstanding.

I feel like I owe onebadrubi and je100 both checks for their consulting services, but thank you all for your input.  Very helpful.

I jumped on here as I am talking to the group by phone at 3PM Central today (about 45 minutes).

Just cover my hogville dues and we can call it even

Albert Swinestein

Re: Private Banking
« Reply #14 on: September 06, 2019, 04:32:27 pm »

Update:
I deferred this for now.  They wanted to have someone fly in to visit with me in person from their Minneapolis headquarters, but I decided to not waste their time for now.
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ricepig

Re: Private Banking
« Reply #15 on: September 06, 2019, 04:40:51 pm »

Update:
I deferred this for now.  They wanted to have someone fly in to visit with me in person from their Minneapolis headquarters, but I decided to not waste their time for now.

Iíll just say this, if itís WF, run.......
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Albert Swinestein

Re: Private Banking
« Reply #16 on: September 06, 2019, 05:41:49 pm »

.
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Albert Swinestein

Re: Private Banking
« Reply #17 on: September 06, 2019, 05:47:52 pm »

Iíll just say this, if itís WF, run.......

Yes, it is an owned subsidiary of WF.
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onebadrubi

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Re: Private Banking
« Reply #18 on: September 06, 2019, 06:11:45 pm »

Update:
I deferred this for now.  They wanted to have someone fly in to visit with me in person from their Minneapolis headquarters, but I decided to not waste their time for now.

Someone has built up a nice little nest egg that they are pursuing.  Nice job!!
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ricepig

Re: Private Banking
« Reply #19 on: September 06, 2019, 06:20:14 pm »

Yes, it is an owned subsidiary of WF.

Well, maybe theyíll give you good service. I know their regular accounts are horrible. We had some ESAís my parents had set up for my kids there, or rather after they bought out AG Edwards, they were there. It was a three ring circus getting the money when the kids left for college. I still have one there to get the money next spring, hopefully it has improved. After all the shenanigans they pulled over the years at WF, I donít have a high opinion of them. Have you shopped locally? And be sure and do that, theyíll cut their basis points to meet competition.
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Albert Swinestein

Re: Private Banking
« Reply #20 on: September 06, 2019, 06:37:50 pm »

Well, maybe theyíll give you good service. I know their regular accounts are horrible. We had some ESAís my parents had set up for my kids there, or rather after they bought out AG Edwards, they were there. It was a three ring circus getting the money when the kids left for college. I still have one there to get the money next spring, hopefully it has improved. After all the shenanigans they pulled over the years at WF, I donít have a high opinion of them. Have you shopped locally? And be sure and do that, theyíll cut their basis points to meet competition.

I have not shopped at all as I was not actively looking, but I certainly will do so before I sign on with anyone.
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Albert Swinestein

Re: Private Banking
« Reply #21 on: September 06, 2019, 06:41:25 pm »

Someone has built up a nice little nest egg that they are pursuing.  Nice job!!

I was absolutely stunned at the service costs and fees they were throwing out, so whatever nest egg they thought they were pursuing was going to become theirs pretty quickly.
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je100

Re: Private Banking
« Reply #22 on: September 06, 2019, 09:25:15 pm »

If you have a decent chunk, there's no reason to pay any more than 1 percent on assets under management.  That's all in, no additional fees, trading costs, ect.
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onebadrubi

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Re: Private Banking
« Reply #23 on: September 06, 2019, 09:52:29 pm »

I was absolutely stunned at the service costs and fees they were throwing out, so whatever nest egg they thought they were pursuing was going to become theirs pretty quickly.

I hate fees.  Itís a shi t t y way to me for a profit grab.  It says that we run a business and we donít make enough money with are margins, so letís grab some more.  This is all walks of life to me, buying a car or whatever.  Just gets to me

1% is a great number, but can sometimes be beat, especially if doing any of the work yourself. 
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ricepig

Re: Private Banking
« Reply #24 on: September 07, 2019, 06:42:00 am »

If you have a decent chunk, there's no reason to pay any more than 1 percent on assets under management.  That's all in, no additional fees, trading costs, ect.

Itís negotiable, and it goes down the more they manage. I have some I pay to have someone manage, and some I do myself. I would be hesitant to put much with someone or firm I didnít know, or had someone I trust who has a relationship/account with them.

vandybuff

Re: Private Banking
« Reply #25 on: September 08, 2019, 09:16:53 am »

Itís negotiable, and it goes down the more they manage. I have some I pay to have someone manage, and some I do myself. I would be hesitant to put much with someone or firm I didnít know, or had someone I trust who has a relationship/account with them.

Ricepig made the "not just a great point but the only point" of this discussion:  if you are not comfortable, don't do it. 
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HawgPilot

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Re: Private Banking
« Reply #26 on: September 10, 2019, 03:14:08 pm »

yep, just say No. ;)
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