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Merrill Lynch Wealth Management Review

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Merrill Lynch Wealth Management

Merrill Lynch Wealth Management is a national investment advisory firm with offices in most major and mid-sized U.S. cities. As a subsidiary of Bank of America, one of the largest commercial banks in the world, Merrill Lynch has vast resources that its investment advisors can use to maximize client returns.

With no account minimums for most types of accounts, Merrill Lynch Wealth Management is available to nearly anyone. It offers a range of options for investors, ranging from automated accounts handled completely by Merrill Lynch itself to accounts managed by a local financial advisor based on a client’s preferences. 

What Types of Clients Does Merrill Lynch Wealth Management Accept?

Merrill Lynch Wealth Management is available to all level of investors, with no minimum account sizes for most types of advisory accounts in Merrill’s Investment Advisory Program. However, Merrill Lynch typically has catered to high-net-worth clients. According to some reports, Merrill brokers do not get paid for servicing client accounts below $250,000.

Clients below that threshold may be encouraged to join Merrill Edge, Merrill’s automated online investing platform. Furthermore, while Merrill does not have minimum account sizes, many individual Merrill advisors set their own limits. 

Merrill Lynch Wealth Management Minimum Account Sizes

Most accounts with Merrill Lynch Wealth Management do not have a minimum requirement. The exceptions are accounts under Merrill’s Managed Strategies and Custom Managed Strategies programs. The minimum for Managed Strategies accounts is $5,000. The minimum for Custom Managed Strategies accounts is $20,000.

While these are the minimum account sizes for Merrill Lynch as a whole, many Merrill advisors do not accept new clients below a certain threshold. Individual Merrill advisors may have minimum account sizes as high as $10 million.

Merrill Lynch Accounts for High-Net-Worth Individuals

Historically, Merrill Lynch has catered to individuals with assets of $1 million or more, so many Merrill Lynch advisors will be comfortable working with people in the high-net-worth category.

Investment Philosophy

As one of the largest wealth management firms in the world, Merrill employs thousands of brokers and investment advisors. Because of its size, it does not dictate any one philosophy for its advisors (and clients) to follow. Instead, it offers a range of strategies and tools that allow clients and advisors to develop an individualized investment approach.

Your investment advisor will begin by asking you about your risk tolerance, your desired liquidity and your time horizon. These three elements will help determine the exact mix of assets that will work for you. Available asset classes include equities, fixed income securities, CDs and MMFs, mutual funds and exchange-traded funds (ETFs) and annuities.

Fees Under Merrill Lynch Wealth Management

Merrill Lynch charges a program fee for the Merrill Lynch Investment Advisory Program that consists of a Merrill Lynch Fee Rate and a Style Manager Expense Rate.

The maximum rates charged for the Merrill Lynch Fee Rate are 2.20% of AUM for accounts below $5 million and 2.00% of AUM for accounts of $5 million or more. Each client will negotiate a Merrill Lynch Fee Rate with his or her advisor that is less than the maximum rates set by Merrill Lynch.

The second type of fee is the Style Manager Expense Rate. This fee applies if you chose a Style Manager Strategy, and your rate will depend on the particular strategy you pursue. Rates generally range from 0.14% to 0.65% of assets.

The program fee covers the cost of investment advice and guidance, as well as related brokerage services. However, the program fee does not cover all potentially applicable costs. Clients will also be responsible for additional expenses, including custodial costs and charges related to certain investment types.

These fees are applied monthly, with the amount due equal to one-twelfth the calculated annual fee, based on the market value of assets in your account. Merrill does not charge performance-based fees.

Merrill Lynch Wealth Management Awards and Recognition

Advisors with Merrill Lynch Wealth Management have received numerous awards for their performance and service in recent years.

It placed over 600 advisors on the Forbes list of Best In-State Advisors for 2018, more than any other company. Among these were the No. 1 advisor in Georgia, the No. 2 and No. 3 advisors in Southern California, and the No. 1 and No. 2 advisors in Texas.

Likewise, Merrill placed more advisors on the Financial Times 2017 ranking of top retirement advisors than any other company. It placed 55 advisors on that list, out of 401 total.

Merrill advisors have also been recognized in rankings of the top young advisors and the top women advisors in the country. The firm placed 16 advisors in On Wall Street’s ranking of the Top 40 Financial Advisors Under 40, and 18 advisors on Barron’s ranking of the Top 100 Women Advisors, leading the country in both categories.

What to Watch Out For

As mentioned above, Merrill has historically preferred clients with higher net worth. Individuals with assets of less than $250,000 could be encouraged to enter into one of Merrill’s automated programs. 

Such accounts often have lower fees (the annual fee for Merrill Edge Select Portfolios is 0.85%), but may not be a good fit for those who are seeking the personal touch of their own investment advisor.

It’s also important to note that your experience with Merrill Lynch will be largely dependent on the advisor you end up with. Merrill Lynch is one of the largest wealth management firms in the world, with thousands of advisors. Some have been in the business for decades and have a track record of success, while others may just be getting started. So, before opening an account with Merrill, make sure you have an advisor you are comfortable with.

Disclosures

Merrill Lynch has faced a number of disciplinary proceedings from regulators over the past 10 years. The most recent action was in 2014, when the firm entered into an Acceptance, Waiver and Consent agreement with FINRA (the Financial Industry Regulatory Authority) regarding its supervisory system for purchasing mutual fund shares for clients. It paid a fine of $8 million.

In 2012, Merrill entered into an AWC with FINRA regarding its billing practices. Among the issues mentioned in the agreement were unwarranted fees on some client accounts. Merrill reimbursed all affected clients and paid a fine of $2.8 million.

Other disciplinary actions against Merrill Lynch over the past decade include a 2009 SEC order regarding misrepresentations made by advisors at a Florida branch office, and a 2008 agreement with FINRA regarding record-keeping for client accounts.

Opening an Account With Merrill Lynch Wealth Management

Because Merrill Lynch has offices all across the country, the best way to start a relationship with the firm is to set an appointment with an advisor at your local office. You can find contact information for your local office through the search tool on the Merrill Lynch website.

During your introductory appointment, you and your advisor will determine the best investment approach to match your goals. He or she will ask you questions about what you hope to accomplish with your investments and about your risk tolerance. You will also have the opportunity to learn about your advisor’s background and investment approach. 

If you are satisfied with your advisor, you will sign a Client Agreement and make a deposit to open your account.

Where Is Merrill Lynch Wealth Management Located?

Merrill’s headquarters are in New York City, but the firm has offices all around the globe. There are Merrill offices in many smaller U.S. cities such as Missoula, Montana; Little Rock, Arkansas and Portland, Maine. You can use the office locator tool on Merrill’s website to determine if there’s an office near you.

Tips for Finding a Financial Advisor

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  • Consider what you're looking for in a financial advisor and how much you have to invest. This can narrow down the search as many financial advisors have specific areas of expertise, such as retirement planning and estate planning. You want to ensure you find an advisor to work with who can meet your needs.

How Many Years $1 Million Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about the cost of living in retirement for that location.

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Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology To determine how long a $1 million nest egg would cover retirement costs in cities across America, we analyzed data on average expenditures for seniors, cost of living and investment returns.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. Using this data, SmartAsset calculated the average cost of living for retirees in the largest U.S. cities.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%. This reflects the typical return on a conservative investment portfolio. Then, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would cover retirement expenses in each of the cities in our study. Cities where $1 million lasted the longest ranked the highest in the study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research