T. Rowe Price Summit Program

msf

The benefits page for this program is now up:
https://www.troweprice.com/personal-investing/about/client-benefits/index.html

The changes I note immediately from the previous (Select Client) services are:
- Three tiers: $250K, $500K, $1M (vs. two in the old program)
- "Preferred" access to closed funds (whatever that means; it's not clarified)
- Access to I class shares ($50K min) at $500K level
- Free Kiplinger's Personal Finance at $1M level; it used to be WSJ digital. This seems like a downgrade.

The constant is that at all tiers ($250K and above) one still gets M* premium membership.

MikeW

Thanks @msf

hank

“Free Kiplinger's Personal Finance at $1M level“

May I suggest that rather than sending your $1M to TRP, you simply subscribe to this questionably useful tabloid at Amazon?

e-Edition $11.88 yearly (99-cents per issue)

Print Edition $34.95 yearly (about $2.90 per issue)

Provided the previous “WSJ digital” referenced included access to all stories in the paper (not just loaded with conservative editorials), Kiplinger's would represent a ludicrous downgrade.

Roy

Here is a Q & A concerning access to closed TRP funds.

"Certain T. Rowe Price mutual funds (known as “closed funds”) are generally closed to new investors and new accounts. Clients assigned to the Select Services tier ($250,000 Summit balance) or higher of the Summit Program have preferred access to closed funds in their qualifying accounts. Investment minimums and other information about closed funds are specified in each fund’s prospectus.

The 529 portfolios have access to closed T. Rowe Price funds, regardless of participation or status in the Summit Program."

Sven

It appears that TRP wants to attract high net worth individuals.

Observant1

Sven said:

$250k seems to be lot of dough for the privilege of getting TRP’s closed funds.

As you know, Vanguard investors need $1M (Flagship status) to access certain closed Vanguard funds.

msf

Here's the benefits sheet on the old Select Client Services.
https://individual.troweprice.com/staticFiles/Retail/Shared/PDFs/FullBenefits.pdf

Something else missing on the new Summit Program benefits sheet is Turbotax. The online version was free at the $250K level, and downloaded products were free at the $1M level.

I'd say that they were more targeting the mass affluent than the high net worth investors. Really, is that free subscription to Kiplinger's Personal Finance at the $1M level going to get you to double your $500K investment with them?

Roy

TRP is trying to get some of their bigger investors away from the online mutual fund supermarkets so they can reduce the amount of their management fees they have to pay to Fidelity, Schwab, etc.

For several years I've considered returning our accounts directly to TRP out of loyalty and appreciation for the excellent investment management our accounts have received through PRWCX and Giroux. Around 80% of our investments are in TRP funds (primarily PRWCX). I moved our accounts first to TDA and now at Schwab, why should they be getting a big chunk of the management fees, what are they adding to our investment returns in those funds?

But, up until now there has been no personal financial incentive otherwise to make the move back to TRP. Now that the new Summit program has dramatically lowered the hurdle to access institutional shares ($50,000 rather than $1 million) at the lower ER and also gives access to closed funds like PRNHX, I'm seriously considering making the move. Any non-TRP funds we want to invest in can still be done so through a TRP brokerage account. Being able to park our investments in the institutional shares will potentially add TENS OF THOUSANDS OF DOLLARS to our returns over the next number of decades if we are blessed to live that long.

I've wondered why more fund shops haven't followed the lead of organizations like Grandeur Peak who will let shareholders purchase the cheaper institutional shares at far lower minimums if they invest directly with the fund rather than through brokers. Kudos to TRP for finally coming around.

Please let me know if I am overlooking something here.

Sven

@Roy, you brought up excellent point. We consolidated our brokerage and mutual accounts a number years ago for ease of tracking to two large brokerages. So we have to reconsider this announcement from TRP since we already invested in a number of their excellent funds. The ability to invest in their institutional shares at $50K is quite tempting, plus other offering. At Vanguard, one can purchase Pimco institutional shares at $25K instead of $1M (thanks to @msf). At present, we are evaluating the pros and cons of each brokerages and which one would fit our long term needs. My experience of transfer process with TRP was slow, but that was over 5 years ago.

With regards to Grandeur Peak funds, you can purchase their institutional shares at much lower minimum at many brokerages with a transaction fee. The $ minimum is set at the agreement between Grandeur Peak and that specific brokerages. Since Grandeur Peak funds invest in small to mid cap space, it poses challenges to existing investors when the funds closed, where one cannot purchase additional shares from their brokerages. One can transfer their shares to Grandeur Peak but that is not something I wish to do in the long run.

Also, I am trying to
look at what is under the hood of TRP brokerage but am having issue finding it for comparing to brokerages I am currently using. No luck by calling their customer service.

Roy

My wife and I did decide to move our accounts back to TRP from Schwab to take advantage of the new Summit Program, primarily to access TRP institutional share classes at greatly reduced minimums and access to closed TRP funds. With us holding around 80% of our investments in TRP funds, primarily PRWCX, it just made financial sense to make the move. Their brokerage arm is able to hold our non-TRP funds.

6 accounts were moved. The process began on November 17 and was completed today, December 14. Took a little longer than I thought it might as there were a couple hiccups, for a bit they were having difficulty moving the non-brokerage part of my wife's Roth IRA and we were not able to connect our bank account to our new TRP accounts from the TRP website and needed to mail in the forms. A little patience and all is fine. Next step is to transfer into the institutional share class of PRWCX.

We were assigned a Senior Financial Consultant from TRP to assist in the transfer of our accounts. He communicated via phone and email, and when necessary did the leg-work to provide answers to questions we had instead of us having to deal with customer service via phone.

Now, I just need to get reacquainted with navigating the TRP website again.

msf

TRP told me that they will convert all eligible accounts to institutional class shares in January, but that upon request they will do the conversion now.