Wednesday, April 19, 2017

Bye Loyal 3

Auf Wiedersehen Gremlin here to wish Loyal 3 Good-Bye.  Last night the brokerage sent out a mass email to all its users informing them that they will be shutting down and transferring everyone's assets to "low cost" FolioFirst.  Loyal3 is giving three options: 1 - sell everything, take the money, and run; 2 - do nothing and they will transfer your assets into FolioFirst; or 3 - transfer your shares into another brokerage.  For me this is an easy decision, I will take door #3.  With it Loyal 3 will be selling my fractional shares, depositing whole shares in my main brokerage, and depositing all remaining cash in my checking account.  In addition, they will waive the standard transfer fee.

As for the other options, option 1 is just not my game - selling it all and running for the hills is not what I would do (though it is what survivor-gremlin would do...).  Option 2 was intriguing, FolioFirst offers up to 2000 free trades on 200 companies per month.  However, starting in August they would levy a $5 monthly fee for the account.  Though it would be cheaper to maintain an account here if one was buying / selling often enough considering commissions, it still rings hollow.  I also don't do enough buys to justify this.  Going forward, I plan on reducing costs by trying to increase my buy minimum from $1000 up to $1200 or 1500.  That will reduce my fee percentage, and if necessary the size purchases can be increased.

I had hoped Loyal 3 would continue for another year or two, but in the end the result was going to be the same.  That account was going to be merged with my main brokerage account.  If anything, I am happy that they were around to allow some of my positions to be built from scratch.  In the long run, these positions, regardless of size, will become cogs in the engine that is under construction.

So long Loyal 3, we had a good run.

- Dividend Gremlin

PS if you want a better break down of changes go visit the Dividend Growth Investor.


  1. Sad. My sister in law just started with L3 this year. It was perfect for her to get her feet wet with those min $10 buys spread over several companies. I'm not really sure where to point her next.

    1. Hut,

      Thanks for the comment. I would possibly direct her to Robinhood, but it operates only on an iPhone/iPad platform I believe and I don't think they do account transfers. Otherwise, there are some other low cost brokerages out there.

      - Gremlin

    2. You might refer your sister to Stockpile. It seems similar to Loyal3 but with 99c trades to buy/sell. Has a lot more stocks to choose from including ETFs (use the search box because it doesn't list them all in the categories view).

      You can buy fractional shares with as little as $10, free re-investment of dividends, and a pretty hassle free way of transferring from Loyal3.
      I'm in the process of transferring myself. Good luck! - signup (referral link)

  2. Grem - stay positive!

    1. A,

      Oh I will, if nothing else this just accelerates a known timeline. Thanks for the comment.