withdrawal fees/language
| HelpRegister |
withdrawal fees/language How do these withdrawal fees compare to other clubs? "The withdrawing partner will incur all expenses of this liquidation and receive 95% of the proceeds." Aside from all expenses incurred, our withdrawing member receive 95% if they voluntarily withdraw, but 100% if they die. On Mon, Jun 23, 2014 at 6:45 PM, Mary Moriarty <mmoriarty@crocker.com> wrote: How do these withdrawal fees compare to other clubs? "The I can't answer for 'other clubs', but I would consider those fees to be extremely punitive. Some clubs feel that they should charge a fee to cover expenses of liquidating a member's position. 5% would seem much more than adequate for this purpose, and you are piling that on top of charging the actual expense. My strong preference is for ***NO*** withdrawal fee. If you pay off the member with appreciated stock there should be no actual liquidation expense. Rip west The only withdrawal fee that is reasonable is the cost of selling an equity position to pay the departing partner in cash. It is usually better to deliver an appreciated equity position in order to avoid realized capital gains for the remaining partners. Anything more is punitive, and downright wrong. They are only asking for THEIR money back. Our partnership agreements requires a departing member to open a brokerage account at the same brokerage the club uses in order to facilitate a stock transfer. Our club takes the view that the money belongs to the partners and doesn't instill a penalty for a partner asking to withdraw their money in whole or in part. I would say that if a club mandated a 5% withdrawal fee then I would be motivated to contribute the minimum amount.
On Mon, Jun 23, 2014 at 8:15 PM, Clarence Joseph Farrell <cjfarrell46@comcast.net> wrote: The only withdrawal fee that is reasonable is the cost of selling an equity position to pay the departing partner in cash. It is usually better to deliver an appreciated equity position in order to avoid realized capital gains for the remaining partners. My club charges a fee for newbies to discourage someone coming and leaving quickly. If they leave within 1 year it is a 10% fee and each year it decreases by 2%. So, any member that has been in for 5 years will have no fee to pay. A withdrawal disrupts our club. We don't have anything mentioning if a member dies so I will introduce that idea in our next meeting, thanks Jeanne. John On Monday, June 23, 2014 5:20 PM, Barrett <mr.bear.it@gmail.com> wrote: Our club takes the view that the money belongs to the partners and doesn't instill a penalty for a partner asking to withdraw their money in whole or in part. I would say that if a club mandated a 5% withdrawal fee then I would be motivated to contribute the minimum amount.
On Mon, Jun 23, 2014 at 8:15 PM, Clarence Joseph Farrell <cjfarrell46@comcast.net> wrote: The only withdrawal fee that is reasonable is the cost of selling an equity position to pay the departing partner in cash. It is usually better to deliver an appreciated equity position in order to avoid realized capital gains for the remaining partners. John, we have something similar. When we first started we were connected with a larger social group called "Whos New in Madison". There were many people that moved for their jobs and, to be honest, as treasurer it was a bookkeeping nightmare (especially before Bivio). We're no longer connected with that group and the members we get tend to stay a while.
On Mon, Jun 23, 2014 at 9:49 PM, John Rice <rice.j1969@att.net> wrote:
I live in Falcons Landing, Potomac Falls, VA, which is a privately owned CCRC for retired military officers and civilian governmental retirees. We have two investment clubs, First Falcons Landing Investment Club and Second Falcons Landing Investment Club (SFLIC). Each has a membership limited to 25 residents and each has about 25 stocks. As treasurer of SFLIC, we have been with bivio for about 2 years and appreciate their assistance and guidance. Members pay $500 initiation fee and $100 per month dues. Each club meets monthly. Attendance is encouraged but we have no penalty for non-attendance. R. L. Anderson, Financial Partner SFLIC On Jun 24, 2014, at 9:26 AM, Kimberly Hazen <hazenfree@gmail.com> wrote:
I agree with Rip. A partners's share of the capital in the club ultimately belongs to that partner, not to the other members of the club. Withdrawal fees were part of the model BI Partnership Agreement intended to cover the cost of processing a withdrawal. In the "bad, old days", stock transaction commissions could easily run 3% of a transaction. When our club began in 1999, we included a 3% withdrawal fee. I believe we only imposed the fee once before we rewrote our agreement and reduced the withdrawal fee to the actual cost of processing the withdrawal (our trading commissions were $9.99). We also switched to transferring appreciated shares instead of paying the withdrawal in cash, so we haven't even imposed the reduced withdrawal fee since then.
On Mon, Jun 23, 2014 at 8:08 PM, Rip West <ripwest@comcast.net> wrote: I can't answer for 'other clubs', but I would consider those fees to be We do all of the things mentioned below (cost of selling an equity position if it's a loser) but charge a minimum $25 fee to cover the hassle of structuring the withdrawal, copying things, and mailing checks. Having a partner open an account at the same broker and transferring stock has made this a lot easier than in the past when we sold blocks of stocks and wrote a check. Mike Jones Bloomington, MN From: Clarence Joseph Farrell <cjfarrell46@comcast.net> To: club_cafe@bivio.com Sent: Monday, June 23, 2014 7:15 PM Subject: Re: [club_cafe] withdrawal fees/language The only withdrawal fee that is reasonable is the cost of selling an equity position to pay the departing partner in cash. It is usually better to deliver an appreciated equity position in order to avoid realized capital gains for the remaining partners. Anything more is punitive, and downright wrong. They are only asking for THEIR money back. Our partnership agreements requires a departing member to open a brokerage account at the same brokerage the club uses in order to facilitate a stock transfer. We initially had a similar provision, but eventually dropped this. In general, we now have the following: 1) Withdrawal within first 5 years : 95% 2) >5 years, hardship, incapacity, death: 100% We also allow for withdrawal of up to 50% of your account value once every 5 year without penalty (other than fees). Jimmy James P. Dickerson polymerguy@yahoo.com -----Original Message----- From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of Mary Moriarty Sent: Monday, June 23, 2014 7:45 PM To: club_cafe@bivio.com Subject: [club_cafe] withdrawal fees/language How do these withdrawal fees compare to other clubs? "The withdrawing partner will incur all expenses of this liquidation and receive 95% of the proceeds." I am guessing that Ira will ask the same thing: Why charge a partner 5% to withdraw his/her own money when there is nearly no cost to do so? I have said in the past, rules like this reward partners who outlast everyone else because the last one standing gets to keep all those
fees. Mike Jones Wall$treet Wannabees Bloomington, MN From: James Dickerson via bivio.com <user*78700001@bivio.com> To: club_cafe@bivio.com Sent: Thursday, July 3, 2014 12:10 PM Subject: RE: [club_cafe] withdrawal fees/language We initially had a similar provision, but eventually dropped this. In general, we now have the following: 1) Withdrawal within first 5 years : 95% 2) >5 years, hardship, incapacity, death: 100% We also allow for withdrawal of up to 50% of your account value once every 5 year without penalty (other than fees). Jimmy James P. Dickerson polymerguy@yahoo.com -----Original Message----- From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of Mary Moriarty Sent: Monday, June 23, 2014 7:45 PM To: club_cafe@bivio.com Subject: [club_cafe] withdrawal fees/language How do these withdrawal fees compare to other clubs? "The withdrawing partner will incur all expenses of this liquidation and receive 95% of the proceeds." In general, it’s to ensure that members that join the club are committed – and we typically have more people interested in joining than we will allow. That 5% during the first few years in a modest sum – it’s in the latter years is when this becomes significant amount. You are correct that there is not a lot of cost to do so, but it’s not zero. Not only do you have the bookkeeping issues, but training a new person on how you conduct business, evaluate stocks, etc. About 1/2 of our members have been in the club 10+ years. From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of Mike Jones via bivio.com I am guessing that Ira will ask the same thing: Why charge a partner 5% to withdraw his/her own money when there is nearly no cost to do so? I have said in the past, rules like this reward partners who outlast everyone else because the last one standing gets to keep all those fees.
Mike Jones Wall$treet Wannabees Bloomington, MN From: James Dickerson via bivio.com <user*78700001@bivio.com>
|
|
||||||