Do you have a company that your fiercely loyal to? A company who might not be the best in the industry but you love them flaws and all? For me that company is Scottrade. Recently the news came out that TD Ameritrade was in the process of purchasing them. Needless to say I was devastated. Is this an overreaction to something that happens everyday? Probably but Scottrade is not something that can’t be easily replaced.
I know that many of their services were lacking in several different areas. It’s true, you could get lower prices on trades elsewhere. You could also find companies with better mobile apps and fancier websites. There are also brokers out there who offered all sorts of free goodies that Scottrade never even attempted to offer. So why did I love Scottrade so much? They were fiercely loyal to their customers. They offered everyone the same red carpet service, no strings attached. In my opinion their dedication to their customers was unrivaled, no matter the industry.
This is one of those small things that has been ignored by many companies. The focus tends to be on so many other things like offering the lowest price or the most bells and whistles when all I ever wanted was to be treated with respect. Anytime I had a question, I want a truthful answer without waiting forever to get it. If something goes wrong, I don’t want excuses. I simply want it fixed. Their top priority, the customer, never wavered. Customers mattered above all else, period. Although I don’t want you to think Scottrade had nothing unique to offer. They did have one feature I could never find elsewhere and sadly it wasn’t around too long, the FRIP.
You might have heard of a DRIP, dividing reinvestment program, which simply reinvests your dividends into the same fund. This is extremely common and you probably have it happen all the time in you retirement account. Scottrade took this concept to another level with their FRIP, flexible reinvestment plan. You could pool together all of or some of your dividends that you received from your stocks and ETFs and then reinvest those funds into up to five different stocks or ETFs. It gave you a certain flexibly, pun intended, that other programs did not. You could have 20% go to this fund, 50% go that stock and 30% go to this fund, if you wanted to. It was an automatic process that involved no intervention from you. Best of all it was free. I really hope this idea doesn’t die with Scottrade. It would be nice to see other brokers implement it. Simply put, it was one of the most innovative things I’ve seen in the industry and was a another reason why I stayed.
So where to now? I have no idea. There are many places I could go, from established veterans like Fidelity or Charles Schwab or a newcomer like Robinhood. I could also stick with the company who swallowed up Scottrade, TD Ameritrade. I’m still not sure what I want to do and right now the decision isn’t an emergency.
Thank you for being an awesome company Scottrade, you will be missed.