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Northwestern Mutual Investment Services (Brokerage Account) Review


About Northwestern Mutual Investment Services


If bigger is better, then Northwestern Mutual’s investment companies are a stand-out in the financial community. Northwestern Mutual Investment Services (NMIS) and its sister Northwestern Mutual Wealth Management Company are subsidiaries of the original Northwestern Mutual. Their parent was started in 1857 as a life insurance company, and is now the largest direct provider of individual life insurance in the United States.

Northwestern (member of SIPC) is ranked in the top ten independent broker-dealers in 2018, with more than 350 offices across the United States and over $64 billion assets under management.


Offerings


Services available through Northwestern include brokerage services, personal trust services, advisory programs, fixed income management, retirement planning and cash management. Investment accounts can have checking privileges with either hard copy checks available or automatic repeated disbursements of funds.

Products include mutual funds, individual securities, variable annuities, and variable life insurance.

NMIS offers access to most major fund families, but focuses on those that offer a broad spectrum of mutual funds, including Alliance Bernstein Investments, American Century Investments, American Funds, Fidelity Investments (Best Fidelity mutual funds), MFS Investments Management, PIMCO, Russell and and Vanguard (Best Vanguard mutual funds). The breadth available in these families allows clients to diversify holdings while maintaining enough invested in a single fund family to take advantage of reduced charges.


Access


Live general-purpose telephone customer service is available from the home office in Wisconsin Monday-Friday 7 AM – 6 PM CST. This includes technical support for computer users.

Local offices have differing hours for phone access. The Cleveland, Ohio office, for instance, is open 8:30 AM to 5 PM Monday to Friday. Phone access to individual advisors varies, with some advisors giving clients their mobile phone numbers with an invitation to call any time.

Northwestern has been online since 1995, giving clients access to account information and planning tools. After logging in clients can see current portfolio and account totals, view details of the holdings in each account and call up the history of all transactions in an account going back two years.

No transactions can be completed using only the website. All transactions are done through advisors, or by contacting Northwestern’s IPS Trading Services directly. As the name implies, IPS Trading Services will execute trades. Contrary to the website description (“delivers research and advice, and places trades”), callers are referred to their individual brokers for investment advice. Hours are Monday – Friday 7:30 AM to 5 PM CST. Calls to the trading desk can result in long hold times, but since brokers cannot accept transaction commands by voicemail it does provide an alternative means of executing trades.

The NMIS website has a link for e-mailing questions, but responses take one to two business days. There is no chat capability.


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NMIS Research/Education


Clients can retrieve updated account information by logging onto the NMIS website. They also have access to Morningstar fund profiles and to charts for specific stocks and funds. Charting time periods are adjustable from “intra-day every five minutes” to “ten-year monthly”.

Another area of the site allows clients to search for stocks using specific sorting criteria such as industry sector, share price, P/E ratio, four-year EPS growth (%), market capitalization and current dividend yield (%).

The site also gives market updates, and stores recent issues of Northwestern’s quarterly, monthly and weekly Market Commentaries.

There is a library of very basic articles on topics ranging from creating a budget to estate planning, useful only for beginning investors. Elsewhere on the site there is an advanced planning library actually designed for professionals, but accessible via NMIS login to any account holder.

The NMIS site includes a self-proclaimed “Tax Center”. It includes explanations of terminology used in year-end statements, and access to percentage breakdown of tax-exempt income on municipal funds by state and the percentage of income from government agency, direct federal and foreign sources for a particular fund. It does not, however, offer any tax advice or make recommendations on how to reduce or eliminate taxes.


Northwestern Mutual Brokers


Success or failure of your dealings with NMIS hinges on your relationship with your individual broker. Whether settled in one of the corporate buildings or occupying a one-or two-person affiliated office, your broker’s training, experience, knowledge and style are critical.

Brokers in the corporate offices are supported by junior staff who do research and provide information on specific stocks and funds on request. These fledgling brokers-in-training can send the correct forms required to authorize changes to accounts and execute specific trades. They cannot provide actual investment advice.

Brokers are also supported by administrative assistants who handle routine paperwork. These assistants can form a more comfortable link between brokers and clients anxious for advice or action. Rather than getting an impersonal voice message that a broker is “away from the phone”, assistants can share details of the reasons for his/her unavailability and probable return date or time. They can also take detailed messages too complex for voicemail.

Affiliated brokers in small offices may operate independently, without backup. Access to these brokers depends on their responsiveness to voice- and e-mail.

The NMIS broker community is expected to attend training meetings to keep up to date with new products and services, and to be briefed by Northwestern’s experts on economic trends both national and global.


Northwestern Mutual Investment Services review


Northwestern Mutual Investment Services Commissions, Fees, and Minimum Deposit


Unlike online brokerage houses with flat rates per transaction, NMIS uses a sliding commission scale based on the size of each trade.

AmountCommission
$0 to $1,000 $40 + 0%
$1,001 to $5,000 $50 + 1.3%
$5,001 to $10,000 $50 + 1.2%
$10,001 to $25,000 $50 + 1.1%
$25,001 to $50,000 $50 + 0.95%
$50,001 to $100,000 $50 + 0.85%
$100,001 and up $50 + 0.75%


Fund front- or back-end loads may be reduced or eliminated depending on the total investment in a fund family. Typical breakpoints for no load transactions are $500,000 or $1,000,000 invested in the same family.

Some accounts carry $50 annual service fees, and standard bank-type overdraft, wire transfer, stop payment and returned check fees are imposed.


Doing Business with NMIS


The beginning of the broker-client relationship starts with a discussion of needs, wants and expectations, and includes completion of a standardized profile questionnaire to determine the client’s risk tolerance and investment horizon. Based on this profile, NMIS produces a computer-generated recommended portfolio of holdings. This can then be discussed and negotiated with the broker and tailored to the client’s particular situation. Some clients will not accept certain types of stocks to be held in any of their funds, while others want to emphasize “green” or environmentally friendly holdings.

It is possible to do business with NMIS for years without laying eyes on your broker. Monthly reports and detailed annual portfolio reviews are sent out either electronically or in hard copy at the choice of the client, but face-to-face reviews are not necessarily part of the program, unlike some brokerages where annual or even quarterly in-depth reviews are the norm.


Is Northwestern Mutual Investment Services Safe?


Those who worry if Northwestern Mutual Investment Services is a safe company have nothing to fear. Northwestern recently revised its logon procedures, requiring clients to re-establish logins and passwords to access accounts. Clients who enter a login ID are greeted with a picture of their choosing to confirm that the site has recognized them. They then enter a password to complete the login process and access their accounts.

Brokers and their assistants are available by standard email but Northwestern has a special secure email system for sending and receiving confidential information. The system requires a separate login and password from those used to access the website.


Conclusion


NMIS has the advantage of backing from one of the largest and highest rated financial services companies in the country with a long history of superior results. Its status as a mutual company without shareholders allows it to share its financial success to its policyholders and clients. It has a network of brokers with access to advice and analysis from seasoned experts. These brokers pass through a training program designed to prepare them for successful client recruiting and servicing.

Drawbacks to NMIS include the lack of access to client-originated online trades, and a fee schedule that will discourage the small investor. Clients need to decide how much flexibility they are willing to sacrifice and if they are willing to pay high fees (comparing to discount brokers) in order to gain access to the security and expertise NMIS can offer, considering that the same advice they could get from the online brokers, such as TD Ameritrade.


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Northwestern Mutual Investment Services reviewed by Brokerage-Review.com. Rating: 3