We know the people there so we have an edge when it comes to service. Such thoughts are echoed by Tiras, who often recommends the American Express family of AXP funds. A few years ago, outside funds were permitted. Some were happy with the American Express funds and saw no reason to invest in anything else. Others said that they were beginning to wonder why everything I recommended was an American Express fund.
Some clients demand more choices.
If a client's plan calls for a certain type of fund, and the American Express fund is equal to or better than the others out there, that's the one I'll recommend. I have more access to the fund managers, too. A planner might be able to pick up the phone and chat with the manager of an in-house fund while managers of outside funds may be more difficult to pin down. For example, Tiras says that many of his clients have invested in AXP Growth Fund over the years. When there was a manager change last year, I was able to have several conversations with Lisa Costa, the new manager.