Low-Dollar Stock Accounts Offer Little Beyond an Ego Boost

Not too long ago it was BMWs, then cell phones. Now individually managed accounts are the rage for those who have come into a little money and want to bend your ear about it.

These so-called managed accounts are customized stock portfolios put together by one or more money managers working in tandem with your broker or financial adviser. You used to need at least $500,000 in liquid assets to have one, but minimums have recently fallen below $100,000. Salomon Smith Barney recently lowered its account minimum to $50,000 (though you still need to have $100,000 invested with the firm). Lockwood Financial of Malvern, Pa., will open a managed account for just $25,000.

If your money has been stashed in staid mutual funds, having an individually managed stock account can be a great ego boost. But the ostensible benefits of managed accounts -- tax-managed selling, a straightforward fee structure and the money manager's personal attention -- are more illusory than real for most small-time investors. In other words, managed accounts may make better cocktail party chatter than financial sense. ...