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Financial Advisors

7K views 27 replies 19 participants last post by  Richard11111 
#1 ·
We are looking at moving our accounts over to a financial advisor. I am trying to figure out if that is a good idea compared to picking my own investment accounts and managing it myself. Any guidance or recommendations is appreciated.
 
#2 ·
I just went through this. I have handled my investments for years and have done well but it is a lot of work. I felt it was time to move to someone that can handle things for me. I invest through TD Ameritrade and want all of my stuff to be in one place so I can see my balances without logging into a bunch of different sites. There are money management companies that utilize the TD platform so you can easily track what is happening. I chose a company that was somewhat tactical but have only been with them since December so it is too early to tell how good they are. I interviewed several before picking these guys.

The good thing about one of these groups is they do it all. They help/do estate planning, tax and a few other things so you don't have to chase a bunch of different companies to get everything done.
 
#3 ·
I've always handled mine myself but I'm usually pretty conservative. I wanted to get a little more aggressive and really try to grow it. Just recently moved most of my 401's over to ameriprise. I chose them because the guy who opened the only franchise around me has been in business in our small area for over 25 years. I also liked their philosophy and our meeting went better than the others I tried. Basically boils down to if you trust them with your hard earned money or not....which was always hard for me
 
#4 ·
We are looking at moving our accounts over to a financial advisor. I am trying to figure out if that is a good idea compared to picking my own investment accounts and managing it myself.
Just don't set it and forget it. Monitor their progress. If they don't beat the S&P 500 returns after their fees, then some would say you'd be better off managing yourself, investing in a low cost index fund.
Read this article.
https://seekingalpha.com/article/4185284-broad-market-index-funds-winning-now
 
#6 ·
After you narrow down your list..... go see if they have anything on their Advisor record that a former client has filed against them.
Google FINRA broker check .... and plug in their name ..... most have one or none.... but there are a few that make you wonder why they can still work in the industry

....and most of the single ones are BS... the FA would probably even discuss it with you if you asked them.
 
#9 ·
0%
Have told the story here before. Always managed my own account and have never been beaten by the market.

Also had a trust managed by some VP at Smith Barney/Morgan Stanley that I did not view for 18 years. When I finally did view it, it had earned less in those 18 years than tbills. Fees were virtual robbery. I'll never let anyone manage my accounts again.
 
#10 ·
My fees are .5%. I am in the process of moving all of my investments to one platform so I can easily monitor them.

Doing a good job investing is work just like any job. I am to the point where I have enough to retire and I would like to move to monitoring instead of actively investing on a day to day basis. I plan to keep a small account to play with but I'm ready to let the pros transition me to retirement.
 
#15 ·
What most people don't know is that even though you don't see fees at Fidelity, the advisors get a commission based on the value of the funds in your account. If I'm not mistaken, I think I was told 1%/year. Last year I was given some bad advise from mine so I'm shopping for a new one.
 
#16 ·
My experience is that the high fees FAs charge (some about 2%) do not cover their ROI. you can do as well or better using conservative low fee mutual funds like Vanguards. Go to their website and check it out. If you want to be more hands on and aggressive, consider an on line service like Betterment.com
Good luck.
 
#17 ·
Just buy an S&P 500 Index fund (or Russell 3000 or total market) and let it ride through thick and thin. Very few (if any) investment managers beat it on a consistent basis. Diversification is perfect. Very little turnover so not a lot of capital gains to pay tax on every year. Expense ratio and cost to buy and sell is negligible. Pays around 2% in dividends in addition to capital appreciation.

Mutual funds are another possibility. Do your homework and select no load (sales commission) low expense ratios and 10 year history of matching or beating the indexes. Spread your investment between 5-10 funds and sectors for diversification.

You dont need an investment advisor or broker. Just set up an account with Schwab or Fidelity.
 
#18 ·
Just buy an S&P 500 Index fund (or Russell 3000 or total market) and let it ride through thick and thin. Very few (if any) investment managers beat it on a consistent basis. Diversification is perfect. Very little turnover so not a lot of capital gains to pay tax on every year. Expense ratio and cost to buy and sell is negligible. Pays around 2% in dividends in addition to capital appreciation.

Mutual funds are another possibility. Do your homework and select no load (sales commission) low expense ratios and 10 year history of matching or beating the indexes. Spread your investment between 5-10 funds and sectors for diversification.

You dont need an investment advisor or broker. Just set up an account with Schwab or Fidelity.
I met with Schwab and was not very impressed. Very impersonal, I scheduled a meeting a week in advance with an advisor and he pawned my wife and I off with a new guy and only came in to shake my hand. they showed us a robo investor program that was extremely simplified. Last 3 year return was less than a current cd.

Then I met with a seasoned advisor who runs a private practice and he gave me a lot of very valuable advice in a short amount of time. I'm going to meet with one more advisor this week but think I've already made up my mind.

I'm looking for more than just a return on my money but also advise on a broad spectrum of wealth management.
 
#20 ·
You get to choose what you want...

If your looking to trade individual stocks there are a lot of cheap options out there....

If you are looking for advice on how to preserve and keep up with inflation and help with avoiding making mistakes....your going to have to pay for it!
- your entire financial picture is not something you want to go to the cheapest person....nor do you take your advice from the internet.

There is a reason advisors pass a series 7 & 66....along with continuous REQUIRED education

If you were about to rebuild your entire motor.....would you do it yourself?- what if you needed it to carry you along way, and your life depends on it.....not many non- mechanics by trade would....
- my point is there are qualified professionals out there that can help.....and the cheapest is not the best.
 
#24 ·
You get to choose what you want...

If your looking to trade individual stocks there are a lot of cheap options out there....

If you are looking for advice on how to preserve and keep up with inflation and help with avoiding making mistakes....your going to have to pay for it!

- your entire financial picture is not something you want to go to the cheapest person....nor do you take your advice from the internet.

There is a reason advisors pass a series 7 & 66....along with continuous REQUIRED education

If you were about to rebuild your entire motor.....would you do it yourself?- what if you needed it to carry you along way, and your life depends on it.....not many non- mechanics by trade would....

- my point is there are qualified professionals out there that can help.....and the cheapest is not the best.
Spot on mudskipper. When the market has risen for the last 10 years its been relatively easy money. True value shines during volatile times. For those saying just put it in S&P500, good luck with that. Age and personal risk tolerance plays a huge role. Many people truly don't understand and can't quantify the risks they are taking.

Yes, while returns are absolutely important. A miss calculation on the level of risk you unknowingly are taking can set you back very quickly much more than years of advisor fees.

Definitely check broker check on the advisor you plan to hire.

Sent from my SM-G935V using Tapatalk
 
#21 ·
Fidelity has one of the best trading interfaces. I think TD Ameritrade's is very poor. If you go with Fidelity, go to one of the branches and ask about free trades and cash bonus for signing up. If you are young, I would just get an S&P index fund. Most brokers cannot beat the S&P 500. I would slowly migrate a new account to an S&P 500 index as it is a bit pricey at this point.
 
#23 ·
Regarding trading platforms, are you comparing Fidelity's Active Trader vs TDA's Think or Swim platforms?

Or are you comparing each other's standard website interface trading screens?

I've been using TD's Think or Swim. Very impressive. Highly technical and advanced. I recall with Fidelity's Active Trader you need to make a minimum of 36 trades a year. I have both a Fidelity and TDA account and like them for different reasons.

Warren Buffett recommends that his wife use index funds instead of other advisors when he leaves his money to her. He cites that historical statistics show that most advisors have not been able to consistently beat those indexes. Interesting comment coming from a famous professional investor that people look up to.

John Bogle of Vanguard was a pioneer in the indexed funds industry. Suggest to the OP to read about John B. and his philosophy on investing for more insight on this topic. Not as a pump for Vanguard, but to understand the early vision behind index funds and learn more about them. Give you more info to chew on before you switch to blind faith and turn all of your decisions over to a stranger.

I had an advisor for several years from one of the big firms. The returns were not good. I hated paying for something I thought I could do better at. I'm 100% on my own now and putting my money where my mouth is. Pleased to say that I'm doing well and I'm very happy that I finally cut the cord.

Good luck to the OP in finding an advisor they can trust.
 
#22 ·
If you are thinking about using a "financial advisor" you need to know if he is a fiduciary. In other words, does he have to put your best interests ahead of his? Chances are he's not. There are a lot of so called financial advisors who are really variable annuity salesmen who get 5% or more commission if you buy one. Also, full price commission brokers who make money when they get you to buy or sell a stock. What does this guy know that would enable him to do a better job picking stocks than the wall street guys?
 
#25 · (Edited)
I fired my investor two months ago...moved everything to S&P index funds.

I was with Merrill Lynch for 3 years:
- on up years they did worse than the market
- on down years they did worse than the market
- and I was paying them 1.5% to guess with my money

Take a look at the article below....maybe I have become a bit jaded, but these traders/investment firms are not out for you...they are out for them. They make money whether you do or don’t...and ML nickel and dimed me to death.

I refuse to pay a bunch of people that think they are better at guessing than me...when they have zero risk on the table...and 9/10 times they can’t beat the market. The argument about volatility doesn’t hold water in most cases.

https://www.cnbc.com/2019/03/15/act...th-year-in-a-row-in-triumph-for-indexing.html

Granted...when I get closer to retirement...I will likely change investment strategies.

Sorry if I offend any investors in this thread...10 years of statistics are hard to argue against.
 
#27 ·
That’s exactly what I plan to do 37.

Over time, as I age and near retirement...shift to funds that have less risk (like yours).

I’ll never pay that 1.5%+ again...waste of $ and nothing more than fancy suits and marketing. The proof is in the #s.

For me at this point in my career, I’m nearing the peak of my earnings...so dollar cost averaging helps out. If the market goes down, I am buying cheap...if it goes up I’m making $.

It’s all a gamble...I’d rather not pay someone else to gamble with my $$&.
 
#28 ·
Financial advisor

While I was working burning the candle at both ends I use to have a financial advisor. I would always look at their benchmark target and noticed we only would get 66% of my market tolerance (based on age). After I quit working I then had time to look into investing the benchmark. I found out I could fire my financial advisor and be ahead 0.7% by getting rid of that overhead expense. I also sold the high expense ratio investments they had in my portfolio which made me that much more ahead also. I bought index mix of S&P,small cap and bonds and became better than their benchmark (by not getting foreign). I encourage my friends to do the same. The problem is guys can't buy and hold. Something about us guys is we always want to adjust when not needed. My significant other has done better than me since she had me buy her indexes and she never sells other than when I have told her that she was to far from balance.

Here is a link that may explain it



See picture attachment below that shows how one should adjust their mix of various investment over time. I took it from vanguard target date site.

Another site to visit is https://bogleheads.org/forum/index.php Read the personal investment forum questions to learn from others thru their questions

Hope above helps!
 

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