Do you use a “wealth manager” or DIY?

[Anonymous]

I feel confident in my ability to manage my own finances. But I often run into wealth managers at work events and they always offer their services. What exactly do they do that I’m not doing?

[Anonymous]

I can manage investments but figuring out the most strategic way to spend money and from where for tax purposes can be tricky so I’m planning to get a comprehensive financial advisor once I am closer to retirement. For example, if I buy a second home should I ay cash out if brokerage account, retirement accounts (which ones?) or get a mortgage?

[Anonymous]

DIY here. Tax strategy in later years PP said is a good point though. Getting the most out of your money does get complicated.

[Anonymous]

Anonymous wrote:DIY here. Tax strategy in later years PP said is a good point though. Getting the most out of your money does get complicated.

I’m 43, net worth around $800k.

[Anonymous]

DIY at 45 with $5.4.

In 20 years, I may hire some tax and estate planning advisor and lawyers. But it won’t be some “wealth manager” who wants a percentage of AUM every year.

Even now, 1% would be the equivalent of buying a brand new, fairly nice car annually, driving it for one year, and then rolling it off a cliff and buying a new one.

[Anonymous]

DIY. 60 years old, nw 13 million

[Anonymous]

DIY. 30ish mill.

[Anonymous]

Unless you did this for a living it wouldn’t be a great idea.

[Anonymous]

We have a "wealth manager" who handles about $1.8 million of our assets (not our 529s, not our 401ks, obviously not our home equity). Fee is low because they charge us the rate that my parents, with much higher net worth, qualify for. I haven't bothered to figure out whether I could achieve same returns on my own, because it's not a huge amount of money each year, and this way, I don't have to think about it.

[Anonymous]

Anonymous wrote:We have a "wealth manager" who handles about $1.8 million of our assets (not our 529s, not our 401ks, obviously not our home equity). Fee is low because they charge us the rate that my parents, with much higher net worth, qualify for. I haven't bothered to figure out whether I could achieve same returns on my own, because it's not a huge amount of money each year, and this way, I don't have to think about it.

This is me, roughly the same numbers. College is over, house is paid off, TSP and HSA are maxed so they’re only responsible for my taxable brokerage account and backdoor Roth. I did try it on my own for several years and I suck at it. I find they more than pay for themselves and they manage my elderly mom’s accounts as well as my young adult son, so we benefit from a lower rate as they base it on the cumulative of all family accounts. They are also wizards at tax loss harvesting which I know just enough about to know what the term means. They are full service and they set up my trust and will.

To each their own but I prefer to defer to the experts when it comes to this stuff.

[Anonymous]

If you’re comfortable DIY and you’re still far from retirement, stay the course. As you get closer you will want a tax accountant for sure.

If you like the DIY path just keep reading and learning. There are many tools and resources to help. As your portfolio gets larger you may even get free planning from whoever holds your portfolio. Schwab, vanguard and I think Fidelity offer this. Plus, look at Bogleheads. Great resource.

[Anonymous]

My parents DIYed and we continued DIYing for them once they could not do it themselves. My brother and I did a great job with the investments but in retrospect we made some sub-optimal decisions from a tax perspective that will cost us about $400K on a $6M estate. I will likely defer to experts once I retire for this reason. it just gets tricky!!!!

[Anonymous]

Anonymous wrote:

Anonymous wrote:We have a "wealth manager" who handles about $1.8 million of our assets (not our 529s, not our 401ks, obviously not our home equity). Fee is low because they charge us the rate that my parents, with much higher net worth, qualify for. I haven't bothered to figure out whether I could achieve same returns on my own, because it's not a huge amount of money each year, and this way, I don't have to think about it.

This is me, roughly the same numbers. College is over, house is paid off, TSP and HSA are maxed so they’re only responsible for my taxable brokerage account and backdoor Roth. I did try it on my own for several years and I suck at it. I find they more than pay for themselves and they manage my elderly mom’s accounts as well as my young adult son, so we benefit from a lower rate as they base it on the cumulative of all family accounts. They are also wizards at tax loss harvesting which I know just enough about to know what the term means. They are full service and they set up my trust and will.

To each their own but I prefer to defer to the experts when it comes to this stuff.

Depends on your skills, interests and time. It would kill me to pay 1-2% of our invested assets every year for something that at least so far I've been able to do myself. I will say I agree with the tax accountant and estate planning help though.

[Anonymous]

For those of you using outside help, make sure to track and compare your funds’ performance against benchmarks.

[Anonymous]

Anonymous wrote:For those of you using outside help, make sure to track and compare your funds’ performance against benchmarks.

What do you mean by this?

Many funds are index funds which, follow a specific index…like the S&P 500. That funds performance will be nearly identical to the index it tracks.