Anonymous wrote:

Anonymous wrote:If you are paying 1% AUM to a financial advisor to help you with asset allocation and rebalancing you are shooting yourself in the knee.

Pay some $500-1000 once to talk to you about it.

Ours does more than just rebalance the portfolio. Worth every penny, IMO. They have to the tools to crunch the numbers on whether we can retire early or not. Plus, I don't like to spend my time looking at this stuff. I work enough. I don't need more work.

Anonymous wrote:If you are paying 1% AUM to a financial advisor to help you with asset allocation and rebalancing you are shooting yourself in the knee.

Pay some $500-1000 once to talk to you about it.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yes. He is also my dad's financial advisor, and has been for years and years, and he came to my dad very highly recommended by someone he trusted as well. He's been my advisor for about 10 years now, and my dad's for probably 20. He takes 1% of total investments per year (that goes down to 0.5% when your assets reach a certain level, so my dad only pays a half a percent), with NO other fees or anything, so it's very transparent, which I like. I've averaged returns of around 8-9% returns during those 10 years, so he is significantly beating the market, and the 1% fee is worth it. My husband was skeptical (I've been with the FA since before I met him) and was very "there are no fee accounts" to which I say - everyone is getting paid. If there are no fee accounts, the fees are just hidden, like with kick backs from various funds. Having eased into it, he's now completely on board.

He manages our retirement accounts completely. He also managed our house savings account when we were saving for a downpayment, but we've now bought. He will likely at some point manage our kids 529s. He is also available for advice. He's reviewed our monthly budgets, given general financial advice, recommended insurance options, and helped us decide on a budget for our house. Basically, he'll do a call with us anytime if we have a question, but we're fairly low touch.

I love this arrangement, but finding someone you trust would be really scary for me. Getting a recommendation from my dad, who I trust completely, made it easy, but obviously that's not replicable.

It's obviously your choice whether to hire a financial advisor-- I pay someone to mow my lawn because that's how I want to spend my money. However, it's very unlikely that your advisor can beat the market long term (and certainly not on a risk-adjusted return basis). For example, if you just invested in the S&P500 index, you would have seen annual returns of almost 14% a year over the last 10 years. Also, if you are paying 1% of assets and getting 8-9% returns, you are paying over 10% of your annual returns, which will probably reduce your ultimate retirement "nest egg" by a pretty big chunk.

There's more to factor in than that, like tax loss harvesting, portfolio rebalancing, and your actual risk profile. For example, for our risk profile we are in a 70/30 equities vs bonds, then within those there are other categories for diversification purpose, like a mix of US and international equities; and on the bond side a mix of short and medium term bonds, emerging market bonds, and tax-efficient bonds specific to our state.

If your investing goal is to put all your money into a single S&P 500 index fund, then you don't need an advisor for that, but you're also not diversifying, and that's a high risk strategy.

SP 500 has over 500 companies. VSTAX has over 3000. Add a total international and total bond fund and I would call that highly diversified.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yes. He is also my dad's financial advisor, and has been for years and years, and he came to my dad very highly recommended by someone he trusted as well. He's been my advisor for about 10 years now, and my dad's for probably 20. He takes 1% of total investments per year (that goes down to 0.5% when your assets reach a certain level, so my dad only pays a half a percent), with NO other fees or anything, so it's very transparent, which I like. I've averaged returns of around 8-9% returns during those 10 years, so he is significantly beating the market, and the 1% fee is worth it. My husband was skeptical (I've been with the FA since before I met him) and was very "there are no fee accounts" to which I say - everyone is getting paid. If there are no fee accounts, the fees are just hidden, like with kick backs from various funds. Having eased into it, he's now completely on board.

He manages our retirement accounts completely. He also managed our house savings account when we were saving for a downpayment, but we've now bought. He will likely at some point manage our kids 529s. He is also available for advice. He's reviewed our monthly budgets, given general financial advice, recommended insurance options, and helped us decide on a budget for our house. Basically, he'll do a call with us anytime if we have a question, but we're fairly low touch.

I love this arrangement, but finding someone you trust would be really scary for me. Getting a recommendation from my dad, who I trust completely, made it easy, but obviously that's not replicable.

It's obviously your choice whether to hire a financial advisor-- I pay someone to mow my lawn because that's how I want to spend my money. However, it's very unlikely that your advisor can beat the market long term (and certainly not on a risk-adjusted return basis). For example, if you just invested in the S&P500 index, you would have seen annual returns of almost 14% a year over the last 10 years. Also, if you are paying 1% of assets and getting 8-9% returns, you are paying over 10% of your annual returns, which will probably reduce your ultimate retirement "nest egg" by a pretty big chunk.

There's more to factor in than that, like tax loss harvesting, portfolio rebalancing, and your actual risk profile. For example, for our risk profile we are in a 70/30 equities vs bonds, then within those there are other categories for diversification purpose, like a mix of US and international equities; and on the bond side a mix of short and medium term bonds, emerging market bonds, and tax-efficient bonds specific to our state.

If your investing goal is to put all your money into a single S&P 500 index fund, then you don't need an advisor for that, but you're also not diversifying, and that's a high risk strategy.

SP 500 has over 500 companies. VSTAX has over 3000. Add a total international and total bond fund and I would call that highly diversified.

That's good diversification. What % do you put into each? How often do you need to rebalance it?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yes. He is also my dad's financial advisor, and has been for years and years, and he came to my dad very highly recommended by someone he trusted as well. He's been my advisor for about 10 years now, and my dad's for probably 20. He takes 1% of total investments per year (that goes down to 0.5% when your assets reach a certain level, so my dad only pays a half a percent), with NO other fees or anything, so it's very transparent, which I like. I've averaged returns of around 8-9% returns during those 10 years, so he is significantly beating the market, and the 1% fee is worth it. My husband was skeptical (I've been with the FA since before I met him) and was very "there are no fee accounts" to which I say - everyone is getting paid. If there are no fee accounts, the fees are just hidden, like with kick backs from various funds. Having eased into it, he's now completely on board.

He manages our retirement accounts completely. He also managed our house savings account when we were saving for a downpayment, but we've now bought. He will likely at some point manage our kids 529s. He is also available for advice. He's reviewed our monthly budgets, given general financial advice, recommended insurance options, and helped us decide on a budget for our house. Basically, he'll do a call with us anytime if we have a question, but we're fairly low touch.

I love this arrangement, but finding someone you trust would be really scary for me. Getting a recommendation from my dad, who I trust completely, made it easy, but obviously that's not replicable.

It's obviously your choice whether to hire a financial advisor-- I pay someone to mow my lawn because that's how I want to spend my money. However, it's very unlikely that your advisor can beat the market long term (and certainly not on a risk-adjusted return basis). For example, if you just invested in the S&P500 index, you would have seen annual returns of almost 14% a year over the last 10 years. Also, if you are paying 1% of assets and getting 8-9% returns, you are paying over 10% of your annual returns, which will probably reduce your ultimate retirement "nest egg" by a pretty big chunk.

There's more to factor in than that, like tax loss harvesting, portfolio rebalancing, and your actual risk profile. For example, for our risk profile we are in a 70/30 equities vs bonds, then within those there are other categories for diversification purpose, like a mix of US and international equities; and on the bond side a mix of short and medium term bonds, emerging market bonds, and tax-efficient bonds specific to our state.

If your investing goal is to put all your money into a single S&P 500 index fund, then you don't need an advisor for that, but you're also not diversifying, and that's a high risk strategy.

SP 500 has over 500 companies. VSTAX has over 3000. Add a total international and total bond fund and I would call that highly diversified.

Anonymous wrote:

Anonymous wrote:No. I'm smarter than most people and I like learning about financial matters, so it doesn't make sense for me to pay someone else.

That's great - how did you handle the covid decline? did you sell stocks? Any good FA will be honest with you about returns, the most important component is keeping you on track and working to reduce the emotional aspect of investing. The biggest, and most costly mistakes, occur during "scary times."

Anonymous wrote:We have a financial advisor from workplace recommendation. This advisor has helped us with retirement planning and manages a good portion of our available monies (not in 401K). I'm still waiting to see how they perform vs. indices and if their costs are worth it. I'm not sure at this point and will evaluate over time. One good thing that came out of this is that discussion with a financial planner led us to consolidate our investments a bit and so we now have accounts with fewer companies than we did.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yes. He is also my dad's financial advisor, and has been for years and years, and he came to my dad very highly recommended by someone he trusted as well. He's been my advisor for about 10 years now, and my dad's for probably 20. He takes 1% of total investments per year (that goes down to 0.5% when your assets reach a certain level, so my dad only pays a half a percent), with NO other fees or anything, so it's very transparent, which I like. I've averaged returns of around 8-9% returns during those 10 years, so he is significantly beating the market, and the 1% fee is worth it. My husband was skeptical (I've been with the FA since before I met him) and was very "there are no fee accounts" to which I say - everyone is getting paid. If there are no fee accounts, the fees are just hidden, like with kick backs from various funds. Having eased into it, he's now completely on board.

He manages our retirement accounts completely. He also managed our house savings account when we were saving for a downpayment, but we've now bought. He will likely at some point manage our kids 529s. He is also available for advice. He's reviewed our monthly budgets, given general financial advice, recommended insurance options, and helped us decide on a budget for our house. Basically, he'll do a call with us anytime if we have a question, but we're fairly low touch.

I love this arrangement, but finding someone you trust would be really scary for me. Getting a recommendation from my dad, who I trust completely, made it easy, but obviously that's not replicable.

It's obviously your choice whether to hire a financial advisor-- I pay someone to mow my lawn because that's how I want to spend my money. However, it's very unlikely that your advisor can beat the market long term (and certainly not on a risk-adjusted return basis). For example, if you just invested in the S&P500 index, you would have seen annual returns of almost 14% a year over the last 10 years. Also, if you are paying 1% of assets and getting 8-9% returns, you are paying over 10% of your annual returns, which will probably reduce your ultimate retirement "nest egg" by a pretty big chunk.

There's more to factor in than that, like tax loss harvesting, portfolio rebalancing, and your actual risk profile. For example, for our risk profile we are in a 70/30 equities vs bonds, then within those there are other categories for diversification purpose, like a mix of US and international equities; and on the bond side a mix of short and medium term bonds, emerging market bonds, and tax-efficient bonds specific to our state.

If your investing goal is to put all your money into a single S&P 500 index fund, then you don't need an advisor for that, but you're also not diversifying, and that's a high risk strategy.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yes. He is also my dad's financial advisor, and has been for years and years, and he came to my dad very highly recommended by someone he trusted as well. He's been my advisor for about 10 years now, and my dad's for probably 20. He takes 1% of total investments per year (that goes down to 0.5% when your assets reach a certain level, so my dad only pays a half a percent), with NO other fees or anything, so it's very transparent, which I like. I've averaged returns of around 8-9% returns during those 10 years, so he is significantly beating the market, and the 1% fee is worth it. My husband was skeptical (I've been with the FA since before I met him) and was very "there are no fee accounts" to which I say - everyone is getting paid. If there are no fee accounts, the fees are just hidden, like with kick backs from various funds. Having eased into it, he's now completely on board.

He manages our retirement accounts completely. He also managed our house savings account when we were saving for a downpayment, but we've now bought. He will likely at some point manage our kids 529s. He is also available for advice. He's reviewed our monthly budgets, given general financial advice, recommended insurance options, and helped us decide on a budget for our house. Basically, he'll do a call with us anytime if we have a question, but we're fairly low touch.

I love this arrangement, but finding someone you trust would be really scary for me. Getting a recommendation from my dad, who I trust completely, made it easy, but obviously that's not replicable.

It's obviously your choice whether to hire a financial advisor-- I pay someone to mow my lawn because that's how I want to spend my money. However, it's very unlikely that your advisor can beat the market long term (and certainly not on a risk-adjusted return basis). For example, if you just invested in the S&P500 index, you would have seen annual returns of almost 14% a year over the last 10 years. Also, if you are paying 1% of assets and getting 8-9% returns, you are paying over 10% of your annual returns, which will probably reduce your ultimate retirement "nest egg" by a pretty big chunk.

There's more to factor in than that, like tax loss harvesting, portfolio rebalancing, and your actual risk profile. For example, for our risk profile we are in a 70/30 equities vs bonds, then within those there are other categories for diversification purpose, like a mix of US and international equities; and on the bond side a mix of short and medium term bonds, emerging market bonds, and tax-efficient bonds specific to our state.

If your investing goal is to put all your money into a single S&P 500 index fund, then you don't need an advisor for that, but you're also not diversifying, and that's a high risk strategy.

Anonymous wrote:Yes. He is also my dad's financial advisor, and has been for years and years, and he came to my dad very highly recommended by someone he trusted as well. He's been my advisor for about 10 years now, and my dad's for probably 20. He takes 1% of total investments per year (that goes down to 0.5% when your assets reach a certain level, so my dad only pays a half a percent), with NO other fees or anything, so it's very transparent, which I like. I've averaged returns of around 8-9% returns during those 10 years, so he is significantly beating the market, and the 1% fee is worth it. My husband was skeptical (I've been with the FA since before I met him) and was very "there are no fee accounts" to which I say - everyone is getting paid. If there are no fee accounts, the fees are just hidden, like with kick backs from various funds. Having eased into it, he's now completely on board.

He manages our retirement accounts completely. He also managed our house savings account when we were saving for a downpayment, but we've now bought. He will likely at some point manage our kids 529s. He is also available for advice. He's reviewed our monthly budgets, given general financial advice, recommended insurance options, and helped us decide on a budget for our house. Basically, he'll do a call with us anytime if we have a question, but we're fairly low touch.

I love this arrangement, but finding someone you trust would be really scary for me. Getting a recommendation from my dad, who I trust completely, made it easy, but obviously that's not replicable.