No. Why would I pay someone thousands of dollars to tell me everything that's already free on Bogleheads and Reddit?

Unfortunately I don't have a financial advisorand thats why I always need to ask help from aside. For example some months ago I had the necessity to make a financial modeling for startup and I didn't know from what to start. So, I found a company on the internet, that offers such services online https://sturppy.com/models/financial-model-for-saas . Indeed, it was really useful help for such people like me, who don't know the principles of constructing a new business and the base on which the entire financial component of the company rests. Therefore, I consider that a financial advisor is an important person in your affaire.

People on focus too much on the performance. performance isn’t everything and a good, honest, advisor will tell you that. I am a FA and will be the first person to admit that most people can’t outperform “the market” or whatever you all use as a gauge.

The main reason people hire us is because they have absolutely no idea how personal finance works. I am SHOCKED by the lack of knowledge. It’s so much more than throwing money in an index fund.

Long Tax planning strategies, estate planning, eldercare, lending solutions/strategies, how to generate retirement income, what accounts to generate it from and when, legacy planning. Laws are constantly changing. I see many DIYers come into our office and think they are all smart then when we discuss basic planning strategies or ask them why they did X,Y or Z, they get really quiet.

An advisor could pay for their fee for 5-10 years by counseling you not to make an emotional decision when the markets are tanking, or providing a long term Roth conversion strategy so your heirs will inherit money tax free. If you don’t work with an advisor that has all the appropriate professionals on staff and inclusive in their fee schedule then it’s a waste of money.

I would NEVER hire an FA who only manages my money (like most at WF, ML, MS, UBS, etc) they are glorified, highly paid, babysitters.

Anonymous wrote:

Anonymous wrote:See my view is someone who is trying to “study current trends” to improve yields over a 20 time horizon is more likely to reduce their long term success than increase it.

By all means if you want to enter the debate over small cap value tilting you can, but I am pretty comfortable not trying to outguess the market.

What an asinine comment. The tech boom has been a "current trend" for over 20 years. We would expect interest rates to remain low for the next 12-24 months, with plenty of warning for when monetary policy start to tighten. But with the new round of stimulus, the infrastructure spending package, and expected growth from reopening, it's likely that the equities market will continue to be the best choice for companies looking to raise cash, thus driving bond yields lower. Unlike stocks, bonds have a maturity date, anyone who is buying into bonds with the poor current yield is simply making a foolish mistake. Most bond funds over the past 10 years is barely returning 1% above inflation.

Look, 10/15 years ago, it was said that the era of 8-10% annual growth in equities was over, that at best you could hope for is 4-6%. This was the industry consensus, everyone rushed to value investing. If you don't think that current trends have a real long-lasting impact on the 20-year time horizon, you are mismanaging your investments.

I have no idea what you are talking about and you apparently have no idea what I am talking about. I don’t try to guess whether value investing is in or tech investing is in or the impact of BTC— I invest in the market and if those things turn out to be important I make money. I also set my bond/stock allocation based on my risk preferences— I don’t have the need or desire to pretend that dividend paying stocks or REITs are good replacements for bonds in my portfolio.

^^^ Now this wannabe economist is gaming the market!

Anonymous wrote:See my view is someone who is trying to “study current trends” to improve yields over a 20 time horizon is more likely to reduce their long term success than increase it.

By all means if you want to enter the debate over small cap value tilting you can, but I am pretty comfortable not trying to outguess the market.

What an asinine comment. The tech boom has been a "current trend" for over 20 years. We would expect interest rates to remain low for the next 12-24 months, with plenty of warning for when monetary policy start to tighten. But with the new round of stimulus, the infrastructure spending package, and expected growth from reopening, it's likely that the equities market will continue to be the best choice for companies looking to raise cash, thus driving bond yields lower. Unlike stocks, bonds have a maturity date, anyone who is buying into bonds with the poor current yield is simply making a foolish mistake. Most bond funds over the past 10 years is barely returning 1% above inflation.

Look, 10/15 years ago, it was said that the era of 8-10% annual growth in equities was over, that at best you could hope for is 4-6%. This was the industry consensus, everyone rushed to value investing. If you don't think that current trends have a real long-lasting impact on the 20-year time horizon, you are mismanaging your investments.

Meeting with a fee-only financial advisor can be worth it. If it’s someone taking a percentage of your assets “under management” be careful before signing on. We did that and it was not worth it for us.

Anonymous wrote:See my view is someone who is trying to “study current trends” to improve yields over a 20 time horizon is more likely to reduce their long term success than increase it.

By all means if you want to enter the debate over small cap value tilting you can, but I am pretty comfortable not trying to outguess the market.

Everyone is gaming it to a certain extent. If you invest all of your money in US Total Stock Market, you are guessing that the US will outperform every other country.

My retired parents use a financial advisor. I don’t recommend an advisor for basic 401l decisions, but they are familiar with tax laws, wills, pensions, retirement accounts, social security, challenges in retirement, health care, etc. So, at that point paying 1% a year to handle all the logistics, planning, arrangements and problems for family in slowly declining health can be worth it.

I manage a $15M portfolio for myself, spouse, and our kids. Spouse and I are in our early 50s. We're both still working, although we could afford to retire now. We've never used financial advisors, although we once signed up for a "managed separate account" program with one of the big brokerages that was a disaster. It was essentially a mutual fund except that our brokerage account bought and sold individual stocks, resulting in lots of securities transactions that had to be reported at tax time. In exchange for this service, the brokerage and the stock picking advisor collected an annual fee of about 3% as I recall. It underperformed every benchmark so we got rid of it pretty quickly. One important takeaway from the experience is that it is critical to keep your investment-related expenses low because they detract from your returns. Nowadays, with all the brokers offering commission-free trading, you can get your expenses down to almost zero. In fact, this year we had several brokers pay us large bonuses to move accounts to them (where we would continue to get commission-free trading). Another broker paid us a large "retention bonus" not to move some accounts away from them to a competitor.

I probably spend about three hours a week on average managing our accounts. Most information that you need is readily available for free on the internet, including calculators for how much you will need to retire, whether it makes sense to convert a traditional IRA to a Roth, whether it makes sense to convert a 401k plan from an old employer to an IRA, best custodians for a 529 college savings plan, etc. I like making my own investment decisions, so it is not a painful chore for me to spend time on this. If it were a burdensome chore that I disliked, then I would simply put all of our funds in a basket of index ETFs and watch the paint dry.

If I had questions that I could not find a satisfactory answer for on the internet, then I would consider hiring a financial advisor, on an hourly fee basis, to provide advice about discrete topics. I would never pay somebody 1.5% of our assets to manage them. That's a lot of money, and I don't see anyone doing a better job.

Jack Bogle and others demonstrated a long time ago that most actively managed funds and most stock pickers and money managers cannot consistently outperform the S&P500, year after year. Before hiring an asset manager on a percentage fee basis (or continuing to employ one), I would take a look at the returns delivered by the financial advisor and see whether they are superior to the 5-year (or 10-year) return of the S&P500, after deducting whatever fees you are paying. If they aren't, ETF index funds would be the way to go.

See my view is someone who is trying to “study current trends” to improve yields over a 20 time horizon is more likely to reduce their long term success than increase it.

By all means if you want to enter the debate over small cap value tilting you can, but I am pretty comfortable not trying to outguess the market.