Thinking about getting a financial advisor...

[Vil_Riker]

About 10 years ago there was a TD Ameritrade advisor (near my home) that kept hounding me and offered to ‘manage’ my money. He cold called me about 5-6 times and started to get mad that I kept on turning down his offers to help me. Guy called me on my birthday to say hello and he wants to help. I said NO.

He then said that I was being “stubborn”.…..

Normally I would have blown up and get nasty with him but I kept my cool. I told him next time he pesters me I will have to call corporate office and complain that I’m be harassed.

I don’t know if TD Ameritrade was telling their financial advisors to cold call account holders that were trading online and trying to persuade them to use the financial advisor services of TD Ameritrade.

That's where they make their money. I have sought "advice" from financial advisors just to see what it is all about. They basically measure your risk tolerance and sell you a mutual fund portfolio. I lost a few IQ points by being there.

 

[JeffKeryk]

I fired Fidelity because my trusted advisor had me sell some options and buy an annuity. Let's just say I am not a good candidate for an annuity. It is a good annuity but just the same. As I learned more I realized he made a big fat commission. So I moved almost everything to Schwab. I did get several calls from Fidelity but I felt swindled. I am now under the Schwab Wealth Advisory. It's been good; they even gave me an appointment with a high priced tax attorney.

 

[JavierH19]

I always tell people to invest in yourself first and always. Learn as much as you can. But if you are lucky enough, you will have a portfolio that grows large enough that you need a good financial advisor. There are so many products to invest in; quality advice is critical.

There are good advisors and bad advisors. Again, I fired Fidelity and moved almost everything over to Schwab; there was a reason for it.
An excellent place to learn is on the Schwab website under the "Learn" menu item:
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asked a question then saw you already answered it further down.

 

[supton]

I keep thinking about talking to an advisor, but only on a fixed fee basis. Like a one time checkup, see you again in 5 years sort of thing. Still figure I don't have a big enough figure to bother--but then again, maybe it's not big enough because I don't go looking for help?

Lots of stuff out there on the web. It's a bit overwhelming, but, unlike an advisor... it's free, only costs your time.

 

[Astro14]

I keep thinking about talking to an advisor, but only on a fixed fee basis. Like a one time checkup, see you again in 5 years sort of thing. Still figure I don't have a big enough figure to bother--but then again, maybe it's not big enough because I don't go looking for help?

Lots of stuff out there on the web. It's a bit overwhelming, but, unlike an advisor... it's free, only costs your time.

If you don’t think you have enough to talk to a financial advisor, then you need a financial advisor.

And while not every financial advisor is good, the information on the Internet is often less trustworthy.

I would be very curious to see the net worth of the people on this thread recommending against a financial advisor.

I would be a lot more inclined to listen to the opinion of someone with a net worth of say $1 million, who has a financial advisor, than someone with significantly less, who does not.

 

[ARCOgraphite]

I fired Fidelity because my trusted advisor had me sell some options and buy an annuity. Let's just say I am not a good candidate for an annuity. It is a good annuity but just the same. As I learned more I realized he made a big fat commission. So I moved almost everything to Schwab. I did get several calls from Fidelity but I felt swindled. I am now under the Schwab Wealth Advisory. It's been good; they even gave me an appointment with a high priced tax attorney.

Does the commission matter if the product works for you? That must have transpired a while ago given the "false security" of the fiduciary blanked being pushed, Almost any firm the advisor + corporate are taking about 20-30K annually on a 2M portfolio depending on the investment mix and exp ratio.
I only mention this since I had my Mom's nest egg in three fixed annuities that bridged her securely past the recession of 2008- 2009. The big mistake then was not selling her condo and moving into a lease - before thar real estate bubble popped.

It's tough to move when you are in your 90's, and she loved where she was.

- Ken

 

[JeffKeryk]

I keep thinking about talking to an advisor, but only on a fixed fee basis. Like a one time checkup, see you again in 5 years sort of thing. Still figure I don't have a big enough figure to bother--but then again, maybe it's not big enough because I don't go looking for help?

Lots of stuff out there on the web. It's a bit overwhelming, but, unlike an advisor... it's free, only costs your time.

There is no free. And if there is, that's about all it's worth.
Again, if you needed brain surgery, would you rather be self directed or use a skilled, educated, specialist surgeon?

Is a good mechanic free? Do you work for free?
In my case, I learned there are sooooo many products to invest in. There is no way I (or you) could know about them or understand them as compared to a staff of highly qualified advisors; especially how they fit into your specific case.

I hope you end up with a top tier (expensive) advisory. That generally means you have $5M or more in your portfolio. Go for it!

 

[JeffKeryk]

Does the commission matter if the product works for you? That must have transpired a while ago given the "false security" of the fiduciary blanked being pushed, Almost any firm the advisor + corporate are taking about 20-30K annually on a 2M portfolio depending on the investment mix and exp ratio.
I only mention this since I had my Mom's nest egg in three fixed annuities that bridged her securely past the recession of 2008- 2009. The big mistake then was not selling her condo and moving into a lease - before thar real estate bubble popped.

It's tough to move when you are in your 90's, and she loved where she was.

- Ken

Not sure I understand your question...
Annunities tend to be appropriate for those who need a fixed income to live on. In other words, investors with smaller portfolios that may not sustain them over time.

It sounds like your Mother is in good hands; living where she is happy with a secure income. Good on you for taking care of your dear Mother. Interestingly, my father was a super tight wad; I never knew what he owned. One day, in his 80's, he took me to Schwab, introduced me to his advisor and signed control over to me. I was speechless. I also managed it a lot better than he, but a lot of that was due to the run up starting in 2009 or so...

 

[VTECOverRated]

I've never been against commodities as they are resilient in bad times though historically they've underperformed the market which surprised me when i learned that. Though buying and selling physical gold and silver is troublesome I'd consider gold futures.

Futures are paper. When time comes to cover margin calls everyone dumps and prices for paper gold and silver plummet while physical goes up. Happens every time. I have a deal with a local shop that buys and sells gold and we just have a good relationship. Back to basics, face to face.

 

[VTECOverRated]

I always tell people to invest in yourself first and always. Learn as much as you can. But if you are lucky enough, you will have a portfolio that grows large enough that you need a good financial advisor. There are so many products to invest in; quality advice is critical.

There are good advisors and bad advisors. Again, I fired Fidelity and moved almost everything over to Schwab; there was a reason for it.
An excellent place to learn is on the Schwab website under the "Learn" menu item:
View attachment 184983

Scwab will be the second one to fail after BoA. They are cooking books.

BoA just had their earnings call. Its so fake a 5 year old could tell they are underwater. But they exceeded estimates by reshuffling what it means to make money...but their balance sheet is full of bust bonds and worthless sub 1% treasuries...

 

[VTECOverRated]

How much of a balance does someone need to have to justify a financial advisor ?

$250K, $500K, $1M , ….etc…. ?

Some financial advisors are good, others are crooks and very shady.

Its less about how much you have but how much you can afford to pay him and still make money.

 

[frankbee3]

I always tell people to invest in yourself first and always. Learn as much as you can. But if you are lucky enough, you will have a portfolio that grows large enough that you need a good financial advisor. There are so many products to invest in; quality advice is critical.

There are good advisors and bad advisors. Again, I fired Fidelity and moved almost everything over to Schwab; there was a reason for it.
An excellent place to learn is on the Schwab website under the "Learn" menu item:
View attachment 184983

Hi Jeff, your advice here is spot on! I am with Schwab and have used the learn tab on their website quite a bit. Also, investing in yourself is a good way to phrase to do your own research. "Nobody cares as much about you as you do yourself." The time I spent learning about money management has always been worthwhile.

I am overdue for self study.

 

[TiGeo]

I've always seen folks like this as middle men taking my money that I don't need. Should be somewhat straightforward to research these topics and make decisions. I will say IF I was going to use one, I want one that just charges an hourly rate for advice, nobody that is getting fees/commissions on products they sell.

 

[andrew_j]

Make sure you trust them and clearly understand what they are saying . If you ask for clarification and they cannot break down into terms you understand or comfortable with move on.

I have one and it turned out great for me in life. My dad was terrible and I burned 16k of 24k accident settlement age 19. A friend was financial advisor intern and helped me take remainder turn into 30k in a few years instead of accessible. Age 22 owned 20% of first home purchased in low market.

I have state school for eldest funded for four years , life insurance (term) and decent retirement (most self contributions) on advice of advisor.

 

[99Saturn]

There is no free. And if there is, that's about all it's worth.
Again, if you needed brain surgery, would you rather be self directed or use a skilled, educated, specialist surgeon?

Is a good mechanic free? Do you work for free?
In my case, I learned there are sooooo many products to invest in. There is no way I (or you) could know about them or understand them as compared to a staff of highly qualified advisors; especially how they fit into your specific case.

I hope you end up with a top tier (expensive) advisory. That generally means you have $5M or more in your portfolio. Go for it!

Don't many here successfully maintain their own vehicles without a mechanic?

Not saying an advisor is never warranted but everyone's situation is different.

 

[JeffKeryk]

Don't many here successfully maintain their own vehicles without a mechanic?

Not saying an advisor is never warranted but everyone's situation is different.

Fair enough. I humbly suggest to you there is no one here who has $100K of tools, several lifts, a full paint booth, Hunter alignment rack, TechStream SW and other SW, tire shop, on and on.
Schwab provides a full range of securities, brokerage, banking, money management, and financial advisory services.

I certainly agree every situation is different and I wish you and everyone the best. The sheer number of investment products is daunting. There is no way I could possibly begin to be exposed to what's out there.

I have exactly 2 individual stock holdings: Lam Research from my career (purchases, options and grants) and a little Tesla (my purchase). Everything else, from ultra conservative to growth is Schwab or Fidelity products. Highly diversified from wack TSLA to ultra conservative CA double tax free Muni Bond Fund. So the risky stuff can fail or succeed, while the conservative is as close to safe as it gets and I can live on it forever without touching the principle. I could never do this on my own; I am just a lowly programmer. What do I know?

Again, best of luck in your investing endeavors.

 

[Dave Hess]

Here's the disclaimer, I don't know nothing about using a financial advisor, I don't know what to look for in one, besides getting one that is a fiduciary. Is there a site that rates them, on their performance, fees, et? I want them to maybe manage my 401K. I have been listening to one called American Wealth Advisors. Her fee is 1.2% of the total amount of 401K at the end of the year, I think. What do you you investors say?

If your 401K balance was $1M…. you should be able to manage it yourself and be very careful with your nest egg.

Ultimately it comes down to the level of risk you are willing to take.

 

[supton]

Again, if you needed brain surgery, would you rather be self directed or use a skilled, educated, specialist surgeon?

No, but I would be doing all I could to read up on whatever it was that I needed. While usually one can blindly trust their doc, well, sometimes that isn’t best.

Is a good mechanic free? Do you work for free?

No and no. Although the older I get, the more I charge for doing stuff I don’t want to do. Too bad I can’t find work at those rates and get paid that!

I would be fine paying a flat fee, every five or so years, for advice and planning. But I know enough to realize that once a good plan is set in place, all I need to do is to keep contributing to my portfolio. Once a year I check the tax brackets for next year, the max contribution limits, and adjust my budget accordingly. That is the most I should be doing on a yearly basis.

 

[supton]

Was poking around this morning, reading bogleheads, came to the dumb observation that I've been ignoring: a financial adviser who charges a % has skin in the game. The bigger your account, the bigger their take. Duh, not sure why I didn't think of that.

Still, I'm below Fidelity's threshold. Maybe my local agent would be of help. Bogleheads seem split on the idea, some for, some against. I still think I'm at too little and my simple account is good enough. BUT there is a point about if I depart this mortal coil--what would my survivors do? At some point I might have to give in, if the wife doesn't want to take over.

I still have yet to write a will, been putting that off, but technically I somehow have acquired an estate to hand off. Ugh, I started out in life with nothing, and now that I have something, it's kinda uncomfortable.

 

[Dave Hess]

Wife has to be involved in ALL ASPECTS of the family finances while you are still alive.

Investments, retirement accounts, bank accounts, Taxes, paying bills, liabilities, savings, finances, cookie jar money, etc….

If she doesn’t want to get involved and be in the know…… people will take advantage of her.

*** Make sure all beneficiaries are correct ***

Too many women are in the dark when their husband suddenly dies and they have zero idea of the family finances. Court ordered Probate can get very expensive if all parties involved don’t agree on an amicable outcome.