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Old 05-26-2012, 09:47 PM   #21
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I enjoy reading Rick's comments. Though I don't know why anyone would pay him the .25% when he said on TV this week just to split your money into the 4 core funds in Vanguard total stock, international, bond and REIT fund. He gave away his secret for free
Mostly to get access to the DFA index funds which some believe are run better and cheaper than Vanguard...and have been shown to perform better than Vanguard index funds in some markets, not all. (Past performance is not an indication of future results.,etc)
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Old 05-27-2012, 07:35 AM   #22
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redtail, just a reply to say hello and to welcome you to the forum. I can't help you much as I am strictly a CD kind of guy. Your post kind of caught my eye because I retired in 1988 from a plant in Grand Rapids. Did you stay there in retirement or have you moved? Again, welcome and good luck for a great retirement.

I know you're not old enough to be a "redtail" but an interesting name.
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Old 05-27-2012, 07:44 AM   #23
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Is there a particular reason that you or your FA are holding so much cash (that is losing money after considering inflation)?
At first, he waned to see how the market was doing. The first year, 2009, it was 90% in cash, 2010 80% cash, now over 70% in cash. That is why I asked the question, I didn't think it was right to keep that much of my assets in cash. So I called him to move some of the money out of cash, to a better investment. He said he waned to wait a little bit. He has access to all of Fidelity's no load mutual funds.
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Old 05-27-2012, 07:52 AM   #24
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redtail, just a reply to say hello and to welcome you to the forum. I can't help you much as I am strictly a CD kind of guy. Your post kind of caught my eye because I retired in 1988 from a plant in Grand Rapids. Did you stay there in retirement or have you moved? Again, welcome and good luck for a great retirement.

I know you're not old enough to be a "redtail" but an interesting name.
Thanks johnnie. I still live in Grand Rapids. Redtail must have another meaning that I don't know about. I picked that name because I'm a falconer, and I been flying redtail hawks now for 15 years. It's makes my retirement very enjoyable interacting with these birds of prey.
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Old 05-27-2012, 07:59 AM   #25
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At first, he waned to see how the market was doing. The first year, 2009, it was 90% in cash, 2010 80% cash, now over 70% in cash.
Wow. The S&P 500 doubled between the spring of 2009 and now and you missed out on virtually all of those market gains. Keeping you primarily in cash during that time was a very costly strategy, not to mention the fact the FA charged you an annual fee to give you this lousy advice!
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Old 05-27-2012, 08:00 AM   #26
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At first, he waned to see how the market was doing. The first year, 2009, it was 90% in cash, 2010 80% cash, now over 70% in cash. That is why I asked the question, I didn't think it was right to keep that much of my assets in cash. So I called him to move some of the money out of cash, to a better investment. He said he waned to wait a little bit. He has access to all of Fidelity's no load mutual funds.
Your FA must be waiting for the stock market to reach it's peak before moving in. This is market timing at it's worst. If this were my portfolio I would fire the FA, put the cash into the Vanguard Wellesley fund, buy one of Bernstein's books on investing, and take it from there.
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Old 05-27-2012, 08:33 AM   #27
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Hey redtail and welcome. I'll offer a slightly different take on this, maybe in that I will ask if your AA is customized to a specific risk tolerance assessment done by the FA for you, or is this his typical plan for everyone who uses him?

Typically a fee only arrangement does work in your best interests, if you choose not to DIY, so I find it against everyone's goals for you to be so heavily weighted in cash unless there was some compelling reason to do so.

The fee you are paying isn't outrageous, in and of itself, a more common fee would be in the 1% range to 1.25%, but I wouldn't want to pay any of that on cash. Or really to have someone pick mutual finds for me.

Get to reading up on this, learn from the past, and remember no one cares as much about your money as you do. And if at the end of your analysis you fin that your risk tolerance is such that it makes sense to be so much in cash, then "manage" that yourself if not the rest of your portfolio.
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Old 05-27-2012, 09:09 AM   #28
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If this were my portfolio I would fire the FA, put the cash into the Vanguard Wellesley fund, buy one of Bernstein's books on investing, and take it from there.
FWIW, I agree (especially on the Wellesly recommendation) ...

DW/I use Wellesley for putting our current "I don't know what to do" stash, for future use of our adult, disabled "child", after we're gone.

While he has other (greater) assets he will inherit (via a SNT) after we're gone, Wellesley is our "set and forget" fund until such a time (if ever) we need to look at increasing our estate value for his benefit.

It might work for you, until you get your feet wet in your new situation.

BTW, welcome and good luck on your journey...
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Old 05-27-2012, 05:22 PM   #29
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FWIW, I agree (especially on the Wellesly recommendation) ...

DW/I use Wellesley for putting our current "I don't know what to do" stash, for future use of our adult, disabled "child", after we're gone.

While he has other (greater) assets he will inherit (via a SNT) after we're gone, Wellesley is our "set and forget" fund until such a time (if ever) we need to look at increasing our estate value for his benefit.

It might work for you, until you get your feet wet in your new situation.

BTW, welcome and good luck on your journey...
What book of Berstein would you recommend. Personally, in my portfolio, I would like to have all no-load mutual funds, with a little in cash to live on. Again, I want to thank everyone for their inputs on trying to help me out.
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Old 05-27-2012, 07:57 PM   #30
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What book of Berstein would you recommend. Personally, in my portfolio, I would like to have all no-load mutual funds, with a little in cash to live on. Again, I want to thank everyone for their inputs on trying to help me out.
This is his most recent Amazon.com: The Investor's Manifesto: Preparing for Prosperity, Armageddon, and Everything in Between (9780470505144): William J. Bernstein: Books

This is older but classic and just as good today as the day it was first released Amazon.com: The Four Pillars of Investing: Lessons for Building a Winning Portfolio (9780071747059): William Bernstein: Books
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Old 05-27-2012, 09:03 PM   #31
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Fire your FA. With all due respect, he is an idiot market timer, and a poor one at that.
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Old 05-27-2012, 10:38 PM   #32
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TIAA Direct is currently paying 1.24% for an FDIC insured savings account.
That's an attractive rate, but TIAA describes it as "promotional." Will probably revert soon.
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Old 05-27-2012, 10:42 PM   #33
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Credit Unions also may pay better interest on cash savings.
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Old 05-28-2012, 08:43 AM   #34
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That's an attractive rate, but TIAA describes it as "promotional." Will probably revert soon.
Wouldn't surprise me if it ultimately declines to that of other internet banks, but when is the question.
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Old 05-28-2012, 09:42 AM   #35
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What book of Berstein would you recommend.
MichaelB already gave you his, and I have no argument with that recommendation at all.

The one that made the greatest impact on my "thinking" was his classic, "the Four Pillars of Investing".

It's still on my bookshelf, even after many other volumes have been discarded.

My disclaimer? It's a "rough read", unless you have been investing for a bit, and understand his references. Sometimes it's best to read a few chapters - or even a few pages, do "digest" what he has to say. However (overall), it is still revelent and of value - at least to me.

Just my simple opinion, WFIW....
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Old 05-28-2012, 04:37 PM   #36
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If he charging you a fee for your cash balance...i would ask for those fees to be refunded. Either way you should can him but i would first try for the refund. It just nuts to pay .75 to make .01

I just reread some of this and i take the above back. I would go to his office with a baseball bat. Since 2009 oh my!
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Old 05-30-2012, 07:10 AM   #37
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Fire your FA. With all due respect, he is an idiot market timer, and a poor one at that.
+1.
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Old 05-30-2012, 11:31 AM   #38
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I am plannign to retire and am having trouble learning how the best way to get dispersements both in recieving and knowing how much to get. I have 980k in vanguard and 230k in current employers simple ira
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Old 05-30-2012, 12:51 PM   #39
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The couple thousand dollars you have paid him in fees each year is actually small potatoes. If that half million dollars had been in the market since 2009 instead of sitting doing nothing it would have made you several hundred thousand dollars. If most any other professional makes a mistake that costs a client/customer/patient several hundred thousand dollars they could sue them. As a FA he is probably pretty much immune from malfeasance liability in a situation like this.
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Old 05-30-2012, 12:58 PM   #40
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I am plannign to retire and am having trouble learning how the best way to get dispersements both in recieving and knowing how much to get. I have 980k in vanguard and 230k in current employers simple ira
Welcome to the forum You are asking a BIG question. It depends on how much you need to live and whether you have pensions and/or SS and whether the pension has a COLA and whether you have dependents and how old you are and how long you plan to live and whether you have health care insurance and what your tax situation is an on and on and on. A large percentage of the threads on this forum are about subjects that have to do with how we can decumulate our investments most effectvely.
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