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Old 06-30-2016, 04:25 PM   #21
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I've handled my investments in a few different ways over the last 30+ years:

1. Picked my own stocks - a few winners, a few losers but in the main below market returns
2. Managed account at Schwab - below market returns. I think my small account was training fodder for new associates.
3. Fee-only indexed - I think they outsmarted themselves with too many discreet "asset classes" leading to my below market returns.
4. Self-managed index funds at Vanguard - about market returns and probably the best I had done to that point.

After my wife's terminal cancer diagnosis, I put everything with a fee-only adviser (<1%/year). Different one than referenced above. Very helpful as I evaluated retiring early and changing my asset allocation. Returns have been about market, and all that I need to sustain my lifestyle for the foreseeable future.

You will read a lot of commentary here implying it is easy to confidently manage your life's savings, and to hire anyone to assist or do it for you is foolish.

The reality for me is that I spent thousands of hours over the years reading books, studying model portfolios, understanding my appetite for risk, running projections, etc. When life circumstances changed my priorities, I decided I wasn't going to spend my time that way anymore.

If you want to keep using an adviser, my advice to go with a fee-only firm with a passive/index approach. Look for a management fee of less than 1% and fund expenses should be <0.5%, preferably much lower.

Best of luck as you prepare for this next phase of your life.
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Old 06-30-2016, 04:53 PM   #22
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Old 06-30-2016, 05:02 PM   #23
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I spent wasted a lot of time procrastinating, studying, investing in "managed" funds and loading up on 20 or 30 funds in my 401(k).

My conclusion is that all I really need is Vanguard Total Stock Market, Total International and Total Bond funds. The hard part was deciding how much of each to own. YMMV.

https://www.bogleheads.org/wiki/Lazy_portfolios
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Old 06-30-2016, 05:03 PM   #24
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I spent wasted a lot of time procrastinating, studying, investing in "managed" funds and loading up on 20 or 30 funds in my 401(k).

My conclusion is that all I really need is Vanguard Total Stock Market, Total International and Total Bond funds. The hard part was deciding how much of each to own. YMMV.

https://www.bogleheads.org/wiki/Lazy_portfolios
isn't vasgx a combination of those?
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To have a Fin advisor or not
Old 06-30-2016, 05:07 PM   #25
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To have a Fin advisor or not

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isn't vasgx a combination of those?
Yes plus international bond. But I like to be able to apportion it my self.
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Old 06-30-2016, 05:08 PM   #26
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OP, another low-cost option is to let Vanguard manage your portfolio for a very reasonable fee.
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Old 06-30-2016, 05:27 PM   #27
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+1 on reading a few books. I found The Boglehead Guide to Investing to be particularly good. It is worth reading in its entirety (it is a pretty easy read). My conclusions at the end were:
1) It really isn't that hard
2) Go with a simple three or four fund lazy portfolio and you will beat the "experts" the vast majority of the time, especially if you factor in their fee (percentage or fixed)

I had a FA for many years (charging slightly less than 1%). While I liked them and they were generally conservative, I become increasingly convinced I could match their returns with my four fund lazy portfolio and the 1% I was paying them I'd rather pay to myself!
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Old 06-30-2016, 05:35 PM   #28
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I'm DIY at Fidelity. Portfolio is a 50/50 mix of iShares and Vanguard ETFs. Never had a paid financial advisor of any kind. Fidelity has excellent online tools for the DIYer, and I enjoy the annual meeting with our Private Client Group rep. Nothing much changes but I appreciate the second set of eyes at no cost to me.
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Old 06-30-2016, 06:25 PM   #29
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My only involvement with Financial Advisors was when I was ready to ER and I had a couple of them look over my AA and planned withdrawal rate. (one offered thru my workplace and another that presented a retirement symposium thru a local college). They both said I was good to go and confirmed my own analysis. ER happened 14 years ago and things so far look good thru the financial meltdowns of 2000-2003, 2008, Brexit and...
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Old 06-30-2016, 06:30 PM   #30
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Same here with FIDO private client group. So far very pleased with no pressure recommendations. If anything I wish I had listened to him more in alloacating the portion that is still sitting uninvested. Tools are great particularly the Retirement Planner.
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Old 07-01-2016, 12:10 AM   #31
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We have the same one
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Old 07-01-2016, 03:58 AM   #32
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Most are DIY but not adverse to a FEE ONLY advisor occasionally or for a specific purpose or question. Run away from one that wants to charge by assets under management.
Do read the posts on Ameriprise. Their objective has nothing to do with your retirement, it is to transfer money from your accounts to theirs.
There are many (if not most) fee only advisers that charger AUM. Even the robo advisers that I know of use that method mostly. I tend to agree that AUM can be a strange way to charge from the consumer side. I doubt there is a big difference in investing for a $100k or $200k portfolio. But a $10MM may be a different beast when managing taxes, estate planning, and so on.

I know some fee only that do charge AUM, but don't take custody. Some of the advisers fees are high and other s more reasonable. I agree that I think one can save costs with a fee for service type adviser.

One of the more well known fee only advisers (known due to radio show) charges a fairly high AUM has said (if I recall correctly) that a lot of his job is to keep people from doing knee jerk emotional reactions with their investments. Something to think about.
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Old 07-01-2016, 05:22 AM   #33
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Alot of people on this forum seem pretty knowledgable about money. Do most people here have a financial advisor or do you do it on your own ? If on your own, do you use something like etrade, vanguard or any of the numerous others ? I currently am still working (until 4/2017), so my 401k is in vanguard (which my company uses). I also have some money with an Ameriprise financial advisor.
Joe, even a "good" FA may cost you 1/4 of your returns. A bad one can cost you a lot more. I figure if I can coax out 4%, my money will last forever, because I anticipate being able to live on a 3% WR. But if I had to give 1% to a FA, he/she would have to "earn" that 1% by increasing my return. Can they? Will they?

In addition to the Boglehead Guide to Investing, I'd recommend Bernstein's "4 Pillars"...easy reads, very empowering.

And there are lots of smart, self-managed folks on here to bounce ideas off of.

Best of luck!
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Old 07-02-2016, 08:44 PM   #34
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I use an FA. He charges a percentage of AUM, though I negotiated the percentage down significantly from the rack rate. I have found it to be worthwhile.

I am sure I could do my financial planning and investing myself, if I really wanted to. The same is true with repairing my car, doing plumbing work, remodeling my basement, and preparing my tax returns. But I prefer to hire professionals for all of this.

I know that I am a minority on this Board. But there's more than one way to skin a cat...
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Old 07-02-2016, 09:04 PM   #35
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I currently am still working (until 4/2017), so my 401k is in vanguard (which my company uses). I also have some money with an Ameriprise financial advisor.
Joe,
As a rule of thumb, most retirees can plan to draw >about< 4% of their money out every year to support their living expenses. A well diversified portfolio has historically been able to support that rate of withdrawal every year.
Now, if you pay a financial advisor a fee of 1% every year (which is quite typical), it means that you are effectively giving him/her 25% of the amount you'd otherwise be able to spend on yourself (you'd get 3% every year, they'd get 1% = 4% total withdrawal). That's a LOT of money to pay someone for an activity that you can easily perform yourself in a few hours per year, I'm sure you can find a better way to spend it. And you can learn to do it quite easily. If you really don't want to do it, then consider the low-cost advisory services offered by Vanguard. And do yourself a favor--give the Ameriprise rep the heave-ho before he/she costs you even more money. You'll be incensed when you add up all you've paid them (fees to them, fees/decreased return due to the high costs of the investments they have put you in, etc)
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Old 07-02-2016, 09:52 PM   #36
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I use an % of AUM guy too and he is worth it.
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Old 07-03-2016, 06:18 AM   #37
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I spent wasted a lot of time procrastinating, studying, investing in "managed" funds and loading up on 20 or 30 funds in my 401(k).

My conclusion is that all I really need is Vanguard Total Stock Market, Total International and Total Bond funds. The hard part was deciding how much of each to own. YMMV.

https://www.bogleheads.org/wiki/Lazy_portfolios
+1 I like simplicity of such approach and it beats 90% of money manager .

To implement it all one needs is discipline and ability to stomach market changes. Once you get to certain portfolio size dividends will provide sufficient income. So no need to decide what to sell.
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Old 07-06-2016, 02:28 PM   #38
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We have one, but she's fee only. I found her here: Fee-Only Financial Advisors Home - NAPFA - The National Association of Personal Financial Advisors

I'm not as financially savvy as many here, but I just like a little affirmation every other year or so. Her first review was ~$2K, and the "tweaks" are $400, which we do every 2-3 years. She's hands off - recommendations only. Since most of our retirement is in our 401(k)'s, she isn't making a dime off the recommendations - she just advises. Her reviews also include insurance analysis, budget checks & recommendations, etc. She's younger than we are, so I plan to use her until she attends my funeral. DH doesn't do money, so I really like the back-up.
This is exactly the sort of advisor I am looking for. Unfortunately, even using Napfa and Garrett network I am having trouble finding one. I just want someone to look over everything, tell me if I am missing something, and then let me call them once every few years with a question. Everyone I talks to want control of my savings and a %, neither of which I am willing to give.
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Old 07-06-2016, 04:57 PM   #39
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This is exactly the sort of advisor I am looking for. Unfortunately, even using Napfa and Garrett network I am having trouble finding one. I just want someone to look over everything, tell me if I am missing something, and then let me call them once every few years with a question. Everyone I talks to want control of my savings and a %, neither of which I am willing to give.
A post on the Bogleheads site will get you the same thing, for free. Of course you'll get a few different opinions - then it is like wearing two watches and never knowing exactly what time it is.
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