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Re: Our CFP results for the year
Old 02-12-2007, 10:30 AM   #21
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Re: Our CFP results for the year

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Originally Posted by terminator
She moved you into gold and emerging markets which is fine.

Pretty much every "mainstream" asset class did well last year.
Ding! Ding! Ding!

Further point that the couple of high risk asset classes mentioned did exceptionally well in the last few years, and that there were few predictors of their doing well. It was dumb luck.

Compare your results with one of the many free asset class slice and dice portfolios, like a coffee house or regular MPT type ports. Bet they did just about as well and would perform more evenly over longer periods of time, with no fees and low cost.
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Re: Our CFP results for the year
Old 02-12-2007, 10:34 AM   #22
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Re: Our CFP results for the year

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Originally Posted by Cute Fuzzy Bunny
I suppose I *should* offer something, considering I've beaten the s&p 500 for about 12 years running. Looking good for a 13th too.
Well, lemme "offer" this thought: Bill Miller was a coin-flipping monkey but bunnies presumably added value to the process?

Oh, wait, you didn't have to contend with fund bloat!

We're all brilliant investors until we've beaten the S&P for at least two decades.
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Re: Our CFP results for the year
Old 02-12-2007, 10:36 AM   #23
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Re: Our CFP results for the year

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Originally Posted by Nords
Well, lemme "offer" this thought: Bill Miller was a coin-flipping monkey but bunnies presumably added value to the process?

Oh, wait, you didn't have to contend with fund bloat!

We're all brilliant investors until we've beaten the S&P for at least two decades.
Yeah, Bill Miller is a real "monkey", so is that "idiot" Warren Buffet..............
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Re: Our CFP results for the year
Old 02-12-2007, 10:44 AM   #24
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Re: Our CFP results for the year

Hey! I'm getting a LITTLE bloat...my wife keeps bringing home more money and I have to find SOMETHING to do with it!

Bunny's are OBVIOUSLY better than monkeys. For a lot of reasons!
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Re: Our CFP results for the year
Old 02-12-2007, 03:56 PM   #25
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Re: Our CFP results for the year

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Originally Posted by Callie
> OK, a CFP is good to get started, but can we all agree that if the safe withdrawal rate is about 4% a year and if the CFP takes 1% of assets every year, then paying the CFP is like an extra 25% tax hit on your withdrawals that one can easily avoid with a minor amount of education?

I had posted when I first joined that this was a short term solution we agreed to - we needed help getting started. In no way would we be doing this in retirement! We will manage our own money in the next couple of years. We plan to ER in about 5, maybe earlier.

I actually plugged the money we had invested into a sample portfolio in the funds we used to have the money in, and she did much better.

Also, alot of our funds are in 401Ks that she is not paid on, but advises us. Her advice has been terrific on everything.

My husband even has some investments for college funds, and she reviewed those, although they are invested somewhere else (no one is paid on this money).

As far as when she doesn't perform, we will decide that when it happens. We were very direct on this with her.
Considering that at some point I hope to be a CFP, I guess I should take exception to the conventional wisdom, that all financial advisors are at worst case crooks and at best case leeches slowly sucking their victims dry.

It does require a lot of work to become a CFP and by all accounts the test isn't easy. Some of the stuff she has learned is not obvious. If the value of her knowledge is worth 1% of your assets is an open question, but clearly she did ok this year.

Out of curiousity, could you post a bit more information about the portfolio she had you invested in, which mutual funds, individual stocks?, asset allocation, how did she invest in gold, and emerging markets.

I think you are very smart to benchmark her performance vs your previous funds. In fact as long as you are keep close eye on your investments, I think it may make sense for you to keep with her. However at some point, in the next couple of years you should have the discussion with her about switching over to a fee-only based advice. Once she has your portfolio pretty much set, the quarterly tweaking doesn't take a lot of time and paying her a fee as opposed to a 1% expense ratio I think is fairer way of operating.
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Re: Our CFP results for the year
Old 02-12-2007, 04:11 PM   #26
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Re: Our CFP results for the year

One can only speculate in hindsight:

1966 - a fee only CFP versus my actual investment learning curve via the school of hard knocks/reading would have definately improved my retirement.

A grey haired(believable gravitas) mentor type versus a hot young(but intelligently convincing sweetie) female graduate.

I was single and 21 in 1966.

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Re: Our CFP results for the year
Old 02-12-2007, 05:41 PM   #27
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Re: Our CFP results for the year

Callie,

I think you need to take care of your own money and investing. It is not difficult.

If you insist on using a CFP or any of the other designations, go with a planner that is "fee only." The "only 1%" is a guaranteed rip off. For one, they are also negotiable and a fee only planner will cost you much less.

In general, planners add little value to those willing to do a modest amount of learning.

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Re: Our CFP results for the year
Old 02-12-2007, 10:10 PM   #28
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Re: Our CFP results for the year

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Originally Posted by 2B
Callie,

I think you need to take care of your own money and investing. It is not difficult.

If you insist on using a CFP or any of the other designations, go with a planner that is "fee only." The "only 1%" is a guaranteed rip off. For one, they are also negotiable and a fee only planner will cost you much less.

In general, planners add little value to those willing to do a modest amount of learning.

2B
I think you meant "hourly fee" versus "yearly fee for investing". Many advisors do a flat 1%, but a lot more do different schedules for different asset mixes, etc.
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Re: Our CFP results for the year
Old 02-13-2007, 04:43 AM   #29
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Re: Our CFP results for the year

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Originally Posted by FinanceDude
I think you meant "hourly fee" versus "yearly fee for investing". Many advisors do a flat 1%, but a lot more do different schedules for different asset mixes, etc.
I meant avoid giving a % of assets. 1% sounds so "trivial" but when you really see how many $$$ are involved it can get outrageous. I've heard different terms used but "hourly rate" or a "fixed $$$ fee" will involve the physical payment of cash to the planner when the service is rendered.

It's so much more painful that magically have money deducted from the account every month (only 1/12 of 1% -- barely noticeable ) . That will make the value proposition be reviewed more carefully.

Callie may not get concerned about the 1/12 of 1% every month on her $500K portfolio (amount for example purposes only) -- only $416 that is lost in all the clutter. At the end of the year she's out $5,000. If she had to hand that over in a check one time, she'd probably stop and think about whether she can do this on her own a little more seriously.
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Re: Our CFP results for the year
Old 02-13-2007, 09:30 AM   #30
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Re: Our CFP results for the year

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Originally Posted by 2B
Callie may not get concerned about the 1/12 of 1% every month on her $500K portfolio (amount for example purposes only) -- only $416 that is lost in all the clutter. At the end of the year she's out $5,000.
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Re: Our CFP results for the year
Old 02-13-2007, 02:00 PM   #31
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Re: Our CFP results for the year

Quote:
Originally Posted by 2B
Callie may not get concerned about the 1/12 of 1% every month on her $500K portfolio (amount for example purposes only) -- only $416 that is lost in all the clutter. At the end of the year she's out $5,000. If she had to hand that over in a check one time, she'd probably stop and think about whether she can do this on her own a little more seriously.
Management fees are deducted on a quarterly basis, so she will see $1250 out of her balance every 3 months.

Why are you being so hard on her? If she wants to hire a CFP, it's not like it's affecting your portfolio? Maybe in time she will do it herself, and wants someone who is taking steps she is not emotionally or mentally ready to take..........it's NOT laziness.............
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