Investment advice wanted

[Kim451]

I'm 57, single, retired last year and have the majority of my funds in the Thrift Savings Plan. My new FA (I decided to get one since I'm nervous about this market and not sure what's the best thing to do for investing) wants me to move all my money out of the TSP and put it into Ameritrade funds. I'd told them I just wanted advice, didn't want them to have hands-on to my cash, but they've sent up an Advisery account at Ameritrade for me and want me to move the funds, and they'll arrange it all... (Sounds pretty hands-on to me.)

I'm leery (I know; paranoid much?); it's a small firm; don't know how good the adviser is. I'd tried Vanguard but didn't have a good experience with the two guys I talked to there. Hadn't gotten around to trying Fidelity yet. I have a beneficiary IRA being handled by another small firm my parents used, but they tell me they can't advise on the TSP. I don't think the TSP offers a broad enough selection - no Large Cap funds for one - and I'm not very knowledgeable on investing overall. Wish the darned crystal ball worked!

Any suggestions? Try Vanguard again?

 

[Walt34]

Fire the FA! And run away from Ameritrade too.

I haven't had any difficulty with Vanguard but my requirements are pretty simple. If you're reluctant to try Vaunguard again, others here have good opinions of Schwab and Fidelity although I don't have any experience with them myself.

 

[NW-Bound]

..I'd told them I just wanted advice, didn't want them to have hands-on to my cash, but they've sent up an Advisery account at Ameritrade for me and want me to move the funds, and they'll arrange it all... (Sounds pretty hands-on to me.)...

If they did not listen to you, how are you going to trust them?

 

[braumeister]

It has been said many times here that nobody will ever care as much about your money as you do, and learning to manage it yourself is nowhere near as hard as most people think it is.

Why not just dip your toe into the water and start reading a book or two on the subject?

One of my favorites for beginners is Millionaire Teacher by Andrew Hallam.

 

[joeea]

My new FA (I decided to get one since I'm nervous about this market and not sure what's the best thing to do for investing) wants me to move all my money out of the TSP and put it into Ameritrade funds.

Any suggestions? Try Vanguard again?

Spend a few hours with a fee-only fiduciary financial planner.
Then, if you like them you can continue working with them. If not, move on to another. Repeat until you are comfortable.

 

[jazz4cash]

Don’t do anything until you get a firm grip on your situation (except maybe rite BOTH FAs). The beneficiary IRA firm should be able to give you an overview of TSP but since they can’t benefit they don’t want to spend the time. TSP has everything a typical index investor needs including the C Fund which is indeed a large cap US stock fund. You don’t seem to be inclined to invest in individual stocks or anything too exotic. I do think the TSP bond fund options are light...no high quality corporate bond fund. How is the IRA invested? You should look for a fee only planner that is knowledgeable about TSP.

 

[Freedom56]

I'm 57, single, retired last year and have the majority of my funds in the Thrift Savings Plan. My new FA (I decided to get one since I'm nervous about this market and not sure what's the best thing to do for investing) wants me to move all my money out of the TSP and put it into Ameritrade funds. I'd told them I just wanted advice, didn't want them to have hands-on to my cash, but they've sent up an Advisery account at Ameritrade for me and want me to move the funds, and they'll arrange it all... (Sounds pretty hands-on to me.)

I'm leery (I know; paranoid much?); it's a small firm; don't know how good the adviser is. I'd tried Vanguard but didn't have a good experience with the two guys I talked to there. Hadn't gotten around to trying Fidelity yet. I have a beneficiary IRA being handled by another small firm my parents used, but they tell me they can't advise on the TSP. I don't think the TSP offers a broad enough selection - no Large Cap funds for one - and I'm not very knowledgeable on investing overall. Wish the darned crystal ball worked!

Any suggestions? Try Vanguard again?

Be very careful with Advisory accounts at TDA. The fees are high and so are the losses. They were trying to push me into an account managed by some clowns called Sheaff Brock back in 2015. This is a loser firm where many of their clients lost a lot of money and there are multiple arbitration suits pending against Sheaf Brock and TDA. They bribed me with a $500 cash bonus to have a free lunch with representatives from Sheaff Brock and that lunch ended in 24 minutes after I realized I was talking to a total loser. I just had the salad and told the guy to eat my entree. He looked like he was on a 5000 calorie per day diet. I complained to my assigned TDA representative for wasting my time. They upped my cash bonsus to $750 and promised not to do it again.

Here is some information on the arbitration:

https://www.businesswire.com/news/h...RADE-CUSTOMERS-ADVISORDIRECT-ACCOUNTS-MANAGED


If you are unsure of what to do with your money, just ladder CDs or corporate bonds yourself.

 

[BoodaGazelle]

What to do

Here are some simple options:
1. Just invest in something like a “balanced” fund which uses your age to retirement.
2. Alternately, use something like a “Bogleheads” strategy... this requires almost no work and should perform very well.
3. If you want to do a little more work, use either a “Dogs of the Dow” or other dividend investing strategy, with reinvesting dividends.

All of these should do well, IMO. None of them run as much risk of being misled or sold something that only benefits the FA.

 

[HI Bill]

Here are some simple options:
1. Just invest in something like a “balanced” fund which uses your age to retirement.
2. Alternately, use something like a “Bogleheads” strategy... this requires almost no work and should perform very well.

All of these should do well, IMO. None of them run as much risk of being misled or sold something that only benefits the FA.

+1 on #1, and +1 on #2.

 

[Another Reader]

The TSP offers some of the cheapest funds out there. You are fine where you are. Moving money out of the TSP to what this slimy salesman is pushing would be a huge mistake. If you feel you need a more balanced portfolio, roll a small portion over to Vanguard and buy some of the well-managed Wellesley fund or something similar.

Run from this jerk. I don't know where you found this guy, but he clearly is not a fiduciary, acting in your best interest. He is trying to get your money under his management. You don't need or want him or the funds he suggested.

 

[MikeTN]

TSP is hard to beat

I know they don't have as many options as others, but the TSP funds have extremely low costs.

Commercial bond g funds are losing value this year because of rising interest rates yet the G fund can't lose money and is currently paying 3%, and will rise as interest rates rise.

Stay with TSP until you are really sure you have found something better.

Even then you may move only part of your money

 

[Conundrum]

Run far, run fast.

I paid for 5 hrs worth of time with a fiduciary financial planner. I felt it was money well spent.

I do the bogleheads 3 fund now. As was mentioned you could always use a lifestrategy, or balanced fund. Either would work. However, if you are worried about being able to stick to your plan during volatility a lifestrategy might be better.

 

[Kim451]

Thanks! I appreciate the advice. I know the TSP has the lowest fees, so I'll probably leave it in the TSP a while longer and read up more on TSP investment advice and the Boglehead strategy. I've heard the Lifecycle funds in the TSP are on the conservative side, so may split between the 2030 and 2040 funds, with maybe 20% in the G Fund (unless the rumor I'd heard of the govt cutting its interest rates pans out). I'm not planning to touch the money for another 10 to 15 years anyway.

The FA didn't tell me what funds they plan to put my money in; and I just received a Thank You from Ameritrade for choosing to get all my notifications electronically. I've never even logged in to Ameritrade - my comfort level with this whole idea has been exceeded...

 

[Oz investor]

I'm 57, single, retired last year and have the majority of my funds in the Thrift Savings Plan. My new FA (I decided to get one since I'm nervous about this market and not sure what's the best thing to do for investing) wants me to move all my money out of the TSP and put it into Ameritrade funds. I'd told them I just wanted advice, didn't want them to have hands-on to my cash, but they've sent up an Advisery account at Ameritrade for me and want me to move the funds, and they'll arrange it all... (Sounds pretty hands-on to me.)

I'm leery (I know; paranoid much?); it's a small firm; don't know how good the adviser is. I'd tried Vanguard but didn't have a good experience with the two guys I talked to there. Hadn't gotten around to trying Fidelity yet. I have a beneficiary IRA being handled by another small firm my parents used, but they tell me they can't advise on the TSP. I don't think the TSP offers a broad enough selection - no Large Cap funds for one - and I'm not very knowledgeable on investing overall. Wish the darned crystal ball worked!

Any suggestions? Try Vanguard again?

first of all LEARN !!!
( regardless of if you hire an adviser or not )

next have some sort of idea where you want to be in 10 years ( and beyond )

i took the bull by the horns and went , do it yourself , realizing i would make mistakes and some lucky guesses and well as sound judgment calls

there is no 'one size fits all solution ' you will have to understand which differences will suit you best ( and use them )

good luck

take a DEEP breath this will be a big adventure , no doubt about that

 

[Another Reader]

It sounds like this guy opened accounts without your permission. Unless you authorized him to do this, that's not allowed. Read anything you signed carefully. In your shoes, I would e-mail him and tell him you will not be using his services and to close any accounts he set up on your behalf immediately. You do not want them moving the money, as it would likely be impossible to move it back.

 

[Kim451]

Thanks, I'm still figuring it all out. I retired early because I had the good luck to put all my money into the most aggressive (C and S) funds several years ago, plus my mom left me a little. Now I'm just trying to make sure I don't lose it all again when the market does drop.

Not sure where I'll be in 10 years - I'm on my own, retired and the only thing tying me down at this point is my Stuff (condo & everything in it).

 

[Oz investor]

Thanks, I'm still figuring it all out. I retired early because I had the good luck to put all my money into the most aggressive (C and S) funds several years ago, plus my mom left me a little. Now I'm just trying to make sure I don't lose it all again when the market does drop.

Not sure where I'll be in 10 years - I'm on my own, retired and the only thing tying me down at this point is my Stuff (condo & everything in it).

make sure your plan is flexible then

the EASY part is to lose it again , keeping it and growing it is a little harder but not impossible .

also find yourself a reliable calculator ( to always double check the numbers )

PS paranoid is not a totally bad thing in finance even Uncle Sam is out to get some .

you CAN do it , you have started asking questions before all the cash is gone ( well done )

 

[DrRoy]

No to the FA.
No to Ameritrade.
Yes to books. I always recommend Your Money and Your Brain by Jason Zweig.
Yes to one session with a fee only planner if you like.

 

[LOL!]

I think in this case the FA does not work for Ameritrade (TDAmeritrade), but just uses them as a place to hold clients investments. Fidelity, Schwab, and TDAmeritrade all have these kinds of custodial arrangements.

Of course, the FA wants to get their hands on your money. Don't do that.

Take your time. You can even take 2 or 3 years to sort this all out. There is no rush. The TSP is one of the BEST places to have your money.

And the TSP has every investment that you will ever need. When the OP wrote "I don't think the TSP offers a broad enough selection - no Large Cap funds for one - and I'm not very knowledgeable on investing overall." I have to agree with the second part of that, but the TSP has a number of Large Cap funds: At least one for US stocks and one for International stocks. And that's all the large cap funds that one needs.

 

[iloveyoga]

Run don't walk. Such good advice from the others in this post, I won't repeat.

 

[Jerry1]

Lot of good advice here. I would reinforce the point of calling the FA and making certain that either no account was opened on you behalf or, if it was, that it is closed immediately. I’m sure there would be some State regulator that you could file a complaint to if he does not comply immediately and completely.

The other thing I totally agree with is to take you time. There is no need to move your money out and no value in moving it out until you are completely comfortable with what your doing and how you want to do it.

I did notice the comment about retirement year funds (2030 or 2040 target dates) and the thought to maybe put half in each year. If you look at the asset allocation of those types of funds, there is not enough difference in them to worry about splitting your funds. Just pick one if you want to go with a target fund and call it good.

 

[donheff]

OP: You mention that you want to look into Bogleheads for advice. If you want a simple, low cost index fund approach consistent with the BHeads advice, I think the TSP is the best place you can be. I rolled my external tIRA into the TSP. They offer a decent selection of index funds that covers the simple but diversified approach most of us here espouse. The G Fund is one of the best cash/bond alternatives on the planet. They will be instituting a wider set of options for withdrawals next year. Run, do not walk, away from your FA. Follow your inclination to read up on Bogleheads. Spend some time here learning the ropes. Read Jane Bryant Quinn's, How to Make Your Money Last, and other books recommended in various threads her.

 

[king smoothie]

If you move out of TSP have some very good reasons. One of those reasons used to be limited withdraw options, however that recently changed, although the change wasn't fully implemented the last time I checked. The flexibility and limited number of options cry is called by many financial advisors. If you aren't trying to beat the "market" some C, S, I mix will do you just fine for growth. G fund is great for wealth preservation. And the fees are much lower than most options, although there are a handful of lower fee options available that offer similar investment strategies. Possibly a good reason to rollover is if you are going to do conversions. Another may be if you want to take advantage of some of the flexibility of a Roth IRA (spending the basis, etc...). Another would be if you think you are among the minority of people who can beat the market for the long term (1 to 10%) or that your FA is one of those people who can do it after subtracting his fees and the costs of the managed funds he will likely recommend. I recommend reading A Simple Path to Wealth by JL Collins before moving any money. As well as maybe at least 5 or 6 other books to get different perspectives. As a military financial counselor I have had many clients who were not happy with the performance of their FA managed investments that they had either because the FA convinced them to do it instead of TSP or that the FA convinced them to transfer it to them. The two top causes: the FA and the service member never had a conversation about goals and a real assessment and discussion of risk and 2, the FA was making good money for the FA and not the service member.

 

[gayl]

I know they don't have as many options as others, but the TSP funds have extremely low costs. ... Stay with TSP until you are really sure you have found something better.

IMHO you don't need a lot of funds. Nothing wrong with TSP, plenty wrong with 'salesmen.' If you're not a trader, you need 3 funds MAX. (1) low cost total market (2) low cost bond - fixed income (3) standard money market to dump those dividends into. You're just trying to figure out the ratio. If a trader then 90% to those ETFs / funds & 10% to trade. So that puts you with Fidelity or Schwab, whichever office is closest for your 1st meeting and annual free review. Yep, the farther I get from employed / the simpler it becomes (currently ETFs average 0.03% expense ratio)

 

[hesperus]

The TSP offers some of the cheapest funds out there. You are fine where you are. Moving money out of the TSP to what this slimy salesman is pushing would be a huge mistake.

+1
They are very good funds, and yes, very inexpensive. In fact the G fund would be a very safe place to park $$ while you figure it out.
Having the FA* push you out of them, tells me he either knows very little about the TSP, or doesn't care. Either way, I'd run, not walk away.