-12% YTD. Thoughts on these holdings?

[mikes425]

Yes, this is what keeps FAs in business. Also people's feelings that they just do not want to mess with the financial stuff, especially when they don't understand what the FA is costing them in fees and underperformance. Sad, but I cannot be my brother's keeper.

I understand what you're saying and appreciate it. I'll just restate an important detail which is that this is by no means a typical/conventional "AUM" 1% or more FA arrangement...so to be clear, what i am paying is a tiny fraction of the typical FA scenario and has had minuscule cost impact. This is a former fund manager who established a 'boutique' small advisory firm. I got acquainted with him when I was freaking out post 2008-09. Since then I 've maintained my own portfolio and consulted with him at most 2-3x a year on a purely hourly, no-strings-attached basis. These meetings have always only been my at my own discretion and request.

I have seen this as a proactive situation and he has no proprietary interest or benefit gained by any funds he's suggested over the years. I may, as well, be underreporting or short-changing him as far as the actual returns he's helped to accomplish by not factoring in say, dividend income as well as growth of principal. Oversimplification for the purposes of an OP like mine can gloss over some important details. Also to reiterate, FWIW, my total asset value under his 'occasional' guidance has roughly doubled, to recent highs of about 2.4m (before downturn) while working with him. I'm likely the only client for whom he does an hourly thing and i disbelieve that he's ever steered me into any funds for his own gain, because he has zero 'commission' interest let alone physical attachment to my brokerage accounts.

I'll acknowledge that i could've matched and maybe bettered his recommendations and resulting performance with like, a single balanced VG fund alone, and I suspect you'd say I'm trying to justify my laziness in not having made a change by this point. That point does not elude me. Hence, why I'm seriously reflecting on all this at the moment... Thanks

 

[OldShooter]

I understand what you're saying ... <snip> ... I suspect you'd say I'm trying to justify my laziness in not having made a change by this point. That point does not elude me. Hence, why I'm seriously reflecting on all this at the moment... Thanks

Sorry. Abject apologies. I was commenting generally in response to @dtail's comments, actually thinking about some fairly wealthy friends of mine in Iowa who are almost militant about not wanting to worry about managing their money. Nothing about you at all. I think you are actually doing quite well with your fee-for-services situation though you are obviously becoming concerned about unnecessary complexity.

Re funds for his gain I didn't intend to imply any of that either. It's more of a business practices kind of thing -- FAs seem to be very prone to favor unnecessarily complex portfolios. A big part of that is to make the task look too hard for mere mortals. After all, an FA who buys and holds a three-fund portfolio will, after two or three years, have clients asking what they are paying for -- the FA isn't doing anything. I have had FAs admit this to me. It's kind of a necessary evil for them.

 

[Badger]

Hi, thanks for the replies. FA is basically saying I'm doing better than average with a 50/50 AA and that using the AGG bond benchmark is a little skewed because my bond fund mix doesn't really resemble that index...

I don't have a FA and would not even consider hiring one. Our IRAs are in Wellington, Wellsley, cash, then we have some individual stocks and cash in taxable accounts. To date we are at -8% or maybe a bit better. Since our RMD will be taken from cash in the IRAs that we swept in from dividends we won't be selling shares from the MF.
Investing doesn't have to be difficult or complicated regardless of what the FA would tell you.
Note: Our backgrounds are nothing even remotely close to personal finance.
Note: Thanks to many of the members here who have been so helpful over the years. I have been paying attention.

Cheers!

 

[mikes425]

Sorry. Abject apologies. I was commenting generally in response to @dtail's comments, actually thinking about some fairly wealthy friends of mine in Iowa who are almost militant about not wanting to worry about managing their money. Nothing about you at all. I think you are actually doing quite well with your fee-for-services situation though you are obviously becoming concerned about unnecessary complexity.

Re funds for his gain I didn't intend to imply any of that either. It's more of a business practices kind of thing -- FAs seem to be very prone to favor unnecessarily complex portfolios. A big part of that is to make the task look too hard for mere mortals. After all, an FA who buys and holds a three-fund portfolio will, after two or three years, have clients asking what they are paying for -- the FA isn't doing anything. I have had FAs admit this to me. It's kind of a necessary evil for them.

No problem and I really do think you make a very sensible and valid point.
One of my greatest and perhaps costliest problems with $$ and other areas has been indecision and procrastination. I suppose i've done ok in spite of myself; ) but no doubt could've made greater strides had i acted many years ago on similar advice. In any event I do intend to revisit the discussion with him of simplification and rationale for # of funds. Like you say, tax consequences in the I-401k/Roth accts aren't an issue on that front - and with this year's losses in taxable, maybe an opportune time to do some significant consolidation in that account. Thanks!

 

[mikes425]

I don't have a FA and would not even consider hiring one. Our IRAs are in Wellington, Wellsley, cash, then we have some individual stocks and cash in taxable accounts. To date we are at -8% or maybe a bit better. Since our RMD will be taken from cash in the IRAs that we swept in from dividends we won't be selling shares from the MF.
Investing doesn't have to be difficult or complicated regardless of what the FA would tell you.
Note: Our backgrounds are nothing even remotely close to personal finance.
Note: Thanks to many of the members here who have been so helpful over the years. I have been paying attention.

Cheers!

Agreed and glad you've done so well! Likewise, I appreciate the collective wisdom and advice here and find little to take issue with as far as simplification. I'm all about less complexity in investing and life in general : )

 

[OldShooter]

... In any event I do intend to revisit the discussion with him of simplification and rationale for # of funds. ...

Remember this this is not a negotiation. You have hired him because you respect his expertise and opinions, but you are still the customer. If you want a simpler portfolio after discussing it with him, then he should not be an obstacle. It is his job to help you achieve it.

 

[mikes425]

Remember this this is not a negotiation. You have hired him because you respect his expertise and opinions, but you are still the customer. If you want a simpler portfolio after discussing it with him, then he should not be an obstacle. It is his job to help you achieve it.

Yep. Absolutely!