Until recently I've been managing my own finances, but I got married last year and we're thinking about kids, house, retirement, etc, so I felt I needed financial advice. I asked my friends for a referral to a financial advisor, and got several glowing recommendations.
The first one I talked to was private, and was way too expensive for me -- something like $1100 for a series of meetings and an investment strategy, plus some kind of commission structure to manage our money (which he clearly wanted to do).
The second one was an Ameriprise guy. I hear the groans now (I found this site via the Amerprise thread http://www.early-retirement.org/forums/f30/is-ameriprise-any-good-30658.html). But this guy was recently rated in the top 4% of FAs in Boston, and we got a great vibe from him on the phone and in a free initial meeting. He's charging us $400 for the year for planning, doesn't require that we invest with Ameriprise, and isn't recommending life or disability insurance until we have a mortgage or kids to protect. He explained his investment recommendations really well, and it fit with my own understanding of what a portfolio should look like. However, he did SUGGEST that we put it all in an Ameriprise account to consolidate our investments, and he WOULD be charging commission fees on that, of around 1%. He made it sound like that was 1% a year, and that it was basically the same as paying the ER on a fund (e.g. Fidelity), but that Ameriprise was buying Class A funds and absorbing the front-end load to eliminate/minimize the ER. It sounded good, but I was suspicious, hence my digging on the internet. I'm trying to pin him down 100% on what those fees are going to add up to, and how they compare to my current 401k at Fidelity. If anyone has any insight I can use to analyze his answers, that would be great.
So anyway, if I don't like his answers I will keep my money somewhere else and take/leave his recommendations as I see fit. BUT, I have a few questions for you smart folks about this whole idea of consolidating our investments in one place. It seems like a really good idea from a convenience standpoint, to be able to log into one website and see everything, get one statement, move things around for free within one uber-account. BUT, that also seems just a bit risky to me. What happens if the company collapses? That seems unlikely, but, y'know, AIG...
Is the money protected in any way from that scenario? Am I crazy to be worrying about that? Am I crazy to be talking to an FA who works for Ameriprise? Am I extra-crazy if I let Ameriprise handle my money? Can I, and should I, set up all my investment vehicles under one roof elsewhere? Vanguard, Fidelity, where would you suggest?
Thanks for any advice!
The first one I talked to was private, and was way too expensive for me -- something like $1100 for a series of meetings and an investment strategy, plus some kind of commission structure to manage our money (which he clearly wanted to do).
The second one was an Ameriprise guy. I hear the groans now (I found this site via the Amerprise thread http://www.early-retirement.org/forums/f30/is-ameriprise-any-good-30658.html). But this guy was recently rated in the top 4% of FAs in Boston, and we got a great vibe from him on the phone and in a free initial meeting. He's charging us $400 for the year for planning, doesn't require that we invest with Ameriprise, and isn't recommending life or disability insurance until we have a mortgage or kids to protect. He explained his investment recommendations really well, and it fit with my own understanding of what a portfolio should look like. However, he did SUGGEST that we put it all in an Ameriprise account to consolidate our investments, and he WOULD be charging commission fees on that, of around 1%. He made it sound like that was 1% a year, and that it was basically the same as paying the ER on a fund (e.g. Fidelity), but that Ameriprise was buying Class A funds and absorbing the front-end load to eliminate/minimize the ER. It sounded good, but I was suspicious, hence my digging on the internet. I'm trying to pin him down 100% on what those fees are going to add up to, and how they compare to my current 401k at Fidelity. If anyone has any insight I can use to analyze his answers, that would be great.
So anyway, if I don't like his answers I will keep my money somewhere else and take/leave his recommendations as I see fit. BUT, I have a few questions for you smart folks about this whole idea of consolidating our investments in one place. It seems like a really good idea from a convenience standpoint, to be able to log into one website and see everything, get one statement, move things around for free within one uber-account. BUT, that also seems just a bit risky to me. What happens if the company collapses? That seems unlikely, but, y'know, AIG...
Is the money protected in any way from that scenario? Am I crazy to be worrying about that? Am I crazy to be talking to an FA who works for Ameriprise? Am I extra-crazy if I let Ameriprise handle my money? Can I, and should I, set up all my investment vehicles under one roof elsewhere? Vanguard, Fidelity, where would you suggest?
Thanks for any advice!