Just wondering ?

frayne

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The thread on FAs got me to wondering just what percentage of the investing public are do-it-yourselfers, like many of those here on the ER forum ?

I don't know if there is enough good information to quantify and come up with an accurate number but I would guess less than 5%.

What do you think ?
 
I think you are close with the 5% estimate.
If I counted just the ones in my zip code it would be a large number!
 
I suspect a large %age of the people I work/worked with are DIY investors.

A) They tend to be very frugal; the only things they spend freely on seem to be kitchen remodels, daughter's wedding, and trips to Disney facilities.

B) When I was looking around for recommendations for a new tax CPA, nobody had one. They all did their own taxes. I know some of them owned rentals, etc. so had fairly complicated returns.

Amethyst
 
I would expect that there is be a very strong correlation to the amount of assets. I don't really know the answer but 5% overall does not seem ridiculous. I had a FA for a portion of my investments for 10 of 35 years, but am DIY again now.
 
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Depends on whether you're only counting people who have taxable investments or including those who only invest in their 401k's.

I suspect majority of folks who only have their 401k's don't have financial advisors and are probably investing in whatever the default auto-enroll option is.
 
Depends on whether you're only counting people who have taxable investments or including those who only invest in their 401k's.

I suspect majority of folks who only have their 401k's don't have financial advisors and are probably investing in whatever the default auto-enroll option is.
+1 Very few people bother with advisors (or advice for that matter) for their 401K allocations. There probably should be a law requiring these plans to offer low cost, index based lifecycle funds as the default choice if employees don't want to learn about this stuff. I suspect most people don't even think about advisors until they start accumulating significant funds, particularly taxable funds.
 
I think this thread needs a much more descriptive title than "Just wondering?"


I also think it depends on whether or not you are including 401K only investors as asked above. Even assuming not, I don't think the number is that low. I know a lot of people who invest on their own. Maybe it's a self-selecting group as someone with an FA isn't likely to bring up financial topics like others do.
 
The number has to be more than 5%, way more! Give that one large player only sells through FA's I'm in the 25% camp. Edward D. Jones advertises they have 7 million fools er investors. Say what you want ED Jones would not lie, not on tv!
 
At my old w*rk it was probably 50-50... of those who saved/invested. I had to nag a couple younger coworkers to up their 401k contributions. (Trust me, they could afford it... just weren't doing it.) The folks in their 50s/60's all had investments outside their 401k - and about half used "wealth managers" or FAs, and the other half were DIYers using Vanguard. Mindset was different between both groups, too... Cheapo's like me who tended to be savers (driving used cars, bringing in lunch from home) tended towards the DIY camp. Those who drove the high end cars, designer clothes, tended to use "wealth managers". I think they perceived themselves as wealthier because they had someone else managing their money.
 
+1 Very few people bother with advisors (or advice for that matter) for their 401K allocations. There probably should be a law requiring these plans to offer low cost, index based lifecycle funds as the default choice if employees don't want to learn about this stuff. I suspect most people don't even think about advisors until they start accumulating significant funds, particularly taxable funds.
Yup. I reckon having something like Vanguard Target Retirement or Fidelity Freedom Index as the default investment option for 401k would be adequate. Mayhaps not the best choice but likely better than other alternatives. I believe TSP Lifecycle L funds are already the default for new fed hires.

Honestly, I think most people don't even think about financial advisors until they reach maybe their 40s and 50s and have amassed significant wealth or figure "Shoot, I need to start planning for my retirement". The only 20-30 year olds I personally know who have FAs are those whose parents brought them to the (parents') FA. There are also some obvious targets for FAs - celebrities, sports stars, lottery winners, doctors, etc.
 
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