Q's you could ask IF you had a financial advisor

[kumquat]

Who are you and why are you [-]investing [/-]mucking with MY money?

 

[jazz4cash]

Of course, how could somebody who has guided dozens if not hundreds of people through all the stages of retirement know any more than somebody who has done it ONCE?

I guess this would be the basis for my questions.....

1. How many individuals have you guided through ALL the stages of retirement including all the stages of of various market cycles?

2. How is MY situation similar or unique to all the others?

 

[Nords]

I don't agree. Would you say that an attorney who during her career had worked on dozens of cases wouldn't be able to know the details of yours. What about an accountant? Most of them (who do compliance work) will do over a hundred returns during a tax season, would they not be able to know the details of their clients?

I think it's mostly ignorant communication between the customer and the paid professional.

My BIL is a tax CPA, and he's very good at asking the types of questions that have clients going "Oh, that? You need to know about that?!?" But he doesn't know the details of his clients any more than what he has on his computer screen.

Meanwhile I only have to sniff around for the tax aspects of what I did last year and what I'd like to do next year. I know our situation far better than I'd know yours or anyone else's, even if I just had one client. Even better, I know before I do something what I need to learn about it to make a good decision. Most people aren't willing to invest the time (or money) to consult with a CPA as frequently as they should... another communications barrier.

Another problem is that most people aren't willing to keep shopping around for a good CPA or adviser. Get burned once or twice and the search is over. The one time I used a CPA I immediately regretted it (he compounded his mistake by lying about it). While I was researching what I'd need from a CPA, I learned that it was easier to learn how to do my own Form 990s & 1099-MISCs for our small non-profit than it was to find a good accountant.

I suspect that, like any really good mutual fund, a really good paid professional also struggles with client bloat and keeping up with all the facets of the business. When you're doing your own, however, it's a lot easier to keep up.

 

[yakers]

I'd focus on questions that would be difficult to answer on my own:
1. What did I miss?

2. What am I forgetting?

3. What stupid/misunderstood assumptions have I made?

I think these are real questions. That is why I posted a question recently about getting OUT of Wellesley. Not that I wanted to, it has lost less than most funds, but I have to wonder what I am missing. At one time all I knew was the S&P500 index, then I added some international. But I do not know what all the asset classes really are. and this board is a great place for me to post such questions and get people's ideas.
I had but do not currently have a FA but if I did, these are some of the better questions I would ask and I could not even formulate them as well. When I had a FA the way the question came out was simply 'do I have enough to retire'?

 

[audreyh1]

Another problem is that most people aren't willing to keep shopping around for a good CPA or adviser. Get burned once or twice and the search is over. The one time I used a CPA I immediately regretted it (he compounded his mistake by lying about it). While I was researching what I'd need from a CPA, I learned that it was easier to learn how to do my own Form 990s & 1099-MISCs for our small non-profit than it was to find a good accountant.

Yep, me too! Exactly my experience.

I had a close friend who became my CPA. She was really smart and did a great job helping with my taxes. Then she went on to get her PhD in international business and sold her accounting business. The fellow she sold it to was not impressive at all. He had me fill out a long form that was obviously just entered into some tax software. No discussion, no advice, no overview, just - OK, here's your result and the bill! My soon-to-be-husband had been using Turbotax for years for his small business, so I decided I could enter the data into the tax software myself!

Many years later in the 1990s, I consulted a CPA firm about the AMT implications for my stock options and the new tax laws that has lowered the cap gains rate - was that 1998? It turned out that I knew way more about AMT and incentive stock options than these people did - all they did was come "up to speed" at my expense. I was so unimpressed, I pretty much said "that's it"!

Audrey

 

[freebird5825]

i had a very good experience with a CFP back in 2002. i asked a ton of questions about investing, estate, retirement, etc. i negotiated a set price for a soup-to-nuts analysis, and documented all tasks and products delivered. i delivered all the necessary documentation and let them do their thing. i got exactly what i asked for and then some.
i still use their report as a baseline for financial planning. my current status is DIY. if i were to revisit with them, i would ask exactly the same questions i did last time for checkpointing my status post-FIRE status.

 

[Nords]

Many years later in the 1990s, I consulted a CPA firm about the AMT implications for my stock options... all they did was come "up to speed" at my expense.

i had a very good experience with a CFP back in 2002. i asked a ton of questions about investing, estate, retirement, etc. i negotiated a set price for a soup-to-nuts analysis, and documented all tasks and products delivered. i delivered all the necessary documentation and let them do their thing. i got exactly what i asked for and then some.
i still use their report as a baseline for financial planning. my current status is DIY. if i were to revisit with them, i would ask exactly the same questions i did last time for checkpointing my status post-FIRE status.

Yakers and your comments brought back some more memories. In Saluki's/FD's defense, I did get good advice from two FAs.

One listened to my questions/issues over the phone and said "Gosh, it sounds like you know what you're talking about and you seem to have all the issues covered. Why not just take 3% from your portfolio every year and stop worrying about it?" This being the summer of 2001, in retrospect that was a gutsy call. Best money I'd never spent for good advice.

The other was an AXA rep who I'd been referred to for what at the time was their awesome modeling software. They had an extremely detailed [-]data form[/-] questionnaire that, by the time I'd completed it, reassured me that I hadn't missed anything. When I went over the paperwork with their rep and started asking Monte Carlo questions, he admitted that he didn't know the answers but would get them from the guy who was designing the new software. I asked him more questions about the new software, learned all about its features, and said that I'd love to continue the conversation when they implemented it. They never implemented it (or at least they never called me back) and I found FinancialEngines' MC software to be more than enough for my needs.

 

[FinanceDude]

One listened to my questions/issues over the phone and said "Gosh, it sounds like you know what you're talking about and you seem to have all the issues covered. Why not just take 3% from your portfolio every year and stop worrying about it?" This being the summer of 2001, in retrospect that was a gutsy call. Best money I'd never spent for good advice.

He was being honest. He probably figured out you knew more about your finances than 99.99% of his clients, and gave you the correct advice.

The other was an AXA rep who I'd been referred to for what at the time was their awesome modeling software. They had an extremely detailed [-]data form[/-] questionnaire that, by the time I'd completed it, reassured me that I hadn't missed anything. When I went over the paperwork with their rep and started asking Monte Carlo questions, he admitted that he didn't know the answers but would get them from the guy who was designing the new software. I asked him more questions about the new software, learned all about its features, and said that I'd love to continue the conversation when they implemented it. They never implemented it (or at least they never called me back) and I found FinancialEngines' MC software to be more than enough for my needs.

Axa reps are pretty much insurance guys, not true FAs. The fact he couldn't answer Monte Carlo simulation questions confirms this. Probably noone ever asked him a question about Monter Carlo before you.......

 

[Sarah in SC]

i had a very good experience with a CFP back in 2002. i asked a ton of questions about investing, estate, retirement, etc. i negotiated a set price for a soup-to-nuts analysis, and documented all tasks and products delivered. i delivered all the necessary documentation and let them do their thing. i got exactly what i asked for and then some.
i still use their report as a baseline for financial planning. my current status is DIY. if i were to revisit with them, i would ask exactly the same questions i did last time for checkpointing my status post-FIRE status.

Your experience is what happens when you, a well-prepared person, finds and hires an actual planner. I'm glad it went well for you.

Folks who are looking for "free" information from salespeople are bound to be disappointed. You gotta separate the salespeople from the real advisors. And while having a CFP or CFA isn't a guarantee that they aren't pond scum, but it does help weed through some of the most egregious ones.

 

[freebird5825]

Your experience is what happens when you, a well-prepared person, finds and hires an actual planner. I'm glad it went well for you.

TY. i went in the same way i would running an R&D contract - do the statement of work, ID the deliverables, put it all down in writing, agree upon the fixed fee, award and sign. the CFP loved working with me cuz i saved both of us a lot of Q&A time and we were both able to get down to business. we got along great. but i'll bet he secretly sighed with great relief when we were done.