Financial advisors

[djefferis]

Anyone work with one ?

How does it work exactly - do you just hand them a pile of cash - say here, manage this for me and they take a fee based on assets under management?

Should I really just try to DIY or use one of the apps vs hiring someone ?

Seems simple enough - buy index funds/mutual funds on my own - but feel like last time I tried it I wound up under performing. Given where the market is now - I’m questioning if we might not have peaked for a while and if I shouldn’t just park bulk of my $$ with a professional - maintaining a small brokerage account to play with on my own.

The “joys” of having to deal with a windfall of cash - wife/family all lining up for their “share” - everyone wants their cut. This is why I hate having more than a few hundred dollars to my name.

 

[pornhubcasin0]

I'm pretty sure DIY is the way to go. Buy Fortune 500 stock if you just want to stay afloat rather than get eaten up by fees and/or inflation.

I know someone who's done this since 2015, quite successfully. I can tell you more privately if you'd like.

p.s. 'Underperforming' - according to ... a financial advisor-to-be?

 

[pornhubcasin0]

Another option: spend a few *hundred* in equipment to be able to self-custody bitcoin or ETH using cold wallet That's what I would do if I wanted to keep my money safe (both from inflation and the family lol)

Have you considered this, or a rental property out of state where rents are higher? Does it have to be stocks via financial advisor? Just curious what the thought process is. You said you like to 'play with stocks on your own'... I guess I would always prefer to actually bet on sports, but to each his own heh

 

[jjgold]

They don’t know crap and they’re loaded with commissions. You could do everything yourself nowadays with the technology available don’t be dumb.

 

[charliebrown]

I hope financial advisors become obsolete soon

 

[jjgold]

If you don’t have hundreds of millions of dollars, let’s settle down

 

[Tanko]

Anyone work with one ?

How does it work exactly - do you just hand them a pile of cash - say here, manage this for me and they take a fee based on assets under management?

Should I really just try to DIY or use one of the apps vs hiring someone ?

Seems simple enough - buy index funds/mutual funds on my own - but feel like last time I tried it I wound up under performing. Given where the market is now - I’m questioning if we might not have peaked for a while and if I shouldn’t just park bulk of my $$ with a professional - maintaining a small brokerage account to play with on my own.

The “joys” of having to deal with a windfall of cash - wife/family all lining up for their “share” - everyone wants their cut. This is why I hate having more than a few hundred dollars to my name.

Yes, I work with one. They manage ~70% of my assets.

Yes they make a commission off the investments. Some may ask for a flat fee but that's not what I've typically seen. I think it depends on how big a firm you're going with and how much you're investing.

Usually, the higher the investment portfolio value the lower the % they charge (its more fees but lower %). You can provide them direction in how you want to invest by answering several questions related to risk aversion/acceptance and long-term goals but typically your info provides them more generalized instructions without specific stocks mentioned (i.e. I would like between x and y % in each type: domestic stocks, foreign, bonds, etc... and weather you are looking for growth/value/fixed return).

They should ask you what you are saving for (retirment, college for kids, etc...) so they get a better understanding of your risk profile.

They pick the actual investments according to your input and will adjust the investment mix by reading where they believe the market is headed to try and take advantge of the swings and avoid huge losses. This means you miss the bigger upswings but also avoid the huge drops.

I also have a portfolio to manage on my own. Why? Because I think I'm smarter than them sometimes.

There are several things to look for in a financial advisor but the most critical one is... Are they a fiduciary? They should be required to put your interests ahead of theirs and the companies they invest in. If not, move on.

 

[jjgold]

Remember, these are just guys with degrees that memorize facts. Never forget that.

 

[djefferis]

i know many people don’t like them - to me they are like realtors. Car salespeople and some lawyers - people love to bitch about them - bit get a “good” one and you see the benefit.

Everyone thinks they can DIY this stuff - but reality is is the market isn’t going up - most will lose. ANYONE can make money when the index’s go up 10-12% a year - try doing that when they are falling 5-8% or more.

I’m just torn by the whole thing I guess - already enough emotion involved in selling off a family property I inherited - I guess walking away with a massive amount of cash should cheer me up some - but it doesn’t.

Not that we aren’t doing ok as is - this is just literally pushing us to a different level of security - going from being “comfortable” with 2 incomes and a savings to now 2 incomes, no bills outside of a mortgage (thought of paying that off - but I’ve been “house poor” before and don’t want to get stuck in that trap again) and a decent “nest egg” generating income.

Im kind of torn to just stick it in a CD or something - problem there is just money being too accessible is a recipe for disaster. I’d rather have it in something that I can say - here’s the base - give me an “allowance” of 50% of what it generates every month/quarter and reinvest the other 50% in something with a better return.

Again - just buying the S&P for example is a great way to MIMIC returns of the market - but why do I want to mimic everyone else - isn’t the point of the game to get ahead ? Real estate - pass - unless it’s a REIT - way too much individual risk - one shitty tenant and you’re losing your ass. Crypto - will be part of my strategy under MY control - again, plan is take 75% - put it some where where it makes money - take the other 25% - 10% to pay off all credit cards/car notes - and 10% to my investment account (individual stocks/crypto/metals) and 5% to my personal activity fund - which may wind up being an older vehicle or something else fun. Got a few I’ve always wanted - debating do I do one of those or just fix up the project I have on hand now. Again - wife will likely try to veto - but this is something I earned before we ever met - so I think I’m entitled to a little fun.

 

[BobbyFK]

If you don’t have hundreds of millions of dollars, let’s settle down

Exactly. If you don't have A LOT of money then there's no need for one

 

[djefferis]

Exactly. If you don't have A LOT of money then there's no need for one

If I had “alot” of money - would I be posting on BMR ?

And again - there is a difference to everyone as to what constitutes “a lot” - as mentioned yesterday - to a guy betting $8 a clip - anything more than $20 is probably “a lot” - I’m not Arab royalty rich - but I also don’t have to rely on rolling bettors for winning tickets at the sportsbook to go grab something off the value menu for my only meal of the day - so I’ve got that going for me, which is nice.

 

[jjgold]

I would start thinking anything over about 10 million maybe get a real sharp person to at least give you advice or just another opinion

 

[Tanko]

I would start thinking anything over about 10 million maybe get a real sharp person to at least give you advice or just another opinion

You have many options. It all depends on how you want to approach investing.....

If you are sitting on $100k or more (non-essential funds) and want to invest it, you can:

• Put it in CDs and get a guaranteed return that will likely (best case) just keep up with inflation.
• Open a Schwabb account, stuff it in an S&P index fund and ignore it for years.
• Get an advisor for 0.5% ($500/yr) and have them invest it across dozens of investment options (foreign stocks, domestic stocks, bonds, fixed investments, mutual funds, etc...) and have them adjust it regularly to account for any potential swings in the economy.

All are pretty much hands-off approaches.
The later option yeilds higher returns long-term, even when fees are included.

 

[BigJay]

There are several things to look for in a financial advisor but the most critical one is... Are they a fiduciary?

 

[JDS]

If you don’t have hundreds of millions of dollars, let’s settle down

People with the net worth of $100 million or more do not post on gambling sites.

 

[phillyflyers]

You need money to have a financial advisor.

Can't be a broke dikk fukk.

Some money managers require for you to have a certain minimum amount of money to invest with them.

You take a meeting and discuss everything about your financial life. They ask a lot of questions, some really personal so be ready for that.

 

[pornhubcasin0]

You have many options. It all depends on how you want to approach investing.....

If you are sitting on $100k or more (non-essential funds) and want to invest it, you can:

• Put it in CDs and get a guaranteed return that will likely (best case) just keep up with inflation.
• Open a Schwabb account, stuff it in an S&P index fund and ignore it for years.
• Get an advisor for 0.5% ($500/yr) and have them invest it across dozens of investment options (foreign stocks, domestic stocks, bonds, fixed investments, mutual funds, etc...) and have them adjust it regularly to account for any potential swings in the economy.

All are pretty much hands-off approaches.
The later option yeilds higher returns long-term, even when fees are included.

You are talking about buying 20 different stocks/investment instruments, and then selling some of stock A, and adding on some of stock B, and do this perpetually?

This is how commissions eat you up (at least this is what I've come to believe).

OP wants to put money somewhere where it's *not too accessible* and where it makes a reliable profit. This... is a tall order.

I hope dj shares with the forum what he ended up doing and how it panned out. Doing it - more or less - passively is what everyone is striving to achieve. I genuinely hope he finds a *good* manager/advisor if he chooses to stick with this plan... but I choose to remain skeptical.

 

[JDS]

You need money to have a financial advisor.

Can't be a broke dikk fukk.

Some money managers require for you to have a certain minimum amount of money to invest with them.

You take a meeting and discuss everything about your financial life. They ask a lot of questions, some really personal so be ready for that.

This is a valid question for Jeffrey to ask, he is not a broke dick f***, but probably not a valid place where to ask it. @KVB could chime in and maybe shed some light regarding this issue.

 

[bigdaniil445]

I'm genuinely curious how a financial manager would approach a new client.

I mean you have to outperform regular bonds by at least a couple per cent, right? Not an easy thing to do, there's always risks, and there's always fees. Please stay alert and do your due diligence

 

[redrightred]

They are clueless. Just put your money in a basic asset allocation mix based on your age. You can find that for free on the internet. That is all they are going to do.