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|Subject: Re: Talk me out of a Financial Advisor||Date: 6/3/2013 7:08 PM|
|Author: Rayvt||Number: 72396 of 77551|
how many here who are highly critical of financial advisors have actually used a financial advisor? If not, where did you form your negative opinion?
I have used a few FAs, have interviewed several more that I decided to not use, but I'm not in the camp of "highly critical" of them. Just somewhat negative on them.
Some wanted to manage my entire portfolio. Some wanted to know every detail of my financial picture (including wills, emergency fund, bank accounts, insurance policies, etc.) before they'd even consider taking my account.
The best ones took the financial information that I chose to give them, and accepted it when I said, "This is the amount I will invest with you, it's only part of our total money, but it's what I want you to manage, don't worry about my bond allocation, e-fund, etc. because I've already got that taken care of."
Some of them wanted to put me in loaded funds and non-traded REITS. Those were the easy ones to ditch. Neagtive opinion? Yeah, in spades.
We finally pulled our money away from all the ones we hired. Not that they didn't do good -- they did just what I expected of them, including not panicking and selling out at the crashes. I *did* get phone calls from them when the market tanked, I think they were trying to keep their clients calm.
No, the reason was that I got tired of paying 1%-1.5% of assets for them to do basically the same thing that I could do myself with a properly chosen set of funds/ETFs. Not all index funds, either - NTTAWTH. Some of what I currently own are actively managed funds/ETFs, as well as index funds.
Paying someone $6,000 a year finally got to be too much for me. As far as I was concerned, the main job they did was to keep me from panicing and to keep me from taking on too much risk. But that hasn't been a problem for me, so I was paying them for something I didn't need.
The free dinners and Xmas & birthday cards weren't worth it.
When I closed tha last one last December, when I told my wife she said, "Finally!! I was wondering how long you were going to keep paying them money." Then she said, "That's %6000 we can use to take another cruise per year."
a director of our company who has had a real money portfolio with this particular advisor through the 2009 crash carries a lot of weight.
You post & read here, you track your portfolios weekly/monthly/obsessively, you know how to do all kinds of investment things. Does he? It could well be that he has no idea about investing, or how well his account is doing compared to other alternatives such as a well-diversified set of low-cost index funds. It could be the he *needs* a decent FA because otherwise he wouldn't know how to invest in anything except CDs and penny-stocks.
This thread is getting quite long. Maybe you're playing a little bit of devil's advocate? I think a number of people here have given you some pretty good advice and reasons to NOT hire an FA. If you haven't made up your mind by now, then nothing that anyone can say further will be of any use.
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