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Author: blkmagwom Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75701  
Subject: Financial Planner Advice (long) Date: 10/23/2003 6:49 PM
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(cross-posted to Index Funds Board)

I need some advice and if I need to post this on another board, please let me know. I decided to speak to a financial advisor about my general financial state, my retirement investments to see what kind of professional advice he could offer. The financial planning firm is advertised as holistic financial planners and professional investment managers. This is a fee service and not based on commission. It was my understanding (and in the contract I signed) that the fee would be no more than $350 and I would get a report. My questions to the board are at the end of this post.

About me: I am 34 years old. Generally speaking, I have some financial inclinations and I know my way around Excel. I do my own taxes and have done so for a long time. The kind of report I was expecting would be a detailed analysis of my financial situation (including taxes and life insurance issues) with figures and tables. What I received was a 6-page report (3-4 pages of which were a re-stating of stuff like my risk tolerance, investment objectives). The meat of the report was a one-page portfolio recommendation (which I list below) and a 2-page commentary on general issues. Generally, he recommended:

a) That I get a Roth IRA with 55% Vanguard Total Stock Market Index Fund and 45% Total Bond Index.

b) That I have 6 months salary in savings (which I do)

c) I have a mortgage (@5.2%) and a HELOC (@ prime). He recommended that the mortgage be the one where additional $$ are applied, not the HELOC since the mortgage has a higher % rate.

d) That short term debt be paid off (I have no credit card debt)– and in this category of short term he included my student loans of $12K which are at 3.2%.

Here is the breakdown of the asset allocation that were recommended for my retirement:

Investment Grade Bonds – 20%
U.S. Government – 15%
High Yield (Junk) Bonds – 5%
Large Cap Equity – 30%
Mid Cap Equity – 10%
Small Cap Equity – 10%
International – 5%
Cash – 5%

Here is what I currently have in my account:

29% - Bond
28% - Small Cap
22% - Large Cap
20% - Blended (which is 82% stock, 18% bonds)

Questions:

a) Should I talk to my financial planner about getting a more detailed analysis?
b) Is the above a satisfactory product for what I'm paying?
c) Should I from now on do my own research and planning?
d) Any comments about the above advice?

-b-
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Author: buzman Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37563 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/23/2003 8:29 PM
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a) Should I talk to my financial planner about getting a more detailed analysis? Certainly if you are not happy

b) Is the above a satisfactory product for what I'm paying?Yeah, from what I see you got a second opinion on an existing portfolio. Plus it is an improvement on your portfolio.

c) Should I from now on do my own research and planning? It's your life and you are an adult. FWIW, I am a financial planner, the proposed portfolio is an improvement. Is it a good deal? If you aren't happy it's not! But it is an improvement.

d) Any comments about the above advice? Given your age generally speaking you are a little heavy in bonds. The proposed portfolio reduced your expousure & maybe gave you some diversification. I would bump the International exposure higher. Maybe a few other tweaks but given your risk tolerance maybe that is not indicated. Also, you wrote that you have 6 months salary in an emergency fund. I recommend that clients have 6 months living expenses in an emergency fund. There could be a vast difference 6 months salary & 6 months living expense.

The Roth is a great idea, if you did not have one thank him for that!
I would pay off the student loan later, but that's your call.

Hope this helps

buzman



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Author: 8128 Two stars, 250 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37564 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/23/2003 8:52 PM
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From a 66 year old retiree I give you this free advice that may be worth no more than it is costing you. Stay out of credit card debt. Save as much as you can in tax sheltered accounts and if you max them out don't hesitate to open a regular brokerage account. Stay away from most if not all managed mutual funds. Invest in broad market indices or in low, low, fee index funds of the broad market. Ignore bonds and international investments and keep essentially no cash in your "retirement" accounts. The emergency fund is fine but I would view it somewhat differently from your "retirement" funds. As a rough rule of thumb consider that your nest egg at retirement likely will provide you annually about 4 percent of its value at retirement with the initial dollar amount increasing annually with inflation for essentially an indefinite period, i.e., as long as you live in retirement. If you use it faster than this, you increase your chances of outliving your nest egg, not a good thing. Seen this way it probably looks just about impossible to save enough from your vantage point. However, don't overlook the magic of compound interest.

As to how much you will ultimately need, no one can tell at this point given your age and the unknowns like what will happen to social security, any other retirement income you my have, etc. Just observe that you have never heard a retiree complain that they wished that they had not saved so much during their working years. You can hardly go wrong saving as much as you reasonably can. And if by chance you do save more than you need, you can either retire early or, if in a pinch, have to suffer through finding something to spend the extra money on.

The long and short of this is, you can't at your stage in life know all the answers and figure it all out. Just be smart, enjoy life, save what you can, and hope for the best. This will not guarantee you anything, but will tip the odds very much in your favor, and put you way ahead of most others in your age group. As you age your situation in your latter years will become increasingly clear and you can and should refine your financial planning as you go. But for now the best thing you can do for yourself in the economic area is to stay financially stable and save what you can.

Good Luck, we all need that.

Jim Sullivan aka 8128

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Author: MadCapitalist Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37565 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/23/2003 9:15 PM
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Assuming that you can't, or don't want to, find a talented money manager, I think you would be better off with 50% in a low-cost S&P 500 index fund and 50% in a low-cost Wilshire 4500 index fund (i.e. the Wilshire 5000 without the S&P 500). This will give you a broad exposure to large, mid, and small cap stocks.

I wouldn't worry about cash or bonds. You are way too young. Equities provide a better probability of providing a positive real after-tax return over the long-run, so equities are actually less risky if your holding period is very long.

I also wouldn't worry about international funds. For one thing, there are too many games being played because of the time differences between when the stock markets are open in different countries. This causes mutual fund investors to have reduced performance. Also, it just isn't necessary. An international exposure might reduce annual volatility, but annual volatility is not important when you are talking about investing for decades.

MadCapitalist
registered investment advisor, not a financial planner

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Author: TTRoberts Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37566 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/23/2003 10:09 PM
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blkmagwom, you asked:

<< a) Should I talk to my financial planner about getting a more detailed analysis? >>

Since this is not what you expected, yes . . . you should talk to the planner about what you expected and what you got. See what the planner is willing to do for you to get what you want and if there are plans that give you what you want and what the cost might have been.

Was this all there was supposed to be . . . just this report with these recommendations and no implementation plan nor any monitoring plan? There can be a lot more to the services provided. Just what did you agree to in the contract?

Like so many people, you've made some assumptions as to just what you're going to get. This is very common. The way to better get what you hope for is in the beginning to ask the planner for a sample of what you're paying for. Then if you contract to get something that you already know what it's supposed to look like, you can compare and be sure to hold the planner to what you agreed to in the beginning. Starting without a very clear idea as to what you're going to get will result in the kind of disappointment you're expressing.

<< b) Is the above a satisfactory product for what I'm paying? ? >>

It sounds about right. And in some circles it could cost a lot more.

<< c) Should I from now on do my own research and planning? ? >>

Only you can really answer that question.

<< d) Any comments about the above advice? ? >>

As you can see from some of the responses here, there are all kinds of opinions and philosophical approaches to a set of issues. This is why I like to point out that if you give 10 financial planners exactly the same objective and the same set of information, you'll get 11 different financial plans. The eleventh being the plan you finally settle on. Financial planning is not an exact science. . .it's much more of an art. And there is really not just ONE set of answers that are good.

Over all, I feel the suggestions are great. But like others, I might do things just a little different. For example, I would tend to want more exposure in the international market than just 5%. Otherwise, I would say this asset allocation is a good diversified one. I just don't know enough about your risk tolerance to address the specific numbers shown.


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Author: blkmagwom Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37567 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/23/2003 10:29 PM
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TT.

Since this is not what you expected, yes . . . you should talk to the planner about what you expected and what you got. See what the planner is willing to do for you to get what you want and if there are plans that give you what you want and what the cost might have been.

Was this all there was supposed to be . . . just this report with these recommendations and no implementation plan nor any monitoring plan? There can be a lot more to the services provided. Just what did you agree to in the contract?


I did not want the planner to monitor my investments. I wanted suggestions about my retirement portfolio (I already asked him about Roth, so I had been saving all year for it anyway) and how my other financial interests fit into the big picture. When we met the first time, he told me he works with a CPA who could give me some financial suggestions on the other side of things. But it isn't clear to me her suggestions were incorporated. He is an investment specialist and I was looking for more general review as well.

Like so many people, you've made some assumptions as to just what you're going to get.

Not true. He and I had discussed this ahead of time.

-b-



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Author: HardCider One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37568 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/23/2003 11:46 PM
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$350 for a six page report. 4 pages of filler. One page typical recommendation for you that looks like canned stuff. Personally, I think the mad capitalist is partially right: you look like you have too much in bonds. I really like that the advisor recommended some of the least expensive funds in existence.

For the $240 less, check out Morningstar. Their canned advisor would probably pretty much say the same thing (probably recommend less in bonds). You can take a free two week trial and see if their portfolio advisor says the same thing.

I would expect more for three hundred and fifty bucks than what you received. It can't hurt to ask for a more detailed report.

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Author: jesserivera67 Two stars, 250 posts 10+ Year Anniversary! Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37569 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/24/2003 12:10 AM
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Your current allocation seems very conservative. I'm 35 and have put pretty much everything in equities and diversified between large/small growth and value as well as some International. It's served me extremely well especially this year.

a) Should I talk to my financial planner about getting a more detailed analysis?

Definitely

b) b) Is the above a satisfactory product for what I'm paying?

Sounds right...I had a planner quote me $2500 for a plan so it varies greatly (no I didn't go with him...)

c) Should I from now on do my own research and planning?

as everyone said this is something only you can decide. To describe my situation...I became a financial enthusiast a while back when an advisor tried give me the runaround regarding fees. I decided to start studying on my own.

You know if you're worried it's going to take a lot of time...it really doesn't as long as you keep things simple and just let your money ride the market. I have all my stuff with Vanguard, love their website and the fees can't be beat in most cases.

There's a website I've gone to to look at some sample portfolios...www.fundadvice.com. I don't agree with any of the market timing strategies but the buy and hold portfolios aren't bad with some tweaking. They love to recommend DFA but DFA representatives typically charge up to 2% of assets per year...no thanks I'll go it alone.

I'd say a couple of hours a week would be good enough to get going on your own. Of course this depends on your situation and how complex you want to get. For me, I spent more time starting out but now am pretty comfortable and coasting along.

Take it easy and good luck!






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Author: TTRoberts Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37570 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/24/2003 2:38 AM
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alkmagwom, you wrote:

<< ”Since this is not what you expected, yes . . . you should talk to the planner about what you expected and what you got. See what the planner is willing to do for you to get what you want and if there are plans that give you what you want and what the cost might have been.

Was this all there was supposed to be . . . just this report with these recommendations and no implementation plan nor any monitoring plan? There can be a lot more to the services provided. Just what did you agree to in the contract?”


I did not want the planner to monitor my investments. I wanted suggestions about my retirement portfolio (I already asked him about Roth, so I had been saving all year for it anyway) and how my other financial interests fit into the big picture. When we met the first time, he told me he works with a CPA who could give me some financial suggestions on the other side of things. But it isn't clear to me her suggestions were incorporated. He is an investment specialist and I was looking for more general review as well.

Like so many people, you've made some assumptions as to just what you're going to get.

Not true. He and I had discussed this ahead of time.
>>

OK So, it sounds like some kind of miscommunication. Or, maybe the planner is really more of an investment advisor than a planner (just as some are more insurance sales than planner) and he doesn't do the kind of planning you're really after???

Did you see an actual example before hand as to what he was going to give you? What I've experienced is that a lot is lost in translation in what one says (either for you or the planner or both). Seeing and getting in hand an actual example of a written plan is the best way I know to have something to measure whether or not I'm getting what I really want. If the details (the shopping list) of the services you expect is not listed in the contract and you don't have such an example to compare what you got to, then about all you can do is go back to the planner and express your disappointment and see if he'll do more work along the lines of your expectations.

BTW: Do you find it interesting how so many people are ready to disagree with this asset allocation without knowing what your risk tolerance really is? Maybe it would help everyone to know just what risk tolerance is shown on that report? It seems most people around here go for the high risk tolerance position and often with insufficient diversity.


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Author: blkmagwom Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37571 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/24/2003 9:31 AM
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TT, I did not see a sample, but that was okay given the specifics I felt we discussed. For instance, I did not see an installed job of the carpet people before I put down a deposit for my entire home to be carpeted, and I did not see repair work that my mechanic had done and yet I met with them and discussed what I was looking for. So in my previous experience, it seemed reasonable that I was doing what I could to get more in the line of what I was looking for.

Part of my surprise at this final product is that I prepared a lot of information for him. I had a 3-4 page memo with all my details including life insurance, disability insurance, and I did research with my human resources department on the details of my pre-tax supplemental retirement programs and during our first meeting he said he would compare what the pre-tax supplemental program would be taxwise for me vs. a Roth. I had read about Roths and figured out that was the direction I needed to go before I talked to him, but he mentioned I might want to invest in a supplemental program and that he would compare the two.

As far as my risk tolerance...I took a test with him, but here's how I would put my risk tolerance on a scale of 1 to 5 with 5 being very high risk tolerance, I'm about a 4 right now. I actually expected the planner to say my portfolio was too conservative, because I think it is too conservative and I was planning on my own to move 10% or so of bond investments into stocks.

-b-

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Author: TTRoberts Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37572 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/24/2003 10:29 AM
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blkmagwom, you wrote:

<< TT, I did not see a sample, but that was okay given the specifics I felt we discussed. For instance, I did not see an installed job of the carpet people before I put down a deposit for my entire home to be carpeted, and I did not see repair work that my mechanic had done and yet I met with them and discussed what I was looking for. So in my previous experience, it seemed reasonable that I was doing what I could to get more in the line of what I was looking for. >>

. . . . .apples & oranges

In any case <grin> . . . if I'm going to have my car painted, I'm going to want to see some of the work that the painter has done. If I'm going to have a house built by a general contractor, I'm going to want to see some of the houses he has built. If I don't examine some samples, I'm very likely to hire someone that won't or isn't capable of doing the kind of job I expect.

When I was younger, I did not do this and have ended up disappointed too many times. I'm a lot older and wiser now . . . . but certainly not perfect. ;-)

<< Part of my surprise at this final product is that I prepared a lot of information for him. I had a 3-4 page memo with all my details including life insurance, disability insurance, and I did research with my human resources department on the details of my pre-tax supplemental retirement programs and during our first meeting he said he would compare what the pre-tax supplemental program would be taxwise for me vs. a Roth. I had read about Roths and figured out that was the direction I needed to go before I talked to him, but he mentioned I might want to invest in a supplemental program and that he would compare the two. >>

I would certainly make a punctuated point about this to him.

<< As far as my risk tolerance...I took a test with him, but here's how I would put my risk tolerance on a scale of 1 to 5 with 5 being very high risk tolerance, I'm about a 4 right now. I actually expected the planner to say my portfolio was too conservative, because I think it is too conservative and I was planning on my own to move 10% or so of bond investments into stocks. >>

A scale of 1 to 5 is about right and what most might use for a guideline. However, rather than a numeric what is often used is something like Conservative, Moderately Conservative, Moderate, Moderately Aggressive, Aggressive. So you feel you are what might be called Moderately Aggressive. If you really are that, I would tend to agree with what you're saying that a little less in a bond position might be appropriate (leaving the junk bonds alone since they perform much like stocks). But apparently the test you took suggests that you actually have a moderate risk tolerance. I only conclude that because of what I see in the asset allocation you've shown. I would point out that it's very common for people to inflate their own risk tolerance to something higher that what it actually is. For many people, that became very apparent to themselves over the last two or three years.


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Author: THagenah Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37574 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/24/2003 6:14 PM
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You've gotten a lot of good advice from the posters. I can only add that you purchase and read thoroughly William Bernstein's "The Four Pillers of Investing" before you take any specific action. I have been investing for 40 years and its the best book on understanding assets and allocation that I have ever read. Good luck to you.

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Author: MonsterDL One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37576 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/24/2003 7:24 PM
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I also recommend Bernstein's "The Intelligent Asset Allocation," which deals with many of the questions regarding risk vs. allocation...


Monster D

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Author: blkmagwom Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37582 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/26/2003 7:24 PM
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Thanks all to those who replied to this thread. You've give me a lot to think about WRT my financial planner and what I'll do for the future. I appreciate all comments and advice.

-b-

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Author: zsimpson Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37583 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/26/2003 9:03 PM
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Assuming that you can't, or don't want to, find a talented money manager, I think you would be better off with 50% in a low-cost S&P 500 index fund and 50% in a low-cost Wilshire 4500 index fund (i.e. the Wilshire 5000 without the S&P 500). This will give you a broad exposure to large, mid, and small cap stocks.

I wouldn't worry about cash or bonds. You are way too young. Equities provide a better probability of providing a positive real after-tax return over the long-run, so equities are actually less risky if your holding period is very long.

I also wouldn't worry about international funds. For one thing, there are too many games being played because of the time differences between when the stock markets are open in different countries. This causes mutual fund investors to have reduced performance. Also, it just isn't necessary. An international exposure might reduce annual volatility, but annual volatility is not important when you are talking about investing for decades.


I'd like to recthis one again. When I read the post, my first thought was, "He's 34. Why are they putting some much into bonds?"

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Author: zsimpson Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37584 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/26/2003 9:09 PM
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Your current allocation seems very conservative. I'm 35 and have put pretty much everything in equities and diversified between large/small growth and value as well as some International. It's served me extremely well especially this year.

My husband is retired, and I am retired from Corporate America (unless I get extremely desperate), and we have more in equities than the report had. We've made more this past year than we did when we were both employed in Corporate America.

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Author: TTRoberts Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37586 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/26/2003 10:06 PM
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zsimpson writes:

<< I'd like to recthis one again. When I read the post, my first thought was, "He's 34. Why are they putting some much into bonds?" >>

It's about "risk tolerance." There are many 34 year olds that simply do NOT have the "risk tolerance" to have too much in equities. Many people are simply not comfortable with the volatility of the stock market. And "risk tolerance" is not something you just decide on. A lot has to do with being able to manage their feelings when in the market and being able to sleep at night.

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Author: zsimpson Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37587 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/27/2003 3:55 AM
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It's about "risk tolerance." There are many 34 year olds that simply do NOT have the "risk tolerance" to have too much in equities. Many people are simply not comfortable with the volatility of the stock market. And "risk tolerance" is not something you just decide on. A lot has to do with being able to manage their feelings when in the market and being able to sleep at night.

I understand that, and in a later post, he said he rated a 4 of 5. Again, that begs the question, why so much in bonds? Isn't the reason you pay a financial advisor is to grow the amount of money you have and/or hedge against down turns and inflation? Isn't his job to tell you, "You would be better off doing this."? If he has to do the work himself (and it sound like he is), why is he going to bother paying for a financial advisor?

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Author: TTRoberts Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37604 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/27/2003 11:34 PM
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zsimpson, you asked:

<< It's about "risk tolerance." There are many 34 year olds that simply do NOT have the "risk tolerance" to have too much in equities. Many people are simply not comfortable with the volatility of the stock market. And "risk tolerance" is not something you just decide on. A lot has to do with being able to manage their feelings when in the market and being able to sleep at night.

I understand that, and in a later post, he said he rated a 4 of 5. Again, that begs the question, why so much in bonds?
>>

Though I wasn't at the meeting <bg>, from what the poster said it's because of the results of the questions that were asked to determine the risk tolerance. That result was a risk tolerance of a “moderate” investor. He said he felt his tolerance was probably a notch higher, which would be something like a 4 (moderately aggressive). The amount of bonds shown in the asset allocation matches what one might do for a person who's risk tolerance is “moderate.” For a person with a “moderate” risk tolerance, bonds tend to as inverse correlation and reduce volatility making things more comfortable for an investor to stick to their investing plan.

Isn't the reason you pay a financial advisor is to grow the amount of money you have and/or hedge against down turns and inflation?

Yes it is . . . . but within certain parameters. And don't forget that Financial Planning is very different from Managing Money (as a Money Manager does) or even strictly Investment Advising. A Financial Planner is a generalist who helps you plan all of you financial issues (or maybe just some of them). The kind of “financial advisor you seem to be talking about is a Money Manager who's a specialist (not a generalist) hired to manage your investments. Even then, the Money Manager cannot be too far out of line with a client's portfolio or that manager will likely not have a client for long.

Isn't his job to tell you, "You would be better off doing this."? If he has to do the work himself (and it sound like he is), why is he going to bother paying for a financial advisor? >>

That's an EXCELLENT question, and it's that kind of question one should ask himself BEFORE hiring a financial advisor of some kind. If you hired him to tell you “You would be better off doing this,” then yes . . .that would be his job. But is really DEPENDS on what you hired him for . . .right? So, was he hired put together a “financial plan” of some kind . . . or was he just hired to manage the portfolio? Was the financial advisor hired to develop a financial plan that fits the person and their personal objectives, or was the adviser hired to manager investment and go for the highest return without regard to risk?

If you know exactly what kind of work you want done for you, then you hire the kind of advisor(s) that specialize in doing what you want. Financial Planners are indeed “financial advisors,” but they are generalists (though may have an area of expertise) and tend to perform their job as a quarter back of the team of advisors (team = accountant, lawyer, insurance agent, investment advisor/money manager, real estate agent, etc.)


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Author: intercst Big funky green star, 20000 posts Top Favorite Fools Top Recommended Fools Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37605 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/28/2003 12:32 AM
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TTRoberts writes,

If you know exactly what kind of work you want done for you, then you hire the kind of advisor(s) that specialize in doing what you want. Financial Planners are indeed “financial advisors,” but they are generalists (though may have an area of expertise) and tend to perform their job as a quarter back of the team of advisors (team = accountant, lawyer, insurance agent, investment advisor/money manager, real estate agent, etc.)

My God! After paying the fees and commissions on a team roster that large, it's no wonder there's so little left for the client at the end of day. <grin>

intercst


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Author: zsimpson Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37606 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/28/2003 12:32 AM
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zsimpson, you asked:

Um, those questions were meant rhetorically.

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Author: blkmagwom Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37607 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/28/2003 8:48 AM
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I understand that, and in a later post, he said he rated a 4 of 5. Again, that begs the question, why so much in bonds? Isn't the reason you pay a financial advisor is to grow the amount of money you have and/or hedge against down turns and inflation? Isn't his job to tell you, "You would be better off doing this."? If he has to do the work himself (and it sound like he is), why is he going to bother paying for a financial advisor?

Valid points. BTW, I'm a she. :-)

-b-

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Author: zsimpson Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37608 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/28/2003 10:22 AM
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Valid points. BTW, I'm a she. :-)

Oops!! Sorry!

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Author: Hyperborea Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 37619 of 75701
Subject: Re: Financial Planner Advice (long) Date: 10/28/2003 7:35 PM
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Also, you wrote that you have 6 months salary in an emergency fund. I recommend that clients have 6 months living expenses in an emergency fund. There could be a vast difference 6 months salary & 6 months living expense.

That seems to be very high to me. Why should it matter how much I make and not how much I consume?

Hyperborea

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