Skip to main content
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
I am trying to preserve my 83 yo father's assets in order to provide him enough income to last the rest of his life. He lives in a in an assisted living facility and has Alzheimer's so it's up to me. Not quite sure I am up for the task. I moved his money from a bank where it was in trust and being invested conservatively to my stock broker. This may not have proved to be a good plan as he lost quite a bit last year. Now my broker says we need a money manager. I am having trouble with that idea of paying yet another person to manage his money. I consulted another broker who suggested putting his money into bonds yet they would nto yield enough to cover his expenses. I am now at a loss as to what to do. Any suggestions would be most appreciated. I could learn form your experience. Thanks. Ann
Print the post Back To Top
No. of Recommendations: 1
If high quality bonds at current prices will provide enough
income for your dad to live the rest of his life, why take
more risk?
And if you are buying bonds, you emphatically do not need
to pay 1% or more annually to a money manager.
Best wishes, Chris
Print the post Back To Top
No. of Recommendations: 0
Do you know of any high quality bonds? At 7% they unfortunately will not cover my Dad's expenses.
Print the post Back To Top
No. of Recommendations: 1
At 7% they unfortunately will not cover my Dad's expenses.

Please don't think I am crass, but how long can you expect your Dad to live? At 83 years old, I don't think it's a bad thing to use some of the principal. The answer, of course, depends on how much money he has and what his expenses are. But it really doesn't have to last indefinitely - 10 years? 15 years? I don't think you can realistically count on a steady investment return much more than 7%. If you have equities, you won't have a steady return. Again, this may be fine, but you have to evaluate his circumstances. My inclination would be to find a mix of bonds, steady stocks with dividends, and a small part in growth stocks - maybe investing in a "balanced" mutual fund.
Print the post Back To Top
No. of Recommendations: 0
Thank you all for your responses. One more thing. With his current portfolio if I put everything into bonds he would make about 21,000 annually. There is tremendous longetvity in his family with an aunt who just turned 95 and my Dad is in very good health. I am not opposed to using some or all of his principle, but I do want it to last. My concern is that now my broker wants to hire a money manager so that takes more of his money. It would be great if this person could guarantee his return but in the market today I doubt that. I guess am just disaapointed in my broker who I had too much faith in-fool is right! Thanks again for all of your advice.
Print the post Back To Top
No. of Recommendations: 0
amelia101

With assets that would generate 21K in bonds, seems to me, it would be enough to consider Vanguard Admiralty Class funds. Check out Vanguards web site at www.vanguard.com

I don't think you could go wrong there and you don't need a broker or an advisor. Deal direct with Vanguard.

HTH, Sam
Print the post Back To Top
No. of Recommendations: 3
<My concern is that now my broker wants to hire a money manager so that takes more of his money. It would be great if this person could guarantee his return but in the market today I doubt that. I guess am just disapointed in my broker who I had too much faith in>


I know if you have been at the FOOL for a while you have heard the following many times in many variations. Before acting on any financial advice, you should know if or how the person giving the advice advice is benefitting from your action.

One of the great services that the FOOL has provided is the realization that much of the "professional" advice one gets is not worth the price paid for it. If you know what you are looking for, and are willing to take responsibility for your actions you can find what you need on your own. The only thing guaranteed is that the advisors get their money regardless of whether you make any or not.


BRG
Print the post Back To Top
No. of Recommendations: 0
I suggest you check with Vanguard for what return your father would get from an immediate annuity. I'm no expert on this but I understand that they would offer income for life with nothing left for heirs upon your father's death. Inflation would be your enemy, as the income would purchase less as inflation increases. Vanguard is also an excellent source for financial planning/management at reasonable fees. I myself have most of my assets with them. Good luck in your search! Roberto.
Print the post Back To Top
No. of Recommendations: 0
I am trying to preserve my 83 yo father's assets in order to provide him enough income to last the rest of his life. He lives in a in
an assisted living facility and has Alzheimer's so it's up to me. Not quite sure I am up for the task. I moved his money from a
bank where it was in trust and being invested conservatively to my stock broker. This may not have proved to be a good plan
as he lost quite a bit last year. Now my broker says we need a money manager. I am having trouble with that idea of paying yet
another person to manage his money. I consulted another broker who suggested putting his money into bonds yet they would
nto yield enough to cover his expenses. I am now at a loss as to what to do. Any suggestions would be most appreciated. I
could learn form your experience. Thanks. Ann


If you need the money within five years stocks should not be used. If you are going for 10 or 15 years then the next five years of expenses should be in fixed income type investments that come due when you need them. The rest of the money can go into an index fund or exchange traded shares. Since you have a broker talk to him about what you should do then go out on your own and do it. (From what you said I would not have confidence in the broker, but then he might have done what you asked him to and I could not fault him for that if he advised against what you wanted first.)
Print the post Back To Top
No. of Recommendations: 2
<Since you have a broker talk to him about what you should do then go out on your own and do it.>


First and foremost, the broker is looking out for the broker. If you benefit from his actions in any way it is purely by accident.

The original poster was not satisfied with the previous advice from the broker. I do not see what benefit would come from compounding the original mistake by asking him for more advice.


BRG
Print the post Back To Top
No. of Recommendations: 0
I recommed a charted financial consultant, one who only makes money if you do. Brokers are paid commissions on transactions, therefore the tendancy to "churn" an account to get those commissions. Had a relative ripped offf bigtime by a broker who set her up to be paid less per month than her rent. So, he had to sell to get her the extra she needed. Let's not go into all the things involved, but needless to say, to me, brokers are the most predatory animals on the planet. And believe me, they recognise the financial innocents the same way home repair scam folks prey on older people. Read everything you can on this web site, and ask a bunch of folks about financial advisors. My guy is w/MassMutual & has saved several in my family from the predators.
Print the post Back To Top