[CoachKandSportsguy]

Originally Posted by stevecmo

Less than 10% of all advisors beat the S&P 500.

It's very difficult as an advisor has transaction costs, and the index does not. The SP500 index also does not account for dividends nor dividend reinvestment. The other restriction is that an advisor cannot be a closet indexer, meaning, 80% in the SPY and the remaining in advisor selected stocks.

So VOO and SPY would logically seem to be the best investment, as all the bogglehead cult members would espouse. However, there are also mgmt fees for each, therefore, you will still not match the SP500 returns with SP500 index funds. There are also some systemic risk issues with VOO and SPY, which boggleheads refuse to admit. A describer and profiteer of index products, Michael Greene of Simplify Investments, tried to debate the concept in the Vanguard forums and was banned from the cult.

However, there are advisors, and many would not be counted in the advisor pool. The world is big, and there are many managers which are only available to the institutional level, and maybe the retail investor, but retail is not where the money is for making a living.

good luck

[CoachKandSportsguy]

Originally Posted by Nevinator

Fidelity had me classified as an Active Trader VIP. In late 2024 I asked Fidelity for some assistance with reviewing some estate documents (one of their services) and I was told it would take two months to get an appointment. Unsatisfactory in my opinion, but I waited.

estate documents should never be reviewed by a financial institution. Always, always use an estate designated elder law attorney. They will even tell you that financial institutions only advertise their review of estate documents to have you become a customer. They are not elder law attorneys, and should never be treated as such.

[Dond1959]

The cost of an advisor is around 1% of the account value per year. So on a $1 million portfolio that is $10,000 per year and $100,000 for 10 years. You can buy index funds for .08% to 0.12% per year or $800 to $1200 per year ($8,000 to $12,000 over 10 years). You can easily construct a simple 3 or 4 index fund portfolio based on your risk tolerance (many tools to determine your risk tolerance online or use a Fidelity tool). Studies have shown that index funds consistently out perform active management over the long term.

Investing is not rocket science, it is about determining your risk tolerance and picking index funds to match that risk tolerance. I would encourage anyone to go to Bogleheads.org to learn about investing. Don’t allow an advisor to over complicate investing. Pick your funds and stay with them and don’t worry about the short term, long term you will be okay if you stick with it.

Finally, I am a big believer in Fidelity. Their support is top notch and their online platform is very easy to use. Vanguard has a very user unfriendly online platform and trying to get support on a telephone is painstakingly long. I moved from Vanguard to Fidelity a few years ago and I am very happy with my choice.

I tried to make this a simple comment for the OP to understand what they are giving up in return by using an advisor. A compromise is using a “robo” advisor that determines your risk tolerance and tells you what to invest in based on all your factors. The one at Fidelity is called Fidelity Go. Vanguard also has a robo advisor. If you still don’t want to be in control you could use this type of investment vehicle. Fidelity Go charges 0.35% per year. Which is about 1/3 of what an advisor would charge.

[ltcdfancher]

Originally Posted by Dond1959

The cost of an advisor is around 1% of the account value per year. So on a $1 million portfolio that is $10,000 per year and $100,000 for 10 years. You can buy index funds for .08% to 0.12% per year or $800 to $1200 per year ($8,000 to $12,000 over 10 years). You can easily construct a simple 3 or 4 index fund portfolio based on your risk tolerance (many tools to determine your risk tolerance online or use a Fidelity tool). Studies have shown that index funds consistently out perform active management over the long term.

Investing is not rocket science, it is about determining your risk tolerance and picking index funds to match that risk tolerance. I would encourage anyone to go to Bogleheads.org to learn about investing. Don’t allow an advisor to over complicate investing. Pick your funds and stay with them and don’t worry about the short term, long term you will be okay if you stick with it.

Finally, I am a big believer in Fidelity. Their support is top notch and their online platform is very easy to use. Vanguard has a very user unfriendly online platform and trying to get support on a telephone is painstakingly long. I moved from Vanguard to Fidelity a few years ago and I am very happy with my choice.

I tried to make this a simple comment for the OP to understand what they are giving up in return by using an advisor. A compromise is using a “robo” advisor that determines your risk tolerance and tells you what to invest in based on all your factors. The one at Fidelity is called Fidelity Go. Vanguard also has a robo advisor. If you still don’t want to be in control you could use this type of investment vehicle. Fidelity Go charges 0.35% per year. Which is about 1/3 of what an advisor would charge.

I posted earlier about my using a fee-for-service, fiduciary advisor service. I met with Brian twice for over an hour in-person. The initial meeting cost me over $600; he needed time to review everything. Following that meeting, I could have made the adjustments he proposed on my own. Rinse-and-repeat these meetings annually. If someone spends less than $1,000/year for course corrections on a $1M portfolio, then THAT is money well-spent AND it makes me sleep better at night.

[stevecmo]

Originally Posted by mgman

I have been a client of Edward Jones for more than 20 years. I use their 'Advisory Solutions' program and have averaged 7% after all fees over those years. All I have to do is take my tax papers and file income tax. They do minimum withdrawals and wire money to my checking account. I could do it too, but who wants to spend time doing the footwork.

The S&P 500 has averaged 11.8% return over the last 20 years. Let that sink in. Edward Jones did you no favors.

[BillHitz]

Originally Posted by woodwright

Would you say what advisor you use?

I use Andy Panko who owns Tenon Financial. He does fixed fee and not AUM. He also has a great Facebook group called Retirement Planning Education (formerly Taxes in Retirement) as well as a podcast also called Retirement Planning Education.

[spinner1001]

Originally Posted by Cliff Fr

This thread has me wondering when AI will be used to manage an investment portfolio.

If you mean robots, they already are managing portfolios as others have noted.

A more interesting question is, on average, whether robots managing investment portfolios produce better or worse returns for a given level of risk.

If you mean AI learning to trade stocks, it’s already here, too. The future is now. But AI trading systems suffer the same problem as the quants over past decades using statistics for trading decisions: the future likely won’t resemble the past. AI models train on past data, too. Markets are dynamic, not static. Over the *long run*, no one can outperform the market. Some years they can; other years they can’t.

[Happydaz]

Originally Posted by stevecmo

The S&P 500 has averaged 11.8% return over the last 20 years. Let that sink in. Edward Jones did you no favors.

Are you saying a retired person living in the Villages should have 100% of his portfolio in the stock market? A balanced account will have a mixture of stocks and bonds and the return has been in the 6-8% range. If we had a stock market crash that lasted a number of years an elderly person would be grateful that half his money was in bonds as he needs to take money out each year to live on.

[retiredguy123]

Originally Posted by Happydaz

Are you saying a retired person living in the Villages should have 100% of his portfolio in the stock market? A balanced account will have a mixture of stocks and bonds and the return has been in the 6-8% range. If we had a stock market crash that lasted a number of years an elderly person would be grateful that half his money was in bonds as he needs to take money out each year to live on.

I agree that you shouldn't have 100 percent of your investments in the stock market. But you can have 40 percent in an S&P stock index fund, 40 percent in a bond index fund, and 20 percent in a money market fund. And never buy an individual stock or bond or ever pay an advisor an AUM fee. You will do just fine and probably better than paying an advisor.

[CoachKandSportsguy]

Originally Posted by Happydaz

Are you saying a retired person living in the Villages should have 100% of his portfolio in the stock market? A balanced account will have a mixture of stocks and bonds and the return has been in the 6-8% range. If we had a stock market crash that lasted a number of years an elderly person would be grateful that half his money was in bonds as he needs to take money out each year to live on.

correct, though the proportion of bonds shouldn't be static, but should be based upon real interest rates. If interest rates are higher than inflation, there should be a higher proportion of bonds, and if rtes are less than inflation, there should be a smaller proportion of bonds, and a larger proportion based upon age.

Too many people who had a set it and forget it 401K allocation while working, have a recency bias of wanting a similar set it and forget it desire. Unfortunately in retirement a set it and forget it approach may result in an unfortunately large drawdown while not being able to make the loss back very quickly or at all. . .

The future is always uncertain, and sometimes it's more uncertain than other times. . like now.

[Stu from NYC]

Originally Posted by retiredguy123

I agree that you shouldn't have 100 percent of your investments in the stock market. But you can have 40 percent in an S&P stock index fund, 40 percent in a bond index fund, and 20 percent in a money market fund. And never buy an individual stock or bond or ever pay an advisor an AUM fee. You will do just fine and probably better than paying an advisor.

We all have our own tolerance for risk. For me it is higher than most.

A lot of it depends upon the total value of your assets. If higher you can accept more risk.

It is what it is but am constantly amazed that an actively managed mutual fund cannot beat out an index fund.

[goneil2024]

Most of the folks in TV have retired from one field of work or another. Depending on the size, complexity and other factors many may not even need an adviser. I would also expect that most reading this were fairly expert in their respective careers, that may have been, automotive, medical, manufacturing, services, education, government services, etc.

However, I find it difficult to understand why when it comes to a field as complex and impactful as personal finance many of us simply insist on a DIY approach aka self-directed investor(s) especially when one wrong decision could have such lasting consequences to our financial health.

That being said, if an individual understands and can manage all of the following concepts then likely there is no immediate need for a financial adviser. However, do we all really want to spend our time at TV monitoring, rebalancing and executing trades when we can be out playing pickleball, golf or town square with music and friends?

Do we really (be honest) understand and can execute on all of the following:

* Sequence of returns Risk
* Concentration Risk
* Time Horizon
* Risk Tolerance
* Analysis of investment options
* Individual Risk Capacity
* Suitability of Investments
* Our individual Investor Behavioral factors

In my view this as a binary decision. Do it all yourself or hand it over to someone else. After that then if you elect not to do it yourself then which firm to select. My experience after 45-years as a self-directed investor, who was trained, worked as personal financial adviser for a time, and now uses custodial services and other features from a national broker, is that it comes down to the individual at the firm and the team you assemble. Not a shocker for most of us, financial services in my view are very personal services. Just like your doctor or lawyer, some are the right fit and others simply will never be a match.

Well trained, engaged professionals don't work for free, nor should they, so be sure you get your money's worth in all cases.

This is just my personal opinion; it is not financial advice. I suggest you always consult legal, accounting and other professionals for such decisions.

[Stu from NYC]

Originally Posted by goneil2024

Most of the folks in TV have retired from one field of work or another. Depending on the size, complexity and other factors many may not even need an adviser. I would also expect that most reading this were fairly expert in their respective careers, that may have been, automotive, medical, manufacturing, services, education, government services, etc.

However, I find it difficult to understand why when it comes to a field as complex and impactful as personal finance many of us simply insist on a DIY approach aka self-directed investor(s) especially when one wrong decision could have such lasting consequences to our financial health.

That being said, if an individual understands and can manage all of the following concepts then likely there is no immediate need for a financial adviser. However, do we all really want to spend our time at TV monitoring, rebalancing and executing trades when we can be out playing pickleball, golf or town square with music and friends?

Do we really (be honest) understand and can execute on all of the following:

* Sequence of returns Risk
* Concentration Risk
* Time Horizon
* Risk Tolerance
* Analysis of investment options
* Individual Risk Capacity
* Suitability of Investments
* Our individual Investor Behavioral factors

In my view this as a binary decision. Do it all yourself or hand it over to someone else. After that then if you elect not to do it yourself then which firm to select. My experience after 45-years as a self-directed investor, who was trained, worked as personal financial adviser for a time, and now uses custodial services and other features from a national broker, is that it comes down to the individual at the firm and the team you assemble. Not a shocker for most of us, financial services in my view are very personal services. Just like your doctor or lawyer, some are the right fit and others simply will never be a match.

Well trained, engaged professionals don't work for free, nor should they, so be sure you get your money's worth in all cases.

This is just my personal opinion; it is not financial advice. I suggest you always consult legal, accounting and other professionals for such decisions.

I think you make this much harder than it needs to be. Once you decide on how to break down categories find a bunch of well run no load funds or low cost ETF's consistently earning good returns and stay with them as long as they do this.

[biker1]

If you feel the need, Vanguard offers a robot-advisor for 0.15% and a person for 0.3%. They will put you in Vanguard mutual funds and ETFs. I haven't felt the need as I have used a 2 fund strategy for some time.

Originally Posted by AMB444

Above ^

I have an accounting degree and can apply myself if I need to. (I'm at that age that I don't want to)

What are the advantages of keeping a "keeper" of investments.

So far I like my "investment person". But willing to listen to you educated folk.

Thank you in advance for not being overly condescending, like this forum tends to lean towards.

TIA

[manaboutown]

Originally Posted by AMB444

Above ^

I have an accounting degree and can apply myself if I need to. (I'm at that age that I don't want to)

What are the advantages of keeping a "keeper" of investments.

So far I like my "investment person". But willing to listen to you educated folk.

Thank you in advance for not being overly condescending, like this forum tends to lean towards.

TIA

I am glad the OP asked this question and appreciate all the thoughtful responses as at age 83 I feel myself approaching the same situation, ie., when should I turn over investment decision making to a professional?

If I can find a suitable fee-only independent CFA with both a decent track record and a good reputation I can see myself hiring him or her and reviewing my securities portfolios probably quarterly. My challenge lies in finding that advisor.