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Financial Advisor [use Ric Edelman?]

Posted: Fri Aug 24, 2012 9:10 pm
by eonny
I agree with the Ric Edelman philosophy of savings. Any opinions about using a Ric Edelman advisor to take a look at my portfolio?

Re: Financial Advisor

Posted: Fri Aug 24, 2012 10:33 pm
by mhc
Welcome to the forum.

I'm not familiar with that adviser, but you can have a free portfolio review here. Take a look at the following page and if you agree with the Boglehead philosophy, then post according to that page. Could save you a lot of money.

http://www.bogleheads.org/wiki/Getting_Started

Re: Financial Advisor

Posted: Sat Aug 25, 2012 8:26 am
by Johm221122
eonny wrote:I agree with the Ric Edelman philosophy of savings. Any opinions about using a Ric Edelman advisor to take a look at my portfolio?
Welcome to forum,
He seems to charge, can you give us basics.Here is BOGLEHEAD philosophy
http://www.bogleheads.org/wiki/Boglehea ... Philosophy
Give us a comparison of the two
John

Re: Financial Advisor

Posted: Sat Aug 25, 2012 8:39 am
by LadyGeek
Also, welcome! For the members, I found an article that details this advisor: The Truth About Ric Edelman - it's from a financial advisor website. Note that the article mentions this forum.

Consider whether you need the services of a financial advisor (which includes financial planning), or just someone to handle your investments.

Read our wiki and take your time. We think you can do this yourself. If you learn "the basics" you'll have a skill that will literally more than pay for itself for the rest of your life. If you have any questions, just ask.

(Anyone deciding to go with a financial advisor is strongly encouraged to do a background check: Investment adviser)

Re: Financial Advisor

Posted: Sat Aug 25, 2012 8:45 am
by Johm221122
LadyGeek wrote:Also, welcome! For the members, I found an article that details this advisor: The Truth About Ric Edelman - it's from a financial advisor website. Note that the article mentions this forum.

Consider whether you need the services of a financial advisor (which includes financial planning), or just someone to handle your investments.

Read our wiki and take your time. We think you can do this yourself. If you learn "the basics" you'll have a skill that will literally more than pay for itself for the rest of your life. If you have any questions, just ask.

(Anyone deciding to go with a financial advisor is strongly encouraged to do a background check: Investment adviser)
Thanks for link,but he has 125 portfolios,to fit every need :oops: l will pass


OP,I would still like to hear your comparison :sharebeer

Re: Financial Advisor

Posted: Sat Aug 25, 2012 8:56 am
by Call_Me_Op
I have read one of his books and listen to his shows. He seems like a smart and knowledgeable guy - seems to know a lot about all aspects of financial planning.

His approach appears to heavily utilize ETF's and features high-frequency rebalancing. It is not really a Bogleheadish approach, except he does believe in low cost vehicles. Investing is something that generally (in my opinion) can be learned without much difficulty. However, if you are unwilling or unable to learn about it on your own, a financial advisor may make sense. I don't know his fee structure, but he seems smart and if his fee's are reasonable, he may be worth consideration.

You may also consider Rick Ferri. He is knowledgeable and seems very honest - and has low fees. He posts on this board and is always respectful and humble. Look also at Buckingham Asset Management. Larry Swedroe (another Boglehead) is the Head of Research, and is very knowledgeable.

Re: Financial Advisor

Posted: Sat Aug 25, 2012 9:38 am
by Muchtolearn
I wouldn't go near this guy. He has a good schtick on radio. However his fees exceed 1% of assets. Yikes. If you really need an advisor who uses ETFs, look into Rick Ferri who posts here. He is very solid and charges 0.25% of assets. I personally do not use an advisor but if I did I would go with somebody like Rick. Good luck. (I do not know Rick, could not pick him out of a lineup nor have I ever corresponded with him !!!)

Re: Financial Advisor

Posted: Sat Aug 25, 2012 10:02 am
by Call_Me_Op
Muchtolearn wrote:I wouldn't go near this guy. He has a good schtick on radio. However his fees exceed 1% of assets. Yikes. If you really need an advisor who uses ETFs, look into Rick Ferri who posts here. He is very solid and charges 0.25% of assets. I personally do not use an advisor but if I did I would go with somebody like Rick. Good luck. (I do not know Rick, could not pick him out of a lineup nor have I ever corresponded with him !!!)
As I posted above, I would take a serious look at Rick Ferri. He wrote a good book called "All About Asset Allocation." Rick seems very honest, which is reflected in his very reasonable fee. And his approach is based upon low-cost funds and modern portfolio theory.

Re: Financial Advisor

Posted: Sat Aug 25, 2012 10:10 am
by JW-Retired
Here is the Ric Edelman managment fee schedule. Fees start at 2% for up to $150K and don't get down to what Bogleheads might think a fairly reasonable percentage until you have millions with him.
http://www.ricedelman.com/cs/invest_wit ... e_schedule

I have no idea what level of fees the funds he picks might have on top of this schedule. Based on the few times I have heard his infomercial radio show, I think he sells fund picks mainly based on recent past performance, not low cost. OP should understand the enormous drag anything like 2% in fees has on your investment growth.
JW

Re: Financial Advisor

Posted: Sat Aug 25, 2012 10:15 am
by BolderBoy
Wow, his fee schedule almost looks usury by Boglehead standards.

OP - pay close attention to the fee schedule as it very clearly points out something true about all fee-based advisors: "They make money on you whether you make money or not."

FWIW...

Re: Financial Advisor

Posted: Sat Aug 25, 2012 10:17 am
by tibbitts
eonny wrote:I agree with the Ric Edelman philosophy of savings. Any opinions about using a Ric Edelman advisor to take a look at my portfolio?
As with all posts like this, you have to explain what services you're looking for in a financial adviser. Otherwise you'll get posts like the ones recommending Rick (Ferri), whose firm deals specifically with investment management.

For those of us who don't have a clue, please explain Ric Edelman's "philosophy of savings." My philosophy is that saving a big part of my income is a great idea, and I was lucky enough to be able to do that for a number of years. Unfortunately, I don't earn enough now to save that much and still have the goods and services I want, so it really doesn't matter what my "savings philosophy" is, and no amount of hand-holding is going to change that.

Paul

Re: Financial Advisor

Posted: Sat Aug 25, 2012 4:08 pm
by Jerilynn
Call_Me_Op wrote: He seems like a smart and knowledgeable guy - seems to know a lot about all aspects of financial planning.
All the good con men seem that way.

Re: Financial Advisor

Posted: Sat Aug 25, 2012 4:37 pm
by ruralavalon
Welcome to the forum :) .
eonny wrote:I agree with the Ric Edelman philosophy of savings. Any opinions about using a Ric Edelman advisor to take a look at my portfolio?
Tips about hiring an advisor: "On Your Own or Hire an Advisor?" http://investingroadmap.wordpress.com/2 ... n-advisor/

Personally I would not pay a fee that high.

Re: Financial Advisor

Posted: Sun Aug 26, 2012 11:43 pm
by letsgobobby
I really enjoy his show and i think he knows his stuff, but his fees are too high. You can probably do better for less, say an hourly FA as opposed to paying percent of AUM.

Re: Financial Advisor

Posted: Mon Aug 27, 2012 12:16 am
by lawman3966
The link below is a couple of years old, but the numbers seem consistent with those in another link provided above. The brochure linked to below breaks the fees for EMAP and the industry average into three components to allow Edelman to make his point about the "SAI" (statement of additional information).

There was an article in some online journal about two years ago (which I don't have a link to at the moment) that identified a contradiction between the theory and practice of the EMAP approach. Specifically, EMAP charges high management fees to place clients in low-fee ETFs, all the while criticizing the industry for charging too much. If one is going to go to the trouble of reducing ERs from 1% to 0.3% or so, consistency appears to demand paying as little in mgmt fees as possible. It seems the height of absurdity to avoid the traditional 1% ERs on actively managed mutual funds, only to pay twice that much in management fees to have money placed in the low-fee ETFs.

It's bad enough that some investors pay high fees because they don't understand the importance of fees, and don't know what the fee levels are. But it's positively astounding that people would continue to pay high fees to a firm that criticizes high fees, merely because the high fees are disclosed. Upon seeing this, I suspect that Lincoln (not the financial company) might have edited his famous pronouncement to read "with enough hype, you can fool most of the people most of the time".


http://www.ricedelman.com/galleries/def ... F_EMAP.pdf

Re: Financial Advisor

Posted: Mon Aug 27, 2012 5:40 am
by Call_Me_Op
Jerilynn wrote:
Call_Me_Op wrote: He seems like a smart and knowledgeable guy - seems to know a lot about all aspects of financial planning.
All the good con men seem that way.
I am by no means advocating the use of this advisor. He is knowledgeable about investing, but that has nothing to do with whether he is honest or anything else. His fees are certainly high - but I personally wouldn't use a financial advisor regardless of his or her fees.

Re: Financial Advisor

Posted: Mon Aug 27, 2012 9:21 am
by ObliviousInvestor
Have you looked up his Form ADV Part II? (I would always suggest doing this for any adviser you're considering.) Some potentially relevant points:

The fee for the managed asset program ranges from 1-2% for clients with assets under $1 million. (It's less for clients with more than $1 million.)

His investment philosophy is described as follows:
The EFS investment philosophy is based on the following basic principles:
•Develop highly diversified portfolios that feature a broad range of asset classes and market sectors.
• Use market-based investments, not manager-based investments.
• Hold the investments for long periods of time.
• Periodically reallocate investments as conditions warrant.
• Strategically rebalance as needed.
Investments are selected based on past performance (as applicable), manager tenure, portfolio turnover, fees and a variety of academic statistics including beta, standard deviation, R-Squared and Sharpe Ratio.
If I could link to the PDF directly, I would, but the way the SEC site is set up, I can't figure out how. You really should go look at the form yourself -- lots of useful information. (After you look up his firm, you'd want to click the link for "SEC" and then the link way down in the left-side navigation for "Part 2 Brochures.")

Re: Financial Advisor

Posted: Mon Aug 27, 2012 9:23 am
by ObliviousInvestor
lawman3966 wrote:There was an article in some online journal about two years ago (which I don't have a link to at the moment) that identified a contradiction between the theory and practice of the EMAP approach. Specifically, EMAP charges high management fees to place clients in low-fee ETFs, all the while criticizing the industry for charging too much. If one is going to go to the trouble of reducing ERs from 1% to 0.3% or so, consistency appears to demand paying as little in mgmt fees as possible. It seems the height of absurdity to avoid the traditional 1% ERs on actively managed mutual funds, only to pay twice that much in management fees to have money placed in the low-fee ETFs.
I think you might be referring to this article: http://www.cbsnews.com/8301-505123_162- ... tag=mwuser

Also, a more recent article from Allan Roth may be of interest: http://www.cbsnews.com/8301-505123_162- ... ding-fees/

Re: Financial Advisor [use Ric Edelman?]

Posted: Mon Aug 27, 2012 4:38 pm
by nisiprius
I do not feel he is an honest person. I don't mean he does anything illegal, I mean that nothing he presents is straightforward information at all, all of it is twisted in self-serving ways.

Others have referenced his assertion that Vanguard index funds are not what they seem and have huge hidden fees. That's unconscionable because anyone can just compare the funds with the index and see that it isn't true. What's even worse is that he might not have said that--he might have been clever enough to say only words that are technically true, phrased in such as way that most of his audience thinks they heard something different.

His essay, "Eleven Reasons Why You Should Carry A Big, Long Mortgage" is a masterpiece of spin. The man sells investments. He wants you to carry a mortgage so you will have money to put in investments rather than paying down the mortgage. The man also sells mortgages. So he doesn't want you to pay down the mortgage. There's not one straightforward sentence in that whole essay. For example, the point about interest being tax-deductible does not mention the important point that is is true only if you itemize. One of the worst is "Mortgages allow you to sell without selling." No, having a mortgage is not like selling a partial share in your house. If you owe the bank $200,000 on a $400,000 house, and the value of the house drops to $300,000, you still owe the bank $200,000, not $150,000. Ugh.

Re: Financial Advisor [use Ric Edelman?]

Posted: Mon Aug 27, 2012 7:57 pm
by JW-Retired
eonny wrote: I agree with the Ric Edelman philosophy of savings. Any opinions about using a Ric Edelman advisor to take a look at my portfolio?
eonny,
Have not seen you back here since your original post. It should be pretty obvious we don't much like the Edelman high fee structure. Perhaps if you could define what you mean by his "philosophy of savings" we could offer some less expensive way to invest that fits with what you have in mind.
JW

Re: Financial Advisor [use Ric Edelman?]

Posted: Mon Aug 27, 2012 9:42 pm
by SurfCityBill
Everyone's perception of value is different. Edelmans fee's are high and I would not use his services. But I can understand why many people would and are willing to pay his price. They simply don't know where else to go and they're comfortable with what he's offering. Similarly, while many people would only bring their car to a dealership for service I would never do so. These same people do not feel they are being taken advantage of in the least and that's fine. To each his own.

-B

Re: Financial Advisor [use Ric Edelman?]

Posted: Mon Aug 27, 2012 11:34 pm
by letsgobobby
nisiprius wrote:I do not feel he is an honest person. I don't mean he does anything illegal, I mean that nothing he presents is straightforward information at all, all of it is twisted in self-serving ways.

Others have referenced his assertion that Vanguard index funds are not what they seem and have huge hidden fees. That's unconscionable because anyone can just compare the funds with the index and see that it isn't true. What's even worse is that he might not have said that--he might have been clever enough to say only words that are technically true, phrased in such as way that most of his audience thinks they heard something different.

His essay, "Eleven Reasons Why You Should Carry A Big, Long Mortgage" is a masterpiece of spin. The man sells investments. He wants you to carry a mortgage so you will have money to put in investments rather than paying down the mortgage. The man also sells mortgages. So he doesn't want you to pay down the mortgage. There's not one straightforward sentence in that whole essay. For example, the point about interest being tax-deductible does not mention the important point that is is true only if you itemize. One of the worst is "Mortgages allow you to sell without selling." No, having a mortgage is not like selling a partial share in your house. If you owe the bank $200,000 on a $400,000 house, and the value of the house drops to $300,000, you still owe the bank $200,000, not $150,000. Ugh.
I think you're overstating it, but he's definitely a top salesman of self.

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 3:53 am
by SGM
My opinion of Ric Edelman can best be summed up by this quote from Yeats.

"The best lack all conviction, while the worst
Are full of passionate intensity."

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 6:29 am
by stemikger
When I listen to Ric Edelman's radio show, he is all over the place. He is too much of a fast talker for me.

If I also remember correctly, many years ago he didn't like index funds and now he loves them, and EFFs so that makes me even more confused.

I actually did speak to one of his financial advisers that opened up a franchise near my house and the guy I spoke to actually seemed like a decent guy and when I told him my simple approach he said I was doing fine. So I didn't really need him and he never called me back again. I'm not sure if that is because he sensed I knew my stuff or he was extremely ethical or he thought I didn't have enough money to waste his time. LOL.

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 8:11 am
by gerntz
Given this is the op's #1 post, it makes me wonder if s/he is a plant or ruse.

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 8:31 am
by gkaplan
gerntz wrote:Given this is the op's #1 post, it makes me wonder if s/he is a plant or ruse.
I had the exact same thought.

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 11:41 am
by wwross
I have read Edelman's books, listened to his radio broadcast for years, and even have gone to one of his seminars. I think that he is very knowledgable and insightful on a broad array of personal financial topics. His mortgage theory is interesting and in some circumstances (particularly in an extremely low interest rate environment), appears to be a good idea for some people. I personally paid off my mortgage several years ago and am very happy with the decision.

On investing, I made a decision a few years ago to follow the advice from the Edelman online GPS tool. The tool offers up a suggested portfolio allocation, for your circumstances, across about 19 subcategories. I set up the allocation using all low cost index ETFs (mostly Vanguard) purchased through TD-Ameritrade, that correspond to the 19 categories (e.g. Large-Growth, MidCap-Value, International-Value, Real Estate, Commodities, Govt. Short term, Intermediate, Long term bons, etc. etc.) I rebalance approximately once a quarter using a 5% (Stocks vs. Bonds) and a 2% (Subcategory rule).

Maybe my timing was lucky, (I sold all previous mutual funds and individual stocks near the end of 2008 and the Winter of 2009), but the strategy has worked well. Of course, since then I have learned about other simpler Bogle-like 3-asset, and Lazy Portfolio, and tilting allocations. If I had to do it over, I probably would have pursued them. But for the time-being, this strategy seems inexpensive (about .21% ER?) and from I have observed, with essentially a 65/35% stock/bond split, probably similar in outcome to the simpler allocations. I get lots of consumer enjoyment watching how the 19 categories interact and counteract each other in keeping the volatility down.

Now, having said all this, I would never invest with Edelman himself. I agree with the others that the management fees are outrageously expensive. As I and others have posted, percentages of AUM end up being just too much for anybody with a decently sized portfolio. When I pay a lawyer no more than a couple of thousand for a specific service, and my tax person no more than a couple hundred, paying someone over $30k for running their spreadsheets a few couple of times a year and making a few transactions, seems ridiculous.

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 3:26 pm
by Jerilynn
nisiprius wrote:I do not feel he is an honest person. The man also sells mortgages. So he doesn't want you to pay down the mortgage. There's not one straightforward sentence in that whole essay. For example, the point about interest being tax-deductible does not mention the important point that is is true only if you itemize.
And that's now. It's not impossible that sometime in the future the mortgage interest deduction gets 'modified'.

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 5:14 pm
by letsgobobby
Jerilynn wrote:
nisiprius wrote:I do not feel he is an honest person. The man also sells mortgages. So he doesn't want you to pay down the mortgage. There's not one straightforward sentence in that whole essay. For example, the point about interest being tax-deductible does not mention the important point that is is true only if you itemize.
And that's now. It's not impossible that sometime in the future the mortgage interest deduction gets 'modified'.
In that case one could pay off their mortgage. That's why not paying off has value; there's an embedded option. Those who pay off their mortgage cannot automatically extract that equity, for example, in the event of a job loss.

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Aug 28, 2012 5:21 pm
by SamB
You need to go back 30 years and look at Edelman's books over that period. It might surprise you. To say that they are inconsistent would be an understatement.

Re: Financial Advisor [use Ric Edelman?]

Posted: Wed Aug 29, 2012 11:10 am
by Sbashore
eonny wrote:I agree with the Ric Edelman philosophy of savings. Any opinions about using a Ric Edelman advisor to take a look at my portfolio?
Rice, is that you?

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue Sep 04, 2012 12:30 pm
by SurfCityBill
SamB wrote:You need to go back 30 years and look at Edelman's books over that period. It might surprise you. To say that they are inconsistent would be an understatement.
So would you say his recommendations have simply changed over time or has his position flip-flopped back and forth? I can understand the former, but not the later.

-B

Re: Financial Advisor [use Ric Edelman?]

Posted: Sun Sep 16, 2012 4:13 pm
by zaplunken
nisiprius wrote:
His essay, "Eleven Reasons Why You Should Carry A Big, Long Mortgage" is a masterpiece of spin. The man sells investments. He wants you to carry a mortgage so you will have money to put in investments rather than paying down the mortgage. The man also sells mortgages. So he doesn't want you to pay down the mortgage. There's not one straightforward sentence in that whole essay. For example, the point about interest being tax-deductible does not mention the important point that is is true only if you itemize.
+10 on the mortgage issue!

I have listened to (and still do) his radio show for years, it's an infomercial basically. Ric's fee schedule is quite expensive. Rick Feri would be my choice if you have the minimum level to invest with him.

Re: Financial Advisor [use Ric Edelman?]

Posted: Sun Sep 16, 2012 6:57 pm
by eonny
I am not Rice. He seemed to justify his fees by stating a lot of fees are hidden in the statement of additional expenses. Anyway as with anything buyer beware.

Re: Financial Advisor [use Ric Edelman?]

Posted: Sun Sep 16, 2012 7:04 pm
by Rick Ferri
eonny wrote:I am not Rice. He seemed to justify his fees by stating a lot of fees are hidden in the statement of additional expenses. Anyway as with anything buyer beware.
Such as...what? What "hidden" adviser's fee? There is a fee schedule stated in every adviser's ADV and that is all there is. Is he talking about the mutual funds that advisers may put client's money into? Those fees have nothing to do with the fee that Ric Edelman charges.

Sorry, had to chime in on his truly stupid excuse for charging high fees. Here is the real reason, he has no problem charging current clients 3 to 4 times what his advice is worth and use that extra money to market to other people so that he becomes very, very wealthy.

Read John Bogle's book, "The Clash of the Cultures". Jack talks all about companies that charge high management fees so that they can spend a lot more money marketing to other people. He gives those firms a 0 rating.

Rick Ferri

Re: Financial Advisor [use Ric Edelman?]

Posted: Sun Sep 16, 2012 8:43 pm
by JW-Retired
eonny wrote: I am not Rice. He seemed to justify his fees by stating a lot of fees are hidden in the statement of additional expenses. Anyway as with anything buyer beware.
Welcome back. I have to admit I don't know what kind justification of hidden fees you are talking about. He has really high fees. That's all there is to it.
JW

Fee Calculation

Posted: Sun Sep 16, 2012 8:56 pm
by JDCPAEsq
ObliviousInvestor wrote:The fee for the managed asset program ranges from 1-2% for clients with assets under $1 million. (It's less for clients with more than $1 million.)
I don't think you're reading his schedule correctly. He builds in a base fee beginning at 2% so that when you reach $1 million under management your fee is 1.4% or $14,000. He charges .75% on the next $2 million so that at $2 million of assets his fee is $21,500 or 1.08%, and not until about $3 million does the total fee reach $29,000 or .97%.
John

Re: Financial Advisor [use Ric Edelman?]

Posted: Sat Nov 24, 2012 12:39 pm
by EyeYield
LadyGeek wrote:Also, welcome! For the members, I found an article that details this advisor: The Truth About Ric Edelman - it's from a financial advisor website. Note that the article mentions this forum.

Consider whether you need the services of a financial advisor (which includes financial planning), or just someone to handle your investments.

Read our wiki and take your time. We think you can do this yourself. If you learn "the basics" you'll have a skill that will literally more than pay for itself for the rest of your life. If you have any questions, just ask.

(Anyone deciding to go with a financial advisor is strongly encouraged to do a background check: Investment adviser)
LadyGeek wrote:http://www.cbsnews.com/8301-505123_162- ... tag=mwuser
After reading "The Truth" as well as other articles and videos in this thread, I still don't feel I know the truth. Well, to me, the truth is that there is no reason to pay an "advisor" to suggest what is basic common knowledge to the people on this forum. I suppose there are people that will never have the time or inclination to educate themselves and these same people will not mind paying 10k a year to have a "false" sense of security.
I could find no unscripted testimonials from clients who praise the results they achieved, so....
Ric is definitely a great salesman and has the infomercial style down. He would be successful selling time shares, supplements or steak knives. The only line missing is, "but if you call now...".

Re: Financial Advisor [use Ric Edelman?]

Posted: Sat Nov 24, 2012 1:12 pm
by nedsaid
I have mostly been a do it yourself investor and I am suspicious of financial people such as financial advisors, brokers, insurance agents, etc. Yet I have sought out advice and have benefitted from it.

Looking back, I was fortunate to have worked with three pretty good stockbrokers that taught me a lot about the financial markets. I don't recommend using brokers but in my case was really glad I had three good ones.

I also have utilized the financial review services of a mutual fund company, an insurance company, and a financial planning firm. There are mutual fund companies that will do them for free for their customers. Keep in mind that the advice you get is not totally unbiased but I learned useful information each time. I also have attended the Merriman and also Ray Lucia workshops. If I can come up with one or two good ideas each time, then going through a review or attending a seminar is worth the time.

The Boglehead Philosophy is rock-solid sound and people can save themselves many thousands of dollars if they will just do some research on their own. There are pretty complicated financial issues that come up in life and I don't think there is
anything wrong with seeking advice. The trouble is finding someone you can trust.

I have a couple friends who tried their hand in the insurance business and another who was a stock broker. The financial services industry is a tough, tough business and you realize that these companies do not necessarily have your best interests in mind. I am putting it nicely.

Yet it is hard to operate without financial relationships with the financial industry. One just has to be informed and wary.

My reaction to folks like Rick Edelman is to learn from them and separate the good ideas from the ones that won't work for you. All these guys have their strengths and weaknesses.

Re: Financial Advisor [use Ric Edelman?]

Posted: Sun Oct 12, 2014 5:06 am
by Bogle_Feet
eonny wrote:I agree with the Ric Edelman philosophy of savings. Any opinions about using a Ric Edelman advisor to take a look at my portfolio?
There is nothing wrong with paying an adviser for a one-time consultation to come up with a "game plan". Just don't pay someone to CONSTANTLY manage your portfolio. Any 1st grader can do that. It's called re balancing.

Re: Financial Advisor [use Ric Edelman?]

Posted: Sun Oct 12, 2014 10:07 am
by John Z
I bought his big fat book (642 pages) entitled "The Truth About Money" 3rd edition. I remember a few sentences that caused me to ignore future radio shows and books he might publish. A couple I recall and can find in his book that I have marked:

Chapter 23, p177 talking about mutual funds: "(To learn why I hate index funds -- and especially those modeled after the S&P500, read Rule 36 of The New Rules of Money and Chapter 13 of Discover the Wealth in You {Total Returns and Compounding}.) Next sentence talks about the new breed of index fund, ETFs, that allow you to buy and sell during the day to capture intra-day prices. {Day trading anyone?}

He seems to love variable annuities since he starts out with those in Chapter 28 - Annuities. After 9 pages of variable annuities, he mentions fixed annuities. And as bad as they are, only 3 sentences about equity indexed annuities.

I agree with most of the descriptions and opinions posted above; he does have a wealth of knowledge, but whether he could zero in on your personal situation and give you the best Boglehead type of advice, I really doubt it.

For what it's worth,
John

Re: Financial Advisor [use Ric Edelman?]

Posted: Tue May 05, 2020 1:36 pm
by gvsucavie03
nisiprius wrote: Mon Aug 27, 2012 4:38 pm I do not feel he is an honest person. I don't mean he does anything illegal, I mean that nothing he presents is straightforward information at all, all of it is twisted in self-serving ways.

Others have referenced his assertion that Vanguard index funds are not what they seem and have huge hidden fees. That's unconscionable because anyone can just compare the funds with the index and see that it isn't true. What's even worse is that he might not have said that--he might have been clever enough to say only words that are technically true, phrased in such as way that most of his audience thinks they heard something different.

His essay, "Eleven Reasons Why You Should Carry A Big, Long Mortgage" is a masterpiece of spin. The man sells investments. He wants you to carry a mortgage so you will have money to put in investments rather than paying down the mortgage. The man also sells mortgages. So he doesn't want you to pay down the mortgage. There's not one straightforward sentence in that whole essay. For example, the point about interest being tax-deductible does not mention the important point that is is true only if you itemize. One of the worst is "Mortgages allow you to sell without selling." No, having a mortgage is not like selling a partial share in your house. If you owe the bank $200,000 on a $400,000 house, and the value of the house drops to $300,000, you still owe the bank $200,000, not $150,000. Ugh.
I just found Ric Edelman recently and I know this post is really old, but I agree with your conclusions - no real straight answers and it always leads to "you need an advisor, call me" sort of thing. Everything is spoken (albeit very intelligently) in vague terms and general common-sense knowledge. Once the golden nugget is about to be said (specifics about asset allocation, how to DIY, etc), that's when the sales pitch gets put in. He does, after all, have a degree in communications and it makes sense that he's an excellent salesman/businessman that is well-spoken and trusted by many. I don't think he intends on creating any harm, but I'm not convinced I'm getting the full story like I can get here or from folks like Rick Ferri or one of the Boglehead books.