Portfolio review and financial advisor questions

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Topic Author
Adam685
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Joined: Sat Aug 30, 2014 9:08 pm

Portfolio review and financial advisor questions

Post by Adam685 » Thu Jul 11, 2019 10:09 pm

Hello,

I have had a financial advisor for the past 8 years (free during 5 years of residency and fellowship) and then continued with them for the past 3 post training. ($1000 annually plus 1.75% AUM). I appreciated their assistance during the training especially because they helped me get disability and life insurance and connected me with a good accountant. These were things that I had no time to do during training. I have been reading threads on this forum for several years now and have read Bogleheads Guide to Investing. I have been wanting to pull the plug for the past year but have been nervous about managing my wife and my retirement money as well as money to leave for our children (if and when we have them). However, during this last meeting we had, my advisor began talking about variable annuities, crypto, and some real estate product that the firm is developing. I now believe it is time to cut the cord. Below is the portfolio as it has been managed.

Emergency funds: >6 months

Debt:

Mortgage: $398,000 at 4.375%
Student loan: ~$247,000 FedLoan at 6.625% on year 3 of the public student loan forgiveness plan

Tax Filing Status: Married filing joint

Tax Rate: 32% Federal, 0% State

State of Residence: FL

Age: Me 34/Wife 32

Desired Asset allocation: 60% stocks / 40% bonds?
Desired International allocation:?
Gross Annual Income: ~380,000

Current retirement assets~218,000

Taxable
0% cash
0.49% SPSB SPDR Portfolio Short Term Corporate Bond ETF (0.07)
5.0% DISVX DFA Intl Small Cap Value(0.68)
4.7% DMREX DFA Municipal Return Instl (0.23)
3.45% DTMMX DFA Tax-Mgd US Marketwide Value (0.37)

His 401k

TSP:
TSP S Fund 6.39%
TSP C Fund 6.04%
TSP I Fund 8.74%
TSP F Fund 22.91%

Prudential (I moonlight at a 2nd hospital and work 2 shifts a month. It has a 10% match which I max every paycheck. This account is not managed by my financial advisor)
~4% VFIFX Vanguard Institutional Target Retirement 2050 Fund (0.15%)

His Roth IRA at TD Ameritrade
1.3% DEM WisdomTree Emerging High Dividend(0.63)
1.97% GUNR Flexshares MS GI Upstream Nat Res Idx (0.46)
0.43% GWX SPDR S&P International Small Cap (0.40)
2.1% REET iShares Global REIT (0.14)
0.1% SPTM SPDR Portfolio Total Stock Market (0.03)
2.1% SPYV SPDR S&P 500 Value ETF (0.04)
2.1% DFEMX DFA Emerging Markets(0.47)
10.1% DFIVX DFA International Value Portfolio (0.43)
6.5% DFSVX DFA US Small Cap Value (0.52)

Her Roth IRA at TD Ameritrade
2.24% DEM WisdomTree Emerging High Dividend (0.63)
0.31% EFV iShares MSCI EAFE Value Index (0.38)
1.41% PDBC Invesco Optimum Yield Diversified Commodity Strategy No K-1 (0.58)
1.29% REET iShares Global REIT (0.14)
1.86% SLYV SPDR S&P 600 Small Cap Value (0.15)
1% SPTM SPDR Portfolio Total Stock Market (0.03)
2.74% SPYV SPDR S&P 500 Value ETF (0.04)
3.16% DFGEX DFA Global Real Estate Secs (0.24)
5.1% DISVX DFA Intl Small Cap Value (0.68)
_______________________________________________________________


Contributions

New annual Contributions
I max the 401k limit every year. I contribute $3600 to the prudential account and the rest goes to TSP

I max our IRAs in January and do back door Roth (12,000) and then $2000 is taken out every month to fund taxable ($24,000)

I know I can contribute more monthly and that is the reason why I have >6 months in our emergency fund. However, I have had 2nd thoughts about the investments for awhile now but have not been ready to make a change.

Questions:

1. How does this portfolio look?

2. I tried looking for a fee only fiduciary near me but could not find one. I recently saw a post and someone mentioned the vanguard personal advisor service. Can anyone share experiences with that? Would they help me do the backdoor Roth IRA every year? Will they help get the funds out of TD Ameritrade? Will they provide recommendations about the TSP? How do I go about ending the relationship I had with this firm? What happens to my life and disability insurance?
3. I was thinking of just putting all the money in Vanguard 2050 fund and keeping it simple. Is that a reasonable approach?

Any help would be greatly appreciated. Thanks!
Last edited by Adam685 on Thu Jul 11, 2019 10:43 pm, edited 1 time in total.

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Watty
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Re: Portfolio review and financial advisor questions

Post by Watty » Thu Jul 11, 2019 10:32 pm

If you have not seen it yet be sure to look at the White Coat Investor web site which is run by a doctor who who is a poster here.

https://www.whitecoatinvestor.com/

You may get better responses to your post if you edit it to add the fund names in addition to the ticker symbols.
Adam685 wrote:
Thu Jul 11, 2019 10:09 pm
3. I was thinking of just putting all the money in Vanguard 2050 fund and keeping it simple. Is that a reasonable approach?
For the retirement accounts that would work well enough for now but they are not real tax efficient so as your taxable account grows that would be a problems so you could go to a three fund portfolio.

https://www.bogleheads.org/wiki/Three-fund_portfolio

https://www.bogleheads.org/wiki/Tax-eff ... _placement

Topic Author
Adam685
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Re: Portfolio review and financial advisor questions

Post by Adam685 » Thu Jul 11, 2019 10:47 pm

Thanks for the reply. I have edited the post to add the fund names. I have heard of the White Coat Investor and have read posts on the forum from time to time. Do you have any experience with the vanguard advisor service?

HomeStretch
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Re: Portfolio review and financial advisor questions

Post by HomeStretch » Thu Jul 11, 2019 11:06 pm

No experience with Vanguard PAS. But if you aren’t ready to DIY, they would be a better alternative than an expensive advisor who is talking about crypto, annuities and real estate investments especially when you still have a negative net worth.

Your advisor-designed portfolios look complex - your Roth IRAs could hold just 1-2 funds (US and International total stock market funds), your 401k could hold just 1-2 funds (your bond allocation plus any excess in equities) and hold equities in your taxable account.

You will most likely in your profession accumulate a great deal of wealth in your lifetime, even more so if you learn to manage your savings in a simple low cost portfolio.

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Duckie
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Re: Portfolio review and financial advisor questions

Post by Duckie » Fri Jul 12, 2019 5:39 pm

Adam685 wrote:Age: Me 34/Wife 32
Desired Asset allocation: 60% stocks / 40% bonds?
40% bonds is very conservative for your ages. I'd recommend 25-30%.
Desired International allocation:?
Vanguard has found between 20% and 40% of stocks in international to be the "sweet spot". See the Vanguard paper link and the discussion. I usually split the difference and recommend 30% of stocks.
How does this portfolio look?
Messy.
I recently saw a post and someone mentioned the vanguard personal advisor service. Can anyone share experiences with that? Would they help me do the backdoor Roth IRA every year?
What kind of help would you need? You contribute, then you convert.
Will they help get the funds out of TD Ameritrade?
Unlikely, but there are transfer agents that help with moving accounts.
Will they provide recommendations about the TSP?
Unlikely, they usually concentrate on your Vanguard assets.
What happens to my life and disability insurance?
Who holds the insurance? I'll bet it's an insurance company, not the advisor.
I was thinking of just putting all the money in Vanguard 2050 fund and keeping it simple. Is that a reasonable approach?
Not with a taxable account in the mix.
Any help would be greatly appreciated.
The following example of a retirement portfolio has an AA of 60% stocks, 40% bonds, with 30% of stocks in international. That breaks down to 42% US stocks, 18% international stocks, and 40% bonds. You could have:

Taxable at Vanguard -- 13%
13% (VTSAX) Vanguard Total Stock Market Index Fund Admiral Shares (0.04%)

His Thrift Savings Plan -- 41%
1% (N/A) C Fund (0.04%)
20% (N/A) F Fund (0.04%)
20% (N/A) G Fund (0.04%)

His Prudential 401k -- 4%
4% (N/A) US stock index fund, either total, 500 index, or large cap

His Roth IRA at Vanguard -- 24%
6% (VTSAX) Vanguard Total Stock Market Index Fund Admiral Shares (0.04%)
18% (VTIAX) Vanguard Total International Stock Index Fund Admiral Shares (0.11%)

Her Roth IRA at Vanguard -- 18%
18% (VTSAX) Vanguard Total Stock Market Index Fund Admiral Shares (0.04%)

My comments:
  • Your percentages added up to 108%, so I refigured them. They won't be right, but they should be close enough for the example.
  • This ignores the tax cost of selling in taxable.
  • This puts all the bonds in pre-tax accounts, namely his TSP.
  • This puts just stocks in Roth and taxable accounts.
Just some possibilities.
Last edited by Duckie on Sat Jul 13, 2019 4:55 pm, edited 1 time in total.

Topic Author
Adam685
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Joined: Sat Aug 30, 2014 9:08 pm

Re: Portfolio review and financial advisor questions

Post by Adam685 » Sat Jul 13, 2019 8:03 am

Thanks for the help! I’ve been seeing this portfolio getting worse and worse through the last year or so but have been hesitant about making such a big change. I’m just nervous about closing all the TD Ameritrade accounts and reinvesting them and getting tax penalties. Is this typically a seamless thing to do?

livesoft
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Re: Portfolio review and financial advisor questions

Post by livesoft » Sat Jul 13, 2019 8:20 am

The Roth IRAs at TDAmeritrade will have no tax consequences to sell all the assets. However, TDAmeritrade is a good brokerage to use since they have no commissions on ETFs. Indeed, you are invested in several of their no-commission ETFs which are practically identical to the Vanguard funds that people might recommend. You may have an account closure fee if your assets are too low.

I don't know if you would pay a commission to sell your DFA funds at TDAmeritrade, but I think so.

But if I look back at Duckie's response, I can write that anywhere that VSTAX at Vanguard is suggested, one could use SPTM at TDAmeritrade. If you do not understand that these are essentially identical investments, then let us know. And if you see VTIAX at Vanguard, then SPDW at TDAmeritrade can be used although it is not quite the same.

The taxable account at TDAmeritrade is not a big deal either as it appears to be small and tax managed. I would not be rash about unloading it, but I would probably not add to those funds in there were any fees or commissions to put more money into them. I am sure charitable giving is in your future, so I would sequester the stock investments for a while until I gave them away to charity. The ones that would cost no taxes to sell now, I would sell those soon after I worked out a plan and invest them in my newly chosen investments.

Full disclosure: I have accounts at Vanguard and TDAmeritrade and some other places. I own SPTM and SPDW and VTI, VEA, VEU, VSS, but not VTIAX nor VTSAX. I also own SPSB but not in a taxable account.

In any event, you can terminate the financial advisor and stop paying their fees now. You can start new investments now and hold on to the old ones until you have a plan well figured out.
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Katietsu
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Re: Portfolio review and financial advisor questions

Post by Katietsu » Sat Jul 13, 2019 9:50 am

At a high level, your current portfolio looks quite reasonable. I am surprised that an advisor whose system has you in that portfolio would start talking crypto and variable annuities.

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neurosphere
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Re: Portfolio review and financial advisor questions

Post by neurosphere » Sat Jul 13, 2019 11:22 am

Not that you asked for loan help, but...

What Federal repayment plan are you on?
Why only three years so far of eligible payments, despite being out of school for at least 8 years?

Anyway, given your questions, I have the impression that Vanguard advisory services may not be your best bet (although you could certainly do worse). Not that VAS would give bad advice or anything like that, but it seems you need/want help with mechanics of certain things not related to portfolio management, and I'm not sure how much VAS does in this regard (they might be awesome with those things, not sure).

One suggestion would be to consider a new advisor who is not "near you". Do you require face to face meetings? Phone and video chat works quite well for most people. And of course, you could indeed learn how to tackle your questions on your own (e.g. personal education and the help here, etc).
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes".

Topic Author
Adam685
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Re: Portfolio review and financial advisor questions

Post by Adam685 » Sat Jul 13, 2019 12:19 pm

Thanks for the replies everyone!

Neurosphere: Regarding my loans, I did not have the wherewithal to start PSLF in training as I did not know where I would end up working and did not have much money, so I kept them in deferment. That is my biggest financial regret thus far because I would be almost done with my payments and would have been making much less payments in residency and fellowship than now. But I can’t change that. I had a meeting with Doctors Without Quarters, which is a company that helps with organizing the best way to payoff debt and the PSLF was the best bet. Right now I am on the REPAYE plan. I also am not a stickler on face to face meetings so would be willing to work with an advisor not in my area. Thanks for bringing up that possibility. I definitely want to learn to be able to manage this on my own. It just seems quite a big mountain to climb right now.

Livesoft: I used the advisor client app to look at my TD Ameritrade account. I will call them on Monday to ask myself but do you know if I need to close the advisor client account and open a new ones if I were to stay with them?

Katietsu: Yes I was quite surprised during this meeting especially when he brought up a syndicated real estate product that the firm was starting. He’s never really tried selling me products like this before.

livesoft
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Re: Portfolio review and financial advisor questions

Post by livesoft » Sat Jul 13, 2019 12:42 pm

Adam685 wrote:
Sat Jul 13, 2019 12:19 pm
Livesoft: I used the advisor client app to look at my TD Ameritrade account. I will call them on Monday to ask myself but do you know if I need to close the advisor client account and open a new ones if I were to stay with them?
I don't know, but I doubt i. I think they just flip a software switch.
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neurosphere
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Re: Portfolio review and financial advisor questions

Post by neurosphere » Sat Jul 13, 2019 12:50 pm

Adam685 wrote:
Sat Jul 13, 2019 12:19 pm
I did not have the wherewithal to start PSLF in training as I did not know where I would end up working and did not have much money, so I kept them in deferment...Right now I am on the REPAYE plan.
I ran a set of numbers for you based on your post, and IBR payments would be lower than REPAYE, however your AGI is now too high to switch into IBR. If you ever have a time where your family AGI drops significantly for whatever reason, consider investigating a switch into IBR (this is assuming you are not eligible for PAYE, which is always better than IBR and never worse than REPAYE if one gets PSLF). Note that if you are indeed eligible for PAYE, the income criteria are less stringent and you may actually currently be eligible for a switch into PAYE now. But PAYE requires that you had no balances on federal loans as of Oct 2007, and had taken out at least one loan after 2011. So I suspect you don't qualify (but perhaps you should research!)
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes".

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ruralavalon
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Re: Portfolio review and financial advisor questions

Post by ruralavalon » Sat Jul 13, 2019 1:56 pm

Adam685 wrote:
Thu Jul 11, 2019 10:09 pm
Age: Me 34/Wife 32

Desired Asset allocation: 60% stocks / 40% bonds?
Desired International allocation:?
In my opinion your desired asset allocation is within the range of what is reasonable, although a little on the conservative side. Here are two good articles on the classic 60/40 stock/bond allocation:
1) Peter Bernstein, Bloomberg Personal Finance (2002) , "The 60/40 Solution"; and
2) Rick Ferri, etf.com (2/25/2015), "Wisdom Of 60/40 Portfolios Timeless"".

I suggest around 20 - 30% of stocks in international stocks. Vanguard paper (March 2012), "Considerations for investing in non-U.S. equities". Historically, allocating 20% of an equity portfolio to non-U.S. stocks would have captured about 84% of the maximum possible diversification benefit, and allocating 30% of an equity portfolio to non-U.S. stocks would have captured about 99% of the maximum possible diversification benefit (p. 6). (You can find lots of debate here on international allocation, opinions ranging all the way from 00% to 50% of stocks in international stocks. If you want more viewpoints on international stocks please try the Google search box, upper right, this page).

That works out to about 40% bonds, 15% international stocks, and 45% domestic stocks. Asset allocation is a very personal decision. You must decide on an allocation that is comfortable for you based on your own ability, willingness and need to take risk.



Adam685 wrote:
Thu Jul 11, 2019 10:09 pm
Questions:

1. How does this portfolio look?
I don't see anything very bad in the funds or ETFs you are using. The funds and ETFs have low or modest expense ratios, and are almost all either index funds or low turnover DFA funds.

I do think that the portfolio is unnecessarily complex, and could use more diversified funds with lower expense ratios..


Adam685 wrote:
Thu Jul 11, 2019 10:09 pm
2. I tried looking for a fee only fiduciary near me but could not find one.
Here is a guide to help in deciding if you want or need an advisor: "The great paradox of using an advisor is that you must know some basics in order to evaluate the advice, and once you do, you also know enough to consider doing your own management." "Chapter 10 – On Your Own or Hire an Advisor".

1) Harry Sit, who sometimes posts here, offers a service thru his blog to help people locate an advisor in their locality. "Advice-Only Search and Screening".

2) Two links for finding an advisor:
http://www.napfa.org/consumer/index.asp
http://www.garrettplanningnetwork.com/

Adam685 wrote:
Thu Jul 11, 2019 10:09 pm
I recently saw a post and someone mentioned the vanguard personal advisor service. Can anyone share experiences with that? Would they help me do the backdoor Roth IRA every year? Will they help get the funds out of TD Ameritrade? Will they provide recommendations about the TSP? How do I go about ending the relationship I had with this firm? What happens to my life and disability insurance?
I have no experience with Vanguard Personal Advisory Services (PAS).

Rollover the 2 TDAmeritrade IRAs to IRAs at Vanguard. If you ask Vanguard will help with the rollovers. You will have to sign some paperwork, but Vanguard will do most of the work for you. Vanguard will help with the rollovers, whether or not also use the PAS. They have a "Concierge Service" that can help you.


Adam685 wrote:
Thu Jul 11, 2019 10:09 pm
3. I was thinking of just putting all the money in Vanguard 2050 fund and keeping it simple. Is that a reasonable approach?
Not for a taxable brokerage account in a high tax bracket.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

Katietsu
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Re: Portfolio review and financial advisor questions

Post by Katietsu » Sat Jul 13, 2019 6:24 pm

Adam685 wrote:
Sat Jul 13, 2019 12:19 pm


Katietsu: Yes I was quite surprised during this meeting especially when he brought up a syndicated real estate product that the firm was starting. He’s never really tried selling me products like this before.
Syndicated real estate deals are not variable annuities or crypto currencies. Go to WCI and search for syndicated real estate. You will find Boglehead type physician investors involved in syndicated real estate. This is in no way to say they are right for you or the one being pitched is a good one. But the discussion of syndicated real estate is not a red flag.
I’ve been seeing this portfolio getting worse and worse through the last year or so but have been hesitant about making such a big change
It would be helpful if you explained what you mean by this. I am concerned that you might see the balance of an account go down and think that is reason alone to change investments.


And how much in total fees will you be paying this advisor in 2019? The % looks crazy high but I can not tell the balance being used for the fee calculation.

Topic Author
Adam685
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Re: Portfolio review and financial advisor questions

Post by Adam685 » Sun Jul 14, 2019 7:52 am

Neurosphere: Thanks for running the numbers for me! As you suspect, I do not qualify for PAYE

Ruralavalon: Thanks for your input!

Katietsu: I consider myself a novice when it comes to investments and I just want to do the right thing for myself and my family in the long run. I just saw the portfolio getting more and more complex with new funds being added continuously and I believed it conflicted with the Boglehead approach (3 fund portfolio) from what I’ve read in the book and reading on this forum. I am definitely not reacting to the value of my portfolio declining. I just wonder if paying these fees for the next 20-30 years is necessary. Right now my portfolio is in the low 200k so total fees would be about $5000

retiredjg
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Re: Portfolio review and financial advisor questions

Post by retiredjg » Sun Jul 14, 2019 8:12 am

Adam685 wrote:
Thu Jul 11, 2019 10:09 pm
Prudential (I moonlight at a 2nd hospital and work 2 shifts a month. It has a 10% match which I max every paycheck. This account is not managed by my financial advisor)
~4% VFIFX Vanguard Institutional Target Retirement 2050 Fund (0.15%)
What kind of account is this? If you are saving $19k in the TSP, you may not be allowed to make these contributions depending on what kind of account it is.

His Roth IRA at TD Ameritrade
1.3% DEM WisdomTree Emerging High Dividend(0.63)
1.97% GUNR Flexshares MS GI Upstream Nat Res Idx (0.46)
0.43% GWX SPDR S&P International Small Cap (0.40)
2.1% REET iShares Global REIT (0.14)
0.1% SPTM SPDR Portfolio Total Stock Market (0.03)
2.1% SPYV SPDR S&P 500 Value ETF (0.04)
2.1% DFEMX DFA Emerging Markets(0.47)
10.1% DFIVX DFA International Value Portfolio (0.43)
6.5% DFSVX DFA US Small Cap Value (0.52)
This is nuts. This account should have 1 or 2 funds.

Her Roth IRA at TD Ameritrade
2.24% DEM WisdomTree Emerging High Dividend (0.63)
0.31% EFV iShares MSCI EAFE Value Index (0.38)
1.41% PDBC Invesco Optimum Yield Diversified Commodity Strategy No K-1 (0.58)
1.29% REET iShares Global REIT (0.14)
1.86% SLYV SPDR S&P 600 Small Cap Value (0.15)
1% SPTM SPDR Portfolio Total Stock Market (0.03)
2.74% SPYV SPDR S&P 500 Value ETF (0.04)
3.16% DFGEX DFA Global Real Estate Secs (0.24)
5.1% DISVX DFA Intl Small Cap Value (0.68)
This is nuts. This account should have 1 or 2 funds.



2. I tried looking for a fee only fiduciary near me but could not find one. I recently saw a post and someone mentioned the vanguard personal advisor service. Can anyone share experiences with that? Would they help me do the backdoor Roth IRA every year? Will they help get the funds out of TD Ameritrade? Will they provide recommendations about the TSP? How do I go about ending the relationship I had with this firm? What happens to my life and disability insurance?
Vanguard's PAS will get your portfolio on track, but they will not do the back door Roth contribution for you.

To end your relationship, you email the person and say "Thank you for your help in the past. I have decided to move my accounts." Word it as a statement, not an invitation for a discussion.

Your life and disability insurance should not be affected, but obviously you should ask. At some point, you need to evaluate whether it is even the right insurance for you...but one thing at a time.

3. I was thinking of just putting all the money in Vanguard 2050 fund and keeping it simple. Is that a reasonable approach?
Do you have such a fund available in all your accounts? If yes, that would be fine except do not put this fund in a taxable account.


Here is a link to a trustworthy person you can hire to help you find an advice only advisor. It may not be near you, but all this can be done over the phone/video.

https://adviceonlyfinancial.com


BTW...a 1.75% AUM is beyond outrageous, even without the extra $1k a year. Leave and don't look back.

FoolMeOnce
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Re: Portfolio review and financial advisor questions

Post by FoolMeOnce » Sun Jul 14, 2019 8:37 am

Adam685 wrote:
Sat Jul 13, 2019 12:19 pm

Livesoft: I used the advisor client app to look at my TD Ameritrade account. I will call them on Monday to ask myself but do you know if I need to close the advisor client account and open a new ones if I were to stay with them?
I left an advisor who had our accounts at TD Ameritrade and yes, we had to open corresponding retail accounts and then we transferred everything to the corresponding accounts in kind.

zlandar
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Re: Portfolio review and financial advisor questions

Post by zlandar » Sun Jul 14, 2019 8:46 am

Anything over a 1% AUM is overpriced IMO. The advisor should be willing to drop it down to 1% at the minimum. I personally would DIY unless you feel like the advisor is worth it. Even 1% AUM over 20-30 years is a significant hit to your investment return over time.

I had a similar experience where a financial advisor gave a lecture and I ended up getting disability and term life insurance. If you leave your advisor the policies stay with you.

You need to be very careful on the student loan forgiveness program. There are a lot of gachas to the program and you need to check on the status annually:

https://clark.com/education/public-serv ... rgiveness/

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nedsaid
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Re: Portfolio review and financial advisor questions

Post by nedsaid » Sun Jul 14, 2019 11:11 am

Adam685, my first response to reading your post is that you seem to be in good shape. Though I consider the 1.75% Assets Under Management fees to be too high, it appears you were well served by your advisors. Looking at your portfolio, it looks fine to me, though a bit complex by Boglehead standards. I like what I see, DFA funds and use of the low cost ETFs. What I don't like is the recent talk from your advisors about crypto, private real estate, and variable annuities. You have been well served though probably charged too much, it appears that a change in philosophy has happened at your advisory firm and I agree that it is time to leave.

By the way, Neurosphere is a physician and he provides advice to other physicians as a second business. I have seen the PowerPoint presentation that he makes to Doctors and I liked what I saw. The posts of his that I have read are good and very enjoyable to read. There are other physicians here on the forum that contribute here, so you have good company here.

I think what I would do in your shoes is find another advisor who deals with Dimensional Funds, sticking more or less to the philosophy under which you have been investing. I was quite impressed with the folks at Merriman, Paul Merriman sold his firm and retired but left behind an excellent group of advisors. I liked them but didn't want to pay a 1% Assets Under Management fee, which for you would be a bargain. There are other DFA advisors, my guess is that most will want to charge at least 0.75% AUM.

I think you would benefit from an Advisory relationship. Hate to say it, Doctors don't have the best track record as investors. I think one reason is that they are very busy and sometimes turn to rather questionable advisors. Another reason is that Doctors are very bright people, in the area of investing it is possible to outsmart yourself. I read somewhere that Mensa members tend to be terrible investors. You are bright and fairly financially savvy, you had good instincts about the crypto, private real estate, and variable annuities.

One more comment about Variable Annuities. They are not recommended here as they can be complex instruments that can charge high fees. There are situations where these might make sense, for example I have read that there are states where such Annuities might provide liability protection. These are not particularly tax efficient vehicles, that is another discussion. But you are safe to just say no to these products.

But again, looking at what you have, I think you are doing well. Your instincts are good. Best of luck in whatever decisions you make.
A fool and his money are good for business.

Topic Author
Adam685
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Re: Portfolio review and financial advisor questions

Post by Adam685 » Sun Jul 14, 2019 11:17 am

Retiredjg: Thanks for your input! The prudential account is a 401k. I make sure I do not over contribute. I know exactly how much I contribute to that 2nd account because I get paid per diem and only work 2 shifts a month so I just subject that amount form 19k and continue the the rest to TSP over 26 pay periods.

Zlander: I work for the government and do the annual PSLF employer certification and have yet to be denied.

zlandar
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Re: Portfolio review and financial advisor questions

Post by zlandar » Sun Jul 14, 2019 11:57 am

nedsaid wrote:
Sun Jul 14, 2019 11:11 am
I think you would benefit from an Advisory relationship. Hate to say it, Doctors don't have the best track record as investors. I think one reason is that they are very busy and sometimes turn to rather questionable advisors. Another reason is that Doctors are very bright people, in the area of investing it is possible to outsmart yourself. I read somewhere that Mensa members tend to be terrible investors. You are bright and fairly financially savvy, you had good instincts about the crypto, private real estate, and variable annuities.
I have met some stereotypical examples during my working career. The ones who opened a pizza and yogurt shops that failed spectacularly. The "hot real estate/stock tip" in the doctors' lounge. The docs signed up with high-cost AUM advisors who justify their expenses with an overly-complicated portfolio.

There are other docs doing just fine managing their own portfolio with index funds. The Boglehead books and forum are pretty cheap compared to a FA charging AUM.

It's more about the individual than the profession.

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nedsaid
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Re: Portfolio review and financial advisor questions

Post by nedsaid » Sun Jul 14, 2019 12:03 pm

zlandar wrote:
Sun Jul 14, 2019 11:57 am
nedsaid wrote:
Sun Jul 14, 2019 11:11 am
I think you would benefit from an Advisory relationship. Hate to say it, Doctors don't have the best track record as investors. I think one reason is that they are very busy and sometimes turn to rather questionable advisors. Another reason is that Doctors are very bright people, in the area of investing it is possible to outsmart yourself. I read somewhere that Mensa members tend to be terrible investors. You are bright and fairly financially savvy, you had good instincts about the crypto, private real estate, and variable annuities.
I have met some stereotypical examples during my working career. The ones who opened a pizza and yogurt shops that failed spectacularly. The "hot real estate/stock tip" in the doctors' lounge. The docs signed up with high-cost AUM advisors who justify their expenses with an overly-complicated portfolio.

There are other docs doing just fine managing their own portfolio with index funds. The Boglehead books and forum are pretty cheap compared to a FA charging AUM.

It's more about the individual than the profession.
Yes, us more ordinary folks have done some pretty dumb things related to investment. Not bashing Doctors here, indeed they are among our best contributors to the forum. The preparation for becoming a physician is rather time consuming and intense as is the actual practice of medicine. Not hard to understand why there would be a tendency not to focus on financial issues, these are busy folks.
A fool and his money are good for business.

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