Do You Pay For Financial Advice?

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
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Holden42
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Do You Pay For Financial Advice?

Post by Holden42 » Sat Oct 26, 2019 11:29 am

So I'm in alignment with the Bogle philosophies regarding index investing and simple portfolios.

However, still curious after all the research and real-life experiences...

Do you pay for financial advice?

Yes, fee only
Yes, AUM via Robo Advisor
Yes, AUM via real person financial advisor, CPA or otherwise
No, I do it all myself

Really curious what most folks do. For me, I'm hands on and have been doing it myself + tried Betterment and Wealthfront but didn't feel like the fee necessarily was worth the equivalent returns (to self-directed index investing). I'm in my mid 50's now with more money and with harder questions, like paying for colleges, roth conversion, tax implications, outliving my money, trusts, estate planning etc. So contemplating whether potentially a CFP would be worth 0.30 or 0.40. Also, the last market downturn I had no money to worry about; now if/when it happens, I'd like to think I won't get scared and bail at the wrong time, but who knows...

Thanks you your insight!
Last edited by Flyer24 on Sat Oct 26, 2019 12:08 pm, edited 1 time in total.
Reason: Editing title for clarity

Leesbro63
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Re: Do You Pay For It?

Post by Leesbro63 » Sat Oct 26, 2019 11:36 am

You more said (I'm paraphrasing) that the benefits of paying for advice don't rise to the level of the cost. You hit the nail on the head of one of the reasons this place is so popular. But you're confusing financial advice with money management. Two related but different things. My guess is that a good CPA and careful wording of questions here on Bogleheads and you can do this yourself. This forum is hugely valuable and well worth the fee (FREE!). Your specific situation will probably require a good CPA for tweaking. (Although you might be able to do it on your own with a robust version of Turbotax). None of that requires that you sign up to pay someone 1% per year of your assets for money management.

Good luck. You can get good advice and/or do it yourself without signing up to pay an annual 1% wealth tax.

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JoMoney
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Re: Do You Pay For It?

Post by JoMoney » Sat Oct 26, 2019 11:53 am

I do not pay for advice, I have a very simple portfolio, I rode through the 2008-2009 crisis (although I was younger then) and believe I can "stay the course" of my own accord when the next global financial crisis hits (we'll see *knock on wood*).
I have friends closer to retirement and in retirement that use a planner, endorse their planner, and believe they have been helped to assess their financial situation and readiness to retire in ways they couldn't have on their own. I think I enjoy finances more than they do though, and continue to plan for a DIY approach.

I do not believe most people can buy "advice" to get superior investment returns. At best, they should be aiming to conservatively garner the average returns available. The services that may be worthwhile to pay for are in the form of planning your individual finances, savings goals, budgeting, etc.. and creating a firewall that may help you avoid the common behavioral pitfalls that would keep you from garnering a fair share of the average market returns.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

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arcticpineapplecorp.
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Re: Do You Pay For It?

Post by arcticpineapplecorp. » Sat Oct 26, 2019 12:05 pm

I do it myself. But my situation's not complicated. If I had more moving pieces I might consider paying an hourly fee to get advice to implement on my own, but I'd never pay for ongoing management of AUM.

That being said, these white papers from Vanguard make the case that advisors can add 3% alpha to an investors portfolio:
https://advisors.vanguard.com/iwe/pdf/FASQAAAB.pdf
https://www.vanguard.com/pdf/ISGAA.pdf

Now before you think, wait they can add "alpha" as in "above market returns of 3%?" the answer is no. Most people underperform the market's average largely because of behavioral mistakes, and secondarily because of poor portfolio construction and not taking advantage of wealth management strategies (tax loss harvesting/rebalancing, etc).

But Vanguard believes that an advisor who's worth his/her salt (finding one that is, is the rub) can help you improve the returns you'd get for yourself by helping you avoid behavioral mistakes (market timing, chasing performance, etc.) by 1.5% in and of itself. Of course, they're offering a personal advisory service so you'd expect them to say that. In fairness, this paper was produced before they started their PAS I believe and no one to my knowledge has critiqued their research to the point where they don't still stand behind it, so from that perspective it's peer reviewed and believed to be accurate.

So if you're not sure how you'd do during a downturn, it "might" pay to have an advisor keep you from doing something stupid. Selling stocks after the market's dropped 30%-50% is way more detrimental to wealth than paying an advisor 1% of AUM. If you sell after the market falls 50% you've lost half your money. Paying 1% a year AUM for 40 years would lead to a loss of 33% of what you should've had.

source: http://web.archive.org/web/201611100649 ... f-returns/

But you can always override your advisor's suggestions if you panic enough and aren't swayed by your advisor's logic in the heat of the moment. Paul Merriman talked about losing a couple of clients in 2008-2009 despite his best advice. An advisor isn't handcuffing you.
Last edited by arcticpineapplecorp. on Sat Oct 26, 2019 12:45 pm, edited 3 times in total.
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hudson
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Re: Do You Pay For Financial Advice?

Post by hudson » Sat Oct 26, 2019 12:15 pm

No pay for advice....thanks Bogleheads!
I know of many that do. One uses ED Jones...another pays 1.2%...120 basis points...ouch.
Both are proud of their variable annuities. Ignorance is bliss.
Last edited by hudson on Sat Oct 26, 2019 2:09 pm, edited 2 times in total.

Teague
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Re: Do You Pay For Financial Advice?

Post by Teague » Sat Oct 26, 2019 12:19 pm

Sort of. I make an annual donation to help support the Bogleheads web site. Best return on my money ever.

Other than that, no, I do not pay for financial advice.
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Phineas J. Whoopee
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Re: Do You Pay For Financial Advice?

Post by Phineas J. Whoopee » Sat Oct 26, 2019 12:27 pm

I try to give back what I've learned by helping others, although usually any point of mine has already been made before I get there. Time proverbially being money, yes I do pay for past learning.
PJW
Last edited by Phineas J. Whoopee on Sat Oct 26, 2019 1:01 pm, edited 1 time in total.

retiredjg
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Re: Do You Pay For Financial Advice?

Post by retiredjg » Sat Oct 26, 2019 12:30 pm

I do it all myself. And thanks for the reminder to make a contribution to support the Bogleheads' website. :D

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nedsaid
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Re: Do You Pay For Financial Advice?

Post by nedsaid » Sat Oct 26, 2019 12:45 pm

In the past, I employed Ameriprise for financial planning but never invested with them. I have mostly been a do-it-yourself investor but have sought advice over the years, I worked with an independent broker for years with part of my retirement portfolio. I also took advantage of free portfolio review services. Right now, I am test driving a portfolio advisory service which also includes comprehensive retirement planning.
A fool and his money are good for business.

Topic Author
Holden42
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Re: Do You Pay For Financial Advice?

Post by Holden42 » Sat Oct 26, 2019 1:07 pm

nedsaid wrote:
Sat Oct 26, 2019 12:45 pm
In the past, I employed Ameriprise for financial planning but never invested with them. I have mostly been a do-it-yourself investor but have sought advice over the years, I worked with an independent broker for years with part of my retirement portfolio. I also took advantage of free portfolio review services. Right now, I am test driving a portfolio advisory service which also includes comprehensive retirement planning.
Which advisory service, would you mind saying? Just curious.

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David Jay
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Re: Do You Pay For Financial Advice?

Post by David Jay » Sat Oct 26, 2019 1:13 pm

Holden42 wrote:
Sat Oct 26, 2019 11:29 am
Do You Pay For Financial Advice?
Nope.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

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steve roy
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Re: Do You Pay For Financial Advice?

Post by steve roy » Sat Oct 26, 2019 1:26 pm

Gave up financial advisors twenty-odd years ago when I realized I was getting beaten and robbed on an annual basis. (Taking 2% off the top and under-performing the S&P 500 constitutes high crimes and misdemeanors in my book).

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nedsaid
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Re: Do You Pay For Financial Advice?

Post by nedsaid » Sat Oct 26, 2019 1:29 pm

Holden42 wrote:
Sat Oct 26, 2019 1:07 pm
nedsaid wrote:
Sat Oct 26, 2019 12:45 pm
In the past, I employed Ameriprise for financial planning but never invested with them. I have mostly been a do-it-yourself investor but have sought advice over the years, I worked with an independent broker for years with part of my retirement portfolio. I also took advantage of free portfolio review services. Right now, I am test driving a portfolio advisory service which also includes comprehensive retirement planning.
Which advisory service, would you mind saying? Just curious.
I am test driving American Century Private Client Group. All in expenses are 0.90% a year including advisory fees and underlying expense ratios. Merriman back in 2007 wanted 1% Assets Under Management fee and expenses from underlying DFA funds were another 0.34% for a total of 1.34%.
I have had investments at American Century for many years and for a few more basis points decided to try their advisory service. It is invested in their Cautious portfolio which is very similarly invested like their Conservative Target Risk fund. Their fees are competitive with firms like Buckingham. I also wanted to test their retirement planning services. Just started this back in August.
A fool and his money are good for business.

livesoft
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Re: Do You Pay For Financial Advice?

Post by livesoft » Sat Oct 26, 2019 1:34 pm

While I don't pay for financial advice for myself, I know of someone who does pay a relatively low-cost AUM financial advisor of the DFA-type for managing their portfolio. Furthermore, this person has shown me in detail their accounts and I have helped them also with advice.

It turns out that the advisor has been good for this someone because the someone is indecisive and will let money sit in a bank savings account earning 0.1% interest. But even if the advisor says, "Please add this savings account money to your investments for us to manage", the someone would not to do so out of fear of paying the advisor too much. In the meantime, the savings account money falls behind in performance versus the rest of the portfolio.

So the behavior of this person is costing them more money than the advisor would. I suspect many DIY folks posting on this forum might fall into the same category because they are not DIY, but are Not-DIY.
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runner3081
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Re: Do You Pay For Financial Advice?

Post by runner3081 » Sat Oct 26, 2019 1:37 pm

No, I do it all myself

MathWizard
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Re: Do You Pay For Financial Advice?

Post by MathWizard » Sat Oct 26, 2019 1:50 pm

No. I keep things pretty simple.

I know very advanced math and computing, but need very little beyond simple interest calculations, compound growth and a little algebra.

The behavioral part of finance is much more important, especially deferred gratification

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calmaniac
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Re: Do You Pay For Financial Advice?

Post by calmaniac » Sat Oct 26, 2019 1:51 pm

I have not used a financial planner in the past and have managed my own assets over the past 30 years.

That said, I am planning to engage a fee only advisor in the coming year and expect to pay $2-5k for the one time service, with possibly a follow-up every few years for a smaller fee. I am 61 and nearing the point where I plan to go into "pretirement" and work part-time with a 50-75% decrease in my salary. I want to optimize Roth conversions and the selling of highly appreciated stocks from the 90's, before Social Security and RMDs kick in at age 70. I also have equity in 3 start-up companies and would like to optimally prepare for any (remotely) possible liquidity events. Lots of moving parts.

I am not looking for an investment manager as I am clear and confident in our asset allocation. I do think there is value in a financial planner (CFP or equivalent), who can help to optimize the above and avoid tax mistakes. Also, there is value in having a second set of eyes go over the big picture with one's finances. None of us are perfect or have thought of all of the contingencies.

Lastly, if you are in a long-term relationship, I think there is value on several fronts. First of all, it off-loads some of the responsibility to the financial planner and defuses some of the relationship issues. More importantly, if you predecease your partner, they will have someone to help pick up the pieces.

My own sense is that with all of the resources available to investors in 2019, AUM is a tax on the willfully ignorant.
Last edited by calmaniac on Sat Oct 26, 2019 1:54 pm, edited 1 time in total.

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SevenBridgesRoad
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Re: Do You Pay For Financial Advice?

Post by SevenBridgesRoad » Sat Oct 26, 2019 1:53 pm

No.

And because Vanguard is now practically carpet-bombing my wife with their Advisory ads, I'm stepping up my efforts even further to simplify and automate so she won't need an advisor if I get hit by a bus.
Retired 2018 age 61 | "Not using an alarm is one of the great glories of my life." Robert Greene

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willthrill81
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Re: Do You Pay For Financial Advice?

Post by willthrill81 » Sat Oct 26, 2019 1:59 pm

I do it all myself. Those with more knowledge than I have would cost more than their marginal benefit to me.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

NotWhoYouThink
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Re: Do You Pay For Financial Advice?

Post by NotWhoYouThink » Sat Oct 26, 2019 2:06 pm

contemplating whether potentially a CFP would be worth 0.30 or 0.40.
Someone whose main skill is sales and client retention won't be able to help you with your college/Roth/Tax questions, for .30, .40, or 1.75% Not the right skill set. So don't pay anyone to manage your investments if you can do it yourself.

A one time hourly-fee advisor, who does not propose to manage your investment, might be of some help. People on this board can certainly help. But the person who charges to manage investments won't have the analysis skills to answer the questions you have.

hudson
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Re: Do You Pay For Financial Advice?

Post by hudson » Sat Oct 26, 2019 2:07 pm

duplicate
Last edited by hudson on Sat Oct 26, 2019 2:11 pm, edited 1 time in total.

Ferdinand2014
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Re: Do You Pay For Financial Advice?

Post by Ferdinand2014 » Sat Oct 26, 2019 2:08 pm

Holden42 wrote:
Sat Oct 26, 2019 11:29 am
So I'm in alignment with the Bogle philosophies regarding index investing and simple portfolios.

However, still curious after all the research and real-life experiences...

Do you pay for financial advice?

Yes, fee only
Yes, AUM via Robo Advisor
Yes, AUM via real person financial advisor, CPA or otherwise
No, I do it all myself

Really curious what most folks do. For me, I'm hands on and have been doing it myself + tried Betterment and Wealthfront but didn't feel like the fee necessarily was worth the equivalent returns (to self-directed index investing). I'm in my mid 50's now with more money and with harder questions, like paying for colleges, roth conversion, tax implications, outliving my money, trusts, estate planning etc. So contemplating whether potentially a CFP would be worth 0.30 or 0.40. Also, the last market downturn I had no money to worry about; now if/when it happens, I'd like to think I won't get scared and bail at the wrong time, but who knows...

Thanks you your insight!
Do it all myself.
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett

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scubadiver
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Re: Do You Pay For Financial Advice?

Post by scubadiver » Sat Oct 26, 2019 2:08 pm

Q: Do you pay for financial advice?
A: No.

student
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Re: Do You Pay For Financial Advice?

Post by student » Sat Oct 26, 2019 2:43 pm

I do not pay for financial advice.

wyoming82240
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Re: Do You Pay For Financial Advice?

Post by wyoming82240 » Sat Oct 26, 2019 2:46 pm

No, do it all myself through self education from forum like this, morningstar etc.

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Stinky
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Re: Do You Pay For Financial Advice?

Post by Stinky » Sat Oct 26, 2019 3:13 pm

I pay for subscriptions to WSJ, Morningstar, etc. I pay less than $1,000 per year for their "advice" on things.

The best advice that I get is from the many thoughtful people on this Forum.
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ruralavalon
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Re: Do You Pay For Financial Advice?

Post by ruralavalon » Sat Oct 26, 2019 3:50 pm

Holden42 wrote:
Sat Oct 26, 2019 11:29 am
So I'm in alignment with the Bogle philosophies regarding index investing and simple portfolios.

However, still curious after all the research and real-life experiences...

Do you pay for financial advice?

Yes, fee only
Yes, AUM via Robo Advisor
Yes, AUM via real person financial advisor, CPA or otherwise
No, I do it all myself. Age 74, retired.

Really curious what most folks do. For me, I'm hands on and have been doing it myself + tried Betterment and Wealthfront but didn't feel like the fee necessarily was worth the equivalent returns (to self-directed index investing). I'm in my mid 50's now with more money and with harder questions, like paying for colleges, roth conversion, tax implications, outliving my money, trusts, estate planning etc. So contemplating whether potentially a CFP would be worth 0.30 or 0.40. Also, the last market downturn I had no money to worry about; now if/when it happens, I'd like to think I won't get scared and bail at the wrong time, but who knows...

Thanks you your insight!
No, I handle all our investing decisions myself.

I do have an attorney/CPA do our tax returns, and had an attorney prepare our wills and powers of attorney. They do not advise me on our investing decisions. I did have the attorney/CPA do some calculations for doing Roth conversions.
Last edited by ruralavalon on Sat Oct 26, 2019 3:54 pm, edited 2 times in total.
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retired@50
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Re: Do You Pay For Financial Advice?

Post by retired@50 » Sat Oct 26, 2019 3:53 pm

I do not pay for financial advice. I've yet to meet anyone who cares more than I do about MY money. I'd urge anyone who has even the slightest interest in the topic to do some reading and see if you can't develop the courage to "go it alone". Library cards are free, the books are free, why not give it a try?

Regards,

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GerryL
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Re: Do You Pay For Financial Advice?

Post by GerryL » Sat Oct 26, 2019 4:09 pm

Do I pay for financial advice? Short answer: No.

Slightly longer answer:
Every few years I hire a CPA friend for an hour to review my draw-down plans to make sure I am correctly understanding tax implications of changes I might be considering. Her insight has been helpful.

Have consolidated and simplified my investments, so little management is needed. I am not reactive so don’t feel need for behavioral hand holding.

Every few years have Vanguard CFP rerun my financial plan to make sure I am on track. So far this has been a free benefit.

Have just started working with an elder care attorney about how to set up a plan/system for managing my affairs in the event of cognitive decline. That may involve having to pay for a financial caretaker— a fiduciary, of course.

So, as life moves on, I know I have to be open to possibly paying for help.

lostdog
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Re: Do You Pay For Financial Advice?

Post by lostdog » Sat Oct 26, 2019 5:33 pm

No. I do it myself thanks to Bogleheads. I'm very grateful for this wonderful community.
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RickBoglehead
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Re: Do You Pay For Financial Advice?

Post by RickBoglehead » Sat Oct 26, 2019 5:35 pm

No. Never.

Worked in MF industry in 80s, but didn't move to index funds for another decade, then not entirely.

Never paid for tax advice either.

Found this forum 18 months ago.

Made mistakes. That's life.
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Dottie57
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Re: Do You Pay For Financial Advice?

Post by Dottie57 » Sat Oct 26, 2019 5:44 pm

When I used an advisor, The funds were front loaded. Since finding Bogleheads, I have managed myself.

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Toons
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Re: Do You Pay For Financial Advice?

Post by Toons » Sat Oct 26, 2019 6:55 pm

Live beneath your means,
Stay out of debt,
Save
Invest
Index funds...

No need to charge for that
:mrgreen:
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

CedarWaxWing
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Re: Do You Pay For Financial Advice?

Post by CedarWaxWing » Sat Oct 26, 2019 7:37 pm

No.

However, at age 28 had a stock broker for 8 months, since he was recommended by on older person in my field of study. I fired him because at about 8 months he wanted to start churning instead of sticking to my expressed desire to buy long term holdings to keep for decades.

Then I simply saved like crazy to buy a home... and did.

At age 31 or a friend recommended someone at Waddell Reed and the rep was very slick, but not effective for us. We knew nothing about investing actually, so were easy pickings at first.

At that time there was no internet, and very very few books worth reading (except one by Andrew Tobias). Mutual funds ever since for us, but it took a few years to realize that the front load and high fees at WR was a losing proposition that was better for the sales rep than for us.

After that, active funds (but low cost) for years, until I came across the concept of indexing. I had already determined that the lowest possible fees worked well in the active funds we had, but needed to find the good books on Bogleheads.org with good data... and other papers I found via Bogleheads.org to be fully convinced that indexing at the lowest costs works well.

I read tons and tons of everything I could find before finding books, and this site, with adequate data and long term results information to convince me to go to mostly indexing. (not all... since some of my active funds did and have done well...)

We have also been around now long enough to have seen some of those active funds do great for years, and then revert to the mean, and not close to new investors when they should have... just like Mr. Bogle professed. His readings on that, and why it happens had a lot to do with my conversion to indexed diversified funds at VG.


I appreciate this site a great deal ... and have recommended the books I have found here and this site to scores of people in my personal life.

palaheel
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Re: Do You Pay For Financial Advice?

Post by palaheel » Sat Oct 26, 2019 8:06 pm

I do it myself, but I recommended to DW that, when the time comes, she look at hybrid advisers at Vanguard, Schwab and Fidelity, and pick the one she's most comfortable with. She's plenty smart, but has no interest in the subject.

I know many people here say "do it yourself--it's not hard." I used to change the oil in my cars. I could do that still, but I prefer to pay for that service now. It's the same thing for her and investing.
Markets crash. Markets recover. Inflation takes your money FOREVER.

jwhf
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Re: Do You Pay For Financial Advice?

Post by jwhf » Sat Oct 26, 2019 8:14 pm

We have paid for an advisor in the past, but no more. We were paying 1.1%. Based on our current portfolio and time horizon, that would equate to almost $800,000 over the next 30 years, based on our plan. If you take that $800,000 and apply a 6% rate of return, the future value is about $1.9M. Doing the math, and understanding that fees and expenses reduce your bottom line makes this a bad idea for us. But you have to have the proper discipline, and an asset allocation plan. Employing the Boglehead theory of simplicity is the way to go!

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friar1610
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Re: Do You Pay For Financial Advice?

Post by friar1610 » Sat Oct 26, 2019 8:34 pm

Within the past 6 months I paid a well regarded investment advisor $500 to review my portfolio, make recommendations for tweaking it and providing general advice for structuring the port going forward. Prior to that I had been DIY and plan to continue down that path as I implement the two or three very minor course corrections the advisor recommended. That aside, I suspect he will not be called upon again unless:

- I pass on and my widow needs some help;

- I start to lose the bubble intellectually.
Friar1610

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Wiggums
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Re: Do You Pay For Financial Advice?

Post by Wiggums » Sat Oct 26, 2019 8:36 pm

Holden42 wrote:
Sat Oct 26, 2019 11:29 am
Do You Pay For Financial Advice?
No. I do it myself

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augryphon
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Re: Do You Pay For Financial Advice?

Post by augryphon » Sat Oct 26, 2019 8:47 pm

I manage approximately 75% of our portfolio. The other 25% is my DW’s IRA. It is managed by a medium sized wealth management firm for 1% fee. Although she’s brilliant in her field, DW isn’t at all interested in the nuts and bolts of investing. so if my girlfriend’s husband shoots me, DW has instructions to move our entire portfolio into wealth management. It’s worth the 1% for her piece of mind, and we’ve chosen a firm whose investing strategies align with ours.

As you might expect, my bogleheadish portfolios out earn our managed portfolios by about 1%, the cost of management.

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Re: Do You Pay For Financial Advice?

Post by gorow » Sat Oct 26, 2019 9:12 pm

When Financial Engines was new, and my company offered their services, I used them for a couple of years while I (finally) educated myself on asset allocation. Then I quit them. Two years prior to actually retiring, I paid a fee only advisor to confirm with me that I could retire as planned. Well worth the expense to help understand how to integrate some stock option/PRSU awards into my plan given that vesting changed upon retirement. At this point I do not expect to pay again, and neither will my spouse if something happens to me as our children are (mostly) well-versed in my approach.
Retired 1/1/2019. Not concerned about sequence of returns because two years here taught me what I need to know.

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Re: Do You Pay For Financial Advice?

Post by RadAudit » Sat Oct 26, 2019 9:14 pm

augryphon wrote:
Sat Oct 26, 2019 8:47 pm
so if my girlfriend’s husband shoots me, DW has instructions to ...
It pays to plan ahead. :wink: :dollar
FI is the best revenge. LBYM. Invest the rest. Stay the course. - PS: The cavalry isn't coming, kids. You are on your own.

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Re: Do You Pay For Financial Advice?

Post by Trader Joe » Sat Oct 26, 2019 9:35 pm

Holden42 wrote:
Sat Oct 26, 2019 11:29 am
So I'm in alignment with the Bogle philosophies regarding index investing and simple portfolios.

However, still curious after all the research and real-life experiences...

Do you pay for financial advice?

Yes, fee only
Yes, AUM via Robo Advisor
Yes, AUM via real person financial advisor, CPA or otherwise
No, I do it all myself

Really curious what most folks do. For me, I'm hands on and have been doing it myself + tried Betterment and Wealthfront but didn't feel like the fee necessarily was worth the equivalent returns (to self-directed index investing). I'm in my mid 50's now with more money and with harder questions, like paying for colleges, roth conversion, tax implications, outliving my money, trusts, estate planning etc. So contemplating whether potentially a CFP would be worth 0.30 or 0.40. Also, the last market downturn I had no money to worry about; now if/when it happens, I'd like to think I won't get scared and bail at the wrong time, but who knows...

Thanks you your insight!
No, never.

Cyanide123
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Re: Do You Pay For Financial Advice?

Post by Cyanide123 » Sun Oct 27, 2019 3:36 am

So far I've been doing everything myself. But my financial life is beginning to get complicated. This year im starting to look at financial advisor and an accountant for taxation.

Complications include plan of going S corp taxation structure with my sole proprietor LLC.

Mark zorill is going to be my financial advisor. $99 annual charge. He's for people who can mostly do things on their own. First meeting is in a couple of weeks.

Looking into getting a CPA.. First meeting is in a couple of weeks.

Swansea
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Re: Do You Pay For Financial Advice?

Post by Swansea » Sun Oct 27, 2019 5:17 am

I do it myself and don't pay an advisor.
Interestingly, a friend ,whose asset allocation is very similar to mine, and I compared performance figures over the past 10 years. He pays 1% for advice, yet our performance outcomes were identical. I felt good about that.

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JoeRetire
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Re: Do You Pay For Financial Advice?

Post by JoeRetire » Sun Oct 27, 2019 5:28 am

I have a friend who jumped in and out of the market (several times) during the Great Recession, buying high and selling low several times. For the most part, he missed many years of the recent bull market.

He is proud of his DIY prowess and boasts that he never pays for an adviser.

I always wonder if paid advice might be warranted. How could you know if you would have been better off paying for (and following) advice or not? Even if the results were good, how could you possibly know that they wouldn't have been even better?
Don't be a lemming.

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Googliebear
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Re: Do You Pay For Financial Advice?

Post by Googliebear » Sun Oct 27, 2019 6:37 am

Nope. I've been managing my own money since my early twenties, now mid forties and never paid a dime for advice. Paid some stupid tax early on in my investing endeavors, but I consider that an education well paid for.

Made it through both the tech bubble and the great recession relatively unscathed, but it was only through the knowledge learned over the years (from the likes of Bogle, Buffett, Munger, etc.) and applying it that has led to a majority of my success.

Dandy
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Re: Do You Pay For Financial Advice?

Post by Dandy » Sun Oct 27, 2019 6:48 am

I haven't paid anyone and have done well. I'm sure I didn't maximize everything so in that sense I've probably "paid a price" for just relying on what I've learned. There can be a hidden cost of doing it yourself money management. This forum certainly is helpful in minimizing that.

carolinaman
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Re: Do You Pay For Financial Advice?

Post by carolinaman » Sun Oct 27, 2019 6:56 am

No, I do it myself with low cost index funds

pennywise
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Re: Do You Pay For Financial Advice?

Post by pennywise » Sun Oct 27, 2019 9:06 am

Holden42 wrote:
Sat Oct 26, 2019 11:29 am
So I'm in alignment with the Bogle philosophies regarding index investing and simple portfolios.

However, still curious after all the research and real-life experiences...

Do you pay for financial advice?

Yes, fee only
Yes, AUM via Robo Advisor
Yes, AUM via real person financial advisor, CPA or otherwise
No, I do it all myself
Unlike most responses here, I don't do it myself other than avoiding any of the typical AUM financial planner model advice. Have never had a 'guy' and never plan to with one exception listed below. However along the path to retirement I've used various resources including:

-Advisory service provided at no cost by TIAA wealth advisory rep, a perk from my university 403b provider

-Advisory service paid via one time fee to financial planner to review investments and evaluate retirement readiness

-Advisory service paid via AUM fee (.30) to Vanguard Personal Advisor Service twice: a few years ago upon our inheritance of managed investment account from Oppenheimer that we quickly shifted to Vanguard and now, having recently retired, working with PAS to roll over IRA accounts and create a coherent investment management plan with those funds along with various other financial resources.

My general goal is to work with PAS as long as they are helping me with issues that exceed what I feel capable of handling on my own. We have a lucky combination of retirement assets ranging from IRA funds to cash to be deployed into taxable investments to pensions, social security income and rental property. It's a lot for me to wrap my head around in terms of taxes, asset allocation across a variety of types of income/investments, how, when and where to withdraw etc. I am very comfortable that Vanguard is the ONLY financial provider with my benefit as their highest priority. The final confirmation in my mind for using the advisory service came when I checked the ER for the TIAA stock funds we are rolling over. Turns out that TIAA charges exactly the same for their stock index fund management as the quarterly PAS fee, so I'll be getting a heckuva lot more bang for my fee buck!

If and when I am comfortable that the general structure is in place I may drop the service. Or, if it feels worthwhile I may keep it, time will tell. As I've commented to others about PAS, it can be like financial management training wheels, or it can end up as having a trusted advisor for the long term without worrying about getting ripped off.

Thus my long winded response. Although asking Bogleheads if and how they pay for financial advice is probably going to yield a 99% variation of "aw hell no", there are some of us out here who see a value in paying for assistance, so I thought it might be helpful to explain why this one does :D

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dwickenh
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Location: Illinois

Re: Do You Pay For Financial Advice?

Post by dwickenh » Sun Oct 27, 2019 9:38 am

Teague wrote:
Sat Oct 26, 2019 12:19 pm
Sort of. I make an annual donation to help support the Bogleheads web site. Best return on my money ever.

Other than that, no, I do not pay for financial advice.
+1
The market is the most efficient mechanism anywhere in the world for transferring wealth from impatient people to patient people.” | — Warren Buffett

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