Overwhelmed, Distrustful, Ignorant, and hoarding $

[sparkyma]

I had a horrible experience with EJ ( yes , I've since found out I probably should not have had my money there.) I have also found out they hire anyone and their applicants do not need experience. This is frightening to me.

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing. So doing this myself is not an option. That is why I hired a financial advisor and still need one.

Now I'm afraid to do it again. Reading reviews online is not helpful as I can tell most in my area with lots of good ones were all written at the same time, which does not seem realistic to me.

Can anyone share what questions I should be asking, what qualifications they should have in place, and what I should be looking for ?

Thank you in advance!

[southernlucky]

Advice only, per hour fee from a fiduciary. These guys are often recommended:

https://www.planvisionmn.com/

No need to rush things. Continue to seek guidance and come back here to ask questions.

[Gradient Descent]

Maybe you should look into a roboadvisor, eg: https://investor.vanguard.com/advice/robo-advisor

[steadyosmosis]

I had a horrible experience with EJ ( yes , I've since found out I probably should not have had my money there.) I have also found out they hire anyone and their applicants do not need experience. This is frightening to me.

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing. So doing this myself is not an option. That is why I hired a financial advisor and still need one.

Now I'm afraid to do it again. Reading reviews online is not helpful as I can tell most in my area with lots of good ones were all written at the same time, which does not seem realistic to me.

Can anyone share what questions I should be asking, what qualifications they should have in place, and what I should be looking for ?

Thank you in advance!

I know people (including retirees) who deal only with banks and credit unions, and they are doing fine.
Investing in stocks and bonds is not a necessity.

Vanguard PAS was suggested to you over a year ago.
How did your interaction go with them?

[Raspberry-503]

Read the wiki here. Especially 3 funds portfolio
Even if you decide you need help, what you learn there will help you with the advisor discussion.

As the saying goes: by the time you know enough to get an advisor, you no longer need one.

[arcticpineapplecorp.]

I'd go with Vanguard PAS. If you go with Plan Vision I don't think they want to be holding your hand if that's what you need.

You don't need to do the following if you go with Vanguard, but if you go with someone else:

The 19 quesions to ask your financial advisor, by Jason Zweig

as you're asking the questions, you're learning about why it's important to ask these questions.

[biscuit5]

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing.

maybe list your age (?) and what general ballpark amount you're dealing with, could help folks add context to their replies.

If you're 28 and its $20,000 vs being 78 and its $5 million.....

[bd7]

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing. So doing this myself is not an option. That is why I hired a financial advisor and still need one.

Don't read up on investments, read up (here) on investing. You don't need to know very much at all--you just have to be sufficiently calm so as not to panic every time there's doom in the headlines. It also doesn't matter that much what specific plan you follow as long as it isn't ridiculous. Your bank may offer brokerage services (which one are you at?) or you can open a free Fidelity or Schwab account and buy one stock index plus some bonds (TIPS are good). Other than the hourly non-AUM versions, any Financial Advisor is likely going to charge you money to make things needlessly complicated.

I'm guessing your issues with money are emotional and not intellectual. Don't pay someone what amounts to a ton of money (in the long run) to hold your hand and tell you bedtime stories.

[anoop]

Hopefully your bank is paying decent interest (4% ish). If not, at least get it to Vanguard or Fidelity and put it in a money market fund or buy a 3-mo t-bill.

Are you able to share what was the bad experience other than high fees?

If you want to keep it simple and forget about it, you can try the Couch Potato Portfolio.
https://www.optimizedportfolio.com/couc ... portfolio/

[beyou]

I hate to break the news to you but the vast majority of brokerages hire people for their contacts and ability to make new ones.
They are NOT generally hired based on their investment expertise.

Best to get a fee only financial planner who will help you create a long range plan, explain how to implement it, and you learn how to implement it.
Vet them for having expertise in investing (linkedin, recommendations, online bios).

You can have someone also invest for you at even higher annual cost, but either way get someone with a CFP designation.
Here are some other certifications to consider.
https://www.perplexity.ai/search/certif ... I3.l2eWl6A

[White Coat Investor]

Invest you must. Don't beat yourself up after past errors. There are good advisors out there. They're a minority of those who call themselves advisors and they're not cheap. The more you need, the more they'll cost, but the going rate for "full-service" is $5-15K/year right now.

[Beensabu]

I am what I consider bright, but no matter how much I read up on investments , it's not my thing. So doing this myself is not an option.

What have you read, exactly?

Try reading these, in this order:

The Arithmetic of Active Management - William F. Sharpe - 5 min read

Risk and return: application - wiki - 5 min read

If You Can - William J. Bernstein - 20-30 min read

Bogleheads® investment philosophy - 15 min read

If you still think you cannot do this yourself after reading that, then you will at least know what to look for (and what to run away from) in an advisor:

- does not charge an assets under management (AUM) % per year fee
- only suggests low fee mutual funds or ETFs with an expense ratio as close to 0% as possible (1% is way too high, 0.50% is too high, 0.20% is decent, 0.10% is good, <0.10% is great)
- does not suggest mutual funds with sales loads or redemption fees
- does not suggest more than 5 funds total
- buy and hold only, will not constantly keep buying/selling/exchanging different funds
- takes the time to try to figure out your risk profile

[secondopinion]

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing. So doing this myself is not an option. That is why I hired a financial advisor and still need one.

You need to step back a second and understand what your goals are. I think you are more capable than you think.

At a high level, you hold investments for a while. If you are watching the market or making plans based on speculation, you are not doing it right. Focus on long-term objectives. Right now, I would learn how to invest from the ground up.

First, get a decent rate on your cash. Some of the biggest misses for conservative investors is not missing out on stocks or bonds; it can be as simple as not earning a decent rate on cash. Take a look into Vanguard’s money market funds: you see 4.2% or so. This rate can fluctuate quite a bit, but allows for principal to be maintained. Some other brokerages have similar offerings but they often yield slightly less due to more fees. I find Vanguard is better for mutual fund investors.

Second, gain familiarity with bond funds. These come in various ways. Focus on low-fee bond funds or ETFs that are predominantly short-term treasuries. You will notice some minor volatility in their pricing; this is because the market is constantly changing their minds on what the yield should be for such investments. Such a fund is not in danger of major losses, so it is a good starter to see how daily changes occur; if it is an ETF, you can see it change in real time during market hours.

Third, continue to explore bond funds. You will see long-term bond funds; these funds hold bonds with long maturity dates, and their volatility will be much more than for short-term bond funds. This is because long-term bonds have more “duration risk”. Intermediate-term bond funds are a middle ground between the two.

You will also see high-yield bond funds; these funds hold bonds with significant “default risk” (the risk that they will not pay you back in full). Essentially all bonds have credit risk but treasuries are deemed to be very safe and extremely unlikely to have an issue. Corporate bonds have more risk; however, those that are investment-grade are less likely to default than those that are speculative-grade (or sometimes called junk bonds).

For this step, you can consider having a total bond fund (which holds all durations of investment-grade bonds), an intermediate-term treasury bond fund, or even a TIPS fund (treasuries that are indexed to inflation). Going too long in duration or too much in “credit risk” (general term referring to the risk of bonds that can default) is not advisable.

Lastly, look into stocks. A total stock fund holds the vast majority of stocks; this is probably the best option as it is cheap and will likely do decently long-term no matter what the next winner is. Do not do anything fancy here because this is where major losses can occur in a short time. Sometimes, the fund might also include international stocks; you do not need to worry about whether to include them initially, but they are a good addition for very long-term portfolios.

Most of us here had to learn how to invest in order to gain independence from an advisor. I think there are plenty here who would gladly help you learn.

[yzy]

Sounds like you may be more comfortable working with someone in person. Many people on this forum speak positively about Schwab and Fidelity. You may want to make appointments and go interview each one. We meet with Fidelity once or twice a year and they listen well, give some ideas but not pushing products. Makes DW more at ease as she doesn’t enjoy the investing stuff. I choose not to pay them to manage and they’re fine with that. I think they charge 0.8% if you do want them to manage.

[simplesimon]

I am what I consider bright, but no matter how much I read up on investments , it's not my thing.

Do you mind sharing what you've read so far?

While it can certainly help to have an advisor, there's still going to be some basic personal finance language and concepts you need to understand.

It takes time. I've been investing for almost 20 years the Bogleheads way and I'm still learning things. I believe you can do it.

[HomeStretch]

Look forward, not back. Don’t sell yourself short. Come up with a plan such as:

1) get more educated on investing basics. Start with this BH wiki page:
https://www.bogleheads.org/wiki/Getting_started

2) pull together your financial information (you will learn a lot) using the “Asking Portfolio Questions” template found here: viewtopic.php?t=6212
Post here for feedback.

3) if you can’t DIY, consider Vanguard PAS.

[TwstdSista]

When in doubt, my go-to advice is simple - a Target Date Index Fund and then let it ride.

[RickBoglehead]

In Feb 2024 you agreed that Vanguard PAS was a good option to explore. No posts since then. If you haven't even contacted them in over a year, it seems you need to try a different approach. Or, determining if you need some non-financial expertise in how to make decisions.

[cjcerny]

Investing is not nearly as scary or difficult as you think--the flames of fear and difficulty are intentionally fanned by those who stand to profit from you hiring their services. You can invest your money pretty wisely--and with little or no future maintenance--in about 5 minutes once you regain your confidence and trust.

[Carol88888]

Investing is not nearly as scary or difficult as you think--the flames of fear and difficulty are intentionally fanned by those who stand to profit from you hiring their services. You can invest your money pretty wisely--and with little or no future maintenance--in about 5 minutes once you regain your confidence and trust.

+1

[investuntilimrich]

The best financial advisor is the one that teaches you *why* to do things not just telling you *give me your money and I am going to do XYZ*. You've already pulled out of investments once, so no need to go back to someone else who you'll also feel uncomfortable with. I would prefer an hourly fee based advisement myself. If they cannot explain to you why something should be done, then you're not ready to do it and they aren't a good enough teacher. Secondly, just take a big step back, read the wiki here, maybe complete one or more of the commonly recommended investing books. Stay away from anything advocating active trading, active management, crypto, or other things that are proven to be high risk investments that tend to underperform the market. Good luck!

[sparkyma]

In Feb 2024 you agreed that Vanguard PAS was a good option to explore. No posts since then. If you haven't even contacted them in over a year, it seems you need to try a different approach. Or, determining if you need some non-financial expertise in how to make decisions.

Sadly someone in my family got ill and then passed away.
I did not end up taking out the money from EJ as a result until the end of last year. I would prefer to meet with someone in person. I swt up an appointment with someone from fidelity ,only to realize that there is a difference from Fidelity investments and Fidelity Bank. He was nice and appeared knowledgeable. He had lots of great ideas. I left and didn't act on it because I was thrown off that it wasn't Fidelity investments (not sure it it matters), and because I realized that I'm not sure what I really should be asking. Also that I don't even know if I'm making this way more complicated than it should be seeing as I'm not looking for high risk investments.

[sparkyma]

Advice only, per hour fee from a fiduciary. These guys are often recommended:

https://www.planvisionmn.com/

No need to rush things. Continue to seek guidance and come back here to ask questions.

Thank you !

[sparkyma]

I had a horrible experience with EJ ( yes , I've since found out I probably should not have had my money there.) I have also found out they hire anyone and their applicants do not need experience. This is frightening to me.

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing. So doing this myself is not an option. That is why I hired a financial advisor and still need one.

Now I'm afraid to do it again. Reading reviews online is not helpful as I can tell most in my area with lots of good ones were all written at the same time, which does not seem realistic to me.

Can anyone share what questions I should be asking, what qualifications they should have in place, and what I should be looking for ?

Thank you in advance!

I know people (including retirees) who deal only with banks and credit unions, and they are doing fine.
Investing in stocks and bonds is not a necessity.

Vanguard PAS was suggested to you over a year ago.
How did your interaction go with them?

I decided to try Fidelity which was another suggestion, due to being able to meet in person. He seems great, but I wasn't aware that there was a Fidelty Bank and a Fidelity Investments. He was part of the bank. I just met with him last month due to someone becoming chronically ill and then passing in my family.

[sparkyma]

I'd go with Vanguard PAS. If you go with Plan Vision I don't think they want to be holding your hand if that's what you need.

You don't need to do the following if you go with Vanguard, but if you go with someone else:

The 19 quesions to ask your financial advisor, by Jason Zweig

as you're asking the questions, you're learning about why it's important to ask these questions.

Thank you

[sparkyma]

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing.

maybe list your age (?) and what general ballpark amount you're dealing with, could help folks add context to their replies.

If you're 28 and its $20,000 vs being 78 and its $5 million.....

48, Around a million

[sparkyma]

Hopefully your bank is paying decent interest (4% ish). If not, at least get it to Vanguard or Fidelity and put it in a money market fund or buy a 3-mo t-bill.

Are you able to share what was the bad experience other than high fees?

If you want to keep it simple and forget about it, you can try the Couch Potato Portfolio.
https://www.optimizedportfolio.com/couc ... portfolio/

I am probably the keep it simple and forget about it person which is why I was initially looking for a financial advisor..or maybe the proper term is financial investor ?
I have a business and they were ICs so initially the EJ rep has me start and invest in a solo 401k. I let him know I was switching them over to W2 as of 1/1. He said I could keep the solo 401k open but I just couldn't put anymore money into it bc I would have employees so I stopped. We had our review at the end of Oct that year and he double checked that i didnt put any money in it. Then he called me in November late night saying he messed up and apologized. Asked that I meet him and his attorney on Monday. That I needed to prepare to pay $28,000 I think it was, and open a 401k for all my FT and PT employees and put in it a percentage of their wages for the entire year, plus a penalty fee because i didn't close the solo 401k
So nothing to do with investing per say..and people make mistakes , it was the way it was handled that rubbed me the wrong way.

[sparkyma]

Now all my money is just sitting in my bank. I am what I consider bright, but no matter how much I read up on investments , it's not my thing. So doing this myself is not an option. That is why I hired a financial advisor and still need one.

You need to step back a second and understand what your goals are. I think you are more capable than you think.

At a high level, you hold investments for a while. If you are watching the market or making plans based on speculation, you are not doing it right. Focus on long-term objectives. Right now, I would learn how to invest from the ground up.

First, get a decent rate on your cash. Some of the biggest misses for conservative investors is not missing out on stocks or bonds; it can be as simple as not earning a decent rate on cash. Take a look into Vanguard’s money market funds: you see 4.2% or so. This rate can fluctuate quite a bit, but allows for principal to be maintained. Some other brokerages have similar offerings but they often yield slightly less due to more fees. I find Vanguard is better for mutual fund investors.

Second, gain familiarity with bond funds. These come in various ways. Focus on low-fee bond funds or ETFs that are predominantly short-term treasuries. You will notice some minor volatility in their pricing; this is because the market is constantly changing their minds on what the yield should be for such investments. Such a fund is not in danger of major losses, so it is a good starter to see how daily changes occur; if it is an ETF, you can see it change in real time during market hours.

Third, continue to explore bond funds. You will see long-term bond funds; these funds hold bonds with long maturity dates, and their volatility will be much more than for short-term bond funds. This is because long-term bonds have more “duration risk”. Intermediate-term bond funds are a middle ground between the two.

You will also see high-yield bond funds; these funds hold bonds with significant “default risk” (the risk that they will not pay you back in full). Essentially all bonds have credit risk but treasuries are deemed to be very safe and extremely unlikely to have an issue. Corporate bonds have more risk; however, those that are investment-grade are less likely to default than those that are speculative-grade (or sometimes called junk bonds).

For this step, you can consider having a total bond fund (which holds all durations of investment-grade bonds), an intermediate-term treasury bond fund, or even a TIPS fund (treasuries that are indexed to inflation). Going too long in duration or too much in “credit risk” (general term referring to the risk of bonds that can default) is not advisable.

Lastly, look into stocks. A total stock fund holds the vast majority of stocks; this is probably the best option as it is cheap and will likely do decently long-term no matter what the next winner is. Do not do anything fancy here because this is where major losses can occur in a short time. Sometimes, the fund might also include international stocks; you do not need to worry about whether to include them initially, but they are a good addition for very long-term portfolios.

Most of us here had to learn how to invest in order to gain independence from an advisor. I think there are plenty here who would gladly help you learn.

Thank you for this

[sparkyma]

Sounds like you may be more comfortable working with someone in person. Many people on this forum speak positively about Schwab and Fidelity. You may want to make appointments and go interview each one. We meet with Fidelity once or twice a year and they listen well, give some ideas but not pushing products. Makes DW more at ease as she doesn’t enjoy the investing stuff. I choose not to pay them to manage and they’re fine with that. I think they charge 0.8% if you do want them to manage.

Yes, I would . I set up an appointment with Fidelity and realized once I got there that there is a difference beteeen Fidelity Bank and Fidelity Investing. Shows how much of a block I have put in front of myself in this area !

[sparkyma]

Look forward, not back. Don’t sell yourself short. Come up with a plan such as:

1) get more educated on investing basics. Start with this BH wiki page:
https://www.bogleheads.org/wiki/Getting_started

2) pull together your financial information (you will learn a lot) using the “Asking Portfolio Questions” template found here: viewtopic.php?t=6212
Post here for feedback.

3) if you can’t DIY, consider Vanguard PAS.

Thank you

[sparkyma]

Investing is not nearly as scary or difficult as you think--the flames of fear and difficulty are intentionally fanned by those who stand to profit from you hiring their services. You can invest your money pretty wisely--and with little or no future maintenance--in about 5 minutes once you regain your confidence and trust.

Good to know. I will try to move forward with this in my mind!

[sparkyma]

The best financial advisor is the one that teaches you *why* to do things not just telling you *give me your money and I am going to do XYZ*. You've already pulled out of investments once, so no need to go back to someone else who you'll also feel uncomfortable with. I would prefer an hourly fee based advisement myself. If they cannot explain to you why something should be done, then you're not ready to do it and they aren't a good enough teacher. Secondly, just take a big step back, read the wiki here, maybe complete one or more of the commonly recommended investing books. Stay away from anything advocating active trading, active management, crypto, or other things that are proven to be high risk investments that tend to underperform the market. Good luck!

Thank you !

[sparkyma]

Look forward, not back. Don’t sell yourself short. Come up with a plan such as:

1) get more educated on investing basics. Start with this BH wiki page:
https://www.bogleheads.org/wiki/Getting_started

2) pull together your financial information (you will learn a lot) using the “Asking Portfolio Questions” template found here: viewtopic.php?t=6212
Post here for feedback.

3) if you can’t DIY, consider Vanguard PAS.

Thank you. I will start reading now.

[carolinaman]

Sounds like you may be more comfortable working with someone in person. Many people on this forum speak positively about Schwab and Fidelity. You may want to make appointments and go interview each one. We meet with Fidelity once or twice a year and they listen well, give some ideas but not pushing products. Makes DW more at ease as she doesn’t enjoy the investing stuff. I choose not to pay them to manage and they’re fine with that. I think they charge 0.8% if you do want them to manage.

+1. I totally agree. We switched from Vanguard to Fidelity last year. I have an assigned rep and can go into the branch to meet in person if desired. Fidelity has branches in most major metro areas and I am guessing that Schwab does too. My wife is old school and wants to do business in person, and I like that too although I am equally comfortable with Zoom. One of the nice things with having an assigned rep is if you have an issue, that person serves as your go to person to get it resolved and that process is efficient and fast. Vanguard did not have that and we had a couple of issues the last year we were with them, that took a long time and a lot of phone calls to get resolved.