Need of investment adviser?

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Applepie1965
Posts: 1
Joined: Thu Nov 14, 2019 12:28 pm

Need of investment adviser?

Post by Applepie1965 » Thu Nov 14, 2019 12:54 pm

Hi all,
I'm a new member to this site and have a question... If one is to follow the general philosophy of bogleheads, is it really necessary to have a financial adviser? Their management fee can add up to big time money over time and I'm not convinced they can do much better based on what I have been reading here. Please comment.

Thanks,
Applepie1965

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David Jay
Posts: 7286
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Need of investment adviser?

Post by David Jay » Thu Nov 14, 2019 2:01 pm

Welcome to the forum!

A frequent quote here is: “When you have learned enough to pick a good advisor, you no longer need one”.

This is to say, there are a lot of “advisors” who are, to phrase it politely, “not adding value” to their customer’s portfolio. To find a good one you need to learn the basics. Once you know the basics you can manage your own portfolio with the help of the BH forum.

The investing startup kit in the Wiki is a great place to start, link here: https://www.bogleheads.org/wiki/Boglehe ... art-up_kit

From the book list, start with the introductory “If You Can”, Bernstein’s little pamphlet which is a free PDF.

[edit] And don’t be afraid to ask questions - just posting this has placed you on a good path.
Last edited by David Jay on Thu Nov 14, 2019 2:07 pm, edited 3 times in total.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

dbr
Posts: 30798
Joined: Sun Mar 04, 2007 9:50 am

Re: Need of investment adviser?

Post by dbr » Thu Nov 14, 2019 2:03 pm

No it is not really necessary to have an investment advisor. It is also not really necessary to have an investment advisor if one is not a BH investor.

That does not mean there is no use and value to the right kind of advisor in some cases. One can also find one's financial situation moderately or severely damaged by using the wrong kind of "advisor."

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ruralavalon
Posts: 16690
Joined: Sat Feb 02, 2008 10:29 am
Location: Illinois

Re: Need of investment adviser?

Post by ruralavalon » Thu Nov 14, 2019 3:09 pm

Welcome to the forum :) .

Applepie1965 wrote:
Thu Nov 14, 2019 12:54 pm
Hi all,
I'm a new member to this site and have a question... If one is to follow the general philosophy of bogleheads, is it really necessary to have a financial adviser? Their management fee can add up to big time money over time and I'm not convinced they can do much better based on what I have been reading here. Please comment.

Thanks,
Applepie1965
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) You could post your financial details on this forum for ideas on investments and financial planning. Please see this for format: "Asking Portfolio Questions". I think that you will fund that simply gathering together all of your information together in one place will be helpful to you in understanding your situation and what you need to do.

2) Vanguard offers a ”Personal Advisory Service” (PAS) that will give you advice and manage your investments for an annual fee of 0.3% of your investments. Fidelity and Schwab offer a similar service.

3) 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".

4) Two links for finding an advisor:
http://www.napfa.org/consumer/index.asp
http://www.garrettplanningnetwork.com/
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

averagedude
Posts: 766
Joined: Sun May 13, 2018 3:41 pm

Re: Need of investment adviser?

Post by averagedude » Thu Nov 14, 2019 3:35 pm

No need for a financial advisor if you follow bogleheads philosophy and you are very familiar with all of the topics on bogleheads wiki page, especially the financial planning area.

cashboy
Posts: 153
Joined: Tue Sep 11, 2018 5:03 pm
Location: USA

Re: Need of investment adviser?

Post by cashboy » Thu Nov 14, 2019 5:07 pm

look here also.

https://www.bogleheads.org/wiki/Video:B ... philosophy


now, from my personal experience:

scenario 1:

my sister went with a fidelity advisor.
she pays several $1,000s of dollars a year for that advisor's 'services' ("assets under management").
the advisor has her in 17 different funds and she pays $1,000s in expenses for these 'actively managed' funds (in addition to the above).



scenario 2:

i have no advisor (other than the great minds here at BH :happy ).
i do not pay thousands of dollars a year to an advisor.
i have my investments in the "3 fund portfolio" and i pay $100s a year in expenses for these three 'index' funds.

read this:

viewtopic.php?f=10&t=88005

in general, you can do it on your own, as did I.

:sharebeer
Three-Fund Portfolio: FSPSX - FXAIX - FXNAX (with slight tilt of CD - CASH - Canned Beans - Rice - Bottled Water)

retired@50
Posts: 647
Joined: Tue Oct 01, 2019 2:36 pm

Re: Need of investment adviser?

Post by retired@50 » Thu Nov 14, 2019 6:19 pm

Applepie1965 wrote:
Thu Nov 14, 2019 12:54 pm
Hi all,
I'm a new member to this site and have a question... If one is to follow the general philosophy of bogleheads, is it really necessary to have a financial adviser? Their management fee can add up to big time money over time and I'm not convinced they can do much better based on what I have been reading here. Please comment.

Thanks,
Applepie1965
No adviser needed. On the off chance that an adviser can "beat the market" it isn't likely that will happen often enough to cover the fees that are collected year after year. Since most folks will be an investor to some degree or another for over half their lives, it's better to DIY using low cost broadly diversified index funds and other Boglehead tips and tricks.

Regards,

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Stinky
Posts: 2450
Joined: Mon Jun 12, 2017 11:38 am
Location: Sweet Home Alabama

Re: Need of investment adviser?

Post by Stinky » Thu Nov 14, 2019 7:53 pm

David Jay wrote:
Thu Nov 14, 2019 2:01 pm

The investing startup kit in the Wiki is a great place to start, link here: https://www.bogleheads.org/wiki/Boglehe ... art-up_kit

From the book list, start with the introductory “If You Can”, Bernstein’s little pamphlet which is a free PDF.

[edit] And don’t be afraid to ask questions - just posting this has placed you on a good path.
Welcome to the Forum! Glad that you posted your question.

David Jay has given you some excellent advice above. You can read the Wiki for free. Read a book or two (or more) from the list.

Then post your questions on the Forum. You’ll get a lot of great advice from some really smart, thoughtful people.

You’ll probably save thousands of dollars over time compared to using a full service planner. And you’ll get an equal or better investment result.
It's a GREAT day to be alive - Travis Tritt

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