Thinking about getting a financial advisor...

[MSCH]

worth remembering something when it comes to paying for financial advice.. best story ever follows..

Buffett's Bet with the Hedge Funds: And the Winner Is … Buffett's ultimately successful contention was that, including fees, costs and expenses, an S&P 500 index fund would outperform a hand-picked portfolio of hedge funds over 10 years. The bet pit two basic investing philosophies against each other: passive and active investing.​

https://www.investopedia.com/articl...etts-bet-hedge-funds-year-eight-brka-brkb.asp

 

[supton]

Wife is more involved than I am with our finances... heck I don't even sign the check anymore, not with direct deposit. She reconciles our bank account (was doing the same for a non-profit that she is involved with, and I think now for our church) so she's better at money than I am. But currently only I touch our retirement, and I do my best to write the yearly budget.

 

[MSCH]

what Dave Hess said is good advice, even if only one of you handle the dinero, the other person needs to know where it is, the passwords, the paperwork and how to handle it if necessary.

 

[supton]

That's a good point, my wife does have passwords written down, but in a move uncharacteristic of her, it's a jumbled mess. We should get a copy of that into the fire safe, and I should print off a set of my passwords too.

 

[99Saturn]

Was poking around this morning, reading bogleheads, came to the dumb observation that I've been ignoring: a financial adviser who charges a % has skin in the game. The bigger your account, the bigger their take. Duh, not sure why I didn't think of that.

The potential criticism there is the risk (for a financial advisor) of under performing the market is potentially less then the risk of performing with the market (even over the long run) when their is big swings (in the short run). --> Unhappy clients.

Still, I'm below Fidelity's threshold. Maybe my local agent would be of help. Bogleheads seem split on the idea, some for, some against. I still think I'm at too little and my simple account is good enough. BUT there is a point about if I depart this mortal coil--what would my survivors do? At some point I might have to give in, if the wife doesn't want to take over.

I still have yet to write a will, been putting that off, but technically I somehow have acquired an estate to hand off. Ugh, I started out in life with nothing, and now that I have something, it's kinda uncomfortable.

Have to think about, what do I need from my assets in the event I depart, as well as what do I need my assets to do if I depart, and how difficult is that plan to manage.

I don't want to assume too much (or maybe I should say I may be wrong in what I'm assuming). But I take it you are in the index and let it grow camp from other posts, and have a good runway until retirement. That's a pretty simple (not saying bad, saying easy to follow) approach as long as others can be trusted to carry that forward.

 

[MSCH]

That's a good point, my wife does have passwords written down, but in a move uncharacteristic of her, it's a jumbled mess. We should get a copy of that into the fire safe, and I should print off a set of my passwords too.

you can also do like I do and have them saved in email form... everything you can think of... and account numbers etc...
and if you ever change a password you reply to that email with the change. works for me

 

[JeffKeryk]

I still have yet to write a will, been putting that off, but technically I somehow have acquired an estate to hand off. Ugh, I started out in life with nothing, and now that I have something, it's kinda uncomfortable.

With wealth comes responsibility. I can tell you, once you have your estate planning in place, you will have piece of mind. But it is a hassle, and only gets worse. Say you help someone out; then you may need to change your trust/will. As your wealth changes, people in your life change, so will your estate plan.

Oh yeah, and it ain't cheap. Sheesh. Absolutely make sure your wife and children understand your wishes. Things can get sticky real fast... I was lucky because I am the financial person in our family; my sister trusted and depended on me to handle matters.

Congrats on your progress. You must be doing something right.

 

[supton]

Congrats on your progress. You must be doing something right.

More luck than anything--I'm sure not money savvy. Wasn't until 36 that I realized I even wanted to retire; had to start ramping up savings rate at that point (more luck: HR put the thumbtacks to me when I was hired, pressured me to do something for my 401k, so at least I had something in retirement at 36). Trying hard with the kids to get them started well in this area.

 

[Pablo]

More luck than anything--I'm sure not money savvy. Wasn't until 36 that I realized I even wanted to retire; had to start ramping up savings rate at that point (more luck: HR put the thumbtacks to me when I was hired, pressured me to do something for my 401k, so at least I had something in retirement at 36). Trying hard with the kids to get them started well in this area.

How old now?
What percentage of overall income are you saving?

 

[99Saturn]

More luck than anything--I'm sure not money savvy. Wasn't until 36 that I realized I even wanted to retire; had to start ramping up savings rate at that point (more luck: HR put the thumbtacks to me when I was hired, pressured me to do something for my 401k, so at least I had something in retirement at 36). Trying hard with the kids to get them started well in this area.

Perfect opportunity to get them started with an IRA young.

 

[supton]

How old now?
What percentage of overall income are you saving?

47. Started saving at 36, before that was 3% 401k match to my 3% savings rate, with basically zip savings rate otherwise. Still not saving outside of retirement, to my chagrin. But now around 20% to retirement (plus 5% match). I'm low at only 3x salary saved for retirement, hoping to get back on track in another 10 years. And am hoping that when the wife goes back to work in a couple of years that maybe we'll finally start saving something.

Perfect opportunity to get them started with an IRA young.

I have one started with Fidelity Youth (the other I'm still working on). Trying what I can to get them started early.

 

[Pablo]

Do everything you possibly can in cutting to get to 25%. Then find every crack and do every possible income source including working more to get to 30%

You will be glad at 62

 

[99Saturn]

I have one started with Fidelity Youth (the other I'm still working on). Trying what I can to get them started early.

Hope it takes, mine still have a while until then - good luck!

 

[JeffKeryk]

More luck than anything--I'm sure not money savvy. Wasn't until 36 that I realized I even wanted to retire; had to start ramping up savings rate at that point (more luck: HR put the thumbtacks to me when I was hired, pressured me to do something for my 401k, so at least I had something in retirement at 36). Trying hard with the kids to get them started well in this area.

"I am a great believer in luck, and I find the harder I work, the more I have of it." Jefferson.
There is no luck and there is no fair.

You are way ahead of me; I got sober at 33 and my 1st degree at 40.
Finance teaches us about the "opportunity cost of money", which means money only spends once. Spend it on yourself by investing in yourself.

 

[supton]

Do everything you possibly can in cutting to get to 25%. Then find every crack and do every possible income source including working more to get to 30%

You will be glad at 62

I've got to look into a spousal Roth next, that might get me to 25%, assuming my wallet is deep enough. 2 teen drivers? ouch, my insurance is crazy. And I just paid one semester of tuition for one, with another semester not far off. [Hoping and praying the younger one gets a full ride!]

Plan is to work until 67, don't see a way around that. But yeah, it will be nice to see a fat nest egg at 62, I'm sure.

Hope it takes, mine still have a while until then - good luck!

Do you have a Fidelity account? mine kept sending me things about signing kids up. Granted they have to be old enough to have a phone number.

 

[Slick3914]

There is also an option of having a fee only fiduciary advisor prepare a comprehensive financial plan and manage your investments yourself.

 

[99Saturn]

Do you have a Fidelity account? mine kept sending me things about signing kids up. Granted they have to be old enough to have a phone number.

Most of my accounts/assets are with Fidelity, became a convenience thing for me as my 401K and other company stuff has been at Fidelity, so my brokerage was there for when I had spare change, plus they have some other accounts that with their setup I can self manage (Health Savings Account for example) that I could not do where my other accounts were. With interest rates being where they are, made the move a while back to basically do a separate brokerage/cash management account to act as a "checking" account with Fidelity and let cash collect in SPAXX or something similar close to 5% now rather than local banks for the most part.

Probably more to your question, my kids are too young for the youth accounts (they are 3 and under and I think the youth accounts start at 13). But I have UTMA account for both of them (more for some place to park their money from birthdays, Christmas, etc. if they get something). Pretty easy setup wise, not sure I can wrap my head around there not being someplace local when they are in their teens but that is probably more me about me than anything else. Pretty sure the youth accounts work just like the cash management as checking setup I mentioned above which is easy.

Edit - they run signup promos too for lots of accounts so if you sign them up make sure they get the $50 or whatever it is bonus at the time.

 

[Dave Hess]

I opened Vanguard Roth IRAs for my 3 kids when they turned 18 and funded the max contribution that year.

All 3 were working part-time jobs and I got the ball rolling before they graduated high school.

 

[supton]

Edit - they run signup promos too for lots of accounts so if you sign them up make sure they get the $50 or whatever it is bonus at the time.

I got one to get the $50 and I need to help her figure out what to do with that (I'll chip in a bit once things get moving). The other... him and a bag of hammers have a lot in common (I shouldn't talk, at his age I wasn't any better).

 

[Cujet]

Fiduciary or not, every financial advisor's job is to make money off of you. This is done by reducing your profit.

It is common to see a 1.5% charge. On a 6% year, that's 25% of your profit. Which never gets to compound and earn.

Just a couple of the buildings your money builds: