Financial Planners/Advisors

[PiratePenguin]

We're getting to a point where I think it would be good to talk to an unbiased financial professional about some issues and goals in our life, but am having trouble finding any that want anything to do with someone who doesn't have a million dollars already invested for them to manage. We have no investments outside of work 401ks currently, which is one of the things we want to start doing, but don't want to start out on the wrong foot. I know a fee-only planner is the way the experts recommend, but how much is too much to pay? What are your experiences? How are fees in your area?

 

[jdb1911]

This is an interesting topic. My wife and I decided a few years back that we need to get serious if we really want to retire by the time I am 56 (only 20 more years yaaa). I have a friend from college who is a CPA and she referred me to a person who was willing to start investing our money for a low amount. About 10,000.00 and they charge fees based on performance. I have no idea if that is the norm. Another thing we did was start an outside 401k through T. Rowe Price. I believe the initial investment was as low as 1,000 and I have an automatic withdrawal from my checking account for 250.00 once a month. I have no idea your age but I am 36 and based on my parents I am already behind lol. Good luck.

I also max out my 401k contribution at work yearly.

 

[tahoebum]

We're getting to a point where I think it would be good to talk to an unbiased financial professional about some issues and goals in our life, but am having trouble finding any that want anything to do with someone who doesn't have a million dollars already invested for them to manage. We have no investments outside of work 401ks currently, which is one of the things we want to start doing, but don't want to start out on the wrong foot. I know a fee-only planner is the way the experts recommend, but how much is too much to pay? What are your experiences? How are fees in your area?

I would start by first reading a few books such as "The Affluent Investor", by Phil DeMuth, or "The Little Book of Bulletproof Investing: Do's and Don't to protect your financial life". By affluent the author means you have more than $100,000 total to invest but the book is worth reading even if you don't have that much yet.

There are dozens of other great books out there but these are two of my favorite out of the 50 or so that sit on my bookshelf.

My wife and I had a bad experience with 2 different fee based financial advisors so I would be very careful before handing one of them a substantial chunk of your money. We finally found one we like who is well worth the 1% annual fee but IMO there are more bad ones than good ones out there. The really good advisors that you can find on Barron's list of top advisors often won't talk to you unless you have over $1 million to invest with them.

 

[Speedliner]

Ask your friends and co-workers, acquaintances that seem to be doing well. You wouldn't take swing advice from a bad golfer, so ask folks you think have their financial life under control.

 

[russtopher]

Agreed with the others above, ask around for references and referrals.

We started out with our brother in law, which was just a bad idea all around for a lot of reasons I won't get into here. We moved from there to Ameriprise, which went well for a number of years until our advisor retired and sold her book of business to her son in law, and it went downhill quickly. We felt like we were paying his annual fee and getting nothing in return.

Now, we use an independent advisor who originally did a lot of work for some friends of ours, and we were immediately comfortable when we met her. She's great, and her business has grown a lot (she's working with some higher ups at Acushnet nowadays) but she still always makes sure we're taken care of, returns calls quickly, etc.

 

[dhartmann34]

I work in the industry. We do fee based financial planning for clients at a fairly in depth level. You need to look for someone that will make you feel comfortable. You need to know they have your best interest at heart. I know for planning we charge a fee which gives you access to us for the whole year. Depending on what you're looking to accomplish, fees can be fairly inexpensive. Having the year-long contracts allows for our clients not to have a plan thrown at them and left to fend for themselves. It's an open line of communication where we can communicate all year about any different scenarios or things that come up. I would interview a few first and if you have any sense of angst, then move along. Sidenote.....Family referrals I would be careful with because you don't want to ever have any possible negative issues with that advisor come between you and them (Not that family referrals aren't good, just be careful because money issues complicate things exponentially). If you have any questions feel free to PM me.

 

[NoLine]

We're getting to a point where I think it would be good to talk to an unbiased financial professional about some issues and goals in our life, but am having trouble finding any that want anything to do with someone who doesn't have a million dollars already invested for them to manage. We have no investments outside of work 401ks currently, which is one of the things we want to start doing, but don't want to start out on the wrong foot. I know a fee-only planner is the way the experts recommend, but how much is too much to pay? What are your experiences? How are fees in your area?

Before you do it I would highly recommend you pick up Tony Robbins book, Money: Master the Game. First, I'm the least likely guy to be a Tony Robbins fan, I'm not. This book however pulls back the curtain on what really goes on with financial managers, mutual funds, annuities, etc and how to avoid getting taken advantage of. It's worth the $20 to avoid getting money manager scammed.

 

[Speedliner]

Once you find one, I recommend opening accounts for your kids. Deposit a small amount and let them pick the stocks...Disney, Mattel, your car OEM, whatever interests them with some coaching by you and the advisor.

It's a great way to orient them, get them paying some attention. Do same with their 529s, but their personal accounts are better for education and interest. Great thing to do for their financial acumen. Few adults understand the time value of money. Great thing for your kids to grow up,understanding..

 

[kenh]

My wife and I signed up with a financial planner about a year and a half ago and it was the best decision that we have made in a long time. His advice and outside perspective on what we are and aren't doing right is invaluable. He has helped us in a number of areas including cash flow, retirement planning, insurance (we had a HUGE gap here that we didn't even realize!) and tax planning. The cost is higher than we expected -- especially in the first year -- but we are confident that the cost is definitely worth it.

My recommendation is to find a certified planner that is independent of any financial institution so you get an unbiased perspective. This was very important to me. The one we use is affiliated with a nationwide group of advisers that was recommended by my parents since they have used someone from the same group for many years, also with great satisfaction.

If you are interested in who we are using, PM me and I'll let you know what group he's part of.

[ Edit/addendum: if a financial advisor says that I need a certain amount of $$ before they will will work with me, I could consider that a huge red flag and end the conversation right there. Same for an advisor who works on some sort of percentage basis instead of fixed-fee. ]

Ken

PS: The fees that you pay a financial advisor are tax-deductible (in the US)! yay.

 

[McLovin]

cpa here. we work with many financial advisors. my biggest caution would be to find someone who has been doing this many years. i look at financial advisors like realtors: when times are good, everyone wants to be a realtor. but when things get tough, they run and find the next get-rich-quick scheme. don't get me wrong, the testing they go through to get certified is very difficult. but in talking to an advisor friend (who has our money), he said it's a seller's market right now because the market is good again and everyone wants in. i have my money with someone who has been through bulls, bears and everything in between.

 

[PiratePenguin]

cpa here. we work with many financial advisors. my biggest caution would be to find someone who has been doing this many years. i look at financial advisors like realtors: when times are good, everyone wants to be a realtor. but when things get tough, they run and find the next get-rich-quick scheme. don't get me wrong, the testing they go through to get certified is very difficult. but in talking to an advisor friend (who has our money), he said it's a seller's market right now because the market is good again and everyone wants in. i have my money with someone who has been through bulls, bears and everything in between.

Yes, I've seen a lot of people listed who just got their certification in like 2006 or later. I agree wholeheartedly about the realtor analogy.