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Trade
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11 registered members (Lonster, Cactus_buck, BRP549, Shane99, mashburn, Semo, AWT6, Tree Dweller, kaintuck, BC_Reb, NWFJ),
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Financial advisers
#4022441
11/22/23 08:55 PM
11/22/23 08:55 PM
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Joined: Feb 2003
Posts: 6,871 shelby county
buzzard
OP
14 point
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OP
14 point
Joined: Feb 2003
Posts: 6,871
shelby county
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What’s the best way to grade my financial advisor? What variables do I need to grade them against yr to yr? I know just enough about the market to be dangerous to myself and our investments. What are some things that I need to look for to make sure my advisor has my best interests at heart. And maybe he has my best interest but he just sucks at his job . What is a “fair” return and how do I judge that
"Hell with them fellows, buzzard got to eat same as a worm" Josey Wales
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Re: Financial advisers
[Re: buzzard]
#4022563
11/23/23 12:26 AM
11/23/23 12:26 AM
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Joined: Mar 2015
Posts: 4,851 AL
Gobble4me757
12 point
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12 point
Joined: Mar 2015
Posts: 4,851
AL
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This is a great question/post…I am here for the answers as well
2017 Team Aldeer Turkey Contest Champion 2018 Team Aldeer Turkey Contest Champion
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Re: Financial advisers
[Re: buzzard]
#4022609
11/23/23 07:06 AM
11/23/23 07:06 AM
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Joined: Jun 2002
Posts: 1,102 Birmingham,AL
low wall
6 point
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6 point
Joined: Jun 2002
Posts: 1,102
Birmingham,AL
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I see nobody has given a simple answer to the question - A fair return is "X". That's not what you want to hear, but it's correct. I'm 63. My risk tolerance is far less than it was when I was 30. I'm not going to demand that my investments outpace the overall market in a boom, as long as i don't lose my tail in a bear market. That make sense?
Also, a "fair" return has to be in comparison with the overall market. If you made, say, 5% over a certain period, but the market increased by 10%, it might not be that great. OTOH, if you LOST 10% over a period, but the market lost 15%, that's pretty impressive. Also, sad but true, an advisor is going to pay more attention if your account is fairly large. In the long run, he's going to make a certain percentage of your investments. Whether he's making either 2% or 10%, he's making more off of a million dollar account than he is off a hundred thousand. kpswihart's answer was spot on
Used to be a lifeguard, until that blue kid got me fired.
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Re: Financial advisers
[Re: AU7MM08]
#4022624
11/23/23 07:57 AM
11/23/23 07:57 AM
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Joined: Dec 2013
Posts: 22,692 Lickskillet, AL
Irishguy
a.k.a. Dingle Johnson
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a.k.a. Dingle Johnson
Joined: Dec 2013
Posts: 22,692
Lickskillet, AL
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I would ask yourself, why do you need a financial advisor.
A few broad based low/no cost index funds will outperform most advisors over the long term, Yep.
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Re: Financial advisers
[Re: buzzard]
#4022640
11/23/23 08:17 AM
11/23/23 08:17 AM
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Joined: Mar 2015
Posts: 4,851 AL
Gobble4me757
12 point
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12 point
Joined: Mar 2015
Posts: 4,851
AL
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Here’s how mine is…mine charges 1% of profit…with northwestern mutual. I am up 15% at last check…I’d say that’s pretty good but like the op said, I have no idea. I don’t do anything as they automatically draw from our account monthly
2017 Team Aldeer Turkey Contest Champion 2018 Team Aldeer Turkey Contest Champion
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Re: Financial advisers
[Re: AU7MM08]
#4022641
11/23/23 08:19 AM
11/23/23 08:19 AM
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Joined: Feb 2007
Posts: 18,930 colbert county
cartervj
Old Mossy Horns
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Old Mossy Horns
Joined: Feb 2007
Posts: 18,930
colbert county
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I would ask yourself, why do you need a financial advisor.
A few broad based low/no cost index funds will outperform most advisors over the long term, Had a retired financial advisor tell me that
“Socialism only works in two places: Heaven where they don't need it and hell where they already have it.” ― Ronald Reagan
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Re: Financial advisers
[Re: cartervj]
#4022662
11/23/23 08:36 AM
11/23/23 08:36 AM
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Joined: Jun 2015
Posts: 14,021 Some Marriott/Auburn
AU7MM08
Booner
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Booner
Joined: Jun 2015
Posts: 14,021
Some Marriott/Auburn
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I would ask yourself, why do you need a financial advisor.
A few broad based low/no cost index funds will outperform most advisors over the long term, Had a retired financial advisor tell me that Max out a Roth IRA/Backdoor Roth IRA for yourself & spouse, that’s $13,000 combined in 2023, going to $14,000($7,000 each), max out a 401K for yourself and spouse $22,500 each, going to $23,000each in 2024 + the run of the mill 5% match, throw some into a brokerage account and throw some into real estate. Very very few people have more money than what this simple plan above can’t take care of.
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Re: Financial advisers
[Re: buzzard]
#4022685
11/23/23 09:01 AM
11/23/23 09:01 AM
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Joined: Jan 2017
Posts: 3,550 Lower Alabama
Andalusia
10 point
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10 point
Joined: Jan 2017
Posts: 3,550
Lower Alabama
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I have used the same fee based advisor for 23 years and I have been very happy with the results and guidance over the years. What attracted me to the fee based advisor was the fact that they don't get commissions on sales, there is no charge for trades etc. They are not biased toward the latest investments pushed by a large company or incentives. They were upfront about their fees, and the fee schedule declined as the amount invested increased.
They developed a roadmap for investing, estate planning needs, and guided on types of insurance needs and because they didn't sell insurance or receive commissions their advice was non-biased.
They are constantly re-balancing the portfolio with several transactions every month to keep the the portfolio diversified according to the percentages in each category based on my current risk tolerance.
When we were dealing with my wife's and my parents' estates, it was one call to get them involved to help with transfer/setup of IRA's, trust assets etc.
Where they have really shined is toward retirement, they spent a great deal of time running various scenarios to ensure we could retire without compromising lifestyle and do fine with worst case scenarios. They also are ready to distribute monthly funds when needed to start drawing out investments to live on and they know where to pull money out for tax purposes etc.
They manage dividends and always keep an eye out for tax consequences. As an example, my tax rate last year was 5%. Not always that good but I couldn't think about all the ways they "manage" the money. They want copies of my tax returns every year and have a meeting with my CPA once yearly. My advisor is also a CPA which has been a great extra bonus.
If I need anything, I know I can call at anytime and they will be ready to help in anyway possible. Should something happen to me, I know they will be there for my family as not only an advisor but friend to help manage anything for my wife and this is priceless.
Bottom line is, while some years they are above or in-line with the markets in general, the amount I have spent in fees is far exceeded by their investment returns and tax savings and I don't have to stress about my decisions on a daily basis or constantly check how my investments are doing.
There is no "right" decision but for me this has been a great partnership and we consider our advisor and firm to be good friends.
Best of luck! One thing to be aware of is that many' fee" only advisors have a minimum amount of funds they require for management. Many require $500,000 to $1,000,000 to start.
"If you are the smartest person in the room, you're in the wrong room"
"How you do Anything, is how you do Everything"
"It is the mark of an educated mind to be able to entertain a thought without accepting it"
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Re: Financial advisers
[Re: Andalusia]
#4022698
11/23/23 09:13 AM
11/23/23 09:13 AM
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Joined: Jun 2007
Posts: 1,715 Sweet Home
Moss
8 point
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8 point
Joined: Jun 2007
Posts: 1,715
Sweet Home
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I have used the same fee based advisor for 23 years and I have been very happy with the results and guidance over the years. What attracted me to the fee based advisor was the fact that they don't get commissions on sales, there is no charge for trades etc. They are not biased toward the latest investments pushed by a large company or incentives. They were upfront about their fees, and the fee schedule declined as the amount invested increased.
They developed a roadmap for investing, estate planning needs, and guided on types of insurance needs and because they didn't sell insurance or receive commissions their advice was non-biased.
They are constantly re-balancing the portfolio with several transactions every month to keep the the portfolio diversified according to the percentages in each category based on my current risk tolerance.
When we were dealing with my wife's and my parents' estates, it was one call to get them involved to help with transfer/setup of IRA's, trust assets etc.
Where they have really shined is toward retirement, they spent a great deal of time running various scenarios to ensure we could retire without compromising lifestyle and do fine with worst case scenarios. They also are ready to distribute monthly funds when needed to start drawing out investments to live on and they know where to pull money out for tax purposes etc.
They manage dividends and always keep an eye out for tax consequences. As an example, my tax rate last year was 5%. Not always that good but I couldn't think about all the ways they "manage" the money. They want copies of my tax returns every year and have a meeting with my CPA once yearly. My advisor is also a CPA which has been a great extra bonus.
If I need anything, I know I can call at anytime and they will be ready to help in anyway possible. Should something happen to me, I know they will be there for my family as not only an advisor but friend to help manage anything for my wife and this is priceless.
Bottom line is, while some years they are above or in-line with the markets in general, the amount I have spent in fees is far exceeded by their investment returns and tax savings and I don't have to stress about my decisions on a daily basis or constantly check how my investments are doing.
There is no "right" decision but for me this has been a great partnership and we consider our advisor and firm to be good friends.
Best of luck! One thing to be aware of is that many' fee" only advisors have a minimum amount of funds they require for management. Many require $500,000 to $1,000,000 to start. I need to know who you are dealing with if you don't mind. Taxes are the largest bill we pay.
O God, you are my God; early will I seek you. Psalm 63:1
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Re: Financial advisers
[Re: geeb1]
#4022701
11/23/23 09:15 AM
11/23/23 09:15 AM
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Joined: Jun 2015
Posts: 14,021 Some Marriott/Auburn
AU7MM08
Booner
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Booner
Joined: Jun 2015
Posts: 14,021
Some Marriott/Auburn
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I got tired of mine charging 1.5% every month. Had me in the same mutual funds for years. I just chose comparable funds funds at Vanguard and I am paying a fraction of what I was paying. Let me guess, your performance is no better/worse than what it was but with an additional 1.5% in your account
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Re: Financial advisers
[Re: buzzard]
#4022706
11/23/23 09:17 AM
11/23/23 09:17 AM
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Joined: Jan 2017
Posts: 3,550 Lower Alabama
Andalusia
10 point
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10 point
Joined: Jan 2017
Posts: 3,550
Lower Alabama
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1.5% is very high! Mine charges .9% and is a sliding scale going to .25% at 2,000,000
"If you are the smartest person in the room, you're in the wrong room"
"How you do Anything, is how you do Everything"
"It is the mark of an educated mind to be able to entertain a thought without accepting it"
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Re: Financial advisers
[Re: AU7MM08]
#4022712
11/23/23 09:23 AM
11/23/23 09:23 AM
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Joined: Jun 2007
Posts: 1,715 Sweet Home
Moss
8 point
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8 point
Joined: Jun 2007
Posts: 1,715
Sweet Home
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I would ask yourself, why do you need a financial advisor.
A few broad based low/no cost index funds will outperform most advisors over the long term, Had a retired financial advisor tell me that Max out a Roth IRA/Backdoor Roth IRA for yourself & spouse, that’s $13,000 combined in 2023, going to $14,000($7,000 each), max out a 401K for yourself and spouse $22,500 each, going to $23,000each in 2024 + the run of the mill 5% match, throw some into a brokerage account and throw some into real estate. Very very few people have more money than what this simple plan above can’t take care of. Right on! Also, owning an LLC will help in many ways. Cost out before taxes is a true advantage. A SEP-IRA can be a game changer just in tax deferment. Either way, you will want an accountant that works for you and not the IRS. I don't break the rules and I want to win playing by the rules.
O God, you are my God; early will I seek you. Psalm 63:1
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Re: Financial advisers
[Re: Moss]
#4022729
11/23/23 09:39 AM
11/23/23 09:39 AM
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Joined: Jan 2017
Posts: 3,550 Lower Alabama
Andalusia
10 point
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10 point
Joined: Jan 2017
Posts: 3,550
Lower Alabama
|
I have used the same fee based advisor for 23 years and I have been very happy with the results and guidance over the years. What attracted me to the fee based advisor was the fact that they don't get commissions on sales, there is no charge for trades etc. They are not biased toward the latest investments pushed by a large company or incentives. They were upfront about their fees, and the fee schedule declined as the amount invested increased.
They developed a roadmap for investing, estate planning needs, and guided on types of insurance needs and because they didn't sell insurance or receive commissions their advice was non-biased.
They are constantly re-balancing the portfolio with several transactions every month to keep the the portfolio diversified according to the percentages in each category based on my current risk tolerance.
When we were dealing with my wife's and my parents' estates, it was one call to get them involved to help with transfer/setup of IRA's, trust assets etc.
Where they have really shined is toward retirement, they spent a great deal of time running various scenarios to ensure we could retire without compromising lifestyle and do fine with worst case scenarios. They also are ready to distribute monthly funds when needed to start drawing out investments to live on and they know where to pull money out for tax purposes etc.
They manage dividends and always keep an eye out for tax consequences. As an example, my tax rate last year was 5%. Not always that good but I couldn't think about all the ways they "manage" the money. They want copies of my tax returns every year and have a meeting with my CPA once yearly. My advisor is also a CPA which has been a great extra bonus.
If I need anything, I know I can call at anytime and they will be ready to help in anyway possible. Should something happen to me, I know they will be there for my family as not only an advisor but friend to help manage anything for my wife and this is priceless.
Bottom line is, while some years they are above or in-line with the markets in general, the amount I have spent in fees is far exceeded by their investment returns and tax savings and I don't have to stress about my decisions on a daily basis or constantly check how my investments are doing.
There is no "right" decision but for me this has been a great partnership and we consider our advisor and firm to be good friends.
Best of luck! One thing to be aware of is that many' fee" only advisors have a minimum amount of funds they require for management. Many require $500,000 to $1,000,000 to start. I need to know who you are dealing with if you don't mind. Taxes are the largest bill we pay. I have paid plenty in taxes when I was working, but in retirement my tax rate has been lower due to the advisors managing my dividends and doing some tax trading on some investments. My advisor and small firm are not accepting new clients at this point. If that changes I will let you know. As I get older (61 now), I have realized that the great folks I have worked with as I was working are retiring or slowing down and these long-term relationships are coming to completion and sometimes their younger partners are also great and sometimes I have to go looking for new folks in all aspects of life. Never really thought about getting to the point where all these resources start going away and need to be replaced as you get older. Fine balance between younger and really talented person vs older/wiser.
"If you are the smartest person in the room, you're in the wrong room"
"How you do Anything, is how you do Everything"
"It is the mark of an educated mind to be able to entertain a thought without accepting it"
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