Quote:
Originally Posted by XutvJet
Assuming your portfolio isn't worth more than $2M, I'd say no to A. Absolutely yes to B.
I had a financial advisor at Morgan Stanley from 2003-2013. He was my parent's advisor as well. He charged a 1% fee, but when I did all the math and considered things like trades, sells, movement of money into various funds, it actually amounted to more like 1.5% to 1.65% annually with everything considered. That's a significant chunk of your portfolio that could working for you.
My advisor was a very nice guy. My parent's love him. He would do everything I asked him to and would give me advice anytime I asked. I went with his recommendation for investments (high fee stuff, yeah I was a dumb sucker) and stuck with it for 10 years because I didn't know better and figured it was way too complicated for me to understand. My accounts simply didn't perform much less match the S&P 500 performance. All I got from him we excuses, some of which seemed manufactured. After doing all the math myself, looking deeper into Warren Buffett's 2 minute retirement plan, and reading the The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns, I fired my advisor and moved everything to Vanguard so that I could manage everything myself.
The performance of my Vanguard account from 2013 to present compared to what I did with Morgan Stanley is hilarious. I'm shocked every time I look at it. I really wasn't mad at my advisor, but rather myself from not researching things earlier.
My 78 y/o mom (father is passed) thinks I'm nuts for investing myself and she swears I'm doing things wrong and there's no way my Vanguard account could have increased so much over the years compared to the performance she's seen at Morgan Stanley. I often think about is how much more I could have if I would had managed everything myself from the start! I'm certain my portfolio's value would be 25-30% higher.
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maybe you are a financial wiz
or maybe you just benefited from one of the longest bull market runs in history
it is easy to make money as long as you have half a brain and picked decent stocks
(and didn't throw money at OTM options like me trying to hit a homerun every time)
I agree with you about not hiring a "financial advisor" who is really just a glorified salesperson selling you investments that earn him/her a fat commission