Need Investing/Retirement Help: Financial Advisor or Planner?
I'm mid-40's, single, no kids, self employed.1) what's an "acceptable" fee to pay a company like Vanguard or Fidelity etc to help manage your retirement investments (SEP/ROTH)? I know this kind of service requires a % fee, but what's considered "average" or acceptable?2) I'd like to find a Financial Advisor or Planner this group highly recommends. I want to learn more about managing my retirement investments, but need some guidance and education initially. (I've been reading a lot online and in books, but having a human to guide and ask questions to would be helpful). I don't want to be sold into specific funds the advisor is affiliated with. I just want guidance so I can eventually mange them myself and reap better returns. My previous investments were lacking in any strategy and I have a lot of catch up I need to do. TIA
Parent Replies
Hi,
I'm also in my mid-40s and self employed and had many of the same questions as you a few months ago. I found a very good financial planner named Chris Foley who works for Edward Jones. I was very skeptical about working with a financial planner because I was worried about fees, but Chris will look at your existing portfolio in detail and make recommendations personalized to your situation and goals, including different options for investments and fees, so that you end up something that you're comfortable will and better prepared for the future. Note: you don't have to do a % fee approach.... there are other options. Message me if you're interested and I'll forward his contact information.
We work with the financial planning firm Reynolds and Reynolds in Atlanta and have all our meetings remotely. We specifically work with Nick Wagner. He’s great, and it’s cheaper work with someone who lives in a more affordable area of the country. Highly recommend.
I feel very passionately about this topic because I think that many financial advisors do not have their client's best interest at stake. I used to have a financial advisor for my family's retirement accounts, to whom I paid an annual fee of about 1.25% of assets, which is fairly standard in the industry. He put us into various funds of his choosing. About seven years ago I was reviewing the periodic reports he would send us, and I was shocked and angry to see that our portfolio was not beating the major indices, and yet we were paying a 1.25% annual fee and the managed funds we were in had high annual expenses! I would have been better off putting my money in the S&P500! About this time I was reading an article about a new company called RebalanceIRA (now called Rebalance360) whose mission it was to help regular people retire with more money by offering an investment strategy at a low cost. They help you identify your risk tolerance and then allocate your money into ten asset classes. They use index funds and ETFs, which have minimal fees. Then they rebalance your portfolio every quarter, bringing it back to your target allocation. They charge 0.7%. That half a percentage savings in fees, plus not paying the costs of a managed fund, make a huge difference in your return over time. They have an account minimum of $100K (I think). If you are below that level or want to do things yourself, then I would recommend Vanguard, which offers low fee funds such as their Target Retirement funds. Needless to say, I fired my financial advisor and moved my accounts to Rebalance, and I have never looked back. Their website has lots of helpful info: rebalance360.com Good luck!