quote:

Originally posted by Skins2881:
CFP after their names.

I think a CFP is what you are looking for. They provide different types of services, usually just for a fee (not commission). CFPs also have much better training.

Way too many "financial advisors" are nothing more than glorified salespeople. Their primary motivation is to sell you products and services that generate hefty commissions.

My wife I were in the same boat about a year ago. My wife heard about a consultant from a co-worker and we made an appointment. We met the person and opened a dialogue.

The first thing he asked was "When do you plan on retiring?" and "What are your goals?". Without divulging any personal background to the advisor, (I have an International MBA) I let him proceed to look at our current situation, identify the weaknesses, and suggest a future plan for our assets. Everything he said made sense and then I opened up about my experience. I often challenge his strategy and he's able to explain it without missing a beat.

First, educate yourself (learn) about investments and their risk. Secondly, know what your risk tolerance is: i.e. if you invest solely in the stockmarket and are comfortable with losing 30%-40% of your investment in the hopes of great gains in a bear market, then do that. If not, then listen to what the person offers and question, question, question. If the advisor can't tell you what his suggestions can do so that you can understand it, move on!

Remember, it's your money and your decision on what to do. Hopefully, you'll find someone you can trust!

My person gets in touch at least quarterly, or more often. He's reached out to us to discuss what's going on with the Coronovirus and the market and has made some solid suggestions.

Good luck!!

My main thing I’m looking for in one is that they are a fiduciary.

I would echo the CFP idea. Your financial life is a giant puzzle and you want to put the whole puzzle together, not just a couple of corners.

this advice is worth what you paid for it:

first thing as has been mentioned -- is to establish GOAL CLARITY.

only once you have established that will you -or anyone else - be able to help you figure out the plan. because you work backward from that.

and the numbers have to be realistic -- you can't base a 20 year plan on averaging stock returns of 15% / year, unrealistic monthly savings amounts etc.

and 'saving a bunch of money' is not clear enough. the goals have to be specific as well as realistic:

provide $75,000 year annual income at retirement at age 65

provide $80,000 x 2 for two children to attend in state public university

pay-off $200,000 remaining mortgage at age 60

etc, etc you get the point, its different for everyone.

Once that is done -- the numbers basically work themselves out using investment amounts per month, a basic budget, historical market performance for stocks / bonds / cash and assuming those returns across your various 'buckets'. once 'in retirement' a distribution rate of 4% is a jumping off point for discussion..... 3% is safer if you are concerned about capital preservation but I personally think 4% is acceptable.

honestly -- it's not complicated. Once you get into the 'where do I put my money' question -- the VAST majority of people are well-served by a blend of LOW COST index funds available from Vanguard, Fidelity etc. as core holdings.

And IMO a % yearly fee like 1% AUM is robbery. That means the investment advisor has to BEAT the market by 1% or MORE year over year just to break even with an index fund. And fees can also include trading fees, sales fees, expense ratios of the funds themselves etc that are less easy to see.

The only reason i would see an advisor is if I had very unique needs like shared business assets, complicated ownership issues, complicated estate ownership issues , etc. But for general 'save for retirement' planning -- completely not necessary.

I printed out a self-made plan almost 20 years ago and saved it. To this day its uncanny how accurate the numbers have unfolded -- even considering various temporary market debacles like the 2009 financial crisis and the current pandemic. The averages always regress to the mean given enough time.

The biggest challenge is to STICK to the plan and not blow it up by buying the new boat, buying too much house, and generally getting off track.

One thing that happens eventually is -- market returns eventually have FAR more effect on the plan than savings rate. But that is when asset allocation becomes a big factor. (mix of stocks / cash / other....)

ETA :: I keep a basic plan recorded on a one page xcel spreadsheet. I print it off at the end of every month -- have done this since September 1997.

The number don't lie - for good or bad. Never paid a penny for outside advisement. It just take a little discipline.

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This message has been edited. Last edited by: Sig209,

As others have suggested--research, referrals,etc.
I'm going to recommend some light reading.. reinforcing aetocles advice.
The Wealthy Barber...
An easy read. Sound advice. Basic stuff but the foundation to build on.