Financial advisor???

[sdsrfr]

Vanguard model is too have low fees. A standard fee for Vanguard is around .03-.05 where some other funds are around .5-.8

IMO, VTI and VOO are hard to beat.

that should cover most anyone afraid to dip more than a toe but wanting in on some action.

not financial advice. I buy stonks to spite hunny bunny, give my dog the life I cannot otherwise afford, and fuel YOLO swirly resin board purchases.

 

[silentbutdeadly]

If I wanted to start a roth ira to supplement my 401k where would I start. Just go to my bank?

Or would I be better off just making more contributions to my 401k?

 

[grapedrink]

If I wanted to start a roth ira to supplement my 401k where would I start. Just go to my bank?

Or would I be better off just making more contributions to my 401k?

Sign up on Schwab, fidelity, etc or if you already have a stock trading account you should already have the option. These are separate from your workplace 401k.

After maxing out my employer match, I then maxout the $6000/year Roth IRA, because the future gains are tax free. Then at some point I hope to be a position where I can maximize the $19.5/year that you can contribute to a 401k to lower your taxable income. IMO the compounding Roth gains will likely be worth more than whatever tax savings I get from trying to max my pretax limit.

 

[kelpcutter]

Check with your employer to see if there is a ROTH 401k option through their investment management company used for your 401k. Assuming you're happy with the investment options available through your 401k, you should have the same options for a ROTH. This makes it easy to set it up and have it automatically come out of your pay before you ever see it. Otherwise, a ROTH IRA outside of your employer as grapedrink says. Not through your bank.

If you want to reduce your taxable income and save more for retirement, max out the 401k first. Otherwise, maximize the employer match first and then fund the ROTH.

 

[Mr Doof]

Posted 7/19/2021
View attachment 113198

And a day later:

silentbutdeadly said:
If I wanted to start a roth ira to supplement my 401k where would I start. Just go to my bank?

Or would I be better off just making more contributions to my 401k?

------------------------

Assuming you have already maxed out your 401k (probably best to do before anything else), you can open an online brokerage account easily but you should be able to go to your banking institution of choice too.


Edit: Three people saying the same thing

 

[bluemarlin04]

Dont even bother looking at your stocks and investments. Drop the money in and forget about it. If you need it anytime soon then you shouldn't be investing it and keep that in a money market.

Otherwise just put the money away and forget it.

 

[keenfish]

Mutual Funds.
Buy and hold for the long run.
Continue to invest in them if you can.
A financial planner can be helpful in changing out the bad for the goods.
Dollar cost averaging is the key to the deal.
It's that simple.

 

[bluemarlin04]

It's that simple.

So is eating healthy and exercising regularly.

But the medical community spends billions of year on combating obesity and obesity related illness.

People can't act rational sometimes.

 

[Random Guy]

There’s funds that are rebalanced for risk for you based on when you plan to retire.
Like this one for 2035 retirement

Vanguard Mutual Fund Profile | Vanguard

investor.vanguard.com

Seems like they couldn’t make it any easier

 

[sdsrfr]

People can't act rational sometimes.

biggest enemy in investing is human intuition.

the best investors would be robots programmed by robots. when you add human element in, the robots are just really fast moving humans since that is who programmed them.

dollar cost average on S&P500 and call it a day. If you put $20/month every month till you die, you will do much better than that same $20 going into a savings account over the same amount of time.

if you are not buying ANY stocks, but you are having an increasing amount in your savings every month, you are missing out on putting your money to work.

key is to be reasonable with what hits savings and what goes into quality long term stonks.

 

[waxhead]

I sure wish I could figure it out...I started putting money into stocks and mutual funds maybe 30 years ago. Sold to buy real estate, then started investing again. Rinse and repeat. I thought the dow was high at 16k when Obama was president, so don't take market advice from me.

I've had money on the sidelines for years. Missed out on a lot of gains over the last 15 years. But, my real estate paid off huge and I pretty much own it outright. I have significant rental income, and cash in the bank. Maybe 25% in the market. Still working and earning solid money, but I'm trying to figure out how to scale back.

I remember telling a broker I thought the market was high, and didn't want to invest at that time. He asked when I'd need the money. i said maybe never. He asked if I thought the US economy would be larger in 10 years. I said yes. He said then you should invest. I should have....

Now at 63, I'm still spooked at the valuation of the market. I recently looked at a private equity firm(Pacific Private Money) promising 8% They invest in real estate hard money loans. I asked if the investment was insured. They said for what? For you turning into Bernie Madoff. They said no, and I said bye. I'm super conservative I guess, but the money I have cost me a lot in terms of years of risk and sweat. At my age, I doubt I'll be earning tons more if I should lose a significant amount.

First world problems, but problems none the less. Financial adviser? Even if they take 1%, over a decade they just took 10% of your investments. Control freak out.

 

[Mr Doof]

Financial adviser? Even if they take 1%, over a decade they just took 10% of your investments. Control freak out.

Just helping to illustrate the point:

Say you invest $100 and it gains 10% per year and the advisor gets 1% of total at end of year.

Year 1 starts with $100.
Year 1 ends with $110.
Advisor then takes 1% of the $110 for $1.10 leaving you with $108.90.

Year 2 starts with $108.90.
Year 2 ends with $119.79.
Advisor then takes 1% of the $119.79 for $1.20 (they round up of course) leaving you with $118.59.

Year 3 starts with $118.59.
Year 3 ends with $130.45.
Advisor then takes 1% of the $130.45 for $1.30 leaving you with $129.15.

Year 4 starts with $129.15.
Year 4 ends with $142.06
Advisor then takes 1% of the $142.06 for $1.42 leaving you with $140.64.

Four years in, you are up 41% (rounding up) or $40.64. They are up $5.02.

Obviously the longer it goes on, the higher the return for both parties. For a lot of people, this is a fair exchange if only so they "don't have to think about it".

Now if it goes down, and you don't get that 10% boost every year and they still take 1%.....

It is this sort of math which makes people want to use self-directed accounts that have lower fees...which still guarantees nothing.

I've had money on the sidelines for years. Missed out on a lot of gains over the last 15 years. But, my real estate paid off huge and I pretty much own it outright. I have significant rental income, and cash in the bank. Maybe 25% in the market. Still working and earning solid money, but I'm trying to figure out how to scale back.

Dear old dad was telling me how to invest about 16 yrs back and how he had moved everything into bonds because there were so much safer. "At my age, I can't afford market swings."

Just this past Sunday he says, "Can you believe this market? How much higher can it go? If I knew I was still going to be alive toay, I wouldn't have put it all in bonds."

He doesn't really want my opinion so I just say, "Yeah, buying the house was the best investment I ever made, besides marrying up."

You know, if I look at my life, maybe the best investment advice would have to be that a person should first improve oneself so you can marry up and then second, don't be stupid and ruin that.

 

[sdsrfr]

Curious what the collective brain trust thinks of money market accounts, associated risks, and whether or not that risk is worth their low return?

I was told money market have such low return with inherent risks that make it just not worth it. pad the s&p500 ETF and savings accounts instead to get similar risk outcome with better returns and less of a bottom falling out at the inopportune time.

 

[bluemarlin04]

I sure wish I could figure it out...I started putting money into stocks and mutual funds maybe 30 years ago. Sold to buy real estate, then started investing again. Rinse and repeat. I thought the dow was high at 16k when Obama was president, so don't take market advice from me.

I've had money on the sidelines for years. Missed out on a lot of gains over the last 15 years. But, my real estate paid off huge and I pretty much own it outright. I have significant rental income, and cash in the bank. Maybe 25% in the market. Still working and earning solid money, but I'm trying to figure out how to scale back.

I remember telling a broker I thought the market was high, and didn't want to invest at that time. He asked when I'd need the money. i said maybe never. He asked if I thought the US economy would be larger in 10 years. I said yes. He said then you should invest. I should have....

Now at 63, I'm still spooked at the valuation of the market. I recently looked at a private equity firm(Pacific Private Money) promising 8% They invest in real estate hard money loans. I asked if the investment was insured. They said for what? For you turning into Bernie Madoff. They said no, and I said bye. I'm super conservative I guess, but the money I have cost me a lot in terms of years of risk and sweat. At my age, I doubt I'll be earning tons more if I should lose a significant amount.

First world problems, but problems none the less. Financial adviser? Even if they take 1%, over a decade they just took 10% of your investments. Control freak out.

You are overthinking it.

Look at the S and P from the beginning and no matter the drops it has always continued to grow.

But if you are 63 you may not want to spend all in the S and P.

 

[Mr Doof]

Curious what the collective brain trust thinks of money market accounts, associated risks, and whether or not that risk is worth their low return?

I was told money market have such low return with inherent risks that make it just not worth it. pad the s&p500 ETF and savings accounts instead to get similar risk outcome with better returns and less of a bottom falling out at the inopportune time.

The ability to have ready access to cash is a valuable thing.

Having to sell assets at inopportune times to cover costs is a great way to lose a lot of capital.

This is part of the reason why some financial advisors say it is good to have 6-12 months of money supply.

After that....

 

[waxhead]

I believe they don't wait till the end of the year to take their cut-some take it upfront, and others quarterly. That cuts into your return even more. And as you wrote, if you lose money, it's compounded by the fact that they still take their cut. Nice work if you can get it. Of course, if they could beat the S&P regularly, or even come close to increasing your stake by 10% consistently, it would be well worth it.

Just helping to illustrate the point:

Say you invest $100 and it gains 10% per year and the advisor gets 1% of total at end of year.

Year 1 starts with $100.
Year 1 ends with $110.
Advisor then takes 1% of the $110 for $1.10 leaving you with $108.90.

Year 2 starts with $108.90.
Year 2 ends with $119.79.
Advisor then takes 1% of the $119.79 for $1.20 (they round up of course) leaving you with $118.59.

Year 3 starts with $118.59.
Year 3 ends with $130.45.
Advisor then takes 1% of the $130.45 for $1.30 leaving you with $129.15.

Year 4 starts with $129.15.
Year 4 ends with $142.06
Advisor then takes 1% of the $142.06 for $1.42 leaving you with $140.64.

Four years in, you are up 41% (rounding up) or $40.64. They are up $5.02.

Obviously the longer it goes on, the higher the return for both parties. For a lot of people, this is a fair exchange if only so they "don't have to think about it".

Now if it goes down, and you don't get that 10% boost every year and they still take 1%.....

It is this sort of math which makes people want to use self-directed accounts that have lower fees...which still guarantees nothing.



Dear old dad was telling me how to invest about 16 yrs back and how he had moved everything into bonds because there were so much safer. "At my age, I can't afford market swings."

Just this past Sunday he says, "Can you believe this market? How much higher can it go? If I knew I was still going to be alive, I wouldn't have put it all in bonds."

He doesn't really want my opinion so I just say, "Yeah, buying the house was the best investment I ever made, besides marrying up."

You know, if I look at my life, maybe the best investment advice would have to be that a person should first be to improve yourself so you can marry up and then second, don't be stupid and ruin that.

 

[bluemarlin04]

The ability to have ready access to cash is a valuable thing.

Having to sell assets at inopportune times to cover costs is a great way to lose a lot of capital.

This is part of the reason why some financial advisors say it is good to have 6-12 months of money supply.

After that....

If you have a rental property- need 6 months of payments plus 10k saved for anything that could pop plus vacancies.

Own house- 6 months of payments saved plus 20k for any issues.

If you are saving money in stocks and don't have that you are setting yourself up for failure. Cause one turn in the market and you need cash and you will kill your investment.

 

[CutnSnip]

Just helping to illustrate the point:

Say you invest $100 and it gains 10% per year and the advisor gets 1% of total at end of year.

Year 1 starts with $100.
Year 1 ends with $110.
Advisor then takes 1% of the $110 for $1.10 leaving you with $108.90.

Year 2 starts with $108.90.
Year 2 ends with $119.79.
Advisor then takes 1% of the $119.79 for $1.20 (they round up of course) leaving you with $118.59.

Year 3 starts with $118.59.
Year 3 ends with $130.45.
Advisor then takes 1% of the $130.45 for $1.30 leaving you with $129.15.

Year 4 starts with $129.15.
Year 4 ends with $142.06
Advisor then takes 1% of the $142.06 for $1.42 leaving you with $140.64.

Four years in, you are up 41% (rounding up) or $40.64. They are up $5.02.

Obviously the longer it goes on, the higher the return for both parties. For a lot of people, this is a fair exchange if only so they "don't have to think about it".

Now if it goes down, and you don't get that 10% boost every year and they still take 1%.....

It is this sort of math which makes people want to use self-directed accounts that have lower fees...which still guarantees nothing.



Dear old dad was telling me how to invest about 16 yrs back and how he had moved everything into bonds because there were so much safer. "At my age, I can't afford market swings."

Just this past Sunday he says, "Can you believe this market? How much higher can it go? If I knew I was still going to be alive toay, I wouldn't have put it all in bonds."

He doesn't really want my opinion so I just say, "Yeah, buying the house was the best investment I ever made, besides marrying up."

You know, if I look at my life, maybe the best investment advice would have to be that a person should first improve oneself so you can marry up and then second, don't be stupid and ruin that.

ive been getting hit up by financial advisors who dont take a fee from me whatsoever..scam? a few of them come from legitimate corps.

 

[bluemarlin04]

ive been getting hit up by financial advisors who dont take a fee from me whatsoever..scam? a few of them come from legitimate corps.

Its not necessarily a scam but they will only recommend their companies funds.

 

[kelpcutter]

Its not necessarily a scam but they will only recommend their companies funds.

They're either paid by you, or paid for the products they sell you. I want someone who works for me.