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Started By
Message
re: Financial Advisor for Young Man
Posted on 7/26/25 at 11:57 am to labguy
Posted on 7/26/25 at 11:57 am to labguy
quote:
Have a good bit of cash saved up
What does this mean?
90% of people are more than fine in VTSAX or equivalent. It’s more about actually saving the money than what the saved money is in for almost all people.
If you start pulling in mid to high 6 figures, then it’s probably worth having professional advice and diversifying your assets
0
Posted on 7/26/25 at 12:46 pm to labguy
quote:
I’ve heard of ETF’s but know nothing about them. That’s why I’m looking for an advisor.
I’d read up on ETFs and index funds before meeting with the advisor.
You want to understand what he talks about.
Don’t let him put you in something with a big front “load” fee.
Posted on 7/26/25 at 2:36 pm to GeauxTigers123
quote:
Don’t let him put you in something with a big front “load” fee.
Front loaded fees aren't necessarily bad. It depends on the investors goals, risk, tolerance, and suitability.
Posted on 7/26/25 at 4:23 pm to labguy
Max out the 401k match at work. It's a huge instant return every payday.
Posted on 7/27/25 at 7:06 am to La Place Mike
Front loaded fees are bad.
Posted on 7/27/25 at 7:14 am to labguy
I wish I sat down with a legit financial advisor in my 30s. Not somebody selling insurance, but a proper fiduciary.
There is a love/hate here with them, however now that I did it in my 40s it is a financial decision I regret not doing it earlier. You can read all the stuff you want and/or watch videos, however there is a real benefit in sitting down with a live person with a whiteboard and paper in hand to map on long financial decisions.
Finding the right one may be hard, however if you can it will be worth it. You have options as well with lump sum payment or ongoing fees. Whatever meets your needs.
There is a love/hate here with them, however now that I did it in my 40s it is a financial decision I regret not doing it earlier. You can read all the stuff you want and/or watch videos, however there is a real benefit in sitting down with a live person with a whiteboard and paper in hand to map on long financial decisions.
Finding the right one may be hard, however if you can it will be worth it. You have options as well with lump sum payment or ongoing fees. Whatever meets your needs.
Posted on 7/27/25 at 8:30 am to CharleyLake
quote:
Front loaded fees are bad.
Not always.
Posted on 7/27/25 at 9:36 am to labguy
Spend less than you make
The length of time your money is invested is significant. Take initiative now.
Keep more of your money in groups of companies (s&p500 is a great choice). You do not have to be an expert stock picker to become wealthy.
Fund a Roth IRA now if you can. The longer you let money grow tax free, the better.
Fund a traditional IRA once your income grows to get tax deferrals
Pay yourself first. Within reason, commit to investing regularly. Too many delay investing because they aren't sure "they can afford it". Commit to adding to your investments regularly before the many discretionary spending choices you have. If you casually make your discretionary spending decisions, then decide if you have money to invest, you will likely delay investing for too long. So set aside money to invest, then make your many discretionary spending decisions.
The length of time your money is invested is significant. Take initiative now.
Keep more of your money in groups of companies (s&p500 is a great choice). You do not have to be an expert stock picker to become wealthy.
Fund a Roth IRA now if you can. The longer you let money grow tax free, the better.
Fund a traditional IRA once your income grows to get tax deferrals
Pay yourself first. Within reason, commit to investing regularly. Too many delay investing because they aren't sure "they can afford it". Commit to adding to your investments regularly before the many discretionary spending choices you have. If you casually make your discretionary spending decisions, then decide if you have money to invest, you will likely delay investing for too long. So set aside money to invest, then make your many discretionary spending decisions.
Posted on 7/27/25 at 10:23 am to DarthRebel
quote:I have said this before and I will say it again. It is a low bar to be a "fiduciary." Just because someone says this doesn't mean that their advice won't involve choices that aren't the best for the client. At a high level they can claim, rightly so, that they are giving sound advice. In the details of execution, the choices will potentially sway to products they are paid to sell. Be aware of fees. Any index fund should provide very low fees. Any actively managed funds will have higher fees and will likely under-perform index funds. Any "retirement horizon" funds will have high fees and are performing very simple rebalancing among low cost fees.
but a proper fiduciary.
Posted on 7/27/25 at 11:49 am to labguy
Most of the better brokerages offer some form of graduated services. Usually, there's an entry level Robo-Adviser which is a low cost option, a step up service that adds a human you can talk to, and then upper tiers where you get more out of the human.
If you really don't know what to do, start with a Robo-adviser and see if you like it. If you follow along with any changes it makes, you might learn something. If you don't, you'll probably still do OK.
If you really don't know what to do, start with a Robo-adviser and see if you like it. If you follow along with any changes it makes, you might learn something. If you don't, you'll probably still do OK.
Posted on 7/29/25 at 7:24 am to KWL85
quote:
Keep more of your money in groups of companies (s&p500 is a great choice). You do not have to be an expert stock picker to become wealthy.
Is this a good one ?
SWPPX
Posted on 7/29/25 at 8:07 am to Stamps74
quote:
Is this a good one ?
SWPPX
That appears to be a mutual fund and not an ETF.
The difference between mutual funds and ETFs is that ETFs can be traded throughout the day like stocks, while mutual funds are only traded at the end of the trading day at their net asset value.
Mutual funds tend to have smaller expense rations that similiar ETF but to me the difference isn't worth the givign up the flexibility of being able to trade like a stock.
I suggest finding a S&P500 ETF like VOO.
Posted on 7/29/25 at 8:43 am to labguy
If you are a “delegator”, meaning you want to pay someone else to manage your money, then you need to find a “Fee Only” advisor. This means they don’t make commission on the products they sell, they charge a flat fee (usually a % of assets under management (AUM)). Don’t mistake FA that claims “Fee Based”, they make commissions on products they sell and therefore have an obvious conflict of interest.
Two important additional things;
1) I believe you should still get a crash course in basic financial planning so you can know what to ask and ensure you aren’t going to be taken advantage of. You need to understand what your FA is getting you invested in, at minimum on a surface level. Money Guy Show, John Bogle’s books, Bogleheads forum/wiki, White Coat Investor, Burton Malkiel “A Random Walk Down Wallstreet” are all good resources that most people that know nothing would benefit from looking into.
2) understand that when you delegate the responsibility to a FA, you are paying for a service. This can be valuable if you are incapable of making decisions and need someone to steer you. However, you need to understand the impact that a “meager” fee will cost you in the long term. For example, look at how a 1.0% AUM fee from your FA will impact your portfolio value over the course of 30-40 investment years, it is staggering.
SEC Article Regarding Fees
Two important additional things;
1) I believe you should still get a crash course in basic financial planning so you can know what to ask and ensure you aren’t going to be taken advantage of. You need to understand what your FA is getting you invested in, at minimum on a surface level. Money Guy Show, John Bogle’s books, Bogleheads forum/wiki, White Coat Investor, Burton Malkiel “A Random Walk Down Wallstreet” are all good resources that most people that know nothing would benefit from looking into.
2) understand that when you delegate the responsibility to a FA, you are paying for a service. This can be valuable if you are incapable of making decisions and need someone to steer you. However, you need to understand the impact that a “meager” fee will cost you in the long term. For example, look at how a 1.0% AUM fee from your FA will impact your portfolio value over the course of 30-40 investment years, it is staggering.
SEC Article Regarding Fees
Posted on 7/29/25 at 9:26 am to Stamps74
Yes. It is a mutual fund, but still a good option. There are quite a few different ones that track the 500.
Posted on 7/30/25 at 7:39 am to La Place Mike
quote:
Front loaded fees aren't necessarily bad. It depends on the investors goals, risk, tolerance, and suitability.
This mindset is why I won’t go with a FA.
I’m sure some FA’s have a great deal of knowledge, but the sales side of them usually takes preference.
I’ve never had a FA and never will. And I’m doing pretty well with my savings and investing.
Posted on 7/30/25 at 8:21 am to Grinder
quote:
This mindset is why I won’t go with a FA. I’m sure some FA’s have a great deal of knowledge, but the sales side of them usually takes preference.
I understand where you are coming from and your suspicions are warranted but there are times where up front fees can actually be less in the long run. Without getting in to a lot of details It all depends on how long the investor will keep the fund and course what the fees are of the differents fund classes that are being compared.
quote:
I’ve never had a FA and never will. And I’m doing pretty well with my savings and investing.
The accumlutaion phase is the easy part these days with the ease of investing and all of the information that is out there. It's the de-accumulation phase is where people start needing more assistance. Personally I try and stay away from absolutes like never and always especially when it comes to finacial issues. I like to stay open to different thoughts and strategies.
With all of that said it's not rocket science. Some people are perfectly capable of handling their own affairs and some people for whatever reason don't have the time nor the inclination.
Posted on 7/30/25 at 8:45 am to La Place Mike
Agree with you with the caveat that accumulation is not always easy. But when to sell is definitely difficult.
Posted on 7/30/25 at 9:04 am to labguy
You've received some good advice here. I'll say this as well. Don't let a financial advisor push you into investing for retirement only. Live your life to fullest including how you invest your hard earned money. Tomorrow is promised to no one. It sounds great to have a large amount of money waiting for you at 65, but you might want to enjoy the fruits of your labor while you're young and healthy. Don't waste your money on material items. Spend it on experiences you'll carry with you forever. Financial advisors don't really want you to spend your money. Remember that when setting up your investment strategy.
Posted on 7/30/25 at 1:07 pm to labguy
Echo a lot of what folks have said here. Just going to add a couple things.
- Be very aware of fees, especially since you are so young. A couple of percent here and there can really punish your returns over a 20-30 year timeframe. This is especially important if you re working with an advisor. You have to understand what they are putting you in and how much loss you are going to absorb because of fees. There are great investments out there that perform as well that have very low fee structures.
- If you're working with an advisor, understand how they make their money and if they get commissions on trades and financial products. You can easily understand the consequences of someone burning through trades, just to run up their commission.
- Time in market is should be your focus, not timing the market. Fidelity released an article and I'm paraphrasing here, that most of the gains from the last 20 years can be boiled down to six specific days in the market. If you were on the sidelines waiting to time the market and missed any of those days, there was a significant decline in you long term returns.
- Do some self evaluation and get a clear understanding of your wants vs. needs. For example, do you really need an Audi, or will a Toyota do? Do you need a new iPhone each year, or will one a few years old do the job? I'll offset that with don't be afraid to spend money at times and enjoy your life, just make sure that you budget for it and don't end up in debt because of lifestyle choices or keeping up with the Jonses.
Overall, be consistent with investing and have a solid budget and plan and you'll find yourself in a good place.
- Be very aware of fees, especially since you are so young. A couple of percent here and there can really punish your returns over a 20-30 year timeframe. This is especially important if you re working with an advisor. You have to understand what they are putting you in and how much loss you are going to absorb because of fees. There are great investments out there that perform as well that have very low fee structures.
- If you're working with an advisor, understand how they make their money and if they get commissions on trades and financial products. You can easily understand the consequences of someone burning through trades, just to run up their commission.
- Time in market is should be your focus, not timing the market. Fidelity released an article and I'm paraphrasing here, that most of the gains from the last 20 years can be boiled down to six specific days in the market. If you were on the sidelines waiting to time the market and missed any of those days, there was a significant decline in you long term returns.
- Do some self evaluation and get a clear understanding of your wants vs. needs. For example, do you really need an Audi, or will a Toyota do? Do you need a new iPhone each year, or will one a few years old do the job? I'll offset that with don't be afraid to spend money at times and enjoy your life, just make sure that you budget for it and don't end up in debt because of lifestyle choices or keeping up with the Jonses.
Overall, be consistent with investing and have a solid budget and plan and you'll find yourself in a good place.
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