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C IL | I have worked with a couple advisors and been aggressively courted by a couple. My experience is that it is all about your fit with the local rep. They are salesmen and women. Their job is to get you in a chair and do a snapshot analysis: what assets you have, income, expenses, age, and retirement goals. Then they do a basic calculation that shows that you likely need to be saving something like 20% of your income to reach that planned amount of future monthly draw (which is true, it’s just math and assumptions). Then you discuss your risk tolerance.
At that point, the two extremes are the guy who asks what you are comfortable investing, gently urges you to take advantage of IRA and similar tax-saving strategies, invests you into some mutual funds, and maybe calls you up in a good year or when the market craters to grab some bargains. If you are minimally financially literate you can do much of this yourself using a few basic principles: dollar cost averaging, sector allocation, maybe lifecycle reallocations. Many people are not financially literate or comfortable and want help with that.
On the other extreme is the guy who wants you to almost day-trade individual stocks and/or sell you whole-life insurance. That guy can maybe make you tons of $ if you get a good one, or fleece you out of a lot of commission if you get a bad one. Just like your grain broker.
We have principally chosen the Fidelity do-it-yourself route, but I am not really much of a market risk-taker. Taking the average of the big indices is good enough for me, I certainly don’t have any more knowledge or insight than the Wall Street types that day trade individual stocks all day.
I do have a little money with an Edward Jones type guy but am just sitting in a mix of about 10 different funds based on the same ideas I use personally - mix of growth, aggressive growth, growth and income (sound like Dave Ramsey anyone)?
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Stock Market, Investing, Opportunity
