Rate my advisers portfolio please.

[rerod]

I inherited my moms financial adviser when she passed. Now that my Dad has also passed I'm wondering how well he is managing my retirement account. I'm 47 and wont use this money until my 60's. This Vanguard account does not include my TIAA/CREF retirement account through work which is worth 1/8th of this vanguard.

8% VINEX Vanguard International Explorer Fund
30% VBIAX Vanguard Balanced Index Fund Admiral Shares
20% VWEAX Vanguard High-Yield Corporate Fund Admiral Shares
36% VFIJX Vanguard GNMA Fund Admiral Shares
6% VTIAX Vanguard Total International Stock Index Fund Admiral Shares


66% Bonds
34% Stocks.

Iv expressed to him that I dont want to miss the boat when the economy improves.. He has told me nothing has really changed, and he is still cautious.

Is my FA to conservative? Any input would be appreciated..

[Petunia 100]

I inherited my moms financial adviser when she passed. Now that my Dad has also passed I'm wondering how well he is managing my retirement account. I'm 47 and wont use this money until my 60's. This Vanguard account does not include my TIAA/CREF retirement account through work which is worth 1/8th of this vanguard.

8% VINEX Vanguard International Explorer Fund
30% VBIAX Vanguard Balanced Index Fund Admiral Shares
20% VWEAX Vanguard High-Yield Corporate Fund Admiral Shares
36% VFIJX Vanguard GNMA Fund Admiral Shares
6% VTIAX Vanguard Total International Stock Index Fund Admiral Shares


66% Bonds
34% Stocks.

Iv expressed to him that I dont want to miss the boat when the economy improves.. He has told me nothing has really changed, and he is still cautious.

Is my FA to conservative? Any input would be appreciated..

In my opinion, this is too conservative for a 47 year old. (Unless your portfolio and other assets are of a size that you only need to preserve your wealth, not grow it.)

For reference, I am 45 and I am 70/30 stocks/bonds.

[disneysteve]

Are you paying this adviser? If so, for what? You can invest in Vanguard funds on your own for free.

I agree that you portfolio is much to conservative. I'm also 47 and I'm about 70% stocks too.

[rerod]

Are you paying this adviser? If so, for what? You can invest in Vanguard funds on your own for free.

I agree that you portfolio is much to conservative. I'm also 47 and I'm about 70% stocks too.

Yes I can invest with vanguard for free. But I would have spent allot more time researching/asking and then still wondered if I made good choices during these times. http://www.stevensoninvestments.com/

Will you guys, who sound 100% more bullish, help me line up a portfolio if I fire him.. nicely?

[jpg7n16]

I would also like to ask, "what are you paying your advisor for?" but not in a "why the heck are you paying for advice?" kind of way.

Seriously, what are you paying him for? What services do you receive for the funds? Are you paying for his expertise and advice? Are you paying him to make all the investment decisions for you in what he believes to be your best interest?

If you're paying for his advice, I'd recommend taking it.


If you're paying him because he managed the funds for your parents, and you just kinda kept things the same, but never really wanted his advice in the first place, then you need to reconsider the arrangement - regardless of how closely he is to what YOU think it should be.


IMO there are a lot of similarities between personal finance and medicine. You pay a doctor for a reason.

Sure you can read up on the appropriate drugs online, but are you going to stick to the full prescription? What if you feel fine halfway through? Should you keep taking it?

Doctors help ensure that you stick to the treatment plan, advisor help ensure that you stick to the financial plan.

I personally think that many people would be better off paying an advisor to manage their finances if it let them stick to their strategy, than attempting to do it themselves and not sticking to the strategy.

[aditi]

no meed to pay for your adviser. just keep in touch with other things like market trend and whats govt. policies. then you will also no need to have an adviser.

[disneysteve]

You pay a doctor for a reason.

Sure you can read up on the appropriate drugs online, but are you going to stick to the full prescription? What if you feel fine halfway through? Should you keep taking it?

Doctors help ensure that you stick to the treatment plan

I sure wish my patients all thought like you.
It is amazing and disturbing how many people come to me and then ignore my advice. I sometimes even reach the point of asking them why they bother coming.

Will you guys, who sound 100% more bullish, help me line up a portfolio if I fire him.. nicely?

Absolutely. You can stay with Vanguard and just shuffle things around a bit and have a perfectly good portfolio.

How much do you pay the adviser? I'm guessing 1% of assets. Is that about right?

[kork13]

Will you guys, who sound 100% more bullish, help me line up a portfolio if I fire him.. nicely?

Absolutely. You can stay with Vanguard and just shuffle things around a bit and have a perfectly good portfolio.

Yup.
That's alot of what goes on around here... Basically helping people figure out a plan that works for them. Not that our collective knowledge and input totally replaces qualified expert advice, but between us all, we can sure go a long way in that direction, then tell you if/when you really do need to hire a pro.

And as stated, since you're already with a solid mutual fund company and set up with an honestly not bad investment portfolio (though it could stand improvement for you personally), that's half the battle over. Done. You can certainly do this yourself, with a little thought and effort put into it.

[kv968]

I inherited my moms financial adviser when she passed. Now that my Dad has also passed I'm wondering how well he is managing my retirement account. I'm 47 and wont use this money until my 60's. This Vanguard account does not include my TIAA/CREF retirement account through work which is worth 1/8th of this vanguard.

8% VINEX Vanguard International Explorer Fund
30% VBIAX Vanguard Balanced Index Fund Admiral Shares
20% VWEAX Vanguard High-Yield Corporate Fund Admiral Shares
36% VFIJX Vanguard GNMA Fund Admiral Shares
6% VTIAX Vanguard Total International Stock Index Fund Admiral Shares


66% Bonds
34% Stocks.

Iv expressed to him that I dont want to miss the boat when the economy improves.. He has told me nothing has really changed, and he is still cautious.

Is my FA to conservative? Any input would be appreciated..

That seems too conservative to me. To tell you the truth, that sounds more like an allocation your parents would have had, not you at 47. I don't know your risk tolerance or what else you hold but I'd ask the advisor why he's this cautious. I can kind of understand him being so with the recent runup in the market and there still being a lot of uncertainty out there but you've still got quite a way to go until 60 and like you said, you "don't want to miss the boat".

I'd just let him know that you're willing to be a little more risky (assuming you are) and see what he then suggests.

[MonkeyMama]

Yes, agreed with the others.

Also check out boglehead forums - I think would be a better place to get investment advice. Those people live, eat and breathe investing - and there is a large focus on Vanguard investments.

OF course, you might get a wide variety of opinions, which is always the hard thing. But if you stick to an asset allocation that is well diversified and better for your own risk preference (i.e. 70% stocks) then it's kind of hard to go wrong.

[Slug]

Yes, agreed with the others.

Also check out boglehead forums - I think would be a better place to get investment advice. Those people live, eat and breathe investing - and there is a large focus on Vanguard investments.

OF course, you might get a wide variety of opinions, which is always the hard thing. But if you stick to an asset allocation that is well diversified and better for your own risk preference (i.e. 70% stocks) then it's kind of hard to go wrong.

^This. SA is a great place for personal finance advice. For a portfolio like the one described, the Bogleheads can definitely help (for FREE).

[rerod]

Absolutely. You can stay with Vanguard and just shuffle things around a bit and have a perfectly good portfolio.

How much do you pay the adviser? I'm guessing 1% of assets. Is that about right?

Im paying him .75% only when the portfolio gains.. He didnt charge me if the quarter was bad..

[disneysteve]

Im paying him .75% only when the portfolio gains.. He didnt charge me if the quarter was bad..

That's a very unusual arrangement. How much does your portfolio have to gain to trigger the fee? I don't think I've ever heard of an adviser charging that way. It is typically a set percentage of assets under management, like 1% per year no matter what the investments do.

[jpg7n16]

no meed to pay for your adviser. just keep in touch with other things like market trend and whats govt. policies. then you will also no need to have an adviser.

Yup. No reason to go to a doctor. Just keep up on the medical journals, and use WebMD. Then you'll have no need for a doctor. I realize you've never been to med school, and you work in marketing, but you're a bright fellow. You'll figure it out. Besides, your sister teaches high school anatomy, and she's pretty healthy, so you'll just ask her what to do. [/sarcasm]

{yup. No reason to go to an advisor. Just keep up on the market and use the internet. Then you'll have no need for an advisor. I realize you've never been to school for finance, or passed the CFP exam, but you're an electrician, you're a bright fellow. You'll figure it out. Besides, your sister works in a bank, and she's got a lot of money, so you'll just ask her what to do}

IMO there are certainly people who can benefit from an advisor. Now, the percentage of people who do need an advisor is less than the percentage of people who need a doctor, but that means they're still out there.

Let's say you use an Internet forum like this one to create your portfolio. You check on bogleheads and they agree that the portfolio is reasonable at 70% stocks. Then, another 2008 market crash happens. What do you do?

A) Think, "well I gotta stick to the plan that the Internet guys told me, so now is a good time to rebalance and ride it out"
-or-
B) Think, "why the heck did I listen to random people on the Internet for advice on my portfolio?? I want out. I'll never do that again - but where do I go now? What am I supposed to do now??"

At least with an advisor, person B could have someone sit down and discuss why sticking to the plan is important, how it's worked historically, how the portfolio is still right for them. And if that helps them stick to the plan, when on their own they wouldn't have, then the fee was worth it.

That's a very unusual arrangement. How much does your portfolio have to gain to trigger the fee? I don't think I've ever heard of an adviser charging that way. It is typically a set percentage of assets under management, like 1% per year no matter what the investments do.

It's rare because there are restrictions on performance based compensation. For that arrangement, it likely just has to be positive.

SEC Raises Dollar Thresholds for Advisers to Charge Performance-Based Fees and Grandfathers Performance-Fee Contracts for Previously Unregistered Advisers | Morrison & Foerster LLP - JDSupra

Although, just to clarify, is that .75%/quarter or per year?

[disneysteve]

Yup. No reason to go to a doctor. Just keep up on the medical journals, and use WebMD. Then you'll have no need for a doctor.

Totally OT but since you keep using the doctor analogy, it really isn't a valid analogy. There isn't anything the adviser does that I can't do myself. Whether or not I know how to do it myself is a different question but assuming I have the know how, I can do it.

That isn't true with a doctor. You might go online and accurately diagnose your problem but without a doctor, you can't get the treatment that you need. You can't walk into a pharmacy and request prescription medications. You can't go get an x-ray or CT scan. You can't perform surgery on yourself. You need a doctor to do all of those things.

The adviser may have knowledge I don't have but with the exception of access to adviser-sold funds, which I wouldn't want anyway, he can't do anything more than I can do.

That is not to say that nobody should ever use an adviser - that isn't my point. Some people need that extra knowledge and support. In this particular case, though, I don't think OP needs an adviser to maintain a portfolio of Vanguard funds. I also don't think the asset allocation is appropriate.