HSBC consultant - would you trust advice?

[KellyJef]

I'm embarrassed to admit that we have $60,000 from a workers comp settlement that's been sitting in an HSBC online account for over a year earning 1.1% interest.

I know we can do better, but I don't know how.

The teller at HSBC has actually mentioned to me several times that I should "sit down" with one of their consultants to see what we should do with this money.

So, my question is: would you trust the competency of an employee of the bank that has my money? Or would you consult an outside financial planner for advice?

[LuxLiving]

KellyJef, do you have debt? If so I'd consider paying some of it down. What is your financial situation - do you have an emergency fund? Retirement savings? How far away from retirement are you?

On trust? That depends on the advice they give you. I'd certainly stay away from annuities.

[jIM_Ohio]

All advice is always biased IMO
once you find the bias and can accept it, that is what makes it unbiased.

Most fee-only planners also have another business or way to make money- it might be selling you mutual funds or doing taxes or doing something else, but if someone just makes a living doing plans, and they charge $5000 for that plan, how much work is that to find new clients every year to shell that money out?

[snshijuptr]

Ask about the planners credentials. You probably want a CFP. You know he/she will be selling you an HSBC product. Ask about Expense Ratios, loads, and other fees. If they are more than about 2% of your investment, you might want to take your money elsewhere. Of course, first you should

1. Pay down debt
2. Have a 3-6 month emergency fund

You should probably be investing in a retirement account if you can with this money.

[jpg7n16]

HSBC consultant = HSBC salesperson

I'd suggest finding a financial planner in your area to have a better chance at getting good advice.

Find an Advisor - Locate a Fee-Only Financial Advisor

Do a bit of research, then choose one you like. Usually interview 2-3.

[Slug]

I'd say tell us more about your situation, especially as it relates to debt, reliability of income stream, size of emergency fund, and willingness to spend some time researching in order to maximize your return.

Would I trust any bank rep? In a word, no. I trust the long-time posters on this board far more in terms of financial guidance, and I do my own due diligence.

[KellyJef]

KellyJef, do you have debt? If so I'd consider paying some of it down. What is your financial situation - do you have an emergency fund? Retirement savings? How far away from retirement are you?

DH and I are both 63, retired and collecting social security (DH's is SSD). We both have small pensions as well.

We have no debt whatsoever (house and cars are paid off and we have no credit card debt either).

We have a 6-month emergency fund in addition to the $60,000 settlement.

[jIM_Ohio]

DH and I are both 63, retired and collecting social security (DH's is SSD). We both have small pensions as well.

We have no debt whatsoever (house and cars are paid off and we have no credit card debt either).

We have a 6-month emergency fund in addition to the $60,000 settlement.

Here are some schools of thought

1) If your SS+pensions are enough for a comfortable living, then the 60k is extra and you can spend it

2) If your SS+pensions are enough for comfortable living, then you can take lots of risk with the 60k and try to grow it and spend even more later.

3) If the SS+pensions are NOT enough to live on, more analysis is needed

[disneysteve]

would you trust the competency of an employee of the bank that has my money? Or would you consult an outside financial planner for advice?

I would not trust the bank salesperson.
I would not consult an outside financial planner.

I would do it myself but that is just my personal preference. If I really felt I needed outside advice (beyond this board where I think you can get all the advice you really need), I'd go meet with a fee-only certified financial planner and get his/her opinion.

The salesperson is going to recommend high-cost, load funds with high expense ratios and high commissions for himself. Nobody should be investing in those.

[JoshuaHeckathorn]

Here's another idea. From what you've posted thus far, it doesn't sound like you really "need" this extra $60K. Do you have grandchildren yet? If so, you might want to think about setting up a 529 for them. College is already expensive, and it's only going to get worse. They'll need all the help they can get.

Anyway, you could easily setup a 529 online without the help of anyone. Of course, this may not apply to you at all, but I just thought I'd mention it as another option.

Bank salespeople make me want to vomit. At the branch level, they usually know about as much as the teller in the first place. Avoid them - you'll be better off.

[puck36]

What I would do is sit down with HSBC and see what they have. Then I would talk with someone else, outside of HSBC, and see what they say. Never do anything you don't understand or what someone said is best for you.

[whitewater30]

I wouldn't trust them. If you have unsecured debts, you should use the 60k to pay them off. I'd set aside at least 20K as an emergency fund. As far as the leftovers go, consult a CFP.

[PMMM]

I would not trust the bank salesperson.
I would not consult an outside financial planner.

I would do it myself but that is just my personal preference. If I really felt I needed outside advice (beyond this board where I think you can get all the advice you really need), I'd go meet with a fee-only certified financial planner and get his/her opinion.

The salesperson is going to recommend high-cost, load funds with high expense ratios and high commissions for himself. Nobody should be investing in those.

I fall into this category as well. I would educate yourself, sounds like you have the time, there are lots of resources in which to pull from. I would want to have control of my own destiny. The last thing you want to be is a victim.

IMHO

Regards,

PMMM