Financial Advisor; Blood-Sucking Yuppies or Worth their Weight in Gold? - Contractor Talk - Professional Construction and Remodeling Forum

**Ed the Roofer** · 02-23-2007, 09:33 PM

Since the other thread about excess cash reserves was so well reponded to, I was wondering the other member thoughts about hiring one and what their qualifying factors for selecting a personal financial advisor would be?

I will always rely on one thing I learned along time ago. Buy land Eddie, they aren't making any more of it!!! Advice from a very wise Uncle who was a farmer most of his adult life.

Ed

ultimatetouch · 02-23-2007, 11:16 PM

Quote:

Originally Posted by Ed the Roofer

Since the other thread about excess cash reserves was so well reponded to, I was wondering the other member thoughts about hiring one and what their qualifying factors for selecting a personal financial advisor would be?

I will always rely on one thing I learned along time ago. Buy land Eddie, they aren't making any more of it!!! Advice from a very wise Uncle who was a farmer most of his adult life.

Ed

Ed I have been tossing and turning over this one for a while. I opt for most of them being blood suckers milking the **** out of you. Unless you make enough money or have a large chunk of saving and I mean like 400,000 and up. The worst thing you could do is nothing at all. I am debating on doing a managed fund by fidelity or schab and have automatic withdrawls for 25% of my pay check. At the end of the year I want to invest a predetermined amount of money in a college fund for kids college coming out of my bonus and trying to max my sep account. I WILL FOCUS THIS YEAR AND DOUBLE MY INCOME so I could invest in realestate as well.

**Ed the Roofer** · 02-23-2007, 11:29 PM

Personally, I used the advice from my accountant for my IRA account. After multiple years of it being in decline, the fund finally is showing a profit. I didn't want to pull out and change, since I will not need the cash for another 20 + years.

I don't believe in retirement. I view my company ownership as a business that gives me a release for pursuing my interests.

My younger brother was talking to me 2 weeks ago, about his SEP plan he has for his political consulting and marketing firm. His value is 75 % higher than mine, with about 10 years less worth of investing, but he does contribute a greater amount than I do with my IRA's.

Other than that, I have owned my own commercial property for about 20 years and own a 2 unit apartment buillding which nearly pays for my mortgage on my new home.

But, I digress!

I have interviewed several consultant, but I have not justified the % out of pocket and do not know the correct way to qualify their experience and talent level, so I have shied away from this venture.

Alternate topic! What money market funds do members hold in high esteem?

Ed

Grumpy · 02-24-2007, 03:18 PM

If they are earning you more money (interest) on your existing money (pricipal investment) I think they are worth their weight in gold. However like anything you will find professionals and find hacks. The way I look at it, if the financial advisors are charging you a percentage of the profits they earn for you.. You've nothign to lose except your principal investment.

Hey Eddie, they do make more land, just not much of it. Manhattan is man made land, and some of the most valuable land int he world. Goose Island on the Chicago river was man made (I saw it on channel 11 a few weeks ago). The Chicago lake shore has all been re-eingineered by man. In Bahai (India) they made these islands from sand they vacuumed from the ocean floor. All the islands are shaped like things such as palm trees and other spectacular geometric shapes and the homes are all starting in the millions.

Perhaps we should all be investing in land creation rather than buying existing land? That's not financial advice. Just thinking aloud.

**Ed the Roofer** · 02-24-2007, 04:59 PM

Well Grumpy, at least I see you read through my posts carefully.

Eddie

gt4674b · 02-27-2007, 07:31 PM

Ed,

When it comes to investing, you are right, it is hard to gauge the experience / success level of any advisor. Even if they have been successful, past performance is no guarantee of future returns. This is why I take the approach to investing that I am happy to be "average". If I can mimic the return of the market over the long term, that's just fine with me. Actively managed funds typically come with increased fees. Long term financial studies have shown that actively managed funds,as a whole, have actually underperformed the market when taking into account their increased fees. It is this revalation that has allowed John Bogle, the founder of Vanguard to create the mutual fund behemoth that exists today. He is well known for having some of the lowest fees in the industry and is a big proponent of index funds.

Instead of a financial advisor, I would at least visit Vanguard's web site and see what they have to offer. They have a section on the site about advice. Basically, it looks like providing basic financial plans to the average investor with more serious advice for those with net worths of $500k plus. I haven't used any of these services personally (other than investing my 401k into index funds) but long term investing is not all that complicated. The only reason it does seem so is because there are so many competing products out there that really are just marketing tools. If you strip out all the BS you will see a simple diversified investment with low fees makes sense for all but the most sophisticated investors. Personally, I would rather spend my time growing my business than trying to "out invest" Wall Street (which is full of very smart people always trying to out invest one another).

Disclaimer: As with all investment advice found on the internet, please take all my comments with a grain of salt and investigate for yourself and see what works best for you.

PressurePros · 02-27-2007, 07:48 PM

Check their personal credit history.

POOLMANinCT · 02-27-2007, 08:12 PM

i follow my money managers advice, well i always go along w/ his suggestions...

he is not a broker or a salesman,, if you know what a money manager is, he must be good b/c im only 33

dirt diggler · 02-27-2007, 08:22 PM

i think it comes down to that YOU possess knowledge of whatever it is you're going to invest in.

In other words - proceed with something if your advisor provides advice that you understand and can, in practice, follow through with.

Don't just say "oh ok" without actually knowing what they're talking about

I have THIS attitude only after talking with one

(at a party)

before - i was totally against them and considered it black magic

**Ed the Roofer** · 02-27-2007, 08:37 PM

Funny you mention Vanguard, Mr.R2D2-C3PO, gt4674b, whatever kind of name that is.

Over the years, if I were to have done something with one of those funds, it would have been that one or Scudder. I have not checked into either ones performance recently, but they always seemed to offer a safe yet increasing value from period to period.

How about additional suggestions on funds from the investors out there. I do not like high risk, personally, but would like a better return than a money market, even though it would not be guaranteed.

Ed