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-   -   financial advisor? (http://www.thefinanceforums.com/showthread.php?t=6434)

peter64 02-15-2012 08:51 PM

financial advisor?
 
My wife and I have 120k combined in our ira's. Our financial advisor has not advised us in 8 years. We just keep putting in $500 per month. Our money is with American Funds. We pay a sales charge of 3.5% on each deposit. The fund has an expense ratio of .64.
Questions:

Should we just tranfer to a Vanguard no load fund and drop the F.A.?

If we leave the exist. money with American Funds does the adviser make a % of our money even if we don't add any new funds?

Does the F.A. get paid a % of the sales charge or the expense ratio or both?

How does the fund take the expense charge. Is it taken out of the share price?

How much does the Financial Adviser make on our money?

SafeRetirement 02-24-2012 01:24 AM

Re: financial advisor?
 
Hello Peter, all good questions, what company does your Financial Advisor work for? I can say that yes, as long as you and your wife's monies are being held with that advisor he is making a certain % of your total portfolio value. He is also making a % on each monthly contribution you and your wife are making. Each situation is a little different, A shares, B shares, etc. Each companies fee's can vary as well. I'm concerned that he has not given you any advice in 8 years, you need someone who you can trust, someone who will stay in contact with you through the good and bad times and guide you through them.


-Matt

callivari1224 06-14-2012 04:44 AM

Re: financial advisor?
 
thanks for sharing

jamieron082 07-10-2012 03:16 AM

Re: financial advisor?
 
I am looking for financial advisor for investment in stock and bonds. any help here.

illus10n 10-12-2012 04:35 PM

Re: financial advisor?
 
I'm 32, had about 10K with advisor who put it in oppenheimer class b mutual funds. I'v was putting a monthly amount in there. These Oppehimer funds were horrible, when I looked them up there were 1 star funds, terrible performers and I'm thinking to myself why the heck is my money still sitting there???? I've had my own Stocktrade account and I do some stock trading on my own, i've done well making about 8K in 10yrs do this on my own, so I decided to cash out my Oppenheimer mutual funds this year and chose my own mutual funds through Scottrade, I was able to find funds that are 4/5 stars have been for quite a long time, they were no loads funds, with exp ratio's under 1% and no advisor getting a cut of my money.

I advise you either talk to the adviso to change your funds, bur really at the end of the day the advisor only makes money by using the funds he's affiliated with which may not be your best choice.

2bWed 11-01-2012 02:27 AM

Re: financial advisor?
 
I enjoyed reading this information, thank you

thesimplemoneyblog 11-05-2012 03:46 PM

Re: financial advisor?
 
You should consider looking up a financial planner that may help you, peter64. The Financial Planning Association (FPA) is a great resource. Most financial planners will work with your investment portfolio and manage it on an ongoing basis in a more active manner instead of keeping it on 'auto-pilot' like you have had it for eight years. Not all financial advisors are created equally. There are three primary revenue structures:

1) Fee-only: The only revenue the financial advisor generates is a very transparent flat, fee (whether hourly or based on a percentage of the assets that you have...i.e. 1% of $120,000).
2) Fee-based: This type of fee structure has characteristics of both fee-only (maybe they get a certain % of the portfolio each quarter/year) plus they may get some commissions. Certain products (particularly insurance) do not have a 'fee-only' structure, so just by nature of having insurance available (life, disability, etc.) may mean they cannot call themselves 'fee-only' advisors.
3) Commission-only: The only revenue the financial advisor generates is through selling products (mutual fund commissions, insurance commissions, etc.) to you specifically.

Without knowing the particular structure of how your advisor is setup, it is hard to know which camp the FA would fall into. It sounds to me like it is more of a commission based model where the FA is receiving some revenue each time you contribute and purchase a fund. Typically, the fee comes off of the top (the 3.5% would be reflected in a fewer number of shares purchased than it would otherwise purchase had there not been this fee). Therefore, it sounds like your $500 is only buying about $482 of investments each time you save.

One question to be sure to ask though when researching a financial planner is whether they have a fiduciary duty to you as the client.

EUPRAXIA 12-02-2012 08:13 PM

Re: financial advisor?
 
Quote:

Originally Posted by peter64 (Post 28281)
My wife and I have 120k combined in our ira's. Our financial advisor has not advised us in 8 years. We just keep putting in $500 per month. Our money is with American Funds. We pay a sales charge of 3.5% on each deposit. The fund has an expense ratio of .64.
Questions:

Should we just tranfer to a Vanguard no load fund and drop the F.A.?

If we leave the exist. money with American Funds does the adviser make a % of our money even if we don't add any new funds?

Does the F.A. get paid a % of the sales charge or the expense ratio or both?

How does the fund take the expense charge. Is it taken out of the share price?

How much does the Financial Adviser make on our money?

Maybe if people like peter64 would actually respond back to the excellent advice that people have tried to give him on this we would be more willing to keep posting advice for others on this particular forum.

thelastsubject 12-03-2012 02:37 PM

Re: financial advisor?
 
Quote:

Originally Posted by peter64 (Post 28281)
My wife and I have 120k combined in our ira's. Our financial advisor has not advised us in 8 years. We just keep putting in $500 per month. Our money is with American Funds. We pay a sales charge of 3.5% on each deposit. The fund has an expense ratio of .64.
Questions:

Should we just tranfer to a Vanguard no load fund and drop the F.A.?

If we leave the exist. money with American Funds does the adviser make a % of our money even if we don't add any new funds?

Does the F.A. get paid a % of the sales charge or the expense ratio or both?

How does the fund take the expense charge. Is it taken out of the share price?

How much does the Financial Adviser make on our money?



Ha! Front loaded funds are becoming as obsolete as Gordon Geckos business shirts. You should NOT be paying a front load of 3.5% on your contributions. Before we had the high number of no-load mutual fund families that we now have, front and back end loaded funds were the norm. Today, there are multiple no load funds performing at similar or better performance. This is the first change I would make if I were you. Get into a no load fund family.

The FA likeley makes a portion of the load. They do not get the 12b1 fees or expense ratios on the mutual funds. These fees go to the portfolio managers and his team of analysts and also to produce, track, and mail statements to investors.


This is not to say that Amerian Funds are bad. They are one of the biggest fund families in the nation. In fact, they offer a wide variety of no load funds that you have access to without having to change firms.


With only 120k the advisor is making next to nothing off your investments since its not worth his time. You would be best off going with a self-directed brokerage account.

simonclay111 02-12-2013 06:45 AM

Re: financial advisor?
 
Well, all these questions refer to a professional financial adviser and i think consulting a professional would be a better option rather than asking around. You can have better solution there. here is my recommendation if you are looking for an experienced adviser:micelifinancialpartners.com/financial_planning.php

clydefreeman 04-08-2013 05:06 AM

Re: financial advisor?
 
You can check it out here yoursouthernheritage[dot]com for more financial info. This website is a comprehensive wealth, retirement and estate planning firm that is committed to helping local retirees and pre-retirees plan for and work towards achieving their retirement goals.

dimpibhosle 04-27-2013 01:24 AM

Re: financial advisor?
 
ask this question to experts so contact to Contact Us - Ruchi Anand & Associates (RAAAS), Audit and Assurance, Tax Services, Risk Advisory, Consultants

JennyMorrow 04-07-2015 01:58 AM

Re: financial advisor?
 
A professional, qualified and well experienced individual or financial firm would be a better choice for the financial advisor. In UAE, I prefer my bank for all my financial and investment needs as they provide best service and suggestions on investments.

refted 05-04-2015 05:39 PM

Re: financial advisor?
 
Just use Vanguard Index funds- anything else is robbery!

Learn from others' mistakes.

Manishshah 05-12-2015 01:39 AM

Re: financial advisor?
 
its amazing Advise thanks For this


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