SD Jarhead Posted October 10, 2008 Posted October 10, 2008 I'd have bought a rainbow-farting unicorn. The value of those can only go up! Where can I buy one? Do they take silver?
Chef Jim Posted October 10, 2008 Posted October 10, 2008 Get yourself into low cost index funds with companies such as Vanguard or Fidelity. And never ever beat the index again.
BillsFanNC Posted October 10, 2008 Posted October 10, 2008 And never ever beat the index again. Or you could invest in high cost load funds and "beat" the index before all the extra fees wipe out any advantage.
Chef Jim Posted October 10, 2008 Posted October 10, 2008 Or you could invest in high cost load funds and "beat" the index before all the extra fees wipe out any advantage. No, beat the index including all those "high" costs. And go ahead and call Vanguard for some advice on your "plan". Did your Vanguard "adviser" look at your tax return, estate plan, life insurance etc, etc? Yeah, I didn't think so. By the way, what's your adviser's name? 1-800-VANGUARD? You get what you pay for in life.
erynthered Posted October 10, 2008 Posted October 10, 2008 No, beat the index including all those "high" costs. And go ahead and call Vanguard for some advice on your "plan". Did your Vanguard "adviser" look at your tax return, estate plan, life insurance etc, etc? Yeah, I didn't think so. By the way, what's your adviser's name? 1-800-VANGUARD? You get what you pay for in life. See that's why some advisers dont have "Attitude & Confidence". You took it all.
BillsFanNC Posted October 10, 2008 Posted October 10, 2008 No, beat the index including all those "high" costs. And go ahead and call Vanguard for some advice on your "plan". Did your Vanguard "adviser" look at your tax return, estate plan, life insurance etc, etc? Yeah, I didn't think so. By the way, what's your adviser's name? 1-800-VANGUARD? You get what you pay for in life. Exactly. I'm my own financial adviser so I never felt the need to call Vanguard for advice. My accountant and attorney have advised me on tax and estate planning, but thanks for your concern. Most people feel more comfortable hiring an adviser and that's fine. I see no problem with people going to a reputable fee only financial planner if they don't have the time or confidence to do it on their own. But it ain't rocket science so there is no reason most people can't do it on their own.
Chef Jim Posted October 10, 2008 Posted October 10, 2008 Exactly. I'm my own financial adviser so I never felt the need to call Vanguard for advice. My accountant and attorney have advised me on tax and estate planning, but thanks for your concern. Most people feel more comfortable hiring an adviser and that's fine. I see no problem with people going to a reputable fee only financial planner if they don't have the time or confidence to do it on their own. But it ain't rocket science so there is no reason most people can't do it on their own. If it "ain't rocket science" than why does almost every affluent person in the country work with a competent financial adviser? But you're right basic investing is relatively pretty easy but it's also emotional and advisers take the emotion out of it. Emotional investing is when people make mistakes.
DC Tom Posted October 10, 2008 Posted October 10, 2008 If it "ain't rocket science" than why does almost every affluent person in the country work with a competent financial adviser? Time.
Chef Jim Posted October 10, 2008 Posted October 10, 2008 Time. That and the lack of knowledge of advanced planning ideas.
DC Tom Posted October 10, 2008 Posted October 10, 2008 That and the lack of knowledge of advanced planning ideas. I never found it too hard to get the knowledge. But it takes time. Then again...I aced the Series 7 after a week's study, so maybe my viewpoint on the difficulty of it is a little skewed.
Chef Jim Posted October 10, 2008 Posted October 10, 2008 I never found it too hard to get the knowledge. But it takes time. Then again...I aced the Series 7 after a week's study, so maybe my viewpoint on the difficulty of it is a little skewed. These are not really series 7 issues or how smart you are. It's knowing the details of tax law, advanced estate planning and wealth transferance. Knowing things like NUA, turning highly appreciated assets (remember those) in a 401k from ordinary income to long term cap gains. Utilizing insurance policies to put money aside for retirement and having those premiums a tax deduction to your company and access the cash tax free during retirement. There are a lot of things out there that many people, even "good" advisers don't know about.
StupidNation Posted October 10, 2008 Posted October 10, 2008 Actually the biggest fraud perpetrated right now is contingency attorneys. I can't think of a bigger scam ever. They know it's cheaper to settle even if you are right if the injury isn't big enough to fight. They make up whatever and you choose to fight it or settle. With law schools ballooning yearly in enrollment there will be more people getting sued than ever before. 30% of every American will be sued, that number will go up to 40-50% in the next 20 years. In most countries contingency attorneys are illegal for that reason. Sorry to hear about your losses. If you want a investment it's real-estate. You can still get a cash on cap return at 10-15% all day long everyday if you do it right. Great investment, best there is bar none. The real estate market is "crashing" in the big cities of appreciation, but the cap rates on multi-families in the Buffalo area are 20% and higher yearly with no appreciation, but you can do fantastic in states like TX, LA, and Missouri.
ExiledInIllinois Posted October 10, 2008 Posted October 10, 2008 If it "ain't rocket science" than why does almost every affluent person in the country work with a competent financial adviser? But you're right basic investing is relatively pretty easy but it's also emotional and advisers take the emotion out of it. Emotional investing is when people make mistakes. True. Mostly because they have other things to do than watch their accounts 24/7/365 (blue). Saves the worry and the headaches if you can't be diligent, no? IMO, advice is important... But, one can find that out for free. Kinda like selling a home... If you don't have the time an energy, every penny if worth sinking into a agent that can do it for you.
meazza Posted October 10, 2008 Posted October 10, 2008 These are not really series 7 issues or how smart you are. It's knowing the details of tax law, advanced estate planning and wealth transferance. Knowing things like NUA, turning highly appreciated assets (remember those) in a 401k from ordinary income to long term cap gains. Utilizing insurance policies to put money aside for retirement and having those premiums a tax deduction to your company and access the cash tax free during retirement. There are a lot of things out there that many people, even "good" advisers don't know about. IA's are salesman. Just like real-estate agents, they don't know the ins' & outs, they deal a lot more with just getting a lot of clients through cold-calling. Of course this is a generalization as I originally wanted to be an IA but realized I'm not good a good salesman. I know quite a few affluent people who don't have a rep and rather do their trading through discount trading sites. It doesn't mean that you fall in this category, as I think there is an exception to every rule.
Chef Jim Posted October 10, 2008 Posted October 10, 2008 IA's are salesman. Just like real-estate agents, they don't know the ins' & outs, they deal a lot more with just getting a lot of clients through cold-calling. Of course this is a generalization as I originally wanted to be an IA but realized I'm not good a good salesman. I know quite a few affluent people who don't have a rep and rather do their trading through discount trading sites. It doesn't mean that you fall in this category, as I think there is an exception to every rule. You don't need to be a salesman to be a good IA. I never sold a thing in my life and I rose to the top of my firm here pretty quickly because I'm compassionate about helping people. I think being a chef helped me in that regard. I spent 25 years in a career that my sole goal was to make people happy. To have them tell me how much they loved to have me cook for them was a great thrill. Now to help people achieve their financial goals, to have them invite me to their house warming party because I helped them save for the house. Invite me to their kids graduation because I helped them save to get into that school they wanted. To have them thank me with tears in their eyes when I told them that they could in fact retire and make more money in retirement than they were making while working. I know that sounds !@#$ing melodramatic but it's true. And that's what pisses me off about those idiots from Wall Street that I get lumped in with.
meazza Posted October 10, 2008 Posted October 10, 2008 You don't need to be a salesman to be a good IA. I never sold a thing in my life and I rose to the top of my firm here pretty quickly because I'm compassionate about helping people. I think being a chef helped me in that regard. I spent 25 years in a career that my sole goal was to make people happy. To have them tell me how much they loved to have me cook for them was a great thrill. Now to help people achieve their financial goals, to have them invite me to their house warming party because I helped them save for the house. Invite me to their kids graduation because I helped them save to get into that school they wanted. To have them thank me with tears in their eyes when I told them that they could in fact retire and make more money in retirement than they were making while working. I know that sounds !@#$ing melodramatic but it's true. And that's what pisses me off about those idiots from Wall Street that I get lumped in with. Well that's much different than the IA's I deal with. Remember, I work in a back office, all I deal with is IA's and institutional traders. I don't like dealing with IA's because they don't understand anything. I once got a question from an IA, "could you let me know when this bond is going to make it's first interest payment?" The only thing was it's a zero coupon bond which they should know because they bought it for their client. Instead, dealing institutional clients is much more interesting. Their concerns are more along the line of, "hey my P&L is all out of whack and I think it's because of what you did."
RLflutie7 Posted October 11, 2008 Posted October 11, 2008 Over my life, I have put money into IRAs. (Thankfully not too much.) I was always lucky enough to invest just as the market tanked. Each time, I used a financial adviser who earned money off me by providing "expert" financial advice and direction that I couldn't get on my own. Here is the nutshell of my advice from these "experts". Day 1: ME: Boy, the market really took a dump today. What should we do? ADVISOR: Best thing to do is stay put. The market always bounces back. A week later: ME: The market's in a tail spin. I've lost 30% of my retirement. Shouldn't we park my money in a money market account until things stabilize? ADVISOR: Worst thing you can do. You'll miss the rally. Trust me, the market is getting ready to do a 180. A month later: ME: My retirement money is mostly gone, !@#$. I thought you were supposed to watch out for my money? ADVISOR: Hey, no one saw this coming. Once-in-a-lifetime event. We were all caught by surprise. But if I were you I'd stay right where you are. ME: Let me ask you something. If staying in the market is so good, what is causing the market to lose 700 points a day? ADVISOR: That's all the money guys pulling their assets out before the whole thing $h!ts the bed. PTR \ Ticket scalpers always sell before a market is starting to tank. I was a ticket scalper and I seem to be able to call it better. I find that people who listen to others always do worse than they normally would. Take control yourself. I've never had money in the stock market, but I did tell my parents to dump all their mutual funds and they did it before the bailout was passed. I know I just contradicted myself, but my mom wanted to get out and I told her to do it. You could just feel that the market was going to tank even if the bailout passed. No one was for it. That means get out. I think it's going to 5,000. The bad news has to stop before we have a prolonged rally and that's not going to happen soon. We may be in real trouble. I hope not.
Chef Jim Posted October 11, 2008 Posted October 11, 2008 Well that's much different than the IA's I deal with. Remember, I work in a back office, all I deal with is IA's and institutional traders. I don't like dealing with IA's because they don't understand anything. I once got a question from an IA, "could you let me know when this bond is going to make it's first interest payment?" The only thing was it's a zero coupon bond which they should know because they bought it for their client. Instead, dealing institutional clients is much more interesting. Their concerns are more along the line of, "hey my P&L is all out of whack and I think it's because of what you did." Hey there are stupid people in all industries. Let me ask you a question. Without looking it up, how are zeros taxed and what are the advantages and the disadvantages to zeros?
meazza Posted October 11, 2008 Posted October 11, 2008 Hey there are stupid people in all industries. Let me ask you a question. Without looking it up, how are zeros taxed and what are the advantages and the disadvantages to zeros? In terms of tax I don't know but we live in different countries so I think the answers would be different anyways. - The only one that comes to mind is the tax advantages of muni's but besides that, I don't know. The advantages? I'd say the fact that you know what you'll get in return at maturity (even though reinvestment risk and inflation risk are still present). Disadvantages - Can be very volatile, no coupons means no cash flow until maturity.
Chef Jim Posted October 11, 2008 Posted October 11, 2008 In terms of tax I don't know but we live in different countries so I think the answers would be different anyways. - The only one that comes to mind is the tax advantages of muni's but besides that, I don't know. The advantages? I'd say the fact that you know what you'll get in return at maturity (even though reinvestment risk and inflation risk are still present). Disadvantages - Can be very volatile, no coupons means no cash flow until maturity. Good job on the advantages, move up in class but not to the front. Even though Zeros pay no semi-annual interest (issued at a discount, and mature at full face) they are taxed as if they were. That is the main disadvantage to them. So if you have a large sum of money in zeros you could pay taxes on the annual income that you have not yet received. However at maturity no tax is due because the full value has become basis due to paying the taxes as you went. See, I'm not your typical IA
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