What would you with $20K?

[eastbay]

[ QUOTE ]
East,

Mutual funds managers dont dispense personal financial advice, they just do a job managing a portfolio in accordance with the mutual fund's stated profile and objectives.

CFPs provide a more personal service that includes a considerable amount of advice about handling net worth through all stages of life. This advice includes aspects of estate planning, handling windfalls and inheritance, financial effects of life milestones (death of parents or spouse, marriage, divorce etc).


[/ QUOTE ]

You made a general statement: "Smart people rely on expert advice." I applied your generality to show that it isn't "as simple as that" in general. I don't need any "experts" to tell me that I should save my money, diversify, and invest to match my desired balance of risk and return, just as I don't need any "experts" to manage my investment portfolio in a mutual fund, when their value added is demonstrably nil.

I think the point here is that financial advice for the vast majority of people isn't rocket science. I have had many people tell me what their "financial advisors" have done for them and I tell them they could have come out ahead by buying a $30 personal finance book and reading it in a couple of evenings.

Smart people don't pay premiums for "expert advice" on subjects which aren't all that complicated.

eastbay

very true eastbay, financial advisors are for the dumb and lazy

[eastbay]

[ QUOTE ]
very true eastbay, financial advisors are for the dumb and lazy

[/ QUOTE ]

On the flip side, people like Suze Ormon seem to have made an entire (probably lucrative) career out of telling people to pay their highest interest loans first and to take advantage of their employer's 401k. So not to detract from Dan's idea too much... advisors may be for the stupid but that's a big market.

eastbay

[lastsamurai]

[ QUOTE ]
[ QUOTE ]
very true eastbay, financial advisors are for the dumb and lazy

[/ QUOTE ]

On the flip side, people like Suze Ormon seem to have made an entire (probably lucrative) career out of telling people to pay their highest interest loans first and to take advantage of their employer's 401k. So not to detract from Dan's idea too much... advisors may be for the stupid but that's a big market.

eastbay

[/ QUOTE ]

I have to disagree with you. I know there are a few bright people on this site but one broker cant follow all 50,000 different mutual funds and stocks out there...if you work with a broker atleast you get a second opinion. Most of the Big ticket clients have 5-6 brokers nation wide...its their form of diversification... Do you think a doctor or a lawyer has the time to sit in front of his computer and analyze stocks all day? If your broker/cfp has a good track record why try to reinvent the wheel...look what happened to those investors who thought they didnt need a broker...opened up an account with etrade in 1999...saw JDSU triple in 3 months only to see it go below 10. If you have the discipline to screen your stocks and pick winners..more power to you...

[eastbay]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
very true eastbay, financial advisors are for the dumb and lazy

[/ QUOTE ]

On the flip side, people like Suze Ormon seem to have made an entire (probably lucrative) career out of telling people to pay their highest interest loans first and to take advantage of their employer's 401k. So not to detract from Dan's idea too much... advisors may be for the stupid but that's a big market.

eastbay

[/ QUOTE ]

I have to disagree with you. I know there are a few bright people on this site but one broker cant follow all 50,000 different mutual funds and stocks out there...if you work with a broker atleast you get a second opinion. Most of the Big ticket clients have 5-6 brokers nation wide...its their form of diversification... Do you think a doctor or a lawyer has the time to sit in front of his computer and analyze stocks all day? If your broker/cfp has a good track record why try to reinvent the wheel...look what happened to those investors who thought they didnt need a broker...opened up an account with etrade in 1999...saw JDSU triple in 3 months only to see it go below 10. If you have the discipline to screen your stocks and pick winners..more power to you...

[/ QUOTE ]

I thought the one thing we could agree upon was that

1) you don't have to "pick winners"
2) the people who supposedly can, can't. c.f. the already discussed mutual fund "expert advice" theory.

and if you say "Warren Buffett can", fine, buy Berkshire Hathaway.

eastbay