| Brought to you by The Oxford Club | |
| |
When to (and Not to) Use a Money Professional
 "A man's got to know his limitations." - Harry Callahan in Magnum Force
It can be difficult to know when you need the advice of a professional. Some people refuse to ask for assistance in any situation. Others hate to pay for it.
Take me, for instance. I am not handy. At all. The fact that I can change a tire makes me the handiest person in my family for the past three generations. And that's about the extent of my handiwork.
So when something needs repair in my house, I don't even try to pretend to make a go of it myself. It's worth it to me to pay someone to do it right the first time. Additionally, I work fairly long hours, so there is value in hiring someone if it means I get to go to my daughter's soccer game or concentrate on stock research.
For some of my friends, the idea of paying someone to do that kind of work goes against everything they stand for. And for them, a Saturday spent laying flooring is a good time.
Do-It-Yourself Investments?
Fixing my own plumbing scares the heck out of me, and for some investors, managing their own money strikes the same level of fear - or worse.
However, most investors can handle their finances themselves, potentially saving thousands of dollars per year in fees.
In my opinion, reading and implementing the ideas in Oxford Club Chief Investment Strategist Alexander Green's book The Gone Fishin' Portfolio, and investing in Perpetual Dividend Raisers (which you can read about in my book Get Rich With Dividends) can help you achieve your goals without paying an advisor.
If you don't do it yourself... prepare to pay for it.
Most advisors charge somewhere around 1% of your invested assets. So if you give an advisor $100,000, he will charge you $1,000 to manage the money. If the next year your account grows to $110,000, you'll pay $1,100.
Over time, that can add up to tens of thousands of dollars in fees.
For example, if you give a financial advisor $250,000 and he matches the market's return while charging you 1% of your assets, over 10 years you will have paid $40,516 in fees.
After 20 years, your advisor will have collected $125,989. That's money that you could have easily kept and invested had you handled your investments yourself.
However, for some investors, an advisor helps them sleep at night. If working with an advisor will relieve stress, then it could be worth the thousands of dollars per year you may pay. If you believe an advisor will achieve better results (net of fees) or manage your risk better than you can, it may be beneficial to work with one.
If you are going to work with an advisor, I suggest you make sure they are a certified financial planner (CFP). It shows the willingness on their part to further their education and adhere to certain standards.
Remember, a stock broker is just a salesperson who happens to sell financial services rather than widgets. That's why I would stick with a CFP.
And don't ever hand over your investments to someone who reaches you through a cold call. It's always best to use an advisor who has been referred to you by someone you trust.
But let's not stop there. Here are two more services where you may need to consider a professional.
Kept in the Dark: 99% of All USA Residents
Practically no one in America knows about this story. It involves two maverick scientists from England... a "miracle" material that sounds like it's from outer space... and a small Midwestern company about to render $357 billion in big-name electronics obsolete. If you get the scoop before the rest, you'll be well positioned to make a killing. Here's what your neighbors likely don't know. | |
Taxes and Insurance
Thanks to TurboTax, TaxACT, TaxSlayer and more, there are some very good software programs out there that enable you to do your taxes yourself. If your tax return is fairly simple, you can save some money by preparing your return yourself. Additionally, you may learn more about your financial situation, the tax code and how to save yourself even more money in the future.
However, if your taxes are complicated, I find that it's worth having a professional do it. The cost will be at least a few hundred dollars, but having a CPA handle it gives me added confidence that it will be done properly and that I'm maximizing my deductions while minimizing the amount I pay to Uncle Sam.
When it comes to insurance, it can be helpful to work with an agent, but, as with choosing a financial advisor, use someone you know or who has been referred to you.
If you know exactly what you are looking for, you probably don't need a professional. You can often find cheaper alternatives online through sites like Esurance. But call an insurance broker anyway to see if he or she can beat the quote you received online. It doesn't cost you anything to ask and you may get a better deal.
I purchased term life insurance online years ago and got a great deal. I've also bought auto and health insurance online. For more complex insurance products, it helps to have an expert walk you through it. If you're using an insurance professional to buy annuities or whole life insurance, be sure to have a clear understanding of how the agent gets paid and what the commissions are, so you can evaluate whether you're getting the best product for you or if it's best for the agent.
Whether to use financial professionals or not is a personal decision. Like any service business, there are costs involved. If you believe it's worth the costs to pay for the advice, be sure to do your homework on the person giving you that advice.
Here at Wealthy Retirement, the information is free, possibly helping you save thousands of dollars per year. Now, can someone return the favor and tell me how to lay flooring?
Good investing,
Marc
P.S. I hope you're coming with me to Cuba November 6-13, 2015. Our guide will be Adam Vaught, who Condé Nast Traveler magazine just named its Top Travel Specialist for Cuba. You'll have the chance to participate in an exclusive architectural tour through the Habana Vieja, one of the country's most charming areas... meet with a professor of economics from the University of Havana to learn about the country's privately owned businesses... enjoy cocktails in the private home of a local artist and curator as well as a private viewing of their gorgeous property and renowned collection of artwork... and much more. To learn more about the event, click here. Or to speak with someone directly and to register, please call Adam Vaught with Absolute Travel at 212.627.1950. You can also email him at avaught@absolutetravel.com.
$0.58 A GALLON GAS?
A little-known company has cracked the energy code...
 And it will soon be able to produce gasoline in America...
For $0.58 a gallon.
It's a breakthrough that seems like something straight out of science fiction. But it's real...
One Pulitzer Prize-winning reporter called this miracle of science "one of the most improbable and important American business stories of the past decade."
It's also a once-a-century development that could make first-in investors very rich.
Discover the incredible story here (before it becomes front-page news). | |
|
| |
This goes out to all those folks who think we have an unreasonable tax code or that the producers in this country get slammed harder than they should. Read On... | |
|
| |
Sometimes dividend cuts (or worse) happen. Occasionally, we as investors fail to heed the warning signs. We fall in love with a position and overlook its faults. Kenny Rogers has the right idea: "You got to know when to hold 'em; know when to fold 'em." Read On... | |
|
| |
One of the more popular master limited partnerships is Energy Transfer Partners. The stock pays a 7.1% yield. And it has an interesting track record. Read On... | |
|
| |
|
|
|
© 2015 The Oxford Club, LLC All Rights Reserved
No comments:
Post a Comment
Keep a civil tongue.