Looking for a Financial Adviser

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“Dear PoPville,

My husband and I have been searching for a financial adviser in the DC/MD/VA area and I’m struggling to find someone. On a lot of sites I’m looking at they say they START working with people who have a portfolio of $250k or $500. We definitely don’t have that, and are looking for someone who can help us get our affairs in order (mortgage, student loans, taxes, etc) and help us start investing in things other than small plate brunches. Any recommendations?”

46 Comment

  • My husband, Daniel Jossen, CFP, is a fee-based financial advisor @ Mindful Wealth Partners. I’m obviously biased, but I think he’s a rare bird in a field of folks that don’t always have their clients’ best interests in mind. His approach is holistic planning – he’s licensed for insurance and investments (vendor and product neutral).

    [email protected] or 202.657.3330

  • I will be in the market for a financial adviser tomorrow morning. specifically someone who knows what to do with roughly $1bn.

  • I know this might be sensitive, but could you ask a mathy-type friend or family member to help? I always wonder why people that don’t have overly complex financial situations pay for a financial advisor when what they really need is a solid weekend to organize their finances and create a budget, There are also some great websites that can be quite helpful — mint.com is my favorite.

    Pay off your most expensive debt first; keep a 6 month cash reserve in the bank; and only spend as much as you can afford – those are my golden rules. As for investing any savings, your best bet is probably to invest in a low fee index fund (which are mutual funds that track the market), I like Charles Schwab or Fidelity for that.

    • I generally agree with the advice here. I think Fidelity is a decent firm, but I would recommend Vanguard as they typically have the lowest fees. I recommend books by Jack Bogle and his follows (AKA “Bogleheads”). They have a forum (google “bogleheads”) that contains loads of free information and recommended reading.

      • If you do hire a financial adviser, you should be sure to know what services you’re paying for, how much those services cost, and how the planner gets paid. They can charge in different ways. Some charge a fixed fee or an hourly fee, but don’t sell investment products. Others are paid by commissions on the products they sell. Some also use a combination of fees and commissions.

      • Sorry. John* Bogle.

      • Hadnt heard of Jack Bogle – will check him out. I love reading about personal finance stuff.

      • I agree about Bogleheads – very informative. One caveat – most of the frequent posters are hard core budgeters and savers, and it’s easy to disheartened. In a recent thread that asked for savings goals for 2016, the vast majority claimed to intend to save over 30% of their gross income, and many were over 50%. It’s easy to feel like a complete slacker when reading that, even if, by any rational definition, you are a good saver/planner. Just take those posts for what they are, listen to the advice, tweak where appropriate, and there’s a ton of good information to be had.

        • That’s a good point. Generally, those on the Boglehead forum have higher incomes, lived below their means for a long period, and saved most of the steady increases in salary/income instead of increasing his/her lifestyle, which all help contribute to that high percentage. The same caveat you noted applies to the Mr. Money Mustache website referenced below (perhaps to an even higher degree).

          • The MMM website is, in my opinion, over the top. If it appeals to you, great, but I have no desire to live like a monk so I can retire at 40 and continue to live like a retired monk for the next 40 years.
            .
            I think many Bogleheads also live in low cost of living areas. I’m not frugal, but I’m no spendthrift, and it’d be incredibly difficult for me to save 50% of my income. Never mind the 75% some claims to save.

          • Two close boyhood friends grow up and go their separate ways. One becomes a humble monk, the other a rich and powerful minister to the king.

            Years later they meet. As they catch up, the minister (in his fine robes) takes pity on the thin, shabby monk. Seeking to help, he says:
            “You know, if you could learn to cater to the king you wouldn’t have to live on rice and beans.”

            To which the monk replies: “If you could learn to live on rice and beans you wouldn’t have to cater to the king.”

    • You are correct – and the general advice you share is sound. That said, you leave out an important reality – conversations and decisions about money are anxiety producing for many people. Financial planning has everything to do with current needs, future plans, etc. and many people need a trusted advisor to have those conversations, be supported in their goals and held accountable.

    • +1. It doesn’t sound like they have enough liquid to afford an adviser that takes a cut of the profits. They will have to pay someone per hour to hold their hand. Bad idea. Anyone you let in the door is going to convince you that you can’t do this alone and constantly need paid professional help. For non-millionaires this is all just a frivolous cost. If you insist on paying someone, find someone that will teach you how to budget and organize your financial life on your own. I haven’t looked, but there must be some product to help you learn how to conquer these basics on your own.
      .
      My only additions to the above golden rules–get life insurance/disability insurance, don’t get divorced.

      • yes to the life insurance (term!)/disability, but the divorce thing I cant get behind because while they can be financially injurious, they can be personally quite liberating!

    • Yes! My advisor gets paid a percentage (small) based on how well my portfolio does – I do well he does well. No minimum portfolio to start last time I checked. My advisor also talked to me about things like insurance, a will, etc that he does not get paid for and I don’t get pushed toward a certain company.

  • I use Heidi Patterson, with Ameriprise. She was a recommendation from a coworker, and I’m very happy with her work.

    She’s got offices in MD, VA and DC. She’s great at managing your (and your husband’s) entire portfolio and doesn’t push transferring your funds into new accounts under Ameriprise.
    http://www.ameripriseadvisors.com/heidi.m.patterson/

    • Ameriprise is not a good option. If talking to friends/family who know what they’re doing isn’t an option, then try spending a few hours researching online before you hand your money over to someone who may be incentivized to put it in funds with high fees and/or loads.

  • Just invest in a Vanguard market fund and save on fees.

    • Vanguard index and target funds are pretty much unbeatable. Many have “Admiral” class versions ($10k initial investment, available in retirement and non-retirement flavors) that carry fees as low as .05%. Ridiculously awesome for the part of your portfolio you don’t want to think about too often.

  • Please don’t waste your hard-earned money on a financial adviser. Study after study has shown they do no better for you in the long term than you could do on your own. Especially if you don’t have a large fortune, managing your money is quite simple, and giving some of it away for no good reason is a poor financial decision. Follow the directions on this index card:

    http://dollarbits.com/can-all-the-investing-advice-youll-ever-need-fit-on-one-index-card/

    and you’ll be fine.

    • A good financial advisor will do more than just invest your money for you, but also help you set goals, budget, assist in determining appropriate investment vehicles, limiting tax liabilities, monitor progress over time, etc. Key word is “good.”

      Since I’m assuming folks on this site run younger, I’d recommend someone who is part of the XY Planning Network, which specializes in financial planning for Gen X and Y. http://www.xyplanningnetwork.com/consumer/find-advisor/

  • Mr. Money Mustache – http://www.mrmoneymustache.com/ – My wife and I are following his plan and will be retiring in exactly 4.5 years at the age of 35. All other financial advice is total BS. Especially financial advisors.

    • +1.
      go on the forums and search for case studies. If you feel comfortable sharing the same level of detail (with no personal identifiers, of course), then start your own case study. Very helpful and educated people will trip over themselves to offer you free financial advice. But it all boils down to this:
      1. Live beneath your means
      2. Pay off debt
      3. Invest in Index Funds with the lowest fees. A well-balanced portfolio can include just 3 funds: 1)VTSAX, 2)VBMFX, and 3)VWIGX.
      Bam. Done.
      Here’s an example:
      http://forum.mrmoneymustache.com/ask-a-mustachian/case-study-how-can-i-get-to-fire-more-quickly

      • This is really good, but if you can afford it, go for the lowest cost Admiral’s class equivalents. VBMFX has a .20% fee while VBTLX is .07%. VWIGX is at .47% while VWILX is .34%. They’re all but identical funds if you can afford the $10k entry fee.

  • Good luck. they’re basically salespeople and may try to get you into things that may not be the best use of your money. if you don’t have much in the way of savings, beyond refinancing options for your debt, the main thing is finding ways to save, even small ones, esp. if you don’t have a pension plan or 401k-type thing at work.

  • I have been VERY happy with Jeremy Pearce, who practices Socially Responsible Investing here in DC. Many socially responsible public companies and mutual funds perform just as well as ‘traditional’ investments, AND you can feel good about where your money is going. SRI investors also encourage divestment from companies who’s values don’t align with yours. (Assuming you are politically progressive).
    Jeremy also takes on ALL types of clients, and can tailor his services to your needs and financial capabilities at the moment.
    Here is his email: [email protected]

  • kiki

    Check out Learnvest.com. You hook up all your accounts, and then for a one-time $300 down, then $20/month fee, you get someone who able to help you set up a budget, suggestions on investments, estate planning, etc. It’s cheaper than most financial advisors, because it’s online, eliminating the face to face overhead costs. Fast Company and Wired have both recommended it.

  • You should use a financial adviser that you pay by the hour–see below. Never use an adviser who stands to gain from how you invest your money. Then invest with Vanguard–see further below–based on the advice provided.

  • deep bear market has begun. get out of stocks and bonds completely and put your money in 30 year treasuries (ticker symbol: TLT). start buying equities again after the s&p drops below 600. there ya go!

    • Prince Of Petworth

      Bullshit – buy anacot steel!!

    • I hope this is mostly jest. If not, why buy after the S&P loses 600? Why not wait until it tanks 700? 900? Because nobody has a crystal ball to know when the market bottoms out. Despite all the hype, nobody knows what is going to happen. Most people just need to have an asset allocation that adequately accounts for their goals and risk tolerance, invest in diversified low-cost index funds, utilize dollar-cost averaging, and play it long (adjusting asset allocation accordingly). Spoiler alert: over the course of 30-40 years the market will go down some years, but historically it has been net positive for periods that long.

  • Does anyone have experience with either Connemara fee only planning (https://www.connemara.com/) or Main Street Financial Planning? (http://www.mainstreetplanning.com/)

  • Just go to http://www.mrmoneymustache.com. He’ll whip you into shape. Build up your frugality muscles.

  • People seem to have a misconception about what a financial advisor does. It’s a lot more than simply telling you which funds to invest in. If that’s all you want then yes, follow advice and invest in a diversified low fee portfolio.

    However, what if that’s the not the best place? There are a dizzying number of insurance products on the market that might be a better option for some investments. Also, what about basic insurance coverage (life, home, auto, personal liability, income)? Are your coverages sufficient? Do you have a will?

    And on and on. A good advisor does WAY more than simply invest in funds. It’s your entire life! Just make sure he/she is a fidicuiary. That way they are legally bound to only steer you into products that are in your best interest, no theirs.

  • Jack Newman with Momentus Advisors

  • If you *really* want some advice, I agree with others that you should find a flat-fee advisor and be brutally honest that you just want a one-time session to discuss your situation and what you’re eligible for/need/what dumb things you’re doing (for example, are you eligible for a Roth? Would making some simple changes reduce your taxes? Do you have enough insurance if one of you became disabled/died? Are you invested in a high-cost fund right now? … Don’t be insulted by “dumb things”…we all do them from time to time, sometimes without knowing it!).
    .
    For taxes, if you’re concerned you’re missing out on something, hire someone to do them for one year and see how they compare to what you’ve done so far. And I REALLY don’t mean H&R Block. Find an Enrolled Agent with a good rep. I use E Tax Services in Alexandria. My returns are far too complicated and time consuming for me to even consider doing them myself, but it sounds like you could do yours on your own going forward by just seeing how someone else handles them and having a good discussion about your situation/tax planning (also, that’s an additional plug for E Tax Services…if he can handle my insanity competently, he can handle your basics with ease!). Given what you’ve said about your tax situation (basic things like mortgage and student loans), this will probably set you back $200-300 (*maybe* a smidge less if that’s really all you have going on tax-wise), but you’ll probably only have to pay that once unless you plan to get into some fancier investing. If you’re going to start investing OUTSIDE OF A ROTH OR WORK PLAN (more on that below), you might want to wait until next year to have a pro do your taxes so that you can see how those are handled.
    .
    I also agree with so many others that no-load, low-cost index and mutual funds should be your target, right now, given what you’ve said. If you can do that within a Roth, even better (here are the income and contribution limits for a Roth: http://www.rothira.com/2016-roth-ira-limits-announced). Remember, you can always take your *contributions* out of a Roth, IN AN EMERGENCY (and only in an emergency…no, that’s not a law, but it’s a good RULE), so (while a substantial, liquid, and safe emergency fund is a MUST HAVE…PLEASE put it in a high-yield online savings account), don’t avoid investing in one now because you might need a larger emergency fund in the future (bigger/more expensive house, kids, etc.). You can start investing with Vanguard (like so many others, I recommend Vanguard…my Roth and some other investments are with them) with only $1500 buy-in. Once you’re in, you can make regular contributions in any amount (I’m sure there’s a minimum, but it’s low…I max out my Roth with bi-weekly contributions, so I toss a little over $200 in there every 2 weeks, and that’s not a problem).
    .
    Finally, while I agree that some of the personal finance sites recommended are good reading, please take all these people saying they save 40, 50, 75% of their income with a grain of salt. I’m sure some do. I’m sure, for some of them, their circumstances aren’t like yours and mine (I have a coworker who lives rent- and utility-free in a condo his parents own and saves 40% of his income…well CONGRATULATIONS, I’D SAVE THAT MUCH, TOO, IF I HAD NO HOUSING EXPENSES!). I’m also sure some of them are lying. If you’re saving 10%, you’re doing well! 15%, you’re doing great! More…well, you go on with your bad self! Me, I’m a smidge above 20%. I worked hard to get to that number. I refuse to deny myself to save more, in the absence of making more (working on that!).

  • 1) Familiarize yourself with Mr. Money Mustache http://www.mrmoneymustache.com/ Despite the funny name, it will change your life.

    2) If you still decide you need a financial adviser, make sure they are legally bound to act in your financial interest (ie. they are a fiduciary). This is really important. You will be surprised to find that most are not and are in fact serving their firm or themselves first by collecting commission from the sale of investment products. (See a sampling of other questions to ask him or her here http://www.forbes.com/sites/janetnovack/2013/09/20/6-pointed-questions-to-ask-before-hiring-a-financial-advisor/#2715e4857a0b6cdff892614e)

    3) Know that if you use an investment platform other than Vanguard or Betterment you will almost certainly be throwing money away through higher than necessary fees. And even the smallest percentage adds up really quickly.

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