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My daughter keeps telling me repeatedly that I need a CFP...Certified Financial Planner. And to get a fee-based planner. I have spoken with a few, but basically didn't like any of their suggestions/advice...the same thing you are saying...their fees would benefit them far more than anything they earned for me. They also seem to push annuities, which I feel are just glorified insurance policies...but I could be wrong? My daughter is savvy and earned about $5K for me last year on the very little she did with some stocks I have. She also bought gold at around $800 for herself and has made money on that one. She seems to know what she is doing but won't do the same for me although she is the sole inheritor of whatever estate there is when I die and it is to her advantage to make what I have grow for the both of us. The last CFP I contacted said he didn't charge for meetings but made the money if I chose to follow his advice on investments. I don't know what I think about this.
1. What do the rest of you think about this last CFP? Should I tell him I really don't trust him at all...or any other, for that matter? I feel as if I don't know enough to be sure I'm not being the goat tied up to be slaughtered.
2. What ails my daughter?!!? She has always been extremely careful with money, particularly her own, which she will NOT discuss at all. She could have 15 cents or 15 million and you'd never know which. Learning what she paid for gold back whenever was something that "slipped" and I just happened to hear. To be fair, she has several small children and a horrifically time-consuming job (she "lives" in a spreadsheet) and any time she has is severely limited. She says she just doesn't have time to spend on my "stuff." She's right...but I desperately wish she'd FIND the time to at least participate in some way with whatever CFP I end up with. She would know in an instant if he was on the up and up with his advice.
2. How on earth does one decide on a CFP when there is deep-seated, innate distrust of anyone "fooling" with my money that was hard-earned and hard-come-by? I have cash, CDs (not well laddered because of the varying times they come due), a little in a bond fund, and the majority in stocks, the major one in a bank that zonked with the market but has since pretty well recovered, a substantial amount (low 6 figures) that needs to be rolled over into ??? before long (daughter says maybe Roth IRA since I don't need the money to live on right now but something has to be done with this money before long). Currently it all is in a major investment firm just sitting there.
I very much would like to hear the groups input on all this. I figure that somewhere along the way I may get some really good advice. No, I do NOT know what I'm doing in investing or in the market though I've tried to learn. It somehow just doesn't "stick" in my brain (stroke...luckily minor...some years back, but it played havoc with my memory and recall, particularly for this sort of thing). HELP. please. All advice and input will be very much appreciated.
I also read about the "best investing tool" and it sounds quite interesting and I forwarded the link on to Said Daughter...I'd be quite interested in how that was figured out originally and how to use it now for myself. Thanks!
I agree with the answers to your questions given by Grandpa49.
I would add the following to what he has said.
Although you have indicated that you do not need money from investments for current living expenses, you might want to think more specifically about the future and what you expect to need from your money. Will you want a steady, monthly income from your investments or do you want to use the money for special activities as money is available, such as travel or major purchases.
When you buy a mutual fund you are paying someone to manage your money; you also are doing so when you use a financial planner or full-service broker. The more you pay other people to manage your money, the more you have to earn with your money just to maintain your capital and stay ahead of inflation. If you decide to pay someone to manage your money, get very specific about the amount and manner of the charges, how charged and how much and how often. Fees can be annual or by transaction or both. They can be a percent of the transaction, a percent of the investment total, a percent of the profit, fixed amount, or any and all combinations.
Your daughter may be a bit overwhelmed by a general request for help with your savings. Grandpa49 indicates he would be concerned about the responsibility for someone else’s savings and I know that I would also. You might ask her a very specific question, such as “I am thinking of investing some money in either NAMEONE (perhaps an index fund), or in NAMETWO (a large, bluechip, dividend paying corporation for example), what do you think?” Helping you decide between two specific choices may be the kind of financial question she would be willing to answer. Or she might not answer the question but might pose questions that help you solve the problem and show the way to answering future questions.
You might take a small portion of your money and invest it yourself just to get the feel of the process. For example, if you have $100,000, then 10% or $10,000 would give be a very reasonable amount to invest in a fund or a company. There are discount brokers where you could invest that money by paying $20 or less. I invested through a discount broker years ago; there are a number of reputable ones readily available.
There are also a number of conservative ways to make an investment in stock while you are getting to learn the process, either through an index fund as Grandpa49 talked about or directly in a bluechip corporation (there are 30 quite diverse choices in the Dow Jones Industrial Average). An index fund based on the S&P 500 should cost you little in terms of fund management fees, as Grandpa49 indicated, and it would reflect the broad market. A bluechip corporation will also follow the market in general and it will usually pay a dividend so that you can have income if that is what you desire, getting back to my first point about your specific needs for he future.