The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: FIRE47 on May 17, 2018, 02:13:51 PM
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Is there any value to this? Does anyone here do so? Am I possibly missing something and am blissfully unaware?
My DW feels we need an outside perspective now that we have reached a certain point financially - but on what? I have guided us safely to this point so I don't see why anything has changed now that the numbers have gotten larger. I don't feel like I need someone to tell me I'm doing fine. I have actually been mildly shamed and embarrassed when in these situations before (mortgage, buying life insurance) due to our financial situation and knowledge for our young age - I do not like opening the books to outsiders either.
I admit perhaps I have a blind spot when it comes to legal matters or insurance products.
I have handled my own investments and taxes for years. I am a CPA and like most posters here has spent a large amount of time studying personal finance, portfolio theory, researching various investments etc I also have a related degree.
Is it possible that there is any value to be gained here? I don't want to sound smug but I feel like along with the average poster here I don't have anything to gain by doing so and I will be wasting my own as well as the advisers time.
What I would ideally want is an advisers perspective if there are any on here.
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My DW feels we need an outside perspective....
Is it possible that there is any value to be gained here?
Yes - marital harmony. Provided, that is, you can refrain from saying "I told you so" if the advisor recommends "no change". :)
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It sounds like your wife trusts you, she just wants a professional opinion now that the stakes are higher. Which makes sense- I trust my primary care doctor with my health, but if she said I had cancer, I'd probably go see a specialist to be sure. It's probably a low price to pay in order to get a second set of eyes on things, even if it's just for peace of mind.
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As long as the planner is a fiduciary at all times, other than the fee for the consultation and possibly a couple of hours you don't have anything to lose.
If the planner says it all looks good your wife would feel happier and more comfortable (and you can think, to yourself, "I told you so")
And who knows, maybe a new set of eyes will point out something interesting that you hadn't considered? It's their whole job after all...
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My experience with a financial planner was not positive. FIRE plans are so unconventional, that he basically refused to even consider that I could retire as I was planning. I was told to work until 50 and save a minimum of $3M. The one good thing was that he listed a series of objections to my plans, most of which I had already considered. So it was affirming in that sense.
I don't see how it would hurt to talk to a financial advisor. Just be prepared for it to be a waste of time or, worse, an exercise in making your wife unnecessarily worried that your planning is all wrong.
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Someone on this board posted a long description of their meeting with a planner, which they found helpful, but I doubt I could find it again. It was a fee-only session, with someone who sort of specialized in the early retirement mindset, and she suggested that his overall savings and investment plan was sound but raised some interesting questions about designating conditional beneficiaries, estate planning for optimal tax advantages, and insurance for downside risks that he felt were worth the money he paid.
Not all financial planners will do that kind of thing, but those questions are absolutely part of your financial future whether you recognize them or not. Do you have an updated will? Does your partner know how to access all of your accounts in the event of your untimely death? How to pay your credit cards and mortgage or other debts, to protect their credit? What happens if both you and your partner die together? Do you have children, and if so have you designated a trustee or caretaker for them and made financial arrangements for their future support?
Good planning means thinking through even the unpleasant situations, like the ones where you're not around to deal with it but the people you care about will have to muddle through. Sometimes a modest life insurance policy can help significantly easy their immediate cash flow problems if you die, before they figure out how to access everything else, because the insurance company will basically hand them a big fat check the next day.
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It depends on the planner.
We have a family member who is a financial planner that we trust. We saw him and he more or less confirmed the wisdom you can glean from this forum.
Ironically, he worked for a large financial institution (not Vanguard), but told us to put everything into Index funds with Vanguard!
I met with a much younger planner earlier in my life, and all he tried to do was sell me bs insurance products for which he likely received a commission.
One thing that a good financial planner can do is lay out the tax advantaged accounts to give you a good order of investing. Also, the trusted financial planner (family member) that we saw finally convinced me that paying off my 3.25% mortgage was a very dumb idea. I could have learned all of these things from reading this forum, but hearing it from an "expert" did help to reinforce what I already probably believed.
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What Sol said. You clearly do not need investment advice, nor do you need someone to hold your hand to make sure you don't sell in a downturn. But you do need someone who has been trained to look at the big picture and see what you might be missing -- life insurance, disability insurance, will/trusts, where the college money will come from, etc.
For ex., I continue to consider hiring a financial planner because we are approaching the time when we will need to adjust from contribution to withdrawals, which is a completely different mindset and not something I have experience with. I am smart enough to know that there are significant tax benefits to be had if I structure my future withdrawals properly, but not trained enough to know how to do so (at least with any level of confidence -- I have some ideas but can't be sure I'm right). So it would be nice to get a plan while I still have several years to work towards that so that everything is set up properly when I am ready to pull the trigger.
Tl;dr: No matter how smart and highly-trained you are, you don't know what you don't know. It can't hurt to get a different perspective.