Author Topic: Should I hire a financial advisor for a Roth IRA?  (Read 6956 times)

mountainjillian

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Should I hire a financial advisor for a Roth IRA?
« on: June 19, 2015, 12:55:19 PM »
Hello friends!  I am finally dipping my toe into the wonderful world of Roth IRAs, and am wondering if the community recommends using a financial advisor (we know of a highly recommended person at our local Edward Jones branch) or figuring out how the eff to manage one myself?  Truth be told, I know NOTHING about investing, but I'm a pretty smart and thorough person when I put my mind to something.  I just know these dudes make a percentage off of you, and that's a drag - but maybe it's worth it if you end up making more money in the long run?  Any advice is greatly appreciated.  Cheers!

Gin1984

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #1 on: June 19, 2015, 12:59:52 PM »
No, do not use them.  Use fidelity or vanguard.

forummm

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #2 on: June 19, 2015, 01:02:06 PM »
NO Edward Jones! Just open your Roth IRA at Vanguard yourself. You can use their automated tool to put you into good funds. Or you can just put it into the Vanguard Target Retirement Fund that's associated with the year closest to when you turn 65. That's all you need to do. Just add up to the maximum ($5500) to the account each year. You can do an account for each spouse, putting up to $5500 per year in each of them.

You will save an insane amount of money vs Edward Jones.

zataks

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #3 on: June 19, 2015, 01:06:39 PM »
http://www.bogleheads.org/wiki/Bogleheads%C2%AE_investing_start-up_kit

Super lazy? Buy a Vanguard Target date fund. (http://www.bogleheads.org/wiki/Target_date_retirement_funds) (http://www.bogleheads.org/wiki/Lazy_portfolios)
Slightly less lazy?  Create a 3-fund portfolio using index-tracking ETFs or Index Funds. (http://www.bogleheads.org/wiki/Three-fund_portfolio)
Kinda active? Research and incorporate specific industries/regions/classes into your portfolio.
Active?  Research and investing in individual stocks and bonds.
Gambler? www.reddit.com/r/wallstreetbets

mountainjillian

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #4 on: June 19, 2015, 01:12:32 PM »
WOW! Resounding answers so far friends - DIY all the way I'm hearing.  I appreciate this feedback BIG TIME.

MDM

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #5 on: June 19, 2015, 01:17:28 PM »
In Edward Jones' own words:
"Edward Jones has its headquarters in St. Louis, with more than 11,000 offices spread across all 50 States. We have more branch offices than any other brokerage firm in the country."

One can reasonably assume that is because they make more money from investors than others.  Google "where are all the customers' yachts" for a similar perspective.

Yes, you can DIY using any of the fine suggestions already made.
« Last Edit: June 22, 2015, 02:10:15 PM by MDM »

forummm

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #6 on: June 19, 2015, 01:49:30 PM »
If your hand really wants to be held, Vanguard does offer personal financial advising for 0.3% of your invested assets. It's unnecessary, but much cheaper than Edward Jones and the like. You do need to have $50k invested in Vanguard funds to use the service though.

https://investor.vanguard.com/financial-advisor/financial-advice

forestbound

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #7 on: June 19, 2015, 01:52:37 PM »
NO ADVISOR! NO! They will try to sell you stuff that has loads and commisions for themselves, that's how they make their money! NO!

Read this, after rereading all of MMM posts:
http://jlcollinsnh.com/stock-series/

Frankies Girl

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #8 on: June 19, 2015, 01:56:17 PM »
I knew pretty much nothing - literally - other than I was blindly investing in my company's 401k a few years ago.
I now feel 100% confident to even advise other people how to invest and handle my mom's accounts.

All it takes is a little bit of time and research. Knowledge truly is power.

http://jlcollinsnh.com/stock-series/
^adding this link as it is definitely one of the best out there in terms of how the whole thing works and what stuff you need to figure out.

Read the Boglehead links, Jim Collins, post questions around here, and in a very short time you'll feel comfortable to take over your own finances and investments.

And I agree with the others: Vanguard is best, but you can do just fine with Fido (they have similar index funds in their Spartan series, just stay away from "managed" funds and you will pay pretty much the same low expense ratios as with Vanguard). Run far away from Edward Jones.

mountainjillian

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #9 on: June 19, 2015, 02:20:12 PM »
You guys!!!!!! I am feeling the Mustache love big time - thank you for all the resources! 

TomTX

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #10 on: June 19, 2015, 02:38:09 PM »
Do you want a guy who will make you feel good about your investments while keeping you financially ignorant (well, except the razzle-dazzle) and takes a hefty fraction of your money, whether he beats the market or not? (usually not)

forummm

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #11 on: June 19, 2015, 05:43:01 PM »
NO ADVISOR! NO! They will try to sell you stuff that has loads and commisions for themselves, that's how they make their money! NO!

Read this, after rereading all of MMM posts:
http://jlcollinsnh.com/stock-series/

Vanguard's advisors won't do this. They just put you in the rock-bottom cost Vanguard funds. But as I said before, they are unnecessary. Their online tool will do something similar for you as well.

mom22boys

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #12 on: June 22, 2015, 12:31:10 PM »
Absolutely NO!  There was a comment on another thread that Financial planner = Salesman (Saleswoman).  I made this mistake two years ago, and am down $1200 in yearly fees + a lot of expense fees on my accounts.  I'm in the process of moving my brokerage account to Vanguard, and will be firing my financial advisor within the next month, after all my accounts are moved.

+1 for recommendations by Forestbound and Frankies Girl on reading the Stock series from JLCollins.  Excellent read....I'm reading it all again for the second time. So helpful!

PARedbeard

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #13 on: June 22, 2015, 12:41:00 PM »
DEFINITELY do a ROTH yourself. When I was young, my father set me up with his accountant/financial adviser. On top of questionable advice, I realized (quite late) that he was nickle and diming me (plus taking a front-load cut when I put funds in).

Vanguard is probably the best option. You can also open a ROTH with a low cost online brokerage (Scottrade, TDAmeritrade, etc.) and manage the money yourself. If you are new to investing, though, it is incredibly hard to beat Vanguard.

arebelspy

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #14 on: June 22, 2015, 12:56:58 PM »
I'm going to go ahead and give the opposite advice of everyone...


Just kidding.  They're all correct.  DIY.  You will come out way ahead in the end.  Stay far away from Edward Jones.  JLCollins' stock series is the best intro for beginners, IMO.  Feel free to ask any questions you have here, too.  Good luck!
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
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thd7t

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #15 on: June 22, 2015, 01:08:30 PM »
Is your earning high enough that you can't do a Traditional IRA or so low that you're paying practically no taxes?  In many cases, a Traditional IRA allows you to pay less tax over all, because when you pay taxes on the ROTH, you pay at your top marginal rate, but when you withdraw from a traditional, you pay at your bottom marginal rate (oversimplified, but pretty much the case most of the time)

mountainjillian

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #16 on: June 22, 2015, 01:52:54 PM »
Is your earning high enough that you can't do a Traditional IRA or so low that you're paying practically no taxes?  In many cases, a Traditional IRA allows you to pay less tax over all, because when you pay taxes on the ROTH, you pay at your top marginal rate, but when you withdraw from a traditional, you pay at your bottom marginal rate (oversimplified, but pretty much the case most of the time)
our income is in the right space for a Roth...

Dudes, we are going to stay away from Edward Jones after hearing all this advice, it's Vanguard all the way for us. And I will ABSOLUTELY be reading these online resources!

wtjbatman

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #17 on: June 22, 2015, 04:21:44 PM »
I'm going to go ahead and give the opposite advice of everyone...


Just kidding.  They're all correct.  DIY.  You will come out way ahead in the end.  Stay far away from Edward Jones.  JLCollins' stock series is the best intro for beginners, IMO.  Feel free to ask any questions you have here, too.  Good luck!

I actually had only scrolled down far enough to see your first sentence by itself. I read it, and almost had a heart attack. Oh arebelspy what happened to you...


Then I scrolled down and saw the rest. You trickster.

arebelspy

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #18 on: June 22, 2015, 07:10:37 PM »
I'm going to go ahead and give the opposite advice of everyone...


Just kidding.  They're all correct.  DIY.  You will come out way ahead in the end.  Stay far away from Edward Jones.  JLCollins' stock series is the best intro for beginners, IMO.  Feel free to ask any questions you have here, too.  Good luck!

I actually had only scrolled down far enough to see your first sentence by itself. I read it, and almost had a heart attack. Oh arebelspy what happened to you...


Then I scrolled down and saw the rest. You trickster.

We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

kpd905

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Re: Should I hire a financial advisor for a Roth IRA?
« Reply #19 on: June 22, 2015, 07:32:52 PM »
Edward Jones is bad news.  That adviser would probably have sold you into a fund where 5%+ of your contributions would immediately disappear and go to him.  That is called a front-end load fee, steer clear of any fund that has one.

Vanguard is probably your best bet.