My schwab cfp is pushing their advisor network on me, I am the trustee of the acct worth 1 million. I think this is his way of making more money for him and the third party. I think this is a scam, Am I paranoid ?. I would be paying more fees the way I read it!! can somebody confirm this?
I considered their offer in the past and rejected it. Definitely will pay more in fees. This article is dated but still worth checking out if you’re considering their adviser network. I haven’t even remotely considered it in several years so they may have improved their service. although I am skeptical.
http://www.forbes.com/sites/advisor/2012/06/01/before-you-ta…
David
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I always ask potential advisors to provide data on their historical average rate of returns for clients compared to the rate of return of an S&P 500 index fund. No potential advisor has ever given me this information.
Wiseguy
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I also ask them to show me their personal investment assets/returns. Haven’t seen those either…
- Khleb
Well… it’s not a scam. But if you are comfortable making your own portfolio allocation, and investment decisions, then you don’t need an advisor, through Schwab, or anyone else.
I went through this process, interviewing several advisors, but struggled to find the chemistry I was seeking. Truth be told, there’s probably no one that I’d find suitable. None of the advisors I met with promoted Schwab products within their managed portfolios.
Sure there are advisor fees, that’s how they earn a living. And if that brings you peace of mind, or the time freedom from managing your investments, then you may find that a good value.
That said, I suspect most everyone that participates in these forums, enjoys engaging their portfolios, and prefers the autonomy over their investment choices. Unless life circumstances change where you no longer have the time, interest, or ability to direct your own portfolio, it’s likely you won’t find satisfaction with an outside advisor.
But scam? No.
Bob
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I’ve had only good experiences with Schwab reps. We divide our year between two places, and we’ve gotten advice from local reps in both of them, as well as on the phone to the Schwab bond specialists.
The local folks know I manage our investments, and they’ve not pushed at all. They’ve told me their door is always open if I want to discuss anything. They’ve answered (correctly) my questions whenever I’ve asked, all without fees.
A few years ago, I called the Schwab bond desk to inquire about selling some Treasuries. The guy on the phone explained how it would work. He asked what I planned to do with the proceeds, and I told him I would probably just keep it in cash for the time being. He suggested that unless I had a plan that would do better than the 8.125% risk-free the Treasuries provided, perhaps I shouldn’t be too quick to sell.
In other words, he talked me out of the transaction. I’m glad he did. Those T-bonds have easily outperformed equities. I’ll be sorry to see them go when they mature in 2019.
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You go with the Motley Fool Million Dollar Portfolio (MDP) advisory. It charges a flat fee and has only underperformed the S&P by 50%. But they are under new management and promise to do much better by picking the best of all the other services.
Vanguard has a nice set of low cost index funds. Never a shame to match the market over 20 years.
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No no no no, if anybody here at Saul’s is looking for a portfolio service at the Fool, check out Motley Fool Pro. It’s a great team and great community and they have a wonderful track record. I could go on and on if anyone is interested (if you are, let me know).
Karen
90% of advisor perform worse than the S&P 500 and charge a hefty fee for that.
If you are not comfortable with selecting your own companies then S&P 500 index fund is the way to go.
Set yourself with TDAMERITRADE Etrade or any other electronic broker.
Then invest all your money in the Vanguard S&P 500 (VOO I think) their fees are relatively small and leave it there
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Serendipitously I just came across this 25 minute MF podcast on financial advisors. I did not listen but I suggest you do.
http://www.fool.com/answers/podcasts/episode/how-to-find-the…