Fees
My wife and I are both retired. The companies that we retired from used Fidelity to house our 401k plans. We have been recently searching for a financial advisor(Wealthramp.com) along with some other sources to hopefully save some money and develop a closer relationship with our advisor. You have always mentioned fee only advisors are preferable but a couple of our leads had advisors whose fees were higher than what I am paying now. It seems that fees is a pretty broad statement. What and how, in your opinion, should a fee only advisor charge?
Terry Says
Good advice is worth paying for! As long as it is fully disclosed (all Wealthramp advisors are fee-only) I am not opposed to paying a fee. But it depends on the advice you are seeking.
If you only want investment advice, you can get it free on Fidelity or Vanguard — but free advice is worth exactly what you pay for it! (My advice excepted, of course!)
If you just want investment advice for asset allocation and hand holding in a crisis, then the typical fee is 1% a year. That probably should exclude your “chicken money” which is always going to sit in a MM fund or Treasury bills.
BUT, if your financial planner is giving advice on income withdrawals, or estate planning, or tax changes to benefit you in the long run, then you might pay a larger one-time fee — especially for the start-up meetings for your plan. Then if you are going to have a checkup twice a year, the fee would be smaller. And don’t forget, you might be paying an estate planning attorney and/or CPA as well, to keep things in line.
