Investment, financial planning lakewood

amother

Wed, Nov 20 2019, 9:17 pm

We have around 20k saved up, own a home no debt mid 30s. We are totally lost regarding financial planning investing. Who would we speak to to get advice information. Would we speak to a financial planner like mayco, oakwood, eli fried or is that only for the very wealthy.

rgh

Wed, Nov 20 2019, 9:25 pm

PM me I can recommend someone amazing.

amother

Cyan

Wed, Nov 20 2019, 9:33 pm

I too wonder at what point someone would be "eligible " to dabble in this. How much money do they expect you to come to the table with?

amother

Aqua

Wed, Nov 20 2019, 9:43 pm

I use Kirschenbaum in Monsey (845) 352-1919.
I think 20k is enough money, and he always gives me the time of day. He’s rather conservative, but we’ve been getting excellent returns over the years.

amother

Wed, Nov 20 2019, 9:47 pm

Thanks I'm really looking for someone in lakewood. I'm also not clear if I'm supposed to first put money in a retirement fund or invest in a cd or index fund. It's all very confusing to me and we need someone to explain. Is there such a thing? Any advise would be appreciated.

Sebastian

Wed, Nov 20 2019, 9:51 pm

max out your roth ira and then do index funds.

I know ppl happy with oakwood financial

amother

Wed, Nov 20 2019, 10:02 pm

Ok so how do I practically do this. I call them up and ask to open a roth, they open it for me or I do it and how do they get paid. Sorry for sounding so dumb, like I said I'm totally clueless.

questioner

Wed, Nov 20 2019, 10:12 pm

You can open a roth IRA through vanguard etc.

You might want to look into robo advisors like Betterment or Wealthfront that will automatically rebalance investments and invest for you according to your risk tolerance.

That being said it sounds worthwhile for you to speak to someone for an hour for some personalized advice and guidance as to where to go. I don't have any recommendations.

Amarante

Wed, Nov 20 2019, 10:22 pm

There are two kinds of financial planners - those who work for a fee and those who make money on commissions.

Honestly, $20,000 is a bit low to justify paying for an for fee financial planner who charges hourly. I think at that level you are better served by reading some basic books on money for beginners. An advisor is only going to be able to give you try basic advice which you can find out quickly yourself for free :-).

At this level you don't have to delve into complicated investment strategies because even if you speak to a professional, you would want to understand stuff to evaluate whatever advice you are getting. There are a number of excellent simple investment books like

For $20,000 it's really pretty basic. Make sure you have three to six months of living expenses in some form of safe liquid investment. A CD from an FDIC insured bank is probably safest. You are less interested in maximizing returns than having a safety net.

Whatever sum you have left invest in an index fund run by Fidelity or its counterpart. This is money that you don't need for short term so you put it in there and you just essentially forget about it because there may be dips in the stock market but in the long term, just parking the money will yield results. If you contact Fidelity, they have brokers who can steer you to one of their index funds.

Since you are young, you don't have to worry about diversifying your portfolio and getting into bonds. The simplest rule of thumb is that the older you get, the higher the percentage of funds that should be in bonds since they are less theoretically volatile than stocks. However, even that isn't necessarily true since bonds can rise or fall depending on interest rates or where the market thinks interest rates are going. At your level of investment you would probably be investing in a bond fund versus purchasing individual bonds. A bond fund is as liquid as a stock fund.

Saving for retirement isn't the opposite of investing for anything else. In general saving for retirement just means where you are putting the money. If you work for a corporation that offers a matching 401 (k) program you obviously max out the contribution. There are tax benefits to putting money in either an IRA or a Roth IRA - the difference depends on your tax liability. You pay taxes on Roth contributions but not on IRA contributions. You therefore pay taxes when you withdraw from an IRA. Keep in mind that there are significant tax penalties if you withdraw from an IRA or Roth which is why the first thing you do is make sure you have a safety net so you don't need to withdraw those funds in an emergency. You can invest your retirement savings in anything - but in general retirement savings are best parked in growth opportunities like stock index funds versus very safe investments with little growth like a CD.

amother

Crimson

Thu, Nov 21 2019, 12:07 am

We use Mayco and we're far from wealthy. My kids got a yerusha from a grandparent and he invested it for us.

amother

cornflower

Thu, Nov 21 2019, 12:11 am

We use oak wood. He doesn’t charge us a fee.
He also advised us about setting up ‘wedding’ accounts for each of our children using direct deposit.

Sebastian

Thu, Nov 21 2019, 12:26 am

amother [ OP ] wrote:

Ok so how do I practically do this. I call them up and ask to open a roth, they open it for me or I do it and how do they get paid. Sorry for sounding so dumb, like I said I'm totally clueless.

you can do it online with vanguard, fidelity etc

look for one with low fees

roth iras are great b/c your gains are tax free and you can pull what you invested without a penalty

watch this channel to learn about investing: https://www.youtube.com/watch?.....n6DrL

Amarante

Thu, Nov 21 2019, 12:33 am

There isn’t anyone who doesn’t charge in some way if they are a "professional" financial advisor. They are not working for you for free unless they aren’t in the business just like a doctor or a lawyer doesn’t work for free unless it’s family or pro bono or charity.

Either they charge a fee or they make a commission based on what they advise you to purchase.

In general a certified financial advisor who works for a fee is going to be more trustworthy because they owe a fiduciary duty to advise on what is best for you whereas someone who works on a commission is possibly going to steer you towards investments that are more lucrative for the broker.

There is nothing inherently wrong about using a commissioned financial advisor as long as you are clear about the differences. A broker can be very savvy about keeping up in market conditions for example.

Last edited by Amarante on Thu, Nov 21 2019, 12:17 pm; edited 2 times in total

baby12x

Thu, Nov 21 2019, 1:01 am

Amarante wrote:

CD are giving very low rates these days. A high interest savings account will give you around the same amount.

Vanguard is a good place to start with that amount of money. No need to hire a planner for that amount. Just do some online reading

baby12x

Thu, Nov 21 2019, 1:01 am

Amarante wrote:

There isn’t anyone who doesn’t make money as a financial advisor. They are noy working for you for free unless they are aren’t in the business just like a doctor or a lawyer doesn’t work for free unless it’s fsmily or pro bono or charity.

Either they charge a fee or they make a commission based on what they advise you to purchase.

In general a certified financial advisor who works for a fee is going to be more trustworthy because they owe a fiduciary duty to advise on what is best for you whereas someone who works on a commission is possibly going to steer you towards investments that are more lucrative for the broker.

There is nothing inherently wrong about using a commissioned financial advisor as long as you are clear about the differences. A broker can be very savvy about keeping up in market conditions for example.

This. They are not working for free

treetop12

Thu, Nov 21 2019, 7:20 am

Fidelity or Vanguard are you best places to start. Like the previous posters stated, they have brokers available to help you who will go through your goals, risk tolerance, etc. And then set you with a portfolio.
Good luck

doctorima

Thu, Nov 21 2019, 10:48 am

amother [ cornflower ] wrote:

We use oak wood. He doesn’t charge us a fee.
He also advised us about setting up ‘wedding’ accounts for each of our children using direct deposit.

As others have said, they're not doing this for chesed. I have a naive relative who went to someone who also did it "for free," meaning that she never paid him a penny and thought he just wanted to help. In reality, he invested all her money in what's called load mutual funds that take 5-6% off the top that's not invested, most of which is given to the advisor as a commission, which was never disclosed to her.

Amarante

Thu, Nov 21 2019, 10:58 am

doctorima wrote:

Adding to this advice - one of the reasons Fidelity or Vanguard are typically recommended for novice middle class investors is because their business model is funds which have low operating costs and little or no loads - either front or back end.

The amount that a fund takes to manage the fund can reduce the actual return on investment significantly. With Fidelity or Vanguard - although I am not advising blindly purchasing anything - these costs are minimized.

And the reason index funds are recommended is because they typically carry the lowest "management fees" because they aren't managed as actively as other types of funds. And in general, heavily managed funds do not outperform the market and with the fees paid, you might actually wind up with less money than if you just put your money in a low cost index fund.

Again, there are always exceptions since there are funds that are heavily managed which do outperform the market even with fees taken into account. However, unless one is a sophisticated investor who actively researches and fully understands AND has a very good investment advisor who is trustworthy, the best course is to purchase index funds for those amounts which one is investing for the relative long term.