Professional Investment Service.

[JayCT]

Thanks for the thoughts. Just to be clear, the Professional Investment Group is not guaranteeing a return. They said that they were successful in providing a return even in down cycles by shifting money quickly into and out of the market. They said that even during financial crisis they got their investors a return of over 2% on their money.

I kind of thought that it is not worth it but my friend is concerned about being able to maintain the balance of the account or at least minimize the impact of a downturn. Right now the portfolio is heavy into stock funds in which they could stay and ride out a down cycle. That said they are about 10 years from retirement and getting concerned that the time period for riding out cycles is getting shorter and shorter. I will suggest the idea of a "fee only" planner. Thanks again, Jay

[LordSquidworth]

Originally Posted by JayCT

Someone I know has a fairly sizable amount of money in their 401k and needs to decide what to with it. It is now with a major investment company. They could keep it there or move it. One option is to place with a
Professional Investment group. They would charge a 1.3 percent fee. Would it be worth it? They claim to be able to protect the money and assure it grows even in a down economy. Thoughts? Jay

A) I'd avoid big firms. Independents > big firms imo. I work for a big firm.

B) If it's big enough, that 1.3% should be closer to .8% (can be hundreds of thousands, doesn't need to be millions).

Originally Posted by Big-Bucks

Worth it? No. You have to understand what an adviser does. ANYBODY can buy stock and bond index funds and rebalance. Simple. You don't need to pay someone 1.3% to do that. https://pressroom.vanguard.com/conte...3.10.2014.html
They are selling snake oil. There is no such thing as growth AND safety. The two are opposites. Sounds to me like a sales pitch for an annuity. If so and they are ALSO charging to manage the money then they are double dipping. Don't even get me started on annuities.

Not everyone can go it alone. Those preaching go it alone need to understand that.

Originally Posted by Market Junkie

In 2015, with so much information available at the click of a mouse, not to mention the many good books about investing available at the local bookstore, you'd literally have to be insane, in my view, to pay someone 1.3% to manage your dough...

Again, not everyone can go it alone. There are multiple factors for this, having access to information isn't necessarily a cure all for needing an advisor.

Originally Posted by JayCT

Thanks for the thoughts. Just to be clear, the Professional Investment Group is not guaranteeing a return. They said that they were successful in providing a return even in down cycles by shifting money quickly into and out of the market. They said that even during financial crisis they got their investors a return of over 2% on their money.

I kind of thought that it is not worth it but my friend is concerned about being able to maintain the balance of the account or at least minimize the impact of a downturn. Right now the portfolio is heavy into stock funds in which they could stay and ride out a down cycle. That said they are about 10 years from retirement and getting concerned that the time period for riding out cycles is getting shorter and shorter. I will suggest the idea of a "fee only" planner. Thanks again, Jay

Problem with those claims, is they could easily be picking and choosing their data that they're using. Those annuity mailings that I've seen some old folks get of "up to 18%" returns? Everyone sees the 18% returns, most miss the "up to" part.