Q: I am a healthy 62 year old widower. I am planning on retiring next year. I will have sufficient income to live comfortably. I own my home and I have not debt. I have $1,100,000 in cash that I would like to invest in growth rather than income. I would like to keep my income tax burden as low as possible. I have been in contact with Vanguard Investments. They told me they would assign me a financial advisor to advise me on what type of Vanguard Funds to invest my money in according to my needs and time horizon. In your opinion what are the advantages and disadvantages to this plan of investments?
A: We believe that Vanguard is the best solution for investors who are looking for to make all of their investment decisions on their own and DIY invest. What it sounds like you are talking about is an offering where they offer minimal overall financial advice, but overlay a fee for an investment advice solution. The underlying funds are very low-cost, but I would caution you to understand the annual asset management fee that will be charged by their advisory services. This can range as high as 0.85%. Depending on the services that they are offering with this service, it may be worth it for you to interview other advisors who charge in a similar “fee-only” manner as you might receive superior face-to-face advice and service.
We would be happy to sit down with you for a free one-hour consultation as we do operate in this fee-only format.
If you would like to find out more information regarding the types of advice that are available, you can visit our website at https://www.yourwealth.com/about-2/what-is-ria.html
To find other fee-only advisors near you, visit www.napfa.org and click “find a planner”.