Door Dash down 13% today
It’s happening dot gif
Lol we work (-17% today)
https://twitter.com/zerohedge/status/1499835573288247301?s=21
There are some posts up thread I want to read and reply to more in depth, maybe Sunday, but I just had my call about the investment advisor job and I thought I’d give an update, as it’s something I’m going to consider - they’re giving me some compensation information Monday to make sure we’re not wasting each other’s time.
They primarily sell their services to Fortune 500 companies as an added benefit for employees, then help employees with things like planning out how much to save/invest for retirement, making sure they max out 401k matches, allocation based on age, rebalancing, etc. He said one of the big things is talking people out of selling everything off when there’s a lot of volatility and the market is down and buying back in when it’s high.
They also offer help with general financial planning, how to handle investments in taxable accounts, etc. This is all free to the employees using the services.
Then they also offer their services to high net worth individuals to manage their money for them, but it’s not a 2 & 20 type deal, they start at 1.75% of assets under management and the rate drops to a lower percentage regressively relative to AUM. Again they’re handling stuff like tax avoidance, rebalancing, allocation based on age, etc.
So essentially, they’re the good guys. They also do a lot of work with Vanguard for execution of trades, contributions, etc.
The potential advancement path for the position would be to go from handling inbound calls from current clients and answering questions and helping them plan/allocate to being a financial planner for the high net worth individuals and getting more of a variable income based on AUM to potentially opening your own financial planning satellite office under their flag and bringing in your own clients.
None of their model is predicated on returns. We’ll see if the compensation is good enough to consider. I think I’d enjoy the job and everything I learned in it, relatively speaking, but it would be tough to swallow giving up my complete freedom as my own boss and possibly taking a pay cut… Then again I could still do poker on the side.
So we’ll see.
LOL
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1.75% is the highest, not the lowest, and they don’t charge anything on returns. Also that’s only for high net worth individuals, and everything else is free to the employees of the company that pays them to include their services as a benefit to employees.
So for the majority of their individual clients, a Fortune 500 company pays for the services and gives them to their employees, and they can call up and get help figuring out how much to put into their 401k and how much to put in stocks/bonds/cash, how to save for their kids’ college, etc at no additional charge.
He told me there’s virtually no cold calling, except with people who have used the service in the past and haven’t in a while. Now the extent to which that’s true, who knows?
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Oh my god CW come on man. Nothing on returns lololol and they’re probably charging load/expense fees on top of that obscene AUM fee. “Good guys,” good lord.
“Free to the employees,” nope.
The company doesn’t charge the employer anything, instead offering only high expense funds they manage (usually).
I’m on the pension committees for most of my company’s pension plans. I wouldn’t say that these companies that run 401(k) plans charge employers nothing and offer high expense funds. Usually some fees are paid by the employer and some are charged to member accounts, and the fund fees are really not that outrageous. They’re lower than retail, because companies can be successfully sued for not negotiating good fees for their members under the applicable federal pension law.
There are some “bad deals” in employer sponsored plans but nothing like you see in retail. And lots of company plans offer a low cost index fund or funds, too.
I don’t want to dissuade you from what might be a good job for you. But I also don’t think it’s realistic to say that they’re the good guys when they’re charging an incredibly high % of AUM, rather than an hourly rate. On top of that, what qualifications does this company require from these people who are going to serve as advisors? Are they qualified to provide advice?
Again, I am not trying to discourage you from taking a job there - it’s not like I know anyone whose employer is without sin.
My experience with the “advice” channel in our company sponsored pension plans is that the advice is for your median employee, that is to say it is for people that are truly stupid with regard to savings and retirement.
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I, for one, say good luck Cuse. Will be waiting on baited breath to see how this all goes.
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Before taking the job its critical to google and glassdoor them to see what the real deal is.
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CW believes that investments that heavily discount present assets and future earnings are inherently less risky
No expense fees, as they don’t have any financial products of their own or get any commission for selling any others. There is no AUM based fee to the employees of their clients.
They may offer flat rate one off help too but for the 1.75% or less they’re actively rebalancing and such, and helping with financial planning. Worthless to you but to a lot of people it would save them from huge mistakes.
A series 65 and additional internal training.
The odds I take this are still low, I’m waiting to hear about compensation but I expect it to be a big pay cut and I’d go from 40-45 weeks of averaging 25-30 hours to probably 48-50 weeks of 40 hours. But I’ll update again for sure.
Well that’s definitely a positive.
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Sold 1/3 of my position in X, as it’s up 50% already and I’m now pretty overweight on it as a result. It still qualifies as value, though, so keeping the remaining amount invested with a new target set.
The trade filled like 8 minutes before close of after hours, nice little surprise alert on my phone when that happened.
Yeah, that was literally my exact reaction.
I think people in this thread are in the top 1-5% of Americans in terms of financial wisdom, and seem to underestimate the % of assets that the average American obliterates annually making horrendous decisions. You know how many people just YOLO like 10% of their retirement accounts into TSLA or weed stocks or something some dude at the poker table told them about? A scary high number of people!
And beyond that, at least the incentives are not perverse as opposed to most financial products. That was a big part of what I was feeling them out for. I wouldn’t be able to feel good about pushing people into an S&P ETF with a 1% expense ratio while knowing VOO is 0.03%. He said they are completely independent and guide people into what’s actually best, regardless of who it’s from. He also said they do a lot of business with Vanguard, which backs that up, because they’ve got some of the best ETF products.
I mean, shit, Vanguard says the average S&P etf expense ratio is 0.8%. Just by guiding someone into VOO instead of that, I’ve saved them 0.77% already, that’s 44% of the fee! Sure, anyone can look that up in under 60 seconds, but 90-95% of people probably aren’t.
And, again, the vast majority of their clients are getting the services “free” as part of their compensation package at work.
How about “One of the less bad guys”?
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I mean, if you think the entire industry is bad, then that’s a valid opinion I guess. I think it fills a need left by our education system. If you think the service is valid but the cost is too high, then that’s fair enough. If you think it should all be flat rate hourly, that’s fair too, but look at the billing practices of white collar bill by the hour professions and let me know how honest they are with the billing…
Seems to me the question is just what’s the fair market value for this service, and should it scale up based on the AUM.