San Diego Housing Bubble News and Analysis

When I started out, I never found a decent/capable financial advisor that was good AND willing to manage/help if "workable asset" was less than $300k.

Where I would see a financial advisor may help you initially is to put a financial plan together. But what they do isn't really earth shattering, and you could probably read about how to it and/or get one from the web. Beyond just planning,

The real question is how financially disciplined are you AND your wife? You don't have to answer that question here. Just think about it. If you +spouse have issues investing/savings on a regular basis, perhaps you need any advisor to just keep your financial health in check. If you or your wife don't want to spend time doing this, then there may be some value in a FA too (time is money).Questions you may want to ask yourself: do you/wife buy things spontaneously. Over the past year or two, what were your biggest expenses, what's your savings/investment percentage. If you invest, do you gamble alot on stocks or mutual funds (speculative buying). Was your portfolio beating boring index funds (if not, you're better off doing just indexes) etc. How much time do you really want to spend doing tis yourself?

The landscape of financial advisors is large. I would say that you would be hard pressed to find a good one without having a lot of working assets for them to work with. The ones that I ran into from brokerage houses are just that.brokers. They try to sell me stock tips, etc and charge hefty commisions. Pretty useless for me, because they're most of the time wrong imho. If you are well disciplined, I would just do it yourself.

For me, I use a gentlemen from Wachovia. Mainly because my wife wants a safety cushion in case me and her (mainly me) does something stupid. At the same time, my financial advisor wants to take more control of our assets. I don't want him to for the same reason that I feel we need a safety cushion in case he screws up.

Based on his performance, he does better than me when we're in a bear market, and worse than me when we're in a bull market. Also, he charges about a 2% commision per year over a majority of the asset he manages. I'm wouldn't say he's great, I wouldn't say he's bad. Just normal conservative returns.

I guess I'm not estatic about financial advisors because it seems my family's access to "great" financial advisors is limited because we don't really have "a lot" to really be on the radar of great advisors. Or at least, I haven't seen them. Multi-multi-millionaires on this board might want to chime in. Because their experience may be different. And of course, you may run into one that is good.

That said, there's a lot i think you can do for yourself, and there's plenty of information on how to. Skip the infomercials about getting rich quick deals though. Also, although plenty would disagree, skip Suzie Orman. Nothing wrong with her per se, just I find her hellishly annoying..Not what she says, I guess more about the people that ask her the dumb questions.

I'd go see a fee only planner that doesn't have all the hangups of a "broker" discussed above. You can probably do it once every 3-4 years. Initially it will cost you 2K or so.

http://www.napfa.org/

You can find them here, but hopefully some one on this board will give a personal recommendation (I handle my own stuff). On another note, preferably now, but certainly when you have kids, get a will (preferably a trust) together with all your wishes spelled out...will cost you $1,500 or so to do it with a competent lawyer and assuming your situation isn't complicated, but the peace of mind is worth every penny.

Stan

If you need a living trust lawyer, I can recommend one that did one for our family for about $1500.

Also, another thing. If you work for a big company, they often have these financial planning seminars. Companies will come in and help you put a plan together for free. They deal is they are hoping to get your business (which you don't have to feel obligated to do). 

For managing/investing my assets, I use Rich (That's Rich Toscano, who developed this website, for the uninitiated.) His strategies make a lot of sense, his communication is great, and I trust him totally to have my interests at heart. You can find links to his firm's website in the upper right corners of the Piggington pages.

I echo going with a fee only FA. A little knowledge can go a long way, but if you want to be your own FA, it can also cost you dearly. I once told my FA that I try to resist becoming "informed" in investment matters to avoid becoming "opinionated", and therefore forging views that may conflict with his. Since I am paying him to advise me and not the other way round, that makes sense to me. I got the feeling from his reply that his life would suffer less angst, if other clients were similarly disposed. I do however look at the bottom line, and form an opinion as to his performance, and that seems to keep priorities on an even keel. The trouble with brokers and commissions is that charges can be opaque and can bite into your portfolio's performances.

Have been a regular reader for some time, but this is my first post since it's a topic I know something about (unlike housing in San Diego - which I'm interested in because I plan to move there soon).

Fee-only advisor is a no-brainer. Don't do anything else.

But beyond this, the main point to keep in mind is that it is *markets* and not advisers that drive returns over the long run, and that a good adviser is not someone who can give you the next hot tip or who claims to systematically beat the market (be very wary of those who market themselves this way), but who can help you set up a plan with your goals, time horizon, liquidity needs, and risk tolerance in mind, and then guide you through the *emotional roller-coaster* of investing over a period of time.

If you know enough about markets to understand that ups and downs are normal and have a disciplined savings strategy that lets you put aside a regular sum to invest in a well-diversified portfolio through up and down markets, you could pretty much do your own portfolio through Vanguard.

A really great source of articles on this is:

http://www.fundadvice.com/articles/inves...

Time spent on most of these articles is well spent (my favorites are 1 and 6).

http://www.evansonasset.com/ also has good articles (and an especially insightful one on what reasonable fees for advisers should look like)

http://www.ifa.com/library/articles.asp also has good articles (but they hawk themselves a bit too much, which can get annoying).

If you think you need the comfort/peace of mind to have someone to talk to, and to help discipline you, then that's a good reason to have an adviser (but look for these traits rather than believe that they'll beat the market!).

Also, if you’re paying for an adviser anyway, it may be good to find one with access to DFA funds (though you'll get more out of it if you can find a good adviser who charges a *flat* fee or a sharply reducing % fee, and not a constant amount like 1% percent of assets - see the Evanson article to see why this makes sense and to get ideas on how you might negotiate this).

Not from SD, so no specific names to recommend.

Good luck!

Nobody cares about your future more than you do.

SO, if you are so inclined I recommend investing time into learning as much as you can about finance. Assuming you are reasonably intelligent, after a few years you will be able to spot bullshit and sales tactics and be able to separate what's right for you from what what is not right for you from a mile away. You may also consider taking courses to educate yourself.

With some experience and either self-teaching or formal education you will be better positioned in the future to make decisions regarding financial advice from professionals.

Consider those who hire mechanics to fix their cars (I do) : You might not be able to fix it yourself, but if you at least have some understanding of how the vehicle works you won't inadvertently pay $2000 for replacement of the flux capacitor when it goes out.

Thanks for the info, everybody! Aside from the occcccassional splurge, there aren't any serious financial discipline problems, and I'm actually interested in learning as much as I can about all this... so I'm leaning towards setting up a vanguard account (or something along those lines) and going from there.

I made an appointment last week with a financial planner that a friend recommended... I think I'll keep the meeting tomorrow, just to see if it looks like his experience would be a more sensible tool than my exuberance. Will let you know how it goes.

I have been reading and listening to various financial planners on the radio such as Ray Lucia, Mo Ansari and the like who seem pretty solid. The main strategy these days is called "asset allocation" with various mixes from short term liquid assets such as money market funds and CDs to mid range and long term investments such as annuities and stocks/bonds.

Alright, I visited Mr. Financial Planner - nice guy, seems pretty competent as far as the main part of his market goes: helping middle aged people make up for lost time with retirement funds.

But that's not what I'm looking for, so I'm off to the bookstore! :)

Regardless of what you end up doing, read the book on the link below so you are familiar with all the financial terms and inner workings.

http://www.amazon.com/Street-Journal-Gui...

Mix I like both of them two... Mo is a little bit 20/20 hindsight to me though. He always talks about what moves his company did prior to whatever the market did... yet I still listen to him now and then. Ray is cool as well. My wife and I have been to one of the free seminars they did. Also my wife and I have visited their offices a few times in the past 3 years. I think I got Rick Plum kind of bummed at me... About 1.5 years ago we were at the office talking to him and he was talking about the new home he bought in Blossom Valley. I didn't really say anything but then he asked me what I thought of the market and I told him... He was sure that his market wouldn't be affected... I didn't want to get into it with him so I just said we'll see what happens.... Ray on the other hand sold his RB home in the last year.

Trey sorry bout sidebarring the thread. I think you are doing fine. I know saving for a dp is a real chore. Also if in the next few years interest rates go up AND underwriting restrictions tighten up, that will put even more pressure on first time buyers to come up with a bigger dp. Even with that said, 401k and any sort of tax deferred vehicle where you can defer gains is just such a darn good deal. I think a financial planner can run numbers for you to see if seeding a home dp account rather then maxing these other vehicles out is a rational thing to do for a few years.

SD Realtor

Planning is key to success

I am maxxing out my 401k, and plan to a ROTH IRA and invest the balance after bills in CD, money market and liquid assets until real estate drops more in San Diego. I may even buy in Texas after my lease is up in end of 2009 but just depends on what happens in San Diego.

Another interesting read:

4 Pillars of Investing, William J Bernstein (not a financial planning/advisory book, but interesting)

mixxalot I am all for buying in texas if it makes sense to you, but one thing to consider is that you never consider a home an investment in that state. The reason being is that there is no end to how far out someone will build. In the greater Dallas area, Mckinney, and Wylie and places further out, have had a ton of building. What this means to you is that as long as people are willing to move to the next outer ring (and if course they are) that you don't get the appreciation elsewhere. So by all means buy in Texas because you work there and enjoy it, but I wouldn't buy there as an investment.