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Has anyone used VG advisory? The quandary of professional wealth management

creepycougcreepycoug Member Posts: 22,749
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edited May 2022 in Tug Tavern
Here is a supossubly anecdotal review. Seems a little cheery to me to be unsponsored. Anyway, has anyone used them outside the 401-k context?

I have my stuff at MS. Most of the wealth there is not subject to any AUM fees .... yet. My deal with the guy is that when my liquidity event happens, at some point, he'll charge it.

My issue is, will it ever be worth the 1% to 1.5% (some higher)? Do I just build a bond ladder when I retire and call it good? I need to make plans for a move one way or the other, but I can't see myself paying the AUM and I can't see myself going it alone.

What are you all planning to do?


https://www.doughroller.net/investing/vanguard-advisory-services-review/


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    FireCohenFireCohen Member Posts: 21,823
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    edited February 2021
    Idk paying wealtmanagers to pick funds is a fucking waste of money and drag on return. Only worth if you are lazy
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    creepycougcreepycoug Member Posts: 22,749
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    FireCohen said:

    Idk paying wealtmanagers to pick funds is a fucking waste of money and drag on return. Only worth if you are lazy

    Are you saying it's different if they are picking stocks?


    I guess the real question is whether professional money management is worth the AUM?
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    HFNYHFNY Member Posts: 4,528
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    creepycoug said:

    FireCohen said:

    Idk paying wealtmanagers to pick funds is a fucking waste of money and drag on return. Only worth if you are lazy

    Are you saying it's different if they are picking stocks?


    I guess the real question is whether professional money management is worth the AUM?
    It depends. Are you looking for just a money manager or trust and estate help too?

    You could also look to pay a flat fee for one-off CFP advice instead of a yearly fee.

    I am probably younger than you but I like doing all of my stuff myself (other than trust / estate in the future) because a 1% management fee (give or take 25 bps) along with any ETF / Mutual Fund specific fees really add up as the years go on. My errors in judgement (holding a loser too long, selling a winner too early, or generally being FS) haven't cost me quite as much as the fees and errors in judgment a professional would cost over the years.
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    HHuskyHHusky Member Posts: 19,276
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    We've got a portion of our money being managed. I'm doing a little bit of wait and see, but I do look frequently. Best argument I can see for it at this point is that I don't have access to some investments they do have access to. So far so good, but I'm not sure they're doing any better than I do with the rest. And frankly, the boring, passive, low cost Vanguard index funds have done damn well too.
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    FireCohenFireCohen Member Posts: 21,823
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    creepycoug said:

    FireCohen said:

    Idk paying wealtmanagers to pick funds is a fucking waste of money and drag on return. Only worth if you are lazy

    Are you saying it's different if they are picking stocks?


    I guess the real question is whether professional money management is worth the AUM?
    Creep seems like u done well for yourself u don’t need those morons to touch ur $. Most of them don’t do individual stock picking anyways. They tell you some bullshit that you need a diversified portfolio blah blah and how much you should be paying them.
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    Pitchfork51Pitchfork51 Member Posts: 26,606
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    I have to get my shit straight before investing again

    It fucking kills me that I lost my 800 credit score at 26.
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    FireCohenFireCohen Member Posts: 21,823
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    Pitchfork51 said:

    I have to get my shit straight before investing again

    It fucking kills me that I lost my 800 credit score at 26.

    Bragging about that score lol
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    Pitchfork51Pitchfork51 Member Posts: 26,606
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    FireCohen said:

    Pitchfork51 said:

    I have to get my shit straight before investing again

    It fucking kills me that I lost my 800 credit score at 26.

    Bragging about that score lol
    Mines like 300 I'm assuming
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    Pitchfork51Pitchfork51 Member Posts: 26,606
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    Swaye said:

    I decided about a decade ago to just take the slow and steady simple approach to the small portfolio I have. Index it all and stop worrying about it. So, the whole shitpile is still indexed across a few different indexes and I haven't worried about it in years. I'm more worried about my watches valuation than my stocks and bonds.

    Lol fortunately I gave that advice to my mom and sister and they are sitting pretty while I went bankrupt. Go figure.
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    spudenspuden Member Posts: 353
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    I advised my mom to not use Vanguard Advisory Services, and to just set her allocation and leave it alone other than adjusting on a yearly basis. I think VAS charges .3%, which while it's not a lot compared to other brokerages/wealth advisors, does add up over a career. For example, a $1,000,000 portfolio invested for 30 years with 20k added per year and a return of 8% gives you $12.5 million after 30 years. Subtracting the .3% to a 7.7% return gives you $1 million less after 30 years. As another example, if you used a more general wealth advisor cost of 1% of AUM, your return would be about $3 million less after 30 years with the same stock market returns.

    I don't see any reason to add the .3% headwind to my personal investing. But, for people that don't want to invest the time and effort (like 2 hours a year really) it could be the handholding needed to set up a plan and have someone in your corner to keep you from selling when the market drops and you get nervous.

    You may want to check out the book A Simple Path to Wealth by JL Collins. It provides a pretty simple do it yourself approach to using Vanguard Total Stock Market Index (VTSAX) and Vanguard bond index (VBTLX). Another good resources is Bogleheads personal finance message board:

    https://www.bogleheads.org/forum/viewforum.php?f=2&sid=c13f465324f19c74a2c0d167d17c8143
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    TheRoarOfTheCrowdTheRoarOfTheCrowd Member, Swaye's Wigwam Posts: 1,599
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    edited February 2021
    A nice way to go in my mind is to sign up for the motley fool list and just routinely follow their recommendations ~ over time they have done very well. Another service worth the investment is Zacks ~ their number 1 ranked stocks also have a very good track record of outperformance.

    If you are going to hire a model portfolio manager just make sure that they have a verifiable track record history of outperformance to justify the fee, and that the person responsible for the track record is still handling the money.
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    godawgstgodawgst Member, Swaye's Wigwam Posts: 2,410
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    On the Mount Rushmore of investors, Jon Bogle HAS to be on the list for the advent of the index fund and how many trillions he's made investors who have simply bought and held them as their investment philosophy.
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    HoustonHuskyHoustonHusky Member Posts: 5,954
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    One word of caution on these services...they can be really, really good for folks that don’t want to mess with or don’t fully understand it. But I’ve known 3 people now who have been taken to the cleaners by wealth management folks, all with different stories. Including my grandmother who lost what I’m guessing was several million twenty years ago now...her guy retired and the new people churned her account dry.

    Don’t ever assume because you hire these people that you don’t have to pay close attention to it or that they always have your best interest at heart...they have their own drivers as well.
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    TheRoarOfTheCrowdTheRoarOfTheCrowd Member, Swaye's Wigwam Posts: 1,599
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    Here is the track record of Zacks research and i have followed them for years as a service ~ what i mean is that i have been aware of them [not following their research recommendations, simply aware of their service] and i'm convinced that their research capabilities are real. This would still mean religiously following the additions and removals from the number 1 list and acting accordingly which is a lot more than a lot of people would want to do, but it is an option.


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    SourcesSources Member, Swaye's Wigwam Posts: 3,817
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    You can always compare your track record against those of managers. If the delta exceeds fees, it’s a no brainer to not have to do the work.

    Most good managers should be getting you >15-20%, and should have access to funds that would otherwise tell you to fuck off.
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    backthepackbackthepack Member Posts: 19,799
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    edited February 2021
    FireCohen said:

    creepycoug said:

    FireCohen said:

    Idk paying wealtmanagers to pick funds is a fucking waste of money and drag on return. Only worth if you are lazy

    Are you saying it's different if they are picking stocks?


    I guess the real question is whether professional money management is worth the AUM?
    Creep seems like u done well for yourself u don’t need those morons to touch ur $. Most of them don’t do individual stock picking anyways. They tell you some bullshit that you need a diversified portfolio blah blah and how much you should be paying them.
    Wow. You’re an actual autistic financial “genius.” I’m shocked.
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