Quote:
Originally Posted by Phanuthier
I understand stocks and I'm pretty confident about decisions I make. I just have an adviser because (1) I'm becoming busy in life, that I haven't had time to follow all my holdings, let alone find other opportunities I want to invest in, and (2) I don't understand MF's and since my 401k is forced to be in MF's I want someone else telling me what to invest in.
|
I'd stay away from an advisor.
401ks are rather easy to allocate and don't require frequent tinkering imo. I allocate 20% for a bond fund (i've been heavier for a while since rates are dropping and won't rise for a while) and then the remaining to a dividend paying large cap fund, an energy fund, a corporate / convertible bond fund, a healthcare fund, and a small / mid-cap fund. If I have guessed your age range correctly (27-30), then you can bias a little less to bonds if you'd like.
For the most part it's no point to invest in too many funds since their holdings overlap. Find a couple of sectors that will be beneficiaries of increasing demographics (for me, that's healthcare and energy) and then the rest can be in profitable / dividend paying funds. You'll do well in the long run.
I think the money spent on an advisor would just be wasted. They're going to take an annual cut and possibly a cut per re-allocation / transaction... all wasted expenses imo. The benefits of starting your savings early far outweighs any advantage an advisor may provide.