How do you manage your money/investments?

[EZEtoGRU]

I've been using Raymond James for about 12 years now. Not really thrilled with them. I always feel they are trying to push financial products on me that I don't understand or that I don't want. Frequent suggestions to get annuities or Long Term Care insurance....both of which attract a high commission for the broker I think. I feel like they want to set things up that will maximize their income whether or not it is really in my best interest.

 

I thought this would be a good place to see if others feel the way I do about traditional money managers and what better options are out there.

 

Good or bad experiences to share? Please chime in. Many of us could benefit from sharing ideas on this topic.

 

Please let's not turn this into a politics-based discussion.

[+ azdr0710]

I give it all to USAA and sleep well at night......

 

yes, avoid annuities......though safe and "feel-good", the commission thing is a well-established, legendary racket.....

 

long term care insurance is good, I suppose, but gets pricey.....I dunno, if it gets to that point, just put me on an iceberg and shove me out to sea like the Eskimos do......

 

no expert here at all, but sticking with well-known, low-cost groups like Vanguard or USAA seems the way to go......don't get into weird stuff......

 

I don't even have a "broker" that calls me......and I'm happy about that......

[+ Avalon]

I would suggest getting Long Term Care insurance. I wish that I had done that years ago.

[+ MasssageGuy]

I would suggest getting Long Term Care insurance. I wish that I had done that years ago.

Long term care insurance is a bust. I can speak first hand. Rates are low when you sign up, but as the pool of covered insured begins to age, the rates go SKY HIGH!

 

It then turns into a death spiral (no pun intended). Rates go up and people cancel, thus leaving the pool of insured smaller to share the ever increasing costs.

 

I don't recommend to anyone.

[+ Avalon]

Long term care insurance is a bust. I can speak first hand. Rates are low when you sign up, but as the pool of covered insured begins to age, the rates go SKY HIGH!

 

It then turns into a death spiral (no pun intended). Rates go up and people cancel, thus leaving the pool of insured smaller to share the ever increasing costs.

 

I don't recommend to anyone.

 

Thank-you.

[LaffingBear]

Poorly

[EZEtoGRU]

Long term care insurance is a bust. I can speak first hand. Rates are low when you sign up, but as the pool of covered insured begins to age, the rates go SKY HIGH!

 

It then turns into a death spiral (no pun intended). Rates go up and people cancel, thus leaving the pool of insured smaller to share the ever increasing costs.

 

I don't recommend to anyone.

 

I've heard that Long Term Care Insurance ism't worth it. Not so much now, but 5-10 years ago, Raymond James was pressuring me pretty aggressively to get it.

[Epigonos]

Whether long term care is a good think or not depends greatly on ones circumstances. I'm single and if I need long term care the state can take my pension, sell my condo and when that money runs out then the state can pick up the tap. Now if I were married it would be a totally different situation. Long term can can consume all of ones assets and eventually leave ones spouse dead broke. In this situation long term care might make good sense.

[EZEtoGRU]

I give it all to USAA and sleep well at night...…

 

no expert here at all, but sticking with well-known, low-cost groups like Vanguard or USAA seems the way to go......don't get into weird stuff......

 

I don't even have a "broker" that calls me......and I'm happy about that......

 

What are the pluses to you regarding USAA ? Do you manage the portfolio yourself? Do you choose the investments yourself within the USAA account?

[Guest]

Long term care insurance is a bust. I can speak first hand. Rates are low when you sign up, but as the pool of covered insured begins to age, the rates go SKY HIGH!

 

It then turns into a death spiral (no pun intended). Rates go up and people cancel, thus leaving the pool of insured smaller to share the ever increasing costs.

 

I don't recommend to anyone.

This hasn’t been my experience. Maybe the insurer, maybe the policy type...I’m not an expert on it. But 20 yrs of premium were recovered in six months of need with my parents taking the edge off of $9,000/mo in care expenses

[Guest]

What are the pluses to you regarding USAA ? Do you manage the portfolio yourself? Do you choose the investments yourself within the USAA account?

USAA has no commissioned sales people (unless something changed), and they have strong suitability thresholds on what they sell. They stick to the algorithm or don’t sell

[+ Avalon]

Whether long term care is a good think or not depends greatly on ones circumstances. I'm single and if I need long term care the state can take my pension, sell my condo and when that money runs out then the state can pick up the tap. Now if I were married it would be a totally different situation. Long term can can consume all of ones assets and eventually leave ones spouse dead broke. In this situation long term care might make good sense.

 

I have a friend in that situation. She had a home and inherited her parents' home and now she sold them and is waiting to exhaust that and then let Medicaid pay.

[+ azdr0710]

What are the pluses to you regarding USAA ? Do you manage the portfolio yourself? Do you choose the investments yourself within the USAA account?

 

I like USAA because it's a conservative non-profit with a history of serving its members (military and children of (I'm the son of an officer)).......I'm lucky and grateful to be able to use them for all my insurance, in addition to the investments......they used to be only open to military officers and their families, but now serve all military and their children (I believe).......

 

I don't manage one of the USAA portfolios (IRA) at all, other than having selected my risk tolerance and general goals......with another USAA portfolio (savings of a sort), I chose a variety of mutual funds myself with varying risk levels.....was later complemented by a USAA advisor on my selections!

[RM]

One of the money experts on the radio said don't get long term insurance if you can afford to pay for a long term facility. About six years ago insurers discovered they were way underfunded. They told my Mom she could continue the coverage she had for about twice the monthly payment or keep the same payment and lose any inflation in benefits. Since she was 85 at the time, it was an easy choice. Six months after starting using the insurance for in-home care, she no longer had to make monthly payments. She had accumulated $300,000 in insurance benefits, but only used $12,000 before she passed away last year.

[Guest]

I've heard from several sources that annuities are usually a bad idea, so I would mistrust any advice of someone who tried to push them. Don't even think about annuities unless you've maxed-out contributions to all possible retirement plans (401k, IRA, etc.). Long-term care insurance depends on your circumstances. If you have a loved one or heirs, I think it's a good idea. Long-term care can wipe out your savings.

[+ E.T.Bass]

The thing about annuities, at least what I've wondered, if the underlying asset(s) go belly up, tank, crash or what have you, what then with your annuity? The people I've heard do their sales pitch were low enough rank that they didn't seem to grasp the notion that something might go wrong. That said, I've had insurance and finance peeps squeal about annuities, the darling of investments, for so long now. I expect that if the investments are federally insured, that provides safety. But thinking back to the Lincoln Savings disaster where Charles Keating (won't mention who was a close family friend of Keating since you asked to not make it political) put a huge portion of deposits into risky investments that were not federally insured, a lot of old Republican biddies in Orange County lost their granny panties.

 

I grew up hearing that timing the market doesn't work nearly as well as dollar cost averaging in. Also was taught that no load index funds are best and to be careful what kind of financial planner you hire as far as their rates and fees. That is the advice I've followed since I was 24 years old and it's working. However, for anyone starting to save later in their career, I'm curious what the pro's recommend doing.

[+ MasssageGuy]

One of the money experts on the radio said don't get long term insurance if you can afford to pay for a long term facility. About six years ago insurers discovered they were way underfunded. They told my Mom she could continue the coverage she had for about twice the monthly payment or keep the same payment and lose any inflation in benefits. Since she was 85 at the time, it was an easy choice. Six months after starting using the insurance for in-home care, she no longer had to make monthly payments. She had accumulated $300,000 in insurance benefits, but only used $12,000 before she passed away last year.

 

"About six years ago insurers discovered they were way underfunded. They told my Mom she could continue the coverage she had for about twice the monthly payment or keep the same payment and lose any inflation in benefits. "

 

This is what happened to me. They raised the rates many, many, many times before I dropped coverage. The good news is that money paid in is still available for long term care if and when I need it. I'm sure all the actuarial tables used to fund these programs are in need to correcting. Bottom line is if you purchase a policy, you will end up seeing the rates go up and up as your earning capability goes down and down.

[mike carey]

"About six years ago insurers discovered they were way underfunded. They told my Mom she could continue the coverage she had for about twice the monthly payment or keep the same payment and lose any inflation in benefits. "

 

This is what happened to me. They raised the rates many, many, many times before I dropped coverage. The good news is that money paid in is still available for long term care if and when I need it. I'm sure all the actuarial tables used to fund these programs are in need to correcting. Bottom line is if you purchase a policy, you will end up seeing the rates go up and up as your earning capability goes down and down.

That strikes me as not insurance but a savings plan. Insurance should provide you with the same benefit regardless of how long you have paid premiums, and cease to offer any benefit if you cease payments. I guess if you knew what it offered when you started the plan, what you call it isn't important. (I have an endowment insurance policy which offers a death payout and separately a savings element that I can cash out or add to the payout if I die while the policy is active. It seemed like a good idea at the time but in retrospect it was a poor investment.)

[bigvalboy]

Real estate....

[+ Keith30309]

If you do have an annuity or similarly structured life insurance policy consider a tax advantaged 1035 exchange if LTC is right for you (and also consider a lump sum buy-in).

[+ MasssageGuy]

I did forget to mention that even though I dropped paying for my Long Term Care, if I do need nursing home care, once my funds in my Long Term Care account are depleted, I am automatically eligible for Medicaid and do not need to dispose of assets. That is a big plus.

[EZEtoGRU]

I like USAA because it's a conservative non-profit with a history of serving its members (military and children of (I'm the son of an officer)).......I'm lucky and grateful to be able to use them for all my insurance, in addition to the investments......they used to be only open to military officers and their families, but now serve all military and their children (I believe).......

 

I don't manage one of the USAA portfolios (IRA) at all, other than having selected my risk tolerance and general goals......with another USAA portfolio (savings of a sort), I chose a variety of mutual funds myself with varying risk levels.....was later complemented by a USAA advisor on my selections!

 

Thanks for that. I wonder what an equivalent type company would be for non-military folks?

[+ SundayZip]

I have most of my investments in three Fidelity accounts (IRA, Roth IRA and a taxable account). I manage all trades myself using the Fidelity website. Cost is $4.95 per trade or free for ETFs, Bonds, CDs and most Fidelity funds -- but I do very little trading. For the most part, I keep money in a small number of highly diversified or "all market" ETFs and index funds. The exception is a couple of tax-exempt municipal bond funds and an individual stock that I've owned for years and don't want to sell until I'm ready to take the capital gains tax hit. My Fidelity advisor has given me some good ideas over the years (eg, annual Roth IRA conversions and the tax-exempt funds), but I do all trades myself so I'm not paying a brokerage commission or a flat percentage to have someone manage the accounts.

 

I'd recommend that you read "Common Sense Investing" by John Bogle. He's the guy who founded Vanguard. It's a quick read and you don't need to be a finance/investing expert to understand it. You can download from Amazon. If you ever get bored with this forum, check out the BogleHeads Forum. Maybe not so sexy, but LOTS of great information and more than a few interesting characters. People often post about advice they've received from a financial advisor and have then received tons of great feedback. Of course, never do something solely based on what you read in a forum, but you can certainly get lots of great ideas.

[cany10011]

This is a great topic. I'm learning a lot. My mother manages my money and does all the trading in my canadian accounts. When she found out I wasn't saving enough, she made me buy a secondary house in Toronto (booming housing market) - I put down 20% and she loaned me the balance. I only have Vanguard (in US) and TD (in Canada) as brokerage accounts.

[+ Charlie]

I started investing in a TIAA traditional annuity when I was 23, because it was a requirement of my academic contract (we did not have a pension plan). I contributed 5% of my salary, and my employer matched that with another 10%. When I retired at 60, I still had other income sources, so I took only the monthly interest on the plan. In 2008, just before the economy started to collapse, I converted to the annuity at its then face value. I have been able to live comfortably on my annuity payments, plus Social Security, ever since, while friends who depended entirely on stocks and bonds went through a nerve-wracking collapse of their income for some time. (I also have stock investments, but since I have never depended on them, I don't get upset about the roller coaster ride in the markets.) Although one of the drawbacks to annuities is supposed to be that they are permanently fixed, in fact, TIAA has raised my monthly annuity payment almost every year.

 

We almost got long term care insurance, but when I priced things out, I realized that if I put the same amount as the premium into some other safe investment, I would still have that money if I never needed to use the insurance. I had one friend who bought an expensive policy, but only used 3 months of long term care. I also knew a couple of people who bought policies, only to discover that the policy didn't pay enough in benefits to be worthwhile by the time they needed it, because the premiums they would have had to pay to get what they actually needed would have been exorbitant.