Newer partner here. Sadly just getting started with a financial plan with an FA. I know I’m late... Any advice you have on things you wished you did / knew as you started your financial plan? Wishing you’d invested in Apple at $10 or started earlier is a given! Thank you

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Better late than never! If I had the ability to do it myself, I would have started in my early 20’s. However once I started to make some real money I reached out to an alumni friend who is at BoAML. While I was a bit under their usual clientele from a bottom line net worth number, I can say I’ve been extremely pleased with the service and the few perks of being both a BoA customer and Merrill Lynch wealth management client.

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In addition to other great comments here:

1. Diversification isn’t complicated, don’t let your FA complicate your portfolio.

2. Keep some money in cash to seize upon once-a-decade style crashes (like March 2020), these crashes put sound companies 30%+ down and they can be the best way to make some serious gains in a short time, specifically helpful if you are playing catch up. Same opportunity applies for real estate, if you’re up for the additional time/costs that kind if investment may require.

3. Investing in the equity program of my Firm has been extremely lucrative.

4. Don’t ignore crypto assets as an investment. They are volatile, they are risky, and they aren’t going anywhere. Don’t let your FA talk you out of it simply because they don’t understand it. There are some funds worth considering but owning some of these assets outright (in a “wallet”) is easy. Most of the crypto assets are flash in the pan, but a few really do have potential to revolutionize how we do business.

Last, i was an FA early in my career with UBS, Morgan Stanley. They’re best utilized if you don’t want to watch the market. They don’t often have “hot tips” more so than you’re able to find on your own. If you ever want an objective opinion, holler.

MD1, for BTC yes. For LTC no. All i’m saying us do the math to make sure the decision and timing on the buy makes sense.

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I’ve generally found financial advisors to be valueless, actually.

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Same. I find FAs to be useless at best, and biased in their own favor at worst (some are incentivized to steer you to particular fund families etc).

Honestly all you need to do is:

1) create a budget so you know approximately how much is coming in and out each month.

2) max out tax deferred investments first (401k, IRA contributions etc).

3) pay off any high interest debt (credit cards)

4) keep your low interest debt (maximize low risk leverage while you’re growing your asset base - eg a mortgage that’s fixed 3% is hard to beat - it’s almost free money, and you’d be leaving larger gains on the table by using cash to pay off this kind of debt - better to put that cash in the market )

5) start putting all additional surplus into a low cost fund provider (Vanguard is good). Spread across maybe 5-6 funds, get some exposure to large cap, mid cap, small cap, international, and maybe a sector fund that you like (health, real estate, whatever).

6) once you have a sizable enough position in the market you might start looking at private placement real estate deals to diversify a bit and add a bit more risk/reward.

As mentioned, time in the market beats timing the market. Just do the above, and set and forget. You’ll look up in 20 years and have millions of dollars.

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EYP - how did you first find him or her? Some stats or data on performance?

Agree. I do things on my own.

My mantra is time in market > timing the market

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New partner? Understand the tax implications of everything. But/sell/hold/invest/etc. Tax implications for you are different than for others.

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I think a critical aspect here as a new parter and perhaps I missed it elsewhere, but what are the expected tax obligations and frequency you expect? (Generally these are paid quarterly so having enough free cash to cover is preferred IMO, versus something like a home equity line of credit.)

That calculus can change approach where having more liquidity in something like a bond fund may be an important consideration.

Then as a partner there may be stock restrictions so mutual funds are generally the play and aid in diversification.

Another option depending on available cash will be rental real estate which are long term investments but later can provide diversification, passive income and opportunities for tax benefits.

If you remain W2 then it’s a much simpler compensation model.

There may be some intangible benefits of having a third party. Speaking of my own situation, my spouse is more comfortable having an outside advisor as she thinks there’s some special knowledge they have (ehh), and I’m happier having someone else to “blame” when markets are down or an investment doesn’t perform as well as expected. Is that worth 1% a year? Probably for me.

Happy spouse, happy life

It’s all about tax avoidance.

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