Big Box fund managers that actually make money on your investment? HELP!!

So, I'm a little over 50, have a touch over $300k invested in a balanced portfolio, moderate risk levels across the board, and Northwestern Mutual returned me a 4 quarters running loss. I am Berklying IRATE!!!

I talk to my guy after every statement and am getting really tired of hearing 'market volatility, underperforming foreign investments, etc.'. The DOW is setting record after record!!! I'm 'balanced' so I'm not heavily in index funds, but come on!

What, or who, can the hive recommend I change? I'm completely open to walking away from NWM.

Are these actively managed mutual funds?

Adjusted regularly, but not aggressively.

The stock value of my portfolio is up about 3% over the last 12 months, ending at the end of December. I use a fellow associated with Raymond James and he's done well for me over the last several years. Most of my stuff is blue chip, recognizable name stocks that generate dependable dividend yield and growth, rather than appreciation. I'm already retired, so that's more important to me. The large cap portion of the portfolio has not matched the DOW, but the other areas have matched or exceeded other indices that represent their segment. I'm happy with my guy.

Get into a Vanguard index fund, and leave it be. Most money managers CANNOT beat the market on a regular basis; those that do typically have costs high enough to make it not worth it.

I checked a few of Vanguard's funds for the previous 12 month's performance. The 3 or 4 that I looked at did not perform well over that period, they were historically impressive however.

Did you look at index funds?

I honestly don't recall, but will check. I seriously wonder how long the major indeces have before a significant correction though.

Most of my 401k is invested in SNXFX a Schwab index of the top 1000 companies. Tracks with the market well and its a low load fund. Returned something like 6% of my gross in dividends last year (yahoo et al. are wrong for the dividend) and nearly 12% year over year. The rest is invested in a vanguard as it is also low load.

Honestly for long term growth the load is very important. If you allow 1% of the fund to be consumed in fees each year it works out to around 66% of the profits over 30 years. I don't know about you but I work too hard to let some button pusher consume two thirds of my profits.

If you looking for a broker ask them straight to their face if they have a fiduciary duty clause in the contract. If the answer is no thank them for their time and leave.

1: Don't look at the previous 12 month performance. That is 12 months. Compare how they did to the rest of the market in those 12 months, but don't judge it solely on those 12 months. That would be akin to saying that the Miata is a bad car because it is slow, and completely ignoring build quality, handling, and feel.

2: Check out VFINX, VDAIX, VIGRX, VHDYX, VTSMX, VIVAX, And for something a little bit more risky, I'll also throw in VGSIX depending on how you feel about real estate.

The easy buttons for this are VTSMX and VIVAX.

Also, what did your manager do in 2013? What kind of returns? Because I saw approximately 17% in 2013 alone, almost entirely in Vanguard index funds. Was he in that ballpark?

1 other thing: What does he charge you?

Have you considered buying/putting some money in individual stocks? Using the internet to do research it's way easier to find good companies then it was in the days before it. Right now the best performing stock I have is "Waste Management" It pays a dividend and has appreciated nearly 50% since I bought it.

Back in 2008 it was pretty well established that the entire financial industry was the equivalent of a pedophile babysitting operation. Not only that, but they are beyond the reach of the law. I cant believe that people continue to give these crooks their money.

Keep in mind that the person you call a "financial adviser" is rewarded by how much of your money becomes his (companies) money, NOT by how much he makes for you.

The Vanguard funds are very good overall funds. I've got money in their bonds fund VWESX and it's done well.

I've done really good over the last couple years picking my own stocks but it takes a lot of time doing your homework. If you go that route, just do your homework and learn the real dynamics of the market because it doesn't always make sense at first glance.

I'm a vanguard index'er as well. No load. Annual fees around .2% or less. VTSMX made 14% last year with .17% fees. I'm calling that pretty good. Even VTIVX is 9% for one year (2045 target retirement).

NOHOME wrote: Back in 2008 it was pretty well established that the entire financial industry was the equivalent of a pedophile babysitting operation. Not only that, but they are beyond the reach of the law. I cant believe that people continue to give these crooks their money.

This. My retirement plan is basically an episode of "Live Free or Die," but if I had money to invest...I don't think I'd invest it. I'd probably put it into adding off-the-grid tech to my house (if I owned a house), that will eliminate running costs and pay itself off in the long-term so it's kind of like an investment, and depending on how things go it could be particularly useful later.

mtn wrote: Get into a Vanguard index fund, and leave it be. Most money managers CANNOT beat the market on a regular basis; those that do typically have costs high enough to make it not worth it.

Ding ding ding. The cost of having "a guy" rather than "a fund" will eat into your returns pretty significantly over the long term.

After 35 years of doing it on my own with IRA, 401k, and after tax individual investments, my wife and I recently decided to go with a financial advisor. When I was doing it on my own it was a serious hobby. I was constantly researching and reading newsletters, magazines, books, listening to the experts, etc. (Vanguard Total Market had been one of my investments for many years. It follows the market and did OK). We were fortunate to make it successfully through 35 years that way and despite a couple unavoidable market setbacks managed to do well by the time I retired. But it was a lot of work and was somewhat stressful at times. I didn't want to do it alone anymore because the older you get the more important it is to preserve the principle and avoid setbacks. There's not enough time to recover after a downturn. So We found a reputable advisory firm with a good track record and impeccable reputation that's affiliated with the oldest bank in a nearby state. Can't get much better than that. We have quarterly conference calls and an annual face to face meeting to review everything. The fee is a percentage and is surprisingly low. I'm very satisfied with performance after the past 6 quarters we've been with them. The gains far exceed the fee. We're currently in growth mode, but in a year and a half or so when my wife retires they'll switch us over to income payout (interest and dividends only, no principle). I really wish I'd done this sooner. If you're over 50 I'd recommend at least looking into it, even if you think you can do as well or better on your own.

calteg wrote:

mtn wrote: Get into a Vanguard index fund, and leave it be. Most money managers CANNOT beat the market on a regular basis; those that do typically have costs high enough to make it not worth it.

Ding ding ding. The cost of having "a guy" rather than "a fund" will eat into your returns pretty significantly over the long term.

This, again. My Vanguard stuff consistently beats the market and the annual fee is .018% (that's not a misprint or fatfinger). It's VWIAX if you want to look it up.

By the way, be careful WHEN you move. Right now your losses are 'paper losses'. Look at the history, many funds typically rise/fall with the time of year. If you pull your stuff at a low point, your paper loss just became a real one. If you swallow hard and wait for the historical time of year that your fund is 'high' then you can reduce or eliminate that 'paper' loss.

Thank you all for the advice and recommendations. I have a lot to sift through, but will most definitely be making a big change.

As someone with a $37.95 portfolio and 2 kids headed to college, I have to say "OH BOO HOO!" I'm kidding of course, no one likes consistent losses. My rule is that I am ok spending or loosing money on something as long as it makes sense to me and I understand it. If your guy can't give you a clear answer, then find another guy.

Kick your manager to the curb and use a service that performs better and charges much lower fees:

Wealthfront – "Wealthfront manage a diversified, continually rebalanced portfolio of index funds on your behalf that is fully diversified and periodically rebalanced at a very low cost and in an extremely tax efficient manner. Currently managing over $1 billion in assets."
Accounts from $5,000 to $10,000 are free; fees are 0.25% for larger accounts

Betterment – "The Betterment portfolio is designed to achieve optimal returns at every level of risk. Through diversification, automated rebalancing, better behavior, and lower fees, Betterment customers can expect 4.30% higher returns than a typical DIY investor."
No minimum investment; annual fees as low as 0.15%

Aspiration – "Wall Street gives the richest Americans access to strategies not found in the portfolios of most everyone else. Aspiration's mission is to open the doors of opportunity to all." Company donates 10% of revenue to economic development charities.
Minimum investment is $500; fees are voluntary

Curmudgeon wrote:

calteg wrote:

mtn wrote: Get into a Vanguard index fund, and leave it be. Most money managers CANNOT beat the market on a regular basis; those that do typically have costs high enough to make it not worth it.

Ding ding ding. The cost of having "a guy" rather than "a fund" will eat into your returns pretty significantly over the long term.

This, again. My Vanguard stuff consistently beats the market and the annual fee is .018% (that's not a misprint or fatfinger). It's VWIAX if you want to look it up.

+1. Index funds are the way to go. But...

That is a misprint or fat finger. "Expense ratio 0.18%"

The total market index funds @ Fidelity and Vanguard are 0.05% (investments > $10k) and that is about the lowest I have ever seen.

nderwater wrote: Kick your manager to the curb and use a service that performs better and charges much lower fees: Wealthfront – "Wealthfront manage a diversified, continually rebalanced portfolio of index funds on your behalf that is fully diversified and periodically rebalanced at a very low cost and in an extremely tax efficient manner. Currently managing over $1 billion in assets." *Accounts from $5,000 to $10,000 are free; fees are 0.25% for larger accounts* Betterment – "The Betterment portfolio is designed to achieve optimal returns at every level of risk. Through diversification, automated rebalancing, better behavior, and lower fees, Betterment customers can expect 4.30% higher returns than a typical DIY investor." *No minimum investment; annual fees as low as 0.15%* Aspiration – "Wall Street gives the richest Americans access to strategies not found in the portfolios of most everyone else. Aspiration's mission is to open the doors of opportunity to all." Company donates 10% of revenue to economic development charities. *Minimum investment is $500; fees are voluntary*

Those are high fees and some bullE36 M3 statements.

ProDarwin wrote:

nderwater wrote: Kick your manager to the curb and use a service that performs better and charges much lower fees: Wealthfront – "Wealthfront manage a diversified, continually rebalanced portfolio of index funds on your behalf that is fully diversified and periodically rebalanced at a very low cost and in an extremely tax efficient manner. Currently managing over $1 billion in assets." *Accounts from $5,000 to $10,000 are free; fees are 0.25% for larger accounts* Betterment – "The Betterment portfolio is designed to achieve optimal returns at every level of risk. Through diversification, automated rebalancing, better behavior, and lower fees, Betterment customers can expect 4.30% higher returns than a typical DIY investor." *No minimum investment; annual fees as low as 0.15%* Aspiration – "Wall Street gives the richest Americans access to strategies not found in the portfolios of most everyone else. Aspiration's mission is to open the doors of opportunity to all." Company donates 10% of revenue to economic development charities. *Minimum investment is $500; fees are voluntary*

Those are high fees and some bullE36 M3 statements.

Didn't Betterment get the MrMoneyMustache stamp of approval?