ASK A FINANCIAL ADVISOR!! Money questions? Bring 'em on!!
Replies
-
How do you find a FA that you can trust? Are they all out "just to make money". Especially being a single woman, I'm always afraid that I'm not really getting the whole story in any situation.
Your best bet is to find a "Fee only" FA. Fee-only financial planners are registered investment advisors with a fiduciary responsibility to act in their clients’ best interest. They do not accept any fees or compensation based on product sales. Fee-only advisors have fewer inherent conflicts of interest, and they generally provide more comprehensive advice.
I would agree with this. However, there is one caveat. Most fee-only advisors have a minimum portfolio size (typically $250K or more) that they require before they will take on a client. For someone who is just starting out, that's generally unrealistic. I would suggest walking in to a Schwab branch or a Fidelity branch if there is one in your city. They will work with you and give you guidance, online resources and their phone hotlines have a lot of very good people. They do NOT sell "loaded" funds in which you pay a commission up front on any investment.
Stay away from insurance based firms (i.e. Northwestern Mutual, AXA) and firms that do sell loaded funds (i.e. Edward Jones). Ask anyone you interview how they get paid. They should have no problem giving you a straight answer. If they don't give you a straight answer, that's a red flag. Straight commission brokers are not necessarily the devil - I've known some very good and honest ones - but remember that they have to sell something to make any money.
Best of luck!!
Great advice here!! :happy:0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
Get a cheap 10 year term or an ART (annually renewable term). It shouldn't cost you more than $20 a month for that small a death benefit (depending on your health). I honestly doubt it would even be that much.
Yup. Google intelliquote and you can check your posible rates.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
I'm a master at budgeting.
Don't. Buy. Stuff.
But, but, but.... food.... and more food...
No, you're right. I just have to stop being a baby. I'll buy food when I'm rich. But you are right, I gotta get those little expenditures in check.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
Get a cheap 10 year term or an ART (annually renewable term). It shouldn't cost you more than $20 a month for that small a death benefit (depending on your health). I honestly doubt it would even be that much.
Yup. Google intelliquote and you can check your posible rates.
Coolness. Thanks to all for the advice.0 -
Do you know anything about psychiatry?0
-
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.0 -
I am a CFA charterholder and have worked in a bank before, doing financial projections for big corporations. I do my own finances. When I see TV ads from big companies telling you to give them your money so they can make you a cabin by the beach, I flinch real hard. They are only out for themselves and have no interest in your well being. Just know that.0
-
For the person who asked about picking a FA: The strongest protection you can have is to educate yourself. Learn what stocks, bonds, mutual funds, ETFs, etc are and how they work. Knowledge is power.0
-
Did you have clients calling their annuity companies to yell at them because they lost money when the market crashed in '08?
(I was on the receiving end of those calls for almost 3 years)0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
I'm a master at budgeting.
Don't. Buy. Stuff.
But, but, but.... food.... and more food...
No, you're right. I just have to stop being a baby. I'll buy food when I'm rich. But you are right, I gotta get those little expenditures in check.
Ha. Honestly, I'm not a "stuff" person. I don't have cable and my internet is a hot spot off my phone, so I'm only paying one bill for that. My apartment is just enough space for me. I have a studio because I don't need a two bedroom apartment. Up until recently, I had a car that I saved for (by walking/riding/taking the bus), paid it in full and paid the insurance up for 6 months. No car payments, no insurance payments and no cable payments gave me a lot of breathing room and I just bought myself a brand new car.0 -
Here is my simple advice, which has served me well. In order of priority:
1) get out of debt - this means anything you make payments on. Remember if you are making payments, you dont own it, it owns you.
2) have a 6 month emergency fund (3 months to start with). Put this aside in a savings account or buy laddered CDs.
3) if your employer offers a 401K matching, chances are that you get the max if you contribute a certain percent yourself. Get that max match every single month. Invest that money in a Target Date fund which will automatically change the risk profile as you age.
4) Do not time the market but keep an eye on interest rates and the stock market anyway. If they market is going up for no reason, as it has been this year, just know that there are no legs under it. Even in this case, do not change your retirement allocation in 3 above.
5) Stay away from big companies that promise you retirement.
6) Be happy.0 -
Also, its more fun to go to Vegas than to invest in the stock market (that is try and beat the market, Target Retirement funds are a good combination of stocks and bonds and perfect for average man/woman). Both offer similar services.0
-
For the person who asked about picking a FA: The strongest protection you can have is to educate yourself. Learn what stocks, bonds, mutual funds, ETFs, etc are and how they work. Knowledge is power.
Seriously. Having worked in an annuity call center for almost three years, I can attest to the fact that a LOT of people don't educate themselves. They blindly trust their advisors, and even a lot of advisors are not that smart (I worked with both clients and advisors). A lot of people on both ends would call in and ask the most basic questions.
***Make sure the advisor knows what they're selling you!*** Also, read before you sign!!!0 -
Here is my simple advice, which has served me well. In order of priority:
1) get out of debt - this means anything you make payments on. Remember if you are making payments, you dont own it, it owns you.
2) have a 6 month emergency fund (3 months to start with). Put this aside in a savings account or buy laddered CDs.
3) if your employer offers a 401K matching, chances are that you get the max if you contribute a certain percent yourself. Get that max match every single month. Invest that money in a Target Date fund which will automatically change the risk profile as you age.
4) Do not time the market but keep an eye on interest rates and the stock market anyway. If they market is going up for no reason, as it has been this year, just know that there are no legs under it. Even in this case, do not change your retirement allocation in 3 above.
5) Stay away from big companies that promise you retirement.
6) Be happy.
I agree with all of this. Though, I keep my emergency fund in cash and I prefer investing in mutual funds and controlling my own risk profile.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.0 -
I am a CFA charterholder
Those tests are brutal. I did a temp. job helping with the CFA test grading a couple summers ago (the CFA Institute's headquarters is in my town). Props to you.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
*nods* Agreed. I was assuming that dependents were involved.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
I do not recommend using insurance as an investment vehicle.0 -
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
While permanent insurance policies and annuities have their place in financial planning, they are unfortunately some of the most oversold products in the industry due to their high commission structure for the agents that sell them. I can't tell you how many times I helped people get out of CV policies and annuities that never should have been placed in them in the first place.
If you are not maxing out your tax-advantaged retirement account options already, you should not be considering a permanent life insurance policy.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
I do not recommend using insurance as an investment vehicle.
My understanding is that there is a limit to what you can set aside in a IRA or 401K. If you want to set aside more on a tax advantaged basis, you can use an insurance vehicle.0 -
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
While permanent insurance policies and annuities have their place in financial planning, they are unfortunately some of the most oversold products in the industry due to their high commission structure for the agents that sell them. I can't tell you how many times I helped people get out of CV policies and annuities that never should have been placed in them in the first place.
Agreed.0 -
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
While permanent insurance policies and annuities have their place in financial planning, they are unfortunately some of the most oversold products in the industry due to their high commission structure for the agents that sell them. I can't tell you how many times I helped people get out of CV policies and annuities that never should have been placed in them in the first place.
If you are not maxing out your tax-advantaged retirement account options already, you should not be considering a permanent life insurance policy.
yes that last sentence is what i was referring to immediately above.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
I do not recommend using insurance as an investment vehicle.
My understanding is that there is a limit to what you can set aside in a IRA or 401K. If you want to set aside more on a tax advantaged basis, you can use an insurance vehicle.
There is a limit, which is fairly high. Though, you can also roll money over from a traditional to a Roth (if memory serves, I am not quite at this level yet).0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
I do not recommend using insurance as an investment vehicle.
My understanding is that there is a limit to what you can set aside in a IRA or 401K. If you want to set aside more on a tax advantaged basis, you can use an insurance vehicle.
True, they have caps on how much you can put in them per year, and if I'm remembering correctly it's based on age/whether you're retired or not.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
I do not recommend using insurance as an investment vehicle.
My understanding is that there is a limit to what you can set aside in a IRA or 401K. If you want to set aside more on a tax advantaged basis, you can use an insurance vehicle.
True. However, variable annuities and VUL policies have massive fees and huge surrender charges. They do a place in financial planning but they need to be used for the right purpose. I agree with the OP that they are among the most oversold products in the industry. If you want a variable annuity, make sure you understand what you are getting into and HOW you can get out if necessary.
Also, on the emergency fund, basic rule of thumb: 6 months of reserve for a single income family, 3 months for a dual income family. Do NOT ladder CDs for an emergency fund since that money is not liquid without incurring a penalty. That defeats the purpose of an emergency fund. Yield sucks right now anyway.0 -
This is very useful. And very generous on your part.
1) If I close a credit card account, which has a high interest rate (the reason I want to close it) will my credit score decrease? This is my 1st credit card, and all my payments are on time, and have been paid off in the full amount.
2) How often should you check your credit score? Once a year, or twice a year?
3) With the economic meltdown, the number of student loans given out are significantly decreasing. In what ways can a student increase the chance/possibility of getting a loan? (In the $200K+ range)
Thank you.
0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
I do not recommend using insurance as an investment vehicle.
My understanding is that there is a limit to what you can set aside in a IRA or 401K. If you want to set aside more on a tax advantaged basis, you can use an insurance vehicle.
There are still better options out there. Many tax-free securities options exist. The ART factor of life insurance policies will mean that in order to really get the tax-free growth needed to make it a viable option, they need to be overfunded up front and you must make sure to stay well ahead of the rising COI in the policy. For a select few individuals, this is possible and a good option as long as all other tax-free vehicles have been exhausted.
For MOST people, CV life insurance does not make good financial sense given the other options that are available.0 -
I will be a grad student, starting this fall, and I'm getting a "parent loan." They want me to have life insurance just in case something happens and I, being dead, am not able to pay them back the $20,000. What kind of life insurance should I get? Keeping in mind I am a poor grad student.
On that note, any advice for me regarding budgeting, since I will need to work to support myself while I'm in school?
You should get a 20 year term policy for around 10x your annual income, ideally. If you don't make much, this will be pretty cheap. Likely less than $10/month.
As for budgetting, you will want to list all of your monthly expenses in terms of importance. Then allocate your monthly income to each one. It is also worth going through and eliminating any fat at this point.
Food
Housing
Utilities
Transportation
These are the four most important.
One caveat to this advice is to make sure you need life insurance for that much and for that long. Life insurance is primarily used for income replacement. If no one depends on your income (ie, wife, kids, etc...) then you may need much less insurance and for a shorter period of time. Do not pay for something you do not need.
Life insurance with an investment component like Variable Annuities and Universal Life have also been used as an investment vehicle as they offer tax advantages and the insurance company guarantees a minimum protection. However, due to low interest rates, the companies are no longer offering all the guarantees they used to. But if you bought one of these in the past and had the option to surrender, you probably made good money.
I do not recommend using insurance as an investment vehicle.
My understanding is that there is a limit to what you can set aside in a IRA or 401K. If you want to set aside more on a tax advantaged basis, you can use an insurance vehicle.
There is a limit, which is fairly high. Though, you can also roll money over from a traditional to a Roth (if memory serves, I am not quite at this level yet).
True. However, doing so means you are taking a distribution from your traditional IRA and that money will be considered ordinary income in the year in which you do it. That means potentially a very large tax bill as well as penalties if you are under age 59 1/2.0 -
True. However, variable annuities and VUL policies have massive fees and huge surrender charges.
Ohh this depends on the VA. Most do have massive fees compared to other types of investment vehicles, but in terms of surrender charges, if you play your cards right you may not even have one.0
Categories
- All Categories
- 1.4M Health, Wellness and Goals
- 393.4K Introduce Yourself
- 43.8K Getting Started
- 260.2K Health and Weight Loss
- 175.9K Food and Nutrition
- 47.4K Recipes
- 232.5K Fitness and Exercise
- 426 Sleep, Mindfulness and Overall Wellness
- 6.5K Goal: Maintaining Weight
- 8.5K Goal: Gaining Weight and Body Building
- 153K Motivation and Support
- 8K Challenges
- 1.3K Debate Club
- 96.3K Chit-Chat
- 2.5K Fun and Games
- 3.7K MyFitnessPal Information
- 24 News and Announcements
- 1.1K Feature Suggestions and Ideas
- 2.6K MyFitnessPal Tech Support Questions