mispoken

You'll get 100 different answers here. A lot of people in real estate. Some people have advisors. Some people prefer to just do low cost index funds. Personally; I've always just used Stock Advisor and Rule Breakers from the Motley Fool. I'm pretty much "anti" advisor as they are paid a fee of 1-2% and almost always under perform the market. Under performance + fees= potentially millions missed over the course of your career. Indexing is a great way to start and if you want to start dabbling into individual equities check out The Motley Fool.

TED74

Here’s one of a hundred opinions. Hire a fee-for-service advisor that comes recommended from friends and family who have used them for several years. Look for someone smart on investments, but also budgeting, taxes, insurance and retirement planning - get the whole picture. It’s likely they will also have expertise in real estate and other peripheral areas of finance. Pay a few thousand a year for multiple meetings and periodic reviews and strategy tweaks, independent of the performance of your investments (since 1-2% is too expensive, particularly if you have $1M+ in investments they will really just put on cruise control). Expect them to recommend portfolio adjustments that you can initiate yourself. When financial decision points arise for you and your family, you’ll already have someone well versed in your finances and goals and risk tolerance and personality to be able to provide well-informed and relevant advice without starting from scratch.

This opinion is worth exactly what you paid for it!

notEnuf

With 29 years to go, just put as much as possible into your 401k. I wish I had maxed it since day one. As far as investments go, the easy button is the fund of funds for your retirement date. It’s pretty aggressive with your time horizon and diversified enough you won’t get bruised early on before you have a chance to figure out what you want to do. Plenty of people have gone to advisors and said make it a pool I can draw from like a pension only to pay way to much for generic advice. If you are burned early you tend to be gun shy. That can cost a lot over time if you are giving away 1-2% to fees because they’re the pros or you get overly conserve. My $.02. Financial Engine will get you in the ballpark for free. If you average the market it’s 10ish percent per year, there’s no reason to make it 9 or 8 for you.

mispoken

i like these comments. I know a lot of people who decided to go “self directed” to shortly after switch to an advisor or stop all together due to short term unrealized losses. Figure out what works for you, and stick to it. The less you check in on the investments the better you’ll do.

For fun, I recommend running the numbers in a simple compounding calculator. Assume you start with a zero balance and invest $64k/yr (assuming back door Roth and mega back door Roth are still options, TBD). Run them at 10, 9, 8, 7% annualized returns. The difference being under performance and/or advisor fees. See what a HUGE difference 1% under performance and 1% advisor fees will cost you. It is an eye popping number. The numbers won’t seem real, but I assure you they are and they’re very attainable with maxing out those accounts every year and a very long term time horizon in mind.

Hawaii50

This is a great thread. One of the easiest things you can do is read The Simple Path to Wealth by JL Collins. Go from there depending on if you like hands on investing or would rather devote your time somewhere else. Easy read and if you start now and don’t touch it too much, you’ll likely have more money than you know what to do with.

Gunfighter

Guilty of all the above. There are pros and cons of each.

Real estate comes in two flavors, direct involvement and passive involvement. This is my favorite retirement plan and I do a mix of each. The active directly owned real estate takes a fair amount of work, provides the best returns and provides the necessary qualification for my wife to be considered a "real estate professional" for taxes. The passive investments are in multifamily housing with a number of thoroughly vetted syndicators. They provide good cash flow, overall returns and because of "real estate professional" status they also convey the tax advantages. The best part about real estate is that you don't have to predict when you will die, the income from rent (direct) or quarterly distributions (passive) keeps flowing in year after year. The closest market equivalent is a good dividend stock.

Advisors work well when you know why you are hiring them. If you don't know how to invest your own money, how can you tell if the advisor is doing a good job? Ours provides some ancillary estate planning services and advice on entity structure which make it worth the fees on the portion he manages. There are also some networking opportunities with other clients. If you want to be wealthy, you should hang out with wealthy people.

Low cost index funds work great for a set it and forget it approach. This is probably the 90% solution in a 401k account. I'd throw Berkshire Hathaway in the low cost index fund category due to the diversified mix of assets in the company. There is a reason the S&P 500 is the most common yardstick used to measure performance of advisors. IMHO the retirement date target funds don't provide enough equity exposure as you reach retirement. Hopefully we all live long enough in retirement to experience a couple market cycles.

Stock Advisor from Motley Fool is a great tool for investors who are more hands on. I've kept the training wheels on and use the advice on a small portion of the retirement account.

GogglesPisano

I just cancelled my Motley Fool subscription. Their picks underperformed the S&P (they went nuts for tech stocks last year.) IOW, they cost me money.

Not to mention the constant upselling emails.

notEnuf

Motley is a far cry from its niche analytics roots and deep value finds. I dumped them years ago.

SonicFlyer

Have a list of these types of players? I'm interested!

mispoken

the marketing emails are awful. Got to turn that off. I’ve been through ruts with TMF picks before, but 5-6 of their picks that I’ve held for 10+ years make up the majority of my portfolio now. It’s how it goes with individual equities; keep watering the flowers and let the weeds die off. I think a good way to start with them is their starter stocks. That being said, I have to agree, they’re not the company they once were 20 years ago on AOL Keyword “Fool”