Post #3211613

2026-05-25 14:06 UTC

> Professional money-managers tell themselves that they take this money to make good decisions, but there is no evidence that they are any better at managing money than people in general, and for every manager with ten million dollars who does better than average, these is a manager with ten million dollars who does worse. Ask your bank. Well, not literally a for-profit bank, but your credit union or other community-owned banking groups will usually employ a team of financial advisors who advise the local whales, big depositors, and small businesses. The fee can be as high as 2%/yr but it's usually going to be closer to the standard 1%/yr. These advisors will be better-aligned than an independent consultant, so they'll give you better advice for around the same price.

Replies (1)

@CinnasVerses@awful.systems 2026-05-25 15:01

Yes, you want to avoid conflicts of interest like an advisor employed by a bank selling that bank's financial products. A financial advisor or financial planner can add value in areas like: - set you up making monthly contributions to something broadly reasonable - helping you figure out what types of insurance you need - keeping you from putting all your money in stocks that are booming, then selling them all when they crash and staying uninvested for years - help you decide whether to keep your emergency fund in a high-interest savings account, a money-market fund, or a regular bank account - avoid paying too many taxes on your investments But many are collecting 1%+ a year to decide whether to buy Honda stock or BMW stock, and there is very strong evidence that this adds no value. (eg. my current employer's pension fund charges 2% a year). For everyone managing $100 million who does 1% better than average, someone managing $100 million has to do 1% worse, and how can you pick the right one in advance? Even if you do, what happens if they have a stroke and their risk-taking assistant takes over the fund?

Open ##3211614