The hard part is behavioural/emotional/psychological rather than technical.

Usually discussions about money are never actually about money, but rather safety, fear, etc.

That’s where a real advisor earns their keep. Understanding the client and instilling confidence/comfort.

satvikpendem a day ago | parent | next [-]

There's a good book on this called Psychology of Money. I also recommend Money for Couples to see in real time this psychological effect of money, especially with changes since childhood and how that affects people into adulthood.

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zeroq a day ago | parent | prev | next [-]

This.

It's easy to make a good call, but it's really hard to stick with it.

The main financial advice I'm giving to all relatives is to write down their decisions before buying anything. Or, if you're looking for a long term investment - asking someone close to change the password on your account without letting you know.

The major problem with investing is that most people will commit to 2-5y strategy, and panic on the first dip.

If you did your due diligence and you believe that this particular asset will grow within 5 years - when it starts dipping after few months, and nothing major has changed in your predictions - you should buy more instead of selling.

	▲	ElProlactin a day ago \| parent \| next [-]
		> If you did your due diligence and you believe that this particular asset will grow within 5 years... This assumes that most people know how to do "due diligence" and that their "predictions" are accurate. Most people don't actually have the knowledge and skill to evaluate the investment vehicles (stocks, bonds, etc.) available to them so their predictions are inherently limited and flawed. > ... when it starts dipping after few months, and nothing major has changed in your predictions - you should buy more instead of selling. One of the biggest mistakes average people make is selecting investments with risk profiles and durations that are mismatched to their needs and objectives. This is why, for most people, it's much better to use a properly-selected model portfolio than to try to pick individual stocks.
	▲	B-Con a day ago \| parent \| prev [-]
		I've learned this applies to a lot of life. Being a good manager, tech lead, consultant, etc, advisor, parent, friend, etc, is sometimes just half being a good therapist and helping them regulate. I've watched a lot of "not officially financial advice" finance videos on YouTube (the solid people, not grifters), and while the financial theory side is interesting, when they talk about pragmatic investing and patterns of client behavior they have dealt with professionally, a large part of it is emotion management. Convincing clients to stick with a solid plan even when this month is abnormally bad, or avoid going all-in on the latest hotness, etc.

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ghaff 15 hours ago | parent | prev | next [-]

I have had a financial advisor for a while now. (Did and does handle my dad as well.)

Costs a bit of money but he probably does some things with his brokerage's computers that I don't have easy access to and, with one exception, I've consolidated a number of accounts to him--a couple of which I barely looked at. He's also good as a sounding board. I'll sometimes push back if I have a slightly different view of risk/return for some things but I mostly take his advice both for managed accounts and one I directly control at a different brokerage.

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thunky 13 hours ago | parent [-]

With respect, you're likely being taken advantage of.

Your advisor doesn't have any fancy computer with more info than you have. You're paying for an illusion and it's not cheap:

A 1% annual fee reduces your wealth by 20-25% over a 30 year period.

At least do yourself a favor and check to see what your total return is with him vs simple index funds.

If you need a professional sounding board you can pay by the hour.

	▲	ghaff 13 hours ago \| parent [-]
		It's complicated. It's tied in with various family stuff and the reality is that I had accounts I just wasn't managing. Could I make a change someday? Maybe. But this works for my position today and I have a significant brokerage account that I manage personally today which includes index funds but also has a lot of bonds and money market at this point as I'm mostly retired.

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groundzeros2015 a day ago | parent | prev | next [-]

The way people think and talk about money is also heavily dependent on class and culture. It’s very difficult to change. It’s not at all about typing it numbers on a calculator.

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rgmerk a day ago | parent | prev | next [-]

Yeah, 95% of the job is just telling people not to sell in the dips and buy at the peaks.

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HumblyTossed a day ago | parent | prev [-]

> Usually discussions about money are never actually about money, but rather safety, fear, etc.

What keeps me from retiring early and not socking away more money is the fear that medical insurance will refuse to pay for something major.

The U.S. sucks when it comes to healthcare. I don't know why we do this to ourselves ( Well, I actually _do_ know why and it's fucking retarded... ).