The financial services world is changing. Technology is enabling an automated approach to investing that should bring down the cost of commodity services. No longer do you have to fund the lifestyle of a broker or advisor to have him tell you how to diversify or where to find the next investment that cannot be missed. This book will provide the tools for calculators that tell you most of what you need to know; from how much insurance you need to have to how you should diversify. The book will help readers with the following: * Understand what you have * Plan your long-term goals * Start to save (maximizing your 401k) * Reduce debt * Run your Monte Carlo Simulation * Determine the appropriate asset allocation * Set up your auto-rebalancing and periodically (annually, perhaps) re-examining your asset allocation to account for globalization * Deploy the asset mix through low cost, tax-efficient strategies * Look at it once per year This book will provide a better understanding of your investment decisions. But, we all cannot be do-it-yourselfers.
Advisors serve as an important resource for consumers when they are both capable and understand their duty to serve you, the customer, first. To complement their moral station, they must have the skills to deliver appropriate advice. The book, much like the company Steve founded, will simplify standards for consumers and audit advisors to those standards.
Steven D. Lockshin is the founder and former CEO of Convergent Wealth Advisors, one of the nation's leading wealth management firms, providing investors with objective advice, flexible investment solutions, and transparency. He helped pioneer the open architecture approach to investing and was an early adopter of asset allocation strategies for high-net-worth clients.
Preface ix Chapter 1 Is This Any Way to Choose an Advisor? 1 Bad Financial Medicine 3 A Murky Industry 7 You Should Meet My Guy 11 Key Points 17 Chapter 2 Wall Street s Dirty Secrets 19 The More Things Change 23 You Don t Understand 28 Misplaced Interests 33 Brokers and Advisors 35 Wall Street Brokers versus Main Street Consumers 37 Peddling Products 39 Omission versus Commission 42 Key Points 45 Chapter 3 The Wall Street Whitewash 47 Image Is Everything 49 Shopping Shortcuts 52 Vegas Rules 59 Key Points 65 Chapter 4 Hold Your Nose: Other Advisor Options 67 Bank-Based Advisors 70 Private Banking and Trust Departments 72 Asset Managers 74 Insurance Salesmen 76 Fee-Only Planners 78 Other Options 79 Technology s Triumph 81 Key Points 86 Chapter 5 The Case for Independent RIAs 89 The Trouble with Fee-Only Advisors 92 The Case for Independent RIAs 94 Buyer Beware 99 Do All RIAs Live Up to Their Title? 102 Disorienting Disclosure 105 RIAs: A Good Place to Start 115 Key Points 115 Chapter 6 Our Lazy Brains: Why We re So Bad at Choosing Advisors (and Investing Our Own Money) 117 The Gut versus the Mind 121 Salesmanship 101 125 What You See Is All There Is 128 My Advisor Is Handsome, So Why Am I Broke? 130 Why We Stink at Managing Our Own Money 136 Key Points 142 Chapter 7 How to Be Your Own Investment Advisor 145 Don t Let Costs Mug Your Returns 156 How to Win the Game by Not Playing 163 Software-Powered Investing 179 Math First, Emotion Second 183 Why You (Probably) Still Need a Financial Advisor 184 Key Points 185 Chapter 8 Choosing an Advisor: Know What You Don t Know 187 You Are the Family CEO 191 Core Principle: DUTY Clients before Profits 193 Core Principle: SAFEGUARDS 198 Core Principle: PROFESSIONALISM 201 Decoding your Advisor s Answers 205 After the Interview 215 Key Points 217 Chapter 9 Fees and Ice Cream: Baskin-Robbins Got It Right, Why Can t We? 219 Chocolate and Vanilla 221 Baskin-Robbins 31 3 Flavors? 223 Key Pricing Ingredients (Building a Custom Sundae) 227 Chapter 10 Change the Game 231 Why Wait? 240 Afterword: Advisors in Perspective 243 About the Author 247 Index