Robots, Dorks or Old Men

Dr. Jason Van Duyn

Description

Many investors find that with nothing more than discipline and an Internet connection, they are able to improve their financial life without the aid of a third party. But not everyone is thrilled with the idea of DIY financial planning. Robots, Dorks or Old Men focuses on those trying to figure out which source of financial advice is best suited to their personality, needs, goals, means, and values. This clear, accessible guide explains the different types of financial and robo-advisors out there. It identifies the five most common sources of financial advice and thoroughly investigates each one, including checklists to help you determine if that source is right for you. With Robots, Dorks or Old Men, you’ll soon find a great partner to help you pursue your financial dreams! 

Sujets

• Problem Solving
• Decision-Making
• Investing
• Personal Finance
• Gestion et management
• Money Management
• Investment
• Economics
• Business

Informations

• Publié par: Outskirts Press
• Date de parution: 11 juillet 2023
• Nombre de lectures: 0
• EAN13: 9781977203342
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

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Robots, Dorks or Old Men Finding the right financial advisor for you All Rights Reserved. Copyright © 2023 Jason Van Duyn v2.0
The opinions expressed in this manuscript are solely the opinions of the author and do not represent the opinions or thoughts of the publisher. The author has represented and warranted full ownership and/or legal right to publish all the materials in this book.
This book may not be reproduced, transmitted, or stored in whole or in part by any means, including graphic, electronic, or mechanical without the express written consent of the publisher except in the case of brief quotations embodied in critical articles and reviews.
Outskirts Press, Inc. http://www.outskirtspress.com
Library of Congress Control Number: 2022910176
Cover Photo © 2023 www.gettyimages.com . All rights reserved - used with permission.
Outskirts Press and the "OP" logo are trademarks belonging to Outskirts Press, Inc.
PRINTED IN THE UNITED STATES OF AMERICA
SECTION I
Getting Started
Table of Contents
1. The Importance of Choosing the Right Advisor
2. Who Are Brokers?
3. How Do Brokers Work?
4. What’s the Bottom Line on Brokers?
5. Who Are Investment Advisor Representatives?
6. How Do Investment Advisor Representatives Work?
7. What’s the Bottom Line on Investment Advisor Representatives?
8. Who Are Dually Registered Advisors?
9. How Do Dually Registered Advisors Work?
10. What’s the Bottom Line on Dually Registered Advisors?
11. What are Discount Brokers and Robo-advisors?
12. How Do Discount Brokers and Robo-advisors Work?
13. What’s the Bottom Line on Discount Brokers and Robo-advisor?
14. Who Are Dually Registered CFP ® Professionals?
15. How Do Dually Registered CFP ® Professionals Work?
16. What’s the Bottom Line on Dually Registered CFP ® Professionals?
17. Final Thoughts on Choosing the Right Advisor
CHAPTER 1
The Importance of Choosing the Right Advisor
Congratulations! The fact that you have picked up this book means that you have made the decision to improve your financial life. There are a ton of benefits associated with bettering yourself financially, including improved health, increased levels of happiness, and even an increased life expectancy. Most people, of course, would love to improve their financial situation. The problem is that there are so many questions out there. Do I buy Bitcoin? Should I live with my parents, stay single, save every dollar I make and FIRE (do you need to explain this?) at 45? What about rentals? Should I contribute to my 401(k) or Roth IRA? What the heck is a Roth IRA? Honestly, there is so much stuff out there that it makes it completely overwhelming, so most people quit before they start.
Luckily for both of us, you are NOT that kind of person. You have made a commitment to yourself to figure out how to take the first step down the path of bettering your financial position, and we are here to help. That being said, it is still very difficult for most people to even take the step that you just did by reading the first paragraph of this book. By doing so, you have made a commitment by trusting me to help guide you to a proper channel to begin your journey to financial improvement. My commitment to you is that this will be fun and informative. I promise that when you put this book down, your understanding of the financial industry, and where you should go inside of it to seek assistance, will grow exponentially. If it doesn’t, or you still feel stuck after finishing this book, you can call me – 586-731-6020 – or e-mail – [e-mail] - anytime and I will personally attempt to guide you a little further.
Is this book for you?
This book is for anyone who desires to improve their financial life. The fact that you are still reading, means… that is you! As you continue to delve deeper, you may find that we give you the confidence you need to do it yourself, or finally open that Robinhood account your friends have been telling you about. Many investors find that with nothing more than discipline and an internet connection, they are able to take the steps they need to improve their financial life without the aid of a third party. Our goal here is to give you the information you need to decide which DIY path to choose. That said, most people who feel comfortable handling their own finances are never going to crack this book, so we are going to focus far more time and energy on explaining the different types of financial and robo-advisors out there, and you will feel much more comfortable choosing one that fits your needs.
It is true that new technologies are making some aspects of personal finance (like budgeting and investing) much more efficient and accessible, but they may also be creating new opportunities for misunderstandings and financial stress. While many investors may know something about complex financial tools and instruments – like cryptocurrencies, warrants, options, futures, SPACs, and trusts –ano one knows it all. In situations where you are exposed to complicated and potentially confusing financial strategies, there is still no substitute for an educated, dedicated, and experienced professional to guide you through your financial life.

It is estimated that financial "illiteracy" cost Americans $415 billion last year. 1
There are many different types of financial "advising" and almost everyone can benefit from taking advantage of some type of professional advice. In fact, research has shown that significant benefits can result when you utilize the services of a financial planning professional. A recent study by Vanguard concluded that a good financial advisor can increase your net returns per year1 by 3%. While this may not sound like much, consider the impact that 3% has on a single $10,000 investment over a thirty-year time horizon.

The difference between earning 6% and 9% on $10,000 annually is $75,242 over 30 years! That could be the difference between driving a Mercedes in your retirement years or taking the bus!

Research conducted by the CFP Board found that adults working with a financial advisor (67%) are much more likely to say they would feel prepared for a recession than those who are not working with an advisor (38%). 2
Financial advisors can increase wealth and decrease stress
In addition to improved financial decision-making 1,2 , most people who utilize the services of financial professionals also enjoy a reduced level of stress. Psychologically, most people who have a financial advisor worry less about money than those people without one 3 . In fact, access to a financial professional may have saved the life of 20-year-old Alex Kearns.
C ASE S TUDY #1
Using an online trading app, Alex erroneously believed he had accumulated a negative $730,165 cash balance after trading options, a risky financial instrument, with the potential for large gains and losses. The "loss" must have seemed astronomical to the young man, and he believed that by ending his own life, he would protect his family from this terrible debt. In reality, almost any knowledgeable financial professional could have put his mind at complete ease with a simple, yet important, explanation of option settlement procedures 4 . In truth, Alex had additional protective put options in his account that would have covered the negative balance once they had been exercised and settled. While no one knows exactly what was going on in Alex’s mind, it is possible, if not probable, that if Alex had consulted a financial advisor, the young man would still be alive today.
You might not know what "options settlement procedures" or "put options that need to be exercised" mean, and that is OK. This is not a book about investments, this is a book about the types of help that are available to reach your financial goals.
C ASE S TUDY #2
While the debt of Alex Kearns was simply a misunderstanding of a financial report, the debt of actor Nicolas Cage is real. Perhaps you have seen the once "A-list" celebrity appearing in some arguably "D-list" films of late. He apparently says "yes" to any job offered to him nowadays. This is due largely to his $14 million tax debt owed to the IRS. While he has earned $200 million over his film career, financial mismanagement has taken it all. When asked about his failure to meet his tax obligations, Mr. Cage simply stated that he was unaware of the situation 5 . Had he hired a good financial advisor (and not bought a dinosaur skull and 2 islands in the Bahamas), Nicolas Cage’s life and career may have gone much more smoothly.
C ASE S TUDY #3
And in a final example, the services of a good financial advisor could have saved Stefan Thomas the stress of possibly losing approximately $240 million. Mr. Thomas simply lost the password to unlock a small hard drive that holds over 7000 Bitcoin. As of this writing, he has only two guesses left before the Iron Key’s contents are irreversibly encrypted and the money is lost forever 6 . Talk about stress…
It is a fact that people stress about money. You may not see it, but you feel it. It is there, and if you can take steps to help you lower your overall stress level, the benefits are substantial 7 . You may find that you Sleep better Lose weight Get sick less often Recover more quickly when you do get sick Have less muscular tension Enjoy a better all-around mood Get along better with your significant other, family, and friends
In addition, you may find that the services of a financial advisor can actually help you at work. In a research study conducted by the Center for Financial Services Innovation (CFSI), approximately 85% of Americans state that they are anxious about their financial situation, and that their anxiety interferes with their work. This financial stress leads to productivity losses and increases in absenteeism, healthcare claims, and turnover 8 . Further, another study by the Society for Human Resource Management found that most human