Investing successfully is key to reaching your long-term goals. Your ability to invest successfully, however, is based upon a combination of your knowledge, the tools available to you, your time, your motivation and importantly, the quality of the advice that you receive.Way to Invest Money Click To Tweet
1. Doing it all on your own
You conduct the analysis, make decisions as to the correct asset allocation, determine which investments to buy, implement the buys and sells, monitor the portfolio and rebalance the portfolio based on a prudent repeatable process that is tax efficient.
2. Search an advisor that provides you with recommendations
The advisor provides advice as to allocation and specific investments, but you implement the recommended changes to the allocation and specific investments. It is up to you to return for the future advice. The Advisor does not monitor or proactively call you when a change occurs. The advice does not include the payment of commissions.
3. You turn your investment decisions over to a money manager
The Manager invests the money according to a pre-determined plan, monitors the portfolio and investments and makes changes as needed. You are an observer to the process and the results.
4. Advice from a salesperson that earns a commission when you are sold a product
This non-fiduciar” advice is subject to conflict of interest between what is best for the financial services company and sales person versus what is best for you as the investor. Another issue is that an other commission will be charged, if you want to change the investments later.
5. Advisor and you “co-manage” your investments on an ongoing basis.
The advisor does the analysis, provides recommendations, and does the investment implementation except in the case of employer retirement accounts wherein you implement specific changes. The advisor monitors the investments and your asset allocation, reports to you periodically as to the performance of your portfolio, proactively contacts you if a problem arises, discusses suggested tax efficient re-balances as needed, updates your Investment Policy Statement and changes your asset allocation as your plan changes. The advice does not include the payment of commissions.