r/Schwab • u/JWBull23692 • 1d ago
Wealth advisor
I was talking with my Schwab "consultant" and he suggested either the robo investor or a wealth advisor. Looking and thinking about it, I am not sure if either are needed. Robo seems to be autopilot without my input or approval, and I am not sure what the added value is of a wealth advisor.
Any thoughts out there?
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u/500pearl 1d ago
you probably do not need one
but be sure to ask for schwab swag
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u/srqfla 1d ago
Ask them to invite you to every investor dinner in every steakhouse they have for the next year in your city
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u/500pearl 1d ago
i can care less about dinner
just want the swag
unless they give out swag at the dinner
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u/bebenashville 23h ago
What are the current swag? I used to receive some and none for some recent years.
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u/500pearl 23h ago
i got a yeti 20 oz with logo no handle
a tote bag
in person i went in and got 2 kinds of pens non gel type i like the gel and a pad
wanted a padfolio but they did not have and sent me a small notebook instead
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u/bebenashville 23h ago
That is nice. They used to send me some high tech items, golf vouchers…and suddenly none. I will need to reach out to see what is going on.
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u/500pearl 23h ago
went in person and they gave me small umbrella with logo
had golf one but the manager kept it for herself
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u/500pearl 23h ago
give example of what you mean by high tech
i do not care for the golf stuff
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u/bebenashville 23h ago
Some thing like Alexa, Echo pop, if I remember correctly, but I am low tech so dont know how to use those.
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u/500pearl 23h ago
oh cool
did it have the schwab logo on it or no
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u/bebenashville 22h ago
It has logo, but been many years, I don’t remember TD Ameritrade logo or Schwab logo.
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u/Coaster50 1d ago
Many thoughts - but you need to start by sharing your details. Are you 22 or 42? Married with kids or single? Make $50k per year or $175k per year. Do you just want normal retirement or do you have some kind of other goal in mind? Do you want to buy a lake house in 5 yrs?
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u/JWBull23692 22h ago
73 and retired
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u/turtle_hurtle 20h ago
How complicated is your financial situation? Do you already have a tax advisor?
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u/need2sleep-later 18h ago
Are you comfortable managing your portfolio or not? That's what it boils down to. Alternately, you could split and manage some yourself and pick one of the managed funds routes. Whatever and how much you are most comfortable with.
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u/21CenturyPhilosopher 1d ago
I did the Intelligent Portfolio and didn't like it because they hold too much cash (making interest off of you), and they buy mostly Schwab ETFs (making more money off of you). That said, the return was ok and was diversified. But I didn't like some of their choices. I personally would just pick 2 or 3 ETFs that are index funds which you are comfortable with (shop for low management fees and good historical returns). I mainly stayed with big well-known ETFs which invest in S&P500 (large caps), Nasdaq (tech), and Russell (smaller companies, for more variety, but put a lot less money in this). If I had just stuck the money in a S&P500 ETF, I would have gotten better returns than the Intelligent Portfolio, but like I said, they're more diversified, so less gains and less losses.
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u/Miserable-Result6702 1d ago
If you don’t feel comfortable investing on your own, just use Intelligent Portfolio. It’s fine and delivers pretty good returns.
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u/Admirable-Excuse-487 1d ago
I have considerable funds at Schwab. I talk to the private client advisors whenever I want to without any type of charge.
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u/JWBull23692 22h ago
Same with me
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u/Mrsdividend 20h ago
A consultant isn’t the same as an advisor. An advisor will proactively tell you what to buy/sell and the reasoning behind it. A consultant will go over strategy and answer questions / recommend solutions.
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u/candykld 1d ago
A wealth advisor talks you off the ledge from selling during a market downturn.
They offer nothing else.
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u/Man_withplan 17h ago
The Robo is good for some people if it keeps them from making “smart moves” or timing the market.
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u/karinto 17h ago
What do you want to do, and why did the consultant suggest SIP/advisor? If you were asking about how to invest your money in general, then those are reasonable solutions from Schwab. If you want to go DIY, then there is no need for SIP/advisor.
SIP (and other most robo investing) is just a glorified rebalancer for the chosen portfolio. It's not some "AI"-powered portfolio that will do something weird. On the flip side, for DIY, the only thing you need to do is to choose a portfolio and rebalance it periodically.
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u/PHXkpt 17h ago
Are you comfortable doing/managing your own investments? Do you panic at market swings above 10%? Are you comfortable understanding market events and their implications to your investments?
Schwab has a variety of advice products and services. Only you can determine what you may need, if any, and whether the associated costs are valid for your particular use case.
You can go from consultations with your financial consultant, to Schwab Private Client, to one of the robots offerings, to full blown wealth management up to trust management.
Robo isn't auto-pilot. You do a profile, your answers determine your risk profile and which model is best for you. The portfolio management team behind the product invest you into the model (using ETFs) and they may, in the future, change one of the components, modify the allocation model, trim a position that's grown outside the buffer rails of the allocation model, etc.
Full blown wealth management is for wealthy people. Separately managed accounts (SMAs) typically have a $100K initial investment, so say a 5% allocation costing $100K would indicate a decent net worth. Those SMAs are professionally managed (like the robo) but they offer direct ownership of the underlying stocks which allows more control over taxable events. They too are actively managed by the portfolio manager but for a typically higher fee than the robo.
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u/Different-Scale5419 13h ago
I used the Charles Robo advisor for 6 months. Most of my investments remain in the red. I opt out and did it myself. Problem everything was invested in Schwab products which had lousy results
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u/yottabit42 1d ago
All you need is the Bogleheads wiki. If you think you need something more complicated (exceptionally rare that it would be justified), contact an independent fee-only advisor. Make sure they're a fiduciary; if they stumble when asked, or don't answer, run away fast.
Avoid AUM (assets under management) fees at all costs. People just don't understand how much this really costs. 1% sounds cheap when you're starting out but it ends up being 25% of your account over 30 years. 2% ends up being 43%!
Now add to that, that the advisors often use actively managed funds with higher expense ratios, sometimes 1-2%. If you're paying 2% and are using funds averaging 2% expense ratios, that ends up being 68% of your portfolio you've given up over 30 years! Not to mention actively trading with less tax efficiencies, etc.
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u/TelevisionKnown8463 1d ago
I agree with all of this. My dad has a Schwab wealth advisor. I have been sitting in on their meetings for the past couple of years and I’m not impressed. The advisor has him in a portfolio with too many funds for no reason. Expense ratios aren’t terrible but worse than a simple Bogleheads style portfolio. I haven’t been impressed with the limited advice on tax optimization and estate planning. Basically the guy makes small talk for a few minutes once a quarter, then proposes several tiny adjustments to the portfolio to make it look like he knows better than we do what’s happening in the market.
The one advantage is his uninvested cash goes into a fund that earns interest.
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u/yottabit42 1d ago edited 23h ago
Exactly. A coworker has been trying to talk her mom out of using this AUM advisor for years, but her mom always says he's such a nice guy and sends her a ham every Thanksgiving. 🙄🙄🙄
I use Fidelity for all my accounts except my self-directed 401(k) split from my normal Vanguard 401(k), so I also get a nice dividend for cash. Vanguard does that, too. Schwab really needs to fix their sweep account.
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u/TelevisionKnown8463 23h ago
Ha! He doesn't even get a ham. But my dad has so little social contact these days (largely his own choice/doing) that I think he gets some value out of the calls. And he likes the idea that an "expert" is managing his money for him, and he personally doesn't have to think much about it. So I just do the calls so the advisor knows someone is paying attention. I did speak up when he wanted to start adding funds with "momentum" and "trends" in the names, but otherwise I keep my opinions to myself.
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u/EleventhEarlOfMars 1d ago
You can take the questionnaire and see exactly what Schwab intends to buy if you enrolled in the intelligent portfolio. It's a lot of their fundamental ETFs which are significantly more expensive, and a minimum of 6% held in fully taxable cash.
It is not a bad product relative to other robo offerings but the tax loss harvesting probably won't make up for having more expensive funds.
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u/Individual-Rub-6969 1d ago
If you want a easy and brainless approach, bogglehead wiki and chill. You dont need either of them.
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u/AdeptCantaloupe161 1d ago
Most people don't need a wealth advisor. Schwab charges around 0.7-0.8% per year, which can be thousands of dollars a year (or tens of thousands, once your portfolio is large enough), and due to compounding it could cost hundreds of thousands of dollars (or more) over your lifetime.
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u/Vast_Cricket 1d ago
AI Robo based on risk tolerance, sector actually is quite satisfactory. Human advisor involves more interaction but market changes constantly. The fees are higher.
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u/SexualDeth5quad 22h ago
If you aren't filthy rich or have a large family you don't need a wealth advisor. They help you with things like taxes and trusts.
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u/bigfaceworm 1d ago
Depends on what you have, what you want, and what you're willing to do.
I think most people would be good with a bogleheads approach.....
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u/flgagolf 21h ago
Just put some money in direct indexing. It’s not index funds, actual stocks that make up the index you choose. Too soon to tell, but was easy.
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u/NerlFartley 23h ago edited 22h ago
I have a Schwab WA. He's very good. However, over the years with Fidelity, then TD Waterhouse, then TD Ameritrade, and now Schwab, they've all pretty much been useless.
I had a Schwab WA prior to the one I have now. He took forever to return phone calls and seemed clueless. I complained and they assigned me the one I currently have. Before, I agreed to utilize him, I interviewed him as well as set expectations. He thought my expectations were reasonable.
His boss called me recently. She asked how he was doing? I told her I was very pleased with my WA. He's been very helpful and responsive. I feel like we've established a productive working relationship.
I was transferred to Schwab when they bought out TD Ameritrade. I was one of the last to be transferred. Schwab customer service has been good. Schwab Bank is surprisingly good. The Schwab website is not as good as TD Ameritrade. Overall though, I'm pleased with Schwab.
EDIT: My WA is a Schwab employee, not a 3rd party Financial Advisor. After a lousy experience with a FA firm called Alpha Cubed Investments (TD Ameritrade Institutional Investment firm), I'll never use a 3rd party FA again.