Indiana, PA - Indiana County

SMART MONEY: Disappointing returns may signal it's time for a change

by on March 30, 2014 1:49 AM

DEAR BRUCE: I have about $3 million invested through a financial planner, and I need your advice.

This past year I earned zero income from my investments. He said that he was playing it safe with my money. He also said he didn’t lose any of my money. I wrote him back and said in a sense he did lose money for me because the market has soared this past year. He said in return that investing in the stock market was like putting money in a slot machine in Las Vegas. I had 30 percent in the market with him.

My question is, should I change to another financial planner? I have to live off my investments. I think some of these so-called financial planners are just good salesmen. — C.M., via email

DEAR C.M.: Cut very quickly to the chase: Any investment adviser who says putting money in the stock market is like putting money in a slot machine in Las Vegas should be shown the door immediately. You have $3 million and no return? Even a private conservative investor should have come up with at least $100,000, and I would never have been satisfied with a $100,000 return on $3 million.

I would like to know what kind of fees he has made for himself.

Even at 4 percent, which is a no-brainer, your $3 million should have brought in $120,000, and you could figure the percentage if you didn’t invest it all with him. This guy is a loser and should be dumped instantly!

DEAR BRUCE: How much of your income should you spend on monthly house expenses? I heard that it should be 50 percent. Can you tell me if that sounds right? — G.D., via email

DEAR G.D.: I don’t know where you heard 50 percent. That is way out of balance. Somewhere around 30 percent would be as high as I would go, and I would like to shave that down a couple of points. Spending half of your income on just house expenses is far more than most budgets would ever be able to handle.



Send questions to bruce@brucewilliams.com. Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided. The Bruce Williams Radio Show can now be heard 24/7 via iTunes and at www.taeradio.com. It is also available at www.brucewilliams.com.
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