Hiring a money manager

[emon87]

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Maybe he can't get Golden Sack to manage his money, but I see advertisements all the time for money managers. They wouldn't advertise that much if only people with a million to invest can hire them, especially fee-based. OP should check around and see what he can find.

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The point was to find a good one, not one that advertises a lot. And he is checking around by coming here.

[ArturiusX]

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if he is good enough to do well with your money he would do it with his own.

put your money into index funds and as much into a retirement fund as you can. that will beat whatever he does minus his 2% commission every year of your net worth.

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This works especially great when your retirement date coincedes with the bottom of a bear market!

[jively]

It seems you are looking for a financial planner / financial advisor. "Money manager" kind of denotes someone who specializes in choosing individual stocks and bonds, and generally does not do any financial planning.

I am a financial advisor who recommends passive investing. You could possibly do the investments on your own. In this thread I made a series of posts that describe what kind of allocation I use.

The decision on how aggressive or conservative you want the portfolio to be is based on your risk tolerance (which you might not be fully aware of), and on your lifetime goals - when do you want to begin to spend the money in your portfolio. I or another financial planner could help to determine that.

In terms of having a strong relationship with a planner, it may be good to find someone who is local to where you will be living, so you can meet in person periodically.

You might try to search for a planner using the CFP Board's web site. You can also find an advisor using financeware.com's advisor directory. (This web site uses the Wealthcare system for financial and goal planning. This is an excellent way to make a recommendation that has a high degree of confidence of meeting all of the lifetime goals that you value, without unnecessary investment risk.) (It's probably best to search only using your state, as there are not that many advisors there and they don't have a "radius" option.) In order to make sure you are finding a passive advisor, you could try DFA's find an advisor.

My firm does have clients in other states. We do our reviews by mailing documents and making a telephone conference. However, meeting in person generally leads to stronger relationships.

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I have no clue what to pay. I rather pay a small salary then have a bonus based on performance of the portfolio. Though I guess in the long term a % of the assets will want him to keep it growing. What percentage based on assets is standard?

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This does vary by the amount of assets. 1% is very standard. My firm has a $10,000 minimum annual fee, so for $500,000 we generally charge 2%.

Some advisors only charge hourly. You can try the Garrett Financial Network, click on Locate an Advisor. (We are not in this network.)

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Ill prob. start with around $200k cash, with another 500k in investments which can slowly be liquidated over time, plus plan too keep a small budget on my expenses (prob. 10%-15% of my total income) and plan to throw almost all my incoming poker cash flow into my portfolio.

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I don't exactly understand this. You currently have $700,000? $200K to be used for cash (bankroll and/or emergency fund/living expenses?) and $500K to be invested? Then why liquidated over time?

It may be possible to help you here in this thread (if you are not concerned about privacy), but will need more detail. How much do you expect to earn in a year? How much do you want to spend in a year? How long will you work?

Good luck,

-Tom

[PanchoVilla]

I recently setup with a planner. I used to have a "manager" and it costs waaaaay to much. So I am currently working with a planner on a flat fee basis. He will look at
My insurance coverages and investments mainly.

And it's truly fee-based as in he develops a plan for me that says x% in us small caps, x% in asia, x$ in bonds, etc. Then he suggests funds, primarily index that I can then buy myself and I go buy them in my own brokerage accounts. He can also evaluate what-if scenarios. Ie, with my current assets, how much cash can I generate annually sustainably and if I want X dollar per year what net worth do I need to get to so I don't need a paycheck. Things like that.

For comparison the planning fees are less than .5% for the first year for developing the plan and then after that the annual fee drops nearly in half for annual full-reevaluation and whatever scenarios come up during the year. The reason for the low fees I think is that there is a specific fee for a range of net worth and I happen to fall below a cutoff point so it makes it small as a %.

[NajdorfDefense]

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if he is good enough to do well with your money he would do it with his own.

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Yes, so if you qualify for Hedge Funds [and it sounds like you do] you should talk to some of the larger I-banks about the best ones they recommend [but do not run themselves]

[DcifrThs]

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if he is good enough to do well with your money he would do it with his own.

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Yes, so if you qualify for Hedge Funds [and it sounds like you do] you should talk to some of the larger I-banks about the best ones they recommend [but do not run themselves]

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are there hedge funds that are allowed to take $ from people who are non-qualified investors (i.e. net worth of something like $1-2mil and $500k liquid?)?

or is my understanding of what a "qualified" investor is, just wrong?

thanks,
Barron

[NajdorfDefense]

I assumed he was still qualified [or soon will be] if he had bot a Lambo. If he's not, then HF are not an option.

[Thremp]

Barron,

I thought qualified is 1mil NW or 200k a year. Have not spotted it in a while though.

[DcifrThs]

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I assumed he was still qualified [or soon will be] if he had bot a Lambo. If he's not, then HF are not an option.

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hmm, i didn't know that. nor do i know what lambos go for...

...anyways, if he is qualified i definitely agree that hedge funds should be the way to go for the active portion of his portfolio (i.e. not an equity shop or something, but a solid global macro fund that is uncorrelated with risk premia in all other asset classes).

then he can use the rest of his money to simply get the best beta portfolio working that he can.

that isn't exactly "optimal" but it's definitely close enough i think.

Barron

[pig4bill]

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Maybe he can't get Golden Sack to manage his money, but I see advertisements all the time for money managers. They wouldn't advertise that much if only people with a million to invest can hire them, especially fee-based. OP should check around and see what he can find.

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The point was to find a good one, not one that advertises a lot. And he is checking around by coming here.

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The likelihood of him finding a poker-playing money manager that surfs the intarweb on this site and meets his needs is pretty thin. He's probably not going to find him here, and he knows that. That's why he ased for "basic tips". The places for him to check are ads in the Journal, Barron's, IBD, and google. Ask around his lawyer, accountant, stockbroker, and other financial professionals.