Stock market nerd moment.

[fenders53]

Thought you all might get a kick out of this.....

Long story short my daughter lives and works hours away from me.  Monday we met for a couple days in Wisconsin for an overnight at a cabin in the woods and some time together.  She brought her new boyfriend.  She surely told him I am a stock market geek and he struck up a conversation.  It was clear he didn't know what he was invested in so I asked him to show me his funds.  He misunderstood my intentions and pulled up his account balance page with his 401K balance.  I was like "no, I'm not trying to see your net worth, just wanted to see what your advisor has you in".  

He is a very kind and mature young man.  He is in a way overcomplicated mix of about 15-20 funds but told me the service was free from his employer.  No wonder he didn't really know what he was in.   I really hope he didn't think I was interviewing him as a potential suitor lol.  BTW he is about 23 and has 22K in his IRA.  That's not so bad.  When I know him better I'll tell him to slap his advisor and make his portfolio a little more reasonable to understand.

[ken-do-nim]

My ex-wife hired a financial advisor for both the taxable account I gave her and her half of the 401k rolled over into an IRA. She can't tell me a thing about what any of it is invested in, and she thinks of that as a feature.

[Kerim]

Wow. I'd be pleased with a suitor that young who was interested in saving and investing. A good sign!

But yeah, it is always tough seeing how lost some people are with it all. It is a form of literacy that we should be teaching in school!

[fenders53]

(12-08-2021, 11:05 AM)Kerim Wrote: Wow. I'd be pleased with a suitor that young who was interested in saving and investing. A good sign!

But yeah, it is always tough seeing how lost some people are with it all. It is a form of literacy that we should be teaching in school!

In this instance is was a smart young man with the good sense to save for h9s future and just trying to understand what  his advisor was doing.  As I said he had about $22K.  I had a brief look but for sure he owned as amll amount of the following. 

SPY ETF
Russell 2000 ETF
Midcap ETF
A dividend ETF
Short term bond fund
Several mid term bond fund
Several Longterm bond fund
Some government bond funds.

The kid is a 6th generation Iowa farmer (it's kind of a big deal to survive that long).  He is also an ASST manager at a Tyson owned meat market so he can have benefits.  He actually understands AG commodities which isn't that simple.  How in the hell is he supposed to understand his 401K?  The above is a synopsis.  He owned 15+ ETFs with much duplication.  I suspect somebody is getting paid to do that to him.  The more I think about it the more it annoys me.  You shouldn't have to be an investment nerd with ten years experience to have a reasonable understanding of your company 401K.  I told him to tell his advisor to move more of his of assets to SPY gradually.  It's the only rational thing I could think of since his 2021 return was 10%.  I bet he will still have 15 ETFs after that.

[Christinebitg]

(12-09-2021, 01:38 PM)fenders53 Wrote: In this instance is was a smart young man with the good sense to save for h9s future and just trying to understand what  his advisor was doing.  As I said he had about $22K.  I had a brief look but for sure he owned as amll amount of the following. 

SPY ETF
Russell 2000 ETF
Midcap ETF
A dividend ETF
Short term bond fund
Several mid term bond fund
Several Longterm bond fund
Some government bond funds.

The kid is a 6th generation Iowa farmer (it's kind of a big deal to survive that long).  He is also an ASST manager at a Tyson owned meat market so he can have benefits.  He actually understands AG commodities which isn't that simple.  How in the hell is he supposed to understand his 401K?  The above is a synopsis.  He owned 15 ETFs with much duplication.  I suspect somebody is getting paid to do that to him.  The more I think about it the more it annoys me.  You shouldn't have to be an investment nerd with ten years experience to have a reasonable understanding of your company 401K.  I told him to tell his advisor to move more of his of assets to SPY gradually.  It's the only rational thing I could think of since his 2021 return was 10%.  I bet he will still have 15 ETFs after that.

I know you don't know him well enough right now.  But if it were me, I'd tell him to get the h*ll out of most of those bond funds.  Particularly the long term ones.

[EricL]

(12-10-2021, 03:02 PM)Christinebitg Wrote:

(12-09-2021, 01:38 PM)fenders53 Wrote: In this instance is was a smart young man with the good sense to save for h9s future and just trying to understand what  his advisor was doing.  As I said he had about $22K.  I had a brief look but for sure he owned as amll amount of the following. 

SPY ETF
Russell 2000 ETF
Midcap ETF
A dividend ETF
Short term bond fund
Several mid term bond fund
Several Longterm bond fund
Some government bond funds.

The kid is a 6th generation Iowa farmer (it's kind of a big deal to survive that long).  He is also an ASST manager at a Tyson owned meat market so he can have benefits.  He actually understands AG commodities which isn't that simple.  How in the hell is he supposed to understand his 401K?  The above is a synopsis.  He owned 15 ETFs with much duplication.  I suspect somebody is getting paid to do that to him.  The more I think about it the more it annoys me.  You shouldn't have to be an investment nerd with ten years experience to have a reasonable understanding of your company 401K.  I told him to tell his advisor to move more of his of assets to SPY gradually.  It's the only rational thing I could think of since his 2021 return was 10%.  I bet he will still have 15 ETFs after that.

I know you don't know him well enough right now.  But if it were me, I'd tell him to get the h*ll out of most of those bond funds.  Particularly the long term ones.

Exactly what I was thinking. Why would a 23-year-old need four different bond funds in his IRA?

[fenders53]

(12-10-2021, 03:02 PM)Christinebitg Wrote:

(12-09-2021, 01:38 PM)fenders53 Wrote: In this instance is was a smart young man with the good sense to save for h9s future and just trying to understand what  his advisor was doing.  As I said he had about $22K.  I had a brief look but for sure he owned as amll amount of the following. 

SPY ETF
Russell 2000 ETF
Midcap ETF
A dividend ETF
Short term bond fund
Several mid term bond fund
Several Longterm bond fund
Some government bond funds.

The kid is a 6th generation Iowa farmer (it's kind of a big deal to survive that long).  He is also an ASST manager at a Tyson owned meat market so he can have benefits.  He actually understands AG commodities which isn't that simple.  How in the hell is he supposed to understand his 401K?  The above is a synopsis.  He owned 15 ETFs with much duplication.  I suspect somebody is getting paid to do that to him.  The more I think about it the more it annoys me.  You shouldn't have to be an investment nerd with ten years experience to have a reasonable understanding of your company 401K.  I told him to tell his advisor to move more of his of assets to SPY gradually.  It's the only rational thing I could think of since his 2021 return was 10%.  I bet he will still have 15 ETFs after that.

I know you don't know him well enough right now.  But if it were me, I'd tell him to get the h*ll out of most of those bond funds.  Particularly the long term ones.

Yes, I cringed when I saw that.  He does trust me.  I will see him over the holidays and suggest he dump all the longterm bonds and camp that money in very ST bonds for now.  Then he can move some money into SPY every month or so and just maybe he gets lucky and the market dips hard so he can move it faster.  Yeah this is market timing, but I don't want to tell him to move 10K and poof he loses 2K a week later.  It's just safer for me lol.  

[fenders53]

(12-10-2021, 03:10 PM)EricL Wrote:

(12-10-2021, 03:02 PM)Christinebitg Wrote:

(12-09-2021, 01:38 PM)fenders53 Wrote: In this instance is was a smart young man with the good sense to save for h9s future and just trying to understand what  his advisor was doing.  As I said he had about $22K.  I had a brief look but for sure he owned as amll amount of the following. 

SPY ETF
Russell 2000 ETF
Midcap ETF
A dividend ETF
Short term bond fund
Several mid term bond fund
Several Longterm bond fund
Some government bond funds.

The kid is a 6th generation Iowa farmer (it's kind of a big deal to survive that long).  He is also an ASST manager at a Tyson owned meat market so he can have benefits.  He actually understands AG commodities which isn't that simple.  How in the hell is he supposed to understand his 401K?  The above is a synopsis.  He owned 15 ETFs with much duplication.  I suspect somebody is getting paid to do that to him.  The more I think about it the more it annoys me.  You shouldn't have to be an investment nerd with ten years experience to have a reasonable understanding of your company 401K.  I told him to tell his advisor to move more of his of assets to SPY gradually.  It's the only rational thing I could think of since his 2021 return was 10%.  I bet he will still have 15 ETFs after that.

I know you don't know him well enough right now.  But if it were me, I'd tell him to get the h*ll out of most of those bond funds.  Particularly the long term ones.

Exactly what I was thinking. Why would a 23-year-old need four different bond funds in his IRA?

It's malpractice.  It's actually more like 7 or 8 bond funds which is way beyond ridiculous. He should be in something like this....  60% SPY, 20% Russell 2K and 20% ST bonds or total bond market fund, until he understands how a rough market feels.  He actually needs no bonds but it's not a terrible thing if you can buy low on your first dip, in case it's a bad one.  I twisted a lot of young soldiers arms and got them to fund their MIL 401K like this, then come see me if they get scared.  LT bond yields were much better then.