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Today Money financial expert David Bach joined us for a live Web chat Wednesday to answer your questions.
Here’s one of his answers to questions from the live chat. (See below for the full Q&A and video of David’s TV appearance this morning.)
Jennifer asked:
“My husband and I are 30 and because we were in graduate school most of our 20s, we are just starting to save money. At what point in life does it make sense to get a financial planner? How much should a financial planner cost?”
David replied:
“I think the sooner you get a financial planner the better. With that said, you should read up on investing before your hire one so you know what questions to ask and you are prepared better to screen a good advisor from a bad advisor. Read Smart Couples Finish Rich, before you hire a financial advisor. In this book I also layout how to hire and how to pay a financial advisor. The cost to do a basic financial plan is around $500 to $5,000 depending on how detailed it is. Then there are costs to work with the financial advisor. Most advisors today charge a flat fee on assets of around 1%. You can also hire financial advisors by the hour. Hope that helps you get started! Lastly before you hire a financial advisor check out their background online by visiting the NASD website and make sure there are not any complaints or legal issues with the advisor.”
Here’s the full chat archive and David’s TV appearance:
If you have a question for our TODAY Money experts, submit it here.
To sign up for an e-mail reminder for our next chat, click here.
Leave a Comment:
I'm trying to invest in a Money Market account any ideas. I was thinking about invest some in exxon and some in another untility stock I have right now 2,000 to invest and April when my CD's turn over I'll have another 3,000
This sounds like someone trying to get more business. Most folks do not need to hire a financial planner. Unless you have substantial financial assets and investments, any of the discount brokers can fill the need at no cost. Some banks, like JP Morgan Chase, also have financial advisors in some of their branches. They can, again for no fee, work out a plan with you using the software they use for their wealthier clients.
Unless you're suddenly being paid big bucks and don't have a clue about saving and investing or you have no clue that when you get out of graduate school you need to (as I did) start paying off college loans and saving to buy a home by living beneath your means, you're wasting money on a financial advisor. Within several years your situation is likely to have changed so much that the plan you paid for will be way out of date.