The Almighty Dollar

Restoring some fiscal sanity in our -- negative savings rate -- lives


Do it yourself investing or hire a professional?

I'm curious how many of you rely on professionals for investment advice and whether it is worth the cost.

When we were starting out, my husband and I initially considered hiring a financial planner, but then opted against it. Our then-accountant remarked that if people spent the time to do their own research, they could invest just as well as a professional and pocket the fees. At first, we were skeptical, since neither of us have a background in finance. But we hate paying people to do things we could do ourselves, so we started reading. And reading, and reading.

In this day and age, there is a vast amount of information available online. The hard part is sorting through it all and determining what details reflect a well-managed fund or company. We also decided on our investment strategy -- basically we wanted to focus on investments with a longer-term outlook. No day trading for us. Although savings and investing are priorities, we aren't willing to devote the time to watch a stock's performance on a daily basis. Our goal is to build a nest egg for our future.

The bulk of our investments are in mutual funds and ETFs. We tried to buy individual stocks, but always had bad luck with them for one reason or another. That said, we have chosen strong funds that have outperformed the Dow over time and have built a diversified portfolio that some may consider too international-heavy. We are comfortable taking slightly greater risks at our age, but by no means are we stupid.

Overall, we are very pleased with how our investments have done over the years. This makes me wonder,

For those of you who have hired a professional, are you happy with your investments? Is it worth the extra cost?

I ask, because a few of our friends who use brokers have complained about their investments. Some have bought seriously under-performing funds with high fees. Others own stocks that were purchased at inopportune times. All of these decisions were recommended by their brokers. It seemed like with simple research, it would have been obvious that these picks were unwise.