When the Financial Crisis occurred, I was caught with my pants down. Money intended for buying my dream home was invested 100% in equities.  Yes, I should have put this money in a 1-year CD.  However, the stock market kept going up; how could I go wrong?!  After the market fell 10%, I was tossing and turning at night. After the market fell 15%, my dreams of owning a home began to vaporize. After the market fell 20%, I couldn’t take it anymore and sold everything.  It was a good lesson in the emotional aspects of money management.

When there are specific financial obligations like buying a house in 2.8 years or retiring in 8.4 years, stock market volatility can definitely make a person toss and turn at night. Is my asset allocation too heavily weighted in equities?  Should I be in stocks at all?   Will my nest egg last if I live to be 100?

Just as some people are better off hiring a licensed plumber to replace a leaky water valve (because sweating copper pipes is not their cup of tea), some people are better off paying a professional to lessen the self-doubt that accompanies financial market volatility (and deflect criticism from family members).

Keep in mind that plumbers charge $125/hour plus parts, and that’s it.  If the plumber charged you like a financial advisor, your plumber would charge $125/year for as long as water was running through the repaired water valve.  So it’s not really apples-to-apples.


At some point, we should all have professional assistance with managing our investments.  There is research which demonstrates that our investment skills decline in our twilight years.  (However, this does NOT mean that we should choose a costly advisor.)

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There are some fabulous boutique advisory firms, but such firms are being acquired by giant brokerages at record pace for gargantuan sums of money.  Furthermore, financial advisors jump ship every few years to the highest bidder in exchange for millions and a promise to drag along their clients.  After doing this a few times, they retire early onto the mega-yacht that you helped pay for, leaving you in the dust.

In this way, our portfolios will be bounced from advisor-to-advisor, firm-to-firm when we are least able to handle it.  While stand-alone roboadvisors are gaining traction, they don’t hold your hand when you can’t sleep at night due to market gyrations.  They also don’t protect you from yourself when your cognitive decline sets in, and you start believing everything you hear on Fox News or start buying everything you see on Home Shopping Network.


Nearly 40 years ago, Vanguard turned the investing world upside down by offering low-cost investing.  More recently, they have had enormous success with their Vanguard Personal Advisory Services, which charges 0.3% of assets per year and matches clients with Vanguard advisors who do not get paid incentives or kickbacks for selling investment products.

Vanguard personal advisors work closely with each client (over the phone or through video chat) to develop a customized financial plan according to each person’s unique situation, take charge of transferring assets from your current brokerage in a way that minimizes the pain of capital gains taxes, and oversee the eventual transition to low-cost funds according to the agreed upon asset allocation.

No need to worry about your advisor leaving you in the dust.  The financial plans are crafted by Vanguard using evidence-based models, so even if your advisor drops dead at his desk, another advisor can simply log into your account and carry out the prescribed plan.

— AK