[networkOne]

Yes, financial planners will be one of the first industries to totally revamp itself because of AI. $2,000 for some SoA which is 99% boiler-plate? No thanks.

I spent years in this industry, and the advice from these 'experts' is demonstrably poor.

[weitendorf]

This already happened 10-20 years ago when personal finance got big on the Internet, it’s just taking a long time to play out.

It was never about ROI anyway, just preservation of capital and peace of mind - makes a lot of sense in the analog/less automated financial world of yore when non-professionals were writing checks or wiring money to people over the phone, and checking stock prices in the paper.

There will also never be a way to pay $10/mo for Gecko+ and trade your way to a lambo with it, because whatever advantage an amateur investor might have is purely from their niche knowledge/information/heterodox beliefs, though I give it about 6-18 months until we’re hearing all about it because it’s a timeless siren song.

[ingvay7]

This is spot on and has been my experience. The tax-efficiency and lot-selection work it can provide is easily more valuable than a human advisor charging $2,000 for boilerplate. However, I know my P&L best and it has to ride shotgun while I am making the final decisions and I should know the overall strategy — should i be 80/20, have this much tech concentration, will 8% hold, tax implications in my state etc.

[lotsofpulp]

99% of it would just be a search of Bogleheads wiki.

[deadbabe]

Financial planning is mostly a solved problem. For whatever goal and situation a person is looking for, there's already an optimal path that has been long proven.

The only times you need very custom advice is at very high levels of networth or ownership, as in "you want to sell stock but you have to physically find the buyers and negotiate deals because you can't just sell on the open market without disrupting the price"

[DonsDiscountGas]

Lol. You don't even need AI for that 99% boiler plate. Save 6-12 months of expenses in cash, DCA the rest into total market stock index funds. But people still pay expensive advisors to get worse results.

[groundzeros2015]

An advisor gives you emotional support and helps you not fuck it up.

[swat535]

The problem with giving financial advice to people is that many struggle to pay their rent. Telling them to invest in index funds from an ivory tower is laughably misguided of the realistic situation they live in.

After they pay their rent and feed themselves, they may have a little left over which they will simply spend on basic pleasures, or simply rack up debt to get by.

The financial advice ignores the fact that we have people like Musk with a net worth of 600M while the rest struggle to afford necessities.

The wealth inequality gap is simply too much to ignore and I worry that it will reach a breaking point.

[groundzeros2015]

I don’t know what this has to do with financial advisors. People in that situation are not seeking investment advice.

[yodsanklai]

It's more complicated than that. You probably don't want all your equity in stock, unless you're young and you're confident you can keep your strategy when the AI bubble crashes. And what do you do with the part that isn't in stock? bonds? what are they? which ones to buy? Even the 6-12 months of expenses in cash doesn't apply to all people.

That being said, I agree with the bad and expensive advisors, but I think financial planning is hard, and you really need to educate yourself.

[singpolyma3]

I mean, never DCA anything that's terrible advice. But still better than what most people do.

[sweetjuly]

DCA is not unreasonable advice given that most people's greatest enemy is themselves. DCA helps avoid the very emotionally upsetting feeling of you throwing money into a fund and it dropping 5% the next day. This emotional volatility can push people to make bad decisions (pull all their money out, try to time the market, stop investing, etc.). Scheduling your investment into smaller sums lets you diffuse the highs and lows in order to keep you steadfast.

[orsorna]

If you only have a fixed amount of money to put aside every month, DCA makes sense. That applies to 99% of people. Not terrible at all.

[zrail]

That's not really DCA, at least how I understand it. DCA is something like "I have $520,000 in cash right now today sitting in checking, I'm going to buy $10,000 a week of VTSAX for the next 52 weeks" which on average is a bad strategy.

What you're describing is better analyzed as a continuing series of lump sum investments. You're investing as soon as you have cash available, not unnecessarily holding onto cash.

[BeetleB]

This is the original definition of DCA, but by this point most people view DCA as what everyone else in the thread is talking about.

Not a hill worth dying on.

[lotsofpulp]

That's not really choosing to "DCA", that's just not having enough money to not be able to "DCA".

Which is what's so funny about 99% of people that talk about DCA...they don't have any other option.

[ofjcihen]

What’s the one piece of advice everyone sells but you think should be free?

[SOLAR_FIELDS]

If you’re a layman investor just dump all of your shit in index funds. Even if you’re smart and sophisticated, you’re still competing against the massive amount of fraudulent insider trading happening right now with zero enforcement and are trading at a disadvantage as a result

[mfro]

Not to mention huge quant firms that paid more than 4x your salary just to get a trading latency advantage

[weitendorf]

If you understand finance and aren’t specifically attempting to arb on that timescale, you actually want to participate in markets with those participants, because their presence gives you less variance/better price discovery on the scales that don’t factor into your decisions to buy and sell things.

So basically if you’re larping as a trader you will consistently get your ass handed to you unless you are genuinely better than all the pros, but if you’re investing or optimizing for a specific risk profile/exposure/timeline you’re playing a different game.

Anyway the fact that it’s so hard to explain this stuff to individuals does strengthen the argument that most individuals are better off following the herd.