About 10 or so years ago, I was running a landscaping business and my accountant told me to start a SEP IRA. I’d never done any investing in the market before, but this sounded like a good idea.
One of my clients was an advisor with a big firm and it seemed like a logical move to let him manage my money. He was a nice guy. I gave him about a couple hundred thousand dollars to open a SEP, nothing more than that. I’m heavy into real estate, fixing up properties and renting them, so I didn’t want to invest in anything else.
But he didn’t really know diddly squat about money management. My money was spread over like 40 different mutual funds that I could never make sense of. Maybe he couldn’t either. I asked him about his strategy and he never answered. I’d ask, do you think we should make any changes? And he’d say no. The best I could tell, his job was to keep clients happy and “press the flesh.” So I figured out that financial analysis was probably handled by others.
In the beginning we’d meet in person, either in his office or mine. That was a big waste of time. We’d just shoot the breeze—anything but a practical discussion about how to better manage my money—never a conversation that was productive. It got annoying.
Then two years, after I sold my business, I moved an hour away so we began talking on the phone about every six months. At a certain point, I literally started ignoring his calls. Then he would come by my office, just drop in. That got to be really annoying. Some people need a personal approach, being able to walk into an office and look at the books on the shelf. I don’t care about any of that stuff.
Over the years, I started to think, what am I doing paying this guy when he’s not really making the decisions? To hell with this. It came to a head last year. I realized this guy had to talk to all his clients at certain intervals and I was one of them. I finally said, “I know you’re part of a system and you have to follow a procedure. But you don’t need to call me every six months. It’s not a good use of my time. You can email me any questions or approvals if you need anything.” He said he’d check. He got back to me and told me he had to keep doing the phone calls.
Three months ago, I told him to sell everything and put it in cash, so I could transfer it to an online investment platform. For the online platform, I filled out this exhaustive questionnaire about: who you are, your financial goals and your risk tolerance. Then they’d invest based on those answers. I’m a tech guy and the approach made sense to me. I don’t have to waste my time shooting the breeze with someone. Also I assumed if I switched to another person, I’d have to go through the same crap. I assumed that’s the way they all worked.
From a personal perspective, that guy gets high marks. It was painful to fire him, because I liked him. He’d also been a customer of mine. And I didn’t want to go through the pain of setting up a whole new account, transfer the money over and all that. In the end, I had to do it.