On this episode of CFO at Home, Vince talks with James Barrineau, Chief Investment Officer of Fiduciary Capital Management, about what everyday investors should understand as they manage their retirement savings and evaluate financial professionals who may help them along the way..
Drawing on more than 25 years of experience on Wall Street and in investment management, James discusses why investors should understand what they own, the risks they’re taking, and the fees they’re paying. Vince and James also discuss why complexity doesn’t necessarily mean better, why investors should be skeptical of market predictions, and why a good financial professional should be able to explain recommendations in plain English. The bottom line: you don’t have to be an investment expert, but you should know enough to ask good questions about your money.
For more on James and Fiduciary Capital Management, visit fiduciarycm.com.
Key Takeaways:
~03:30 | Know what you own: Understand how your retirement money is invested and why.
~08:00 | Understand the risks: Even “safer” investments have risks, including inflation.
~12:00 | Invest for your needs: Your portfolio should reflect your goals, income needs, time horizon and risk tolerance.
~15:00 | Watch the fees: Know what you’re paying your advisor and what your investments cost.
~18:00 | Don’t confuse complexity with quality: Ask why a complicated investment is better than a simpler, lower-cost alternative.
~21:00 | Don’t invest in what you don’t understand: Know how an investment makes money and how you could lose money.
~28:00 | Expect plain-English answers: A good advisor should be able to explain recommendations in terms you understand.
~31:00 | Be skeptical of predictions: Ask what happens to your plan if the advisor’s market forecast is wrong.
~34:00 | Keep your “BS meter” on: Ask about fees, compensation, conflicts of interest and risks.
~37:00 | Plan for a long retirement: Consider inflation, income needs and how long your money may need to last.
