Asking a Financial Professional about Working ETFs into Your Portfolio
Part of the Exchange-Traded Funds For Dummies Cheat Sheet
If you’re willing to spend time reading quality resources about exchange-traded funds and portfolio construction, you can create for yourself a portfolio that balances risk and potential return and aims toward your investment goals. However, many people find that they want at least a bit of guidance from a financial pro before making investment decisions. If that describes you, look for a fee-only financial planner (someone who does not earn commissions on your investments). Here are some questions to ask when you meet that person:
Given my personal economics, how much risk should I be taking with my money? Specifically, what percent of my portfolio should be in stock ETFs and what percent in bond ETFs?
Given the size of my portfolio, how many individual ETFs would you suggest?
Which brokerage house do you recommend for housing my ETF portfolio?
What is the historical rate of return on the ETF portfolio that you are suggesting, and just how volatile can it be?
Given my age, my tax bracket, and my employment, what kind of account — IRA, Roth IRA, or taxable brokerage account — do you suggest for my ETFs?
What selection of ETFs would you advise for an optimally diversified portfolio?
Do I keep my present investments, or sell them? If I keep them, how are you going to choose ETFs that best complement those investments?
Can you help me jiggle the investments in my 401(k) plan to complement my new ETF portfolio?