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July 6, 2020
Pensions have pretty much gone away. We spend 20 to 30 years in retirement. And Social Security covers only a fraction of our retirement expenses. This means we are pretty much responsible for saving everything we need for retirement on our own.
This may seem like a daunting challenge; some people might consider the help of a financial advisor. But should you hire a financial advisor that’s affiliated with your bank?
For most people, a bank is their main provider of financial services. But this does not necessarily a bank is the right place for your retirement savings: They may not offer you the advice and services you need.
Until 1999, you could not invest through your bank. In 1999, Congress repealed the Glass-Steagall Act that prohibited banks from offering investment and insurance services to retail consumers. The Glass-Steagall Act was originally passed in 1933 after the Great Depression; many people lost all of their savings and investments when banks went bankrupt.
In the event that the firm runs into trouble, there is some additional risk you take on anytime you concentrate more of your assets with any single firm.
These days, there is an ever-expanding landscape of banks and financial institutions that can help you save for retirement.
These institutions offer these services:
If you look at the market landscape of financial providers one way to slice it up would be like this
Here are some of the pros and cons of investing through your bank:
A bank can get the job done, but they are not a good fit for everyone. Good fits for using a bank for retirement investments might be:
If you are saving for the future and want to keep costs low and put your investments on auto-pilot you may want to consider using the services of a robo-advisor.
Do it yourself retirement planning: easy, comprehensive, reliable
Take financial wellness into your own hands and do it yourself retirement planning: easy,
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