Managed account vs. individual management?
I’m 33 and looking for a gut check on a financial advisor’s recommendation.
Current situation:
- Taxable brokerage: $314K, 100% FBGRX (Fidelity Blue Chip Growth)
- Roth IRA: $52K, 100% FXAIX (S&P 500)
- No debt
- $100k in a 3.3% HYSA (thinking of moving 40k to brokerage)
- $220k TC
I previously worked for a company with significant investment restrictions, which limited what I could invest in. Now in a new job and have more options.
My advisor (through Fidelity) recommends gradually selling FBGRX and moving the taxable account into a diversified managed portfolio for a 1.6% annual fee. The rationale is diversification + managing the sell-down in a tax-efficient way.
I agree I’m too concentrated and want to diversify. My hesitation is:
- 1.6% feels steep for something I could potentially accomplish with low-cost index funds.
- I don’t know how to sell off the $314K tax-efficiently (which lots to sell, how much per year, tax-loss harvesting, etc.). This is where professional help seems valuable.
- I haven’t saved as much as I’d like over the past 2 years, so I’d rather avoid realizing gains in 2026 and creating an additional tax bill next spring.
- I may use a meaningful portion of this account for a home purchase in late 2028/2029.
My alternative: Stop contributing to FBGRX now, put all new investments into diversified funds (thinking FSKAX + FTIHX), leave FBGRX alone through 2026, then start a tax-conscious sell-down in January 2027. I’d separately de-risk money earmarked for the house as I get closer.
Would you pay 1.6% AUM for professional management in this situation? Or would I be better off paying a CPA/fee-only fiduciary to develop a tax-efficient sell-down/allocation plan and managing the portfolio myself?
Also curious whether waiting until January to start selling FBGRX is reasonable or if I’m letting taxes drive the investment decision too much.