In this lesson, we’re focusing on how to maximize your wealth growth by controlling investment fees.
- The shocking truth behind how financial advisors are taking 75% of your retirement portfolio
- Why fees being charged as a percent of your assets directly lowers your net return…
- And how that effect on your portfolio growth is compounded
- Why 75% is actually a conservative estimate
- The numbers behind this truth with a real life example
- The simple test of whether an advisor’s fees are justifiable or not
You might not want to see the numbers, but go ahead and complete the homework for this lesson, which involves calculating the cost of investment fees you’ve experienced in your portfolio. Take note of how it impacts your future wealth growth.
Homework: The Impact of Fees on Retirement Income
Office Hours Recording: Download / Listen Here (.mp3)
Research Supporting Conclusion: Well-known Dalbar research showing average investor underperformance. Click through to compliance review edition and look around at some of the links.
Personal Capital White Paper on Fees. (Please note that their analysis of investment product fees is lower than reported elsewhere. There seems to be some confusion in their article on separation of advisory fee for the personal financial advisor vs. advisory fee at the product level. They seem to be separating out just product fees since the objective is to compare their investment product to competitors. You would need to add personal financial advisor fees to these product fees.)
USNews.com article showing how my fee analysis is actually conservative.
Rules of Prudence for Individual Investors – a fun article giving a succinct analysis of investment fees on passive vs. active.