“I
WANT YOUR MONEY!” was what my new client heard from many financial advisers
when he came into some new wealth. Some wanted
to sell him annuities which would likely generate commissions for the adviser
of over $80,000. Some had “great load
funds” that would generate commissions for the adviser of over $50,000. Some wanted to manage the assets for 1% per
year which would likely generate fees for the adviser of over $50,000 in the
next 5 years. All of the above also
usually have an additional $10,000 or more in annual fees inside the
investments. All these fees and
commissions come right out of the client’s portfolio and severely restrain his
long-term growth. How is the poor guy
going to make any money with all these commissions and fees? Fortunately,
a professional contact sent him to me where he gets advice on an hourly basis
that is not affected by what product pays the highest commissions and where he
doesn’t pay fees so large the adviser could buy a Tesla with it. You may think doubling your money sounds good
over 20 years until you learn that you could have tripled it without all the
fees. (Numbers above are based on a $1
million portfolio.)
Larry Pike, CFA
