Great video, about a year ago I left Edward Jones and moved my investments to Vanguard. Edward Jones did not disclose the fees on the statements and when I met with my advisor ashed she just blow my question off and kept on trying to sell me her insurance product. She was no financial advisor just a salesperson trying to increase her bottom end. You are always going to have fees unless you are going to do it yourself, but some of the fees are outrageous.
Exactly how hard is it to just put it in a index fund and self teach yourself about the market in the long term. I manage all my investments I would never pay 1% fee thats crazy . Just for someone to tell me not to sell my investments its not like there helping me do anything else besides that . Thats why I took it out of my head to be a advisor and also more things are online now why would someone pay 1% when they could take that and buy 20 books?
Oh my goodness- I’m going through this now and feel so stupid! We’ve been with Edward Jones for 10yrs and never understood AUM and purchasing fees. In the middle of moving everything to Fidelity who manages our hospital’s 401K plans. So thankful we figured this out earlier in our catching up phase of retirement savings.
@@muradshawar Are there any good ways to learn how to teach yourself? I've recently learned I've been paying a 1.5% annual fee. I feel like I've been getting robbed when it's my roth IRA that's supposed to be there for 30+ years. It shouldn't be that much for them to not do much to it.
@@DefinitelyNotRin Yes go to Barns and Noble and buy Investing books also its not hard to pick a few good etfs and stick with them . ETFs are low cost expense wise and offer good diversification . 1.5% is highway robbery
Perfect timing, Rob! I will be able to use your calculator in my presentation at work which I hope will really drive home the idea that fees matter inside 403b accounts for teachers. Thank you for all you do to shed light on these important financial concepts.
What is your opinion of Raymond James? All of my retirement accounts are managed by them. Your video has scared me a little but also opened my eyes, Thank you!
Learn logarithms! That might sound smug or arrogant; logs are easy to learn and will show you the truth! Example: Fischer wanted 1.5% per year to serve as my financial advisor (because my portfolio is less than 1/2 million). It took me about 30 seconds to calculate that those fees would consume ONE QUARTER of my original nest egg in just under 14 years. Compounding can eat you alive!
My 401k is super deceitful. They have taken the fund sheet and put their logo on it and removed any expense ratios. Equitable is a horrible company apparently. Super huge expenses on the Fee sheet shows up to 2.72% for the highest with 2.02% being the lowest option. I had no idea. And good luck finding the actual ticker symbol the way they generalize the name. Multimanager Technology is one of the funds. That is it.
I need to show to the finance guy at work. He thought I was off my rocker for taking a Coronavirus Related Distriubtion from our 401k only to sock it back into a Vanguard IRA. Went from 1.14% ER to %0.16-ish!
For illustrative purpose on the effect of fees these numbers are fine. But in reality, it's worse. Why? Because people tend to have some fixed income, cash and other investments. The Advisors are getting the AUM fee for managing cash? Also one should expect lower returns due to sequence of return risk. The point of this video, however, is very important, I would say "Critical". My rule: "Money Doesn't Grow on Fees".
Hey Rob, great video. I came across your channel as a friend of mine was curious about a certain someone who is getting some traction "offering" advice on MPI's (give me a break). I saw you were roasting him and it was very apparent you knew your stuff and decided to check out the channel and gave this one a listen. I've never considered expense ratios on the mutual funds, especially the one have been invested in for a few years now (mid 20's). I always suggest SWPPX to new friends starting investing, as it has a had a great return and relatively low risk (and after checking 0.020% expense ratio), but through my family they are saying to look into Russell 2000 (VRTIX , 0.080%). It got me thinking, when it comes down to the expense ratio and the growth of the actual performance of the mutual fund, wouldn't they basically perform /yield the same return over a long period of time, which is why the expense ratios are set up as such? Also, any tips for helping others getting into investing? I've helped a few of my friends this last week get their foot into passive investing (automatically invests into mutual funds via Schwab) but it was a little bit of a hassle having them see the bigger picture (long term plan). Thanks! Appreciate the time! looking forward to the next vid, subbed!
Thanks for the video. My wife and I have several non-employer-sponsored retirement accounts (ROTH and Traditional) managed under Vanguard Personal Advisor Services. It's a .3% fee, which is on the low end and I like that they invest in their own funds which have relatively low fees. To save on the .3% fee, what are your thoughts on opening duplicate accounts outside of management, transferring the bulk of the funds there, and just mirroring the funds and rebalancing that Vanguard does in the managed accounts? I assume you could do this with any advisor where you have a small portion of your overall investments managed, and just use them to duplicate their efforts in your unmanaged accounts. This way, you could have the benefit of an advisor to strategize with, but then use it as a template on accounts with no management fees? Or, is it simple enough to use free info online to figure out what your allocation should be based on your goals and rebalance yourself, which would be exactly what your advisors would be doing anyway?
Rob, Are you suggesting that it's not worth getting a certified financial planner as you're nearing retirement? The one I'm looking at will charge 1.5% of the AUM
Rob, I pay $500 a year to my iRA fees. I want to switch to self managed Roth to M1 finance! I have no clue what to do! Should I contact a financial advisor?
I'm embarrassed to admit I've been holding a ton of cash that needs to be invested very soon, but I have zero knowledge of investing. I'm afraid to invest on my own due to lack of knowledge and experience, but the thought of paying 1% to a manager just feels wrong. Even if I pay a financial planner who tells me which stocks & bonds to choose, I don't have the experience to balance the portfolio and use tax loss harvesting. How can I find a manager who charges less than 1%? I looked into Betterment, but read some complaints about their customer service.
@@chrisa.515 Rob has advised in these cases to look into a good fee for service (per hr) advisor to help get set up in simple low cost 3-4 fund portfolio. Then check annually maybe at tax/rebal time. US viewers can try advisor from his list. He’s also said pre bal funds by Vanguard, BlackRock etc are good option. No matter what even with FT advisor DYOR and self educate. Never outsource responsibility for your money or health.
Im sad that I'm only just realizing how much money ive paid over the years. I took set it and forget it to heart. As of today, i was considering having Fidelity actively manage a rollover 401k of 200k at 1.16 paid in part quarterly? Its currently moved/sitting in my current/new 401k. This video says this a bad idea. Is there a flat rate investment firm that i should consider ?
Is the MER (of etf) charged full or prorated? If i own an ETF for few months (or weeks even) then i exit, will i pay the fee fully for a year or will it be charged pro rated for the months/weeks i held the etf?
Maybe the financial advisor is worth the cost at times because the advisor can encourage the client to stick to the gameplan when the market takes a dive.
High Rob @Rob Berger In my country, we have 1% fee for the index fund! Do I pick stocks, by the way i am not professional, or should I buy this expensive passive investment? What is your take? Thanks
I have a question: I have a fund called William Blair Small-Mid Cap Growth CIT and it has an expense ratio of .85%. Am I a fool to keep paying this high of an expense ratio? I have been thinking about this for a long time and cannot get myself to change it. I have $400,000 in it. Please let me know your thoughts and keep up the great work!
I set up 3 variable annuities in 2020 and they're invested in mutual funds. When I set these up 3 years ago I didn't know anything. And I think the salesman took me for a ride. I have 3 separate accounts each one with about 200000. They have done decent since 2020. Each account portfolio has about 4 or 5 different mutual accounts all ranging from .60 to 1.2. In exp ratio. Are all these fees in a single portfolio added together??? I feel like fees are holding back growth. Im 43 and looking for growth but i am a little scared to lose money. in 1 portfolio i have. Growth fund ,blend fund, high yeild bond,government bond. Should I transfer shares and eliminate funds? Would that reduces fees?
