Thanks Rob. You just saved me from signing up to a 1% advisor fee firm that my wife wanted because all her friends use it. Your presentation changed her mind too. I think these high cost firms just blow a lot of sunshine your way and make you feel good. For a million bucks, I'll call you once a month, make you feel good no matter what, send you birthday and Christmas cards, and tell you to stay the course.
My parents are paying 1.5 % AUM and they have been put into DOZENS of ETF/Mutual funds, it makes me sick. I can't get them to change anything they are old and set in their ways. It's criminal IMHO.
Excellent video. Thank you. This validates my decisions from the beginning of my investment years. A few years ago I had a co-worker retire and he had a substantial amount invested in a 2025 Target-Date fund. His financial advisor wanted to manage that for him and charge a 1% fee. Both of us agreed, "why would you do that?" A 1% fee to manage a passive mutual fund? Save your money: "it can buy you a boat and a truck to pull it."
Yikes, thank you for your video. Currently with an CFA/CFP paying 0.62% advisory, 0.81% Platform/custodian = 1.43 total! Not counting Fund expense radios (0.06-.75%)!$@$!@!! Looking at leaving our 'Adviser' and moving on our own at either Fidelity/Vanguard/M1....
I appreciate it Rob! I was waiting for this video and just watched it within 2 hours of posting it! lol! Unbelievable how the compound fee affects my long term investment. Thank you for clarifying that. It was an eye-opening fact that 3-portfolio fund can virtually give me almost the same result with less standard deviation and less max draw-down. To answer your questions: 1) Tax bracket 24% 2) Live in Texas 3) I brought up the cash and he responded if we wanna buy a fund, we don't wanna sell any other funds to avoid tax event, so we can use this cash. He also said he can't take it out of my checking, so it needs to stay there at hand in case he wants to make a quick move on buying. Again, Thank you very much sir!
Update 12/22/2021 - After Rob's great video, I did my own research and eventually discontinued working with the expensive financial advisor I had and now I'm implementing my own investing strategy of 3 funds with no bonds and it's working well for me. Thank you again Rob!
Hi Rob. Great info on High Yeild bonds. That opened up a question for my portfolio though. What are your thoughts on high yeild dividend funds like VHYAX? And although vhyax is my main question, since I'm on the dividend topic, what your thoughts on REITs like VGSLX if having to compare the two? Even though they are two different categories, hoping for some insight as I have both but may in the future wanna scale back to just owning 1 in my Roth IRA.
I am not a fan of AUMs either. I also think you can use your trusted advisors (who may make commissions) yet choose to make your own decisions. Personal Capital is great free tool online, but I choose not to go with the 0.85% AUM they want to charge either. A combination of good advice and common sense can save a ton of money in your forced early retirement.
I agree to a point, though IMO whenever someone who is on commission recommends something (that they will make commissions off of), I have a hard time trusting that recommendation. Their interests and mine are just misaligned. IMO the best way to go is with a fee only financial planner who gets paid hourly. They are hard to find though.
@@travis1240 I think I read only 5% of advisors are fee-only. That stinks. Too bad the Fiduciary Standard law proposal was shut down a few years ago because of financial industry lobbyists in the pockets of several Congress members.
@@SKITTLELA In Canada in most cases made no diff or made it worse. Good videos on it. Reality check all govts incl U.S. work for same sources who fund both sides from start. Independent financial reports showing corps as financial entities now have more Geo political power then countries excl obv like Ch. Search con gress and corp $ online. Good articles.
I've interviewed 4 financial advisors and all of them charge 1% minimum fee to manage a portfolio. How do you find someone who will do this for an hourly fee? I can't seem to find these people!
It gets better ... How about the Charles Schwab s&p500 0.02% ER index fund that I have to pay a 0.8% "administration fee" through E-Trade. Charles Schwab says they don't charge that fee, E-Trade says they don't charge it. What does one do?
@@ljrockstar69 I wish I could've convinced my friend not to go with Edward Jones before he did. He said he liked that someone is always there to talk to--which I get. The thing is it's pretty easy to manage yourself, and the good advisors that charge low fees (e.g., Vanguard's .3% AUM) generally have a high minimum investment requirement from what I've seen.
@@SKITTLELA you're right it's not difficult to manage a retirement fund. The problem is these financial advisors put fear in their clients saying that you must have an expert to manage your investments.
Hi Rob, loving the videos. I've taken a look at my own MER fees and realized my 3 ETF fund portfolio approach definitely has a higher MER than a single all in one ETF. Is the flexibility I get with the 3 fund portfolio really worth the extra 30 basis points? Would love to hear your thoughts.
I’m paying 1.5% and an additional $1200 a year. I’m really wanting to try this on my own and pay by the hour when I need help. This has helped me make the push to move on.
Great video Rob, this is why I left my Edward Jones advisor. I had no idea what I was paying for AUM and when I met with my advisor and asked her what I was paying she just kept on trying to sell me some of her insurance products. I moved accounts over to Vanguard and am very happy with the low cost and great service.
Thanks Rob. I have been using a DIY approach (researching on my own) and I was wondering if I was missing out by not using an adviser. Thanks to your video, I can now put that question to rest. I still have a lot of learning to do and I appreciate the help from channels like yours. Thanks. You are doing a good job.
I have always read to use Index funds bc of the low fund expenses. But if you have a fund that outperforms the Index by at least the difference in the fund expenses (hopefully more), doesn't that justify owning a fund that outperforms the Index, even if the expenses are higher?
The issue is that the majority of active funds don't outperform the indexes, especially after a extended period of time. For example, I saw a stat that 92 percent of large cap funds don't beat the S&P 500 index after 15 years. It's easy to cherry pick some active funds that have outperformed the corresponding indexes, so far. But it's not a guarantee they will continue to do so especially because of the higher fees.
Hello Rob, I really appreciate how you explain different concepts. My wife and I both have 401(K)s through work, and we are looking at saving for a house as well as looking into IRA accounts. What are your thoughts on prioritizing investments? One concern my wife has is splitting up investments. We want the compound effect to work in our favor, so would it make sense to have two separate 401(K)s, two Roth IRAs, and a taxable account that we are using to invest in the shorter term to save for a house? Thank you again for the videos, the whole community finds them extremely valuable.
Thanks Rob. You just saved me from signing up to a 1% advisor fee firm that my wife wanted because all her friends use it. Your presentation changed her mind too. I think these high cost firms just blow a lot of sunshine your way and make you feel good. For a million bucks, I'll call you once a month, make you feel good no matter what, send you birthday and Christmas cards, and tell you to stay the course.
My parents are paying 1.5 % AUM and they have been put into DOZENS of ETF/Mutual funds, it makes me sick. I can't get them to change anything they are old and set in their ways. It's criminal IMHO.
Excellent video. Thank you. This validates my decisions from the beginning of my investment years. A few years ago I had a co-worker retire and he had a substantial amount invested in a 2025 Target-Date fund. His financial advisor wanted to manage that for him and charge a 1% fee. Both of us agreed, "why would you do that?" A 1% fee to manage a passive mutual fund? Save your money: "it can buy you a boat and a truck to pull it."
Yikes, thank you for your video. Currently with an CFA/CFP paying 0.62% advisory, 0.81% Platform/custodian = 1.43 total! Not counting Fund expense radios (0.06-.75%)!$@$!@!! Looking at leaving our 'Adviser' and moving on our own at either Fidelity/Vanguard/M1....
Thank you for this helpful video. I just about to sign a contract with CFA but hesitant because he charges me for 1.5 %.
I'm not going with an AUM strategy until I'm too old and senile to manage it myself.
I appreciate it Rob! I was waiting for this video and just watched it within 2 hours of posting it! lol! Unbelievable how the compound fee affects my long term investment. Thank you for clarifying that. It was an eye-opening fact that 3-portfolio fund can virtually give me almost the same result with less standard deviation and less max draw-down.
To answer your questions:
1) Tax bracket 24%
2) Live in Texas
3) I brought up the cash and he responded if we wanna buy a fund, we don't wanna sell any other funds to avoid tax event, so we can use this cash. He also said he can't take it out of my checking, so it needs to stay there at hand in case he wants to make a quick move on buying.
Again, Thank you very much sir!
@Mike Finley Thank you Mike for the words of wisdom
Update 12/22/2021 - After Rob's great video, I did my own research and eventually discontinued working with the expensive financial advisor I had and now I'm implementing my own investing strategy of 3 funds with no bonds and it's working well for me. Thank you again Rob!
Hi Rob. Great info on High Yeild bonds. That opened up a question for my portfolio though. What are your thoughts on high yeild dividend funds like VHYAX? And although vhyax is my main question, since I'm on the dividend topic, what your thoughts on REITs like VGSLX if having to compare the two? Even though they are two different categories, hoping for some insight as I have both but may in the future wanna scale back to just owning 1 in my Roth IRA.
Our advisor gets paid thru the fund holder. Can you do a video on that?
I am not a fan of AUMs either. I also think you can use your trusted advisors (who may make commissions) yet choose to make your own decisions. Personal Capital is great free tool online, but I choose not to go with the 0.85% AUM they want to charge either. A combination of good advice and common sense can save a ton of money in your forced early retirement.
I agree to a point, though IMO whenever someone who is on commission recommends something (that they will make commissions off of), I have a hard time trusting that recommendation. Their interests and mine are just misaligned. IMO the best way to go is with a fee only financial planner who gets paid hourly. They are hard to find though.
@@travis1240 I think I read only 5% of advisors are fee-only. That stinks. Too bad the Fiduciary Standard law proposal was shut down a few years ago because of financial industry lobbyists in the pockets of several Congress members.
@@SKITTLELA
In Canada in most cases made no diff or made it worse. Good videos on it. Reality check all govts incl U.S. work for same sources who fund both sides from start. Independent financial reports showing corps as financial entities now have more Geo political power then countries excl obv like Ch. Search con gress and corp $ online. Good articles.
I've interviewed 4 financial advisors and all of them charge 1% minimum fee to manage a portfolio. How do you find someone who will do this for an hourly fee? I can't seem to find these people!
Very good video! Thanks! Can I open the personal capital app to open & see my portfolio?
Eye opener
It gets better ...
How about the Charles Schwab s&p500 0.02% ER index fund that I have to pay a 0.8% "administration fee" through E-Trade. Charles Schwab says they don't charge that fee, E-Trade says they don't charge it. What does one do?
You could do what I did, switch from Schwab to Vanguard
I DIY my IRA account save a Ton of fees.
Is going to a financial advisor like Edward Jones, are these going to dry out my investments?
They are expensive. Fees start at 1.35% www.edwardjones.com/us-en/working-financial-advisor/fees
@@rob_berger thanks. I need advice if I should move my money out. This is a non retirement account. I plan to put it all in Vanguard ETF.
@@ljrockstar69 I wish I could've convinced my friend not to go with Edward Jones before he did. He said he liked that someone is always there to talk to--which I get. The thing is it's pretty easy to manage yourself, and the good advisors that charge low fees (e.g., Vanguard's .3% AUM) generally have a high minimum investment requirement from what I've seen.
@@SKITTLELA you're right it's not difficult to manage a retirement fund. The problem is these financial advisors put fear in their clients saying that you must have an expert to manage your investments.
Hi Rob, loving the videos. I've taken a look at my own MER fees and realized my 3 ETF fund portfolio approach definitely has a higher MER than a single all in one ETF. Is the flexibility I get with the 3 fund portfolio really worth the extra 30 basis points? Would love to hear your thoughts.
I’m paying 1.5% and an additional $1200 a year. I’m really wanting to try this on my own and pay by the hour when I need help. This has helped me make the push to move on.
Great video Rob, this is why I left my Edward Jones advisor. I had no idea what I was paying for AUM and when I met with my advisor and asked her what I was paying she just kept on trying to sell me some of her insurance products. I moved accounts over to Vanguard and am very happy with the low cost and great service.
I just got my sister out of EJ
Thanks Rob. I have been using a DIY approach (researching on my own) and I was wondering if I was missing out by not using an adviser. Thanks to your video, I can now put that question to rest. I still have a lot of learning to do and I appreciate the help from channels like yours. Thanks. You are doing a good job.
I have always read to use Index funds bc of the low fund expenses. But if you have a fund that outperforms the Index by at least the difference in the fund expenses (hopefully more), doesn't that justify owning a fund that outperforms the Index, even if the expenses are higher?
The issue is that the majority of active funds don't outperform the indexes, especially after a extended period of time. For example, I saw a stat that 92 percent of large cap funds don't beat the S&P 500 index after 15 years. It's easy to cherry pick some active funds that have outperformed the corresponding indexes, so far. But it's not a guarantee they will continue to do so especially because of the higher fees.
I would track down a copy of "The Little Book of Common Sense Investing" by John Bogle.
Hello Rob,
I really appreciate how you explain different concepts. My wife and I both have 401(K)s through work, and we are looking at saving for a house as well as looking into IRA accounts. What are your thoughts on prioritizing investments?
One concern my wife has is splitting up investments. We want the compound effect to work in our favor, so would it make sense to have two separate 401(K)s, two Roth IRAs, and a taxable account that we are using to invest in the shorter term to save for a house?
Thank you again for the videos, the whole community finds them extremely valuable.