Pesky Fees! Why am I Paying Them?

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By David S Edge

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Clients are often amazed when we assist them with a new retirement income plan. Many times there are reduced or no fees on many aspects of their new plan. Our plans lookout 20 years so that clients get a real good snapshot of “where are my accounts”, “what are my accounts costing me”, and “how predictable is my current plan”?

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When consulting with many financial planners, there is usually a monthly fee on an entire portfolio, regardless whether your plan makes a profit or not. “It’s the management fee”, they all claim as a matter of fact. This fee typically is in the 1-3% range of the entire account under management. But, what if that 1-3% remained yours? What if there was added certainty, and that there are portions of your retirement plan that were guaranteed? What if there was added value to your plan of Long Term Health Care included? If you don’t know the answers to these questions maybe you might be in the market for a new planner.

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There are two types of planners, accumulation planners and preservation and distribution planners. Accumulation planners are great while you are in your earning years from age 20 to mid-fifties. When you are 5-10 years away from retiring, that’s when you need to mentally shift gears towards conserving what you saved and making it less volatile. This is when you need to seek out the second type of planner, preservation, and distribution. It’s the basic concept that you’ve built your nest egg, and preserving that nest egg is more important than gambling with it.

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Many planners work with specific companies and they can only offer that company’s stable of products. This can mean they are giving you the best choice of what they can offer, but… not the best choice of what’s available across all retirement products.

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If you had a bad experience in 2001 and 2008 with the market crashes, you know exactly what I’m talking about. You had your investments in Mutual Funds, or 401K’s, and the like. These accounts are tied directly to the stock market, and if you listen to John C. Bogle of Vanguard fame, whom many consider the father of modern investing, he stated, “The stock market is a casino that the average investor should avoid.” Ask yourself, “Am I gambling with my retirement money right now”? Many Mutual Funds and 401K accounts have hidden fees and you’ll need a microscope in the fine print to read and understand, but believe me they are there.

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If you want a comprehensive plan, with little or no fees, and a team of folks that will educate you on exactly what you have, where it is, what it’s making you, and what are the certainties of that plan, give us a call. We’re here to help! Isn’t it time you took control of your retirement planning?