I've had some eye opening financial education lately. I'm no expert, but some of what I've learned I'm gonna share with you guys.
I've always been like many of the posters on here. I didn't understand it, so it was better for me to let someone else manage my accounts. Sounds like good advice.
But wait.
Can any of you quickly recall what your fees are to have your accounts managed? Is it 1%? 2%? What exactly are you paying? Those percentages don't sound like much do they?
Anyway, so I didn't take the information I was receiving for a fact. I ran my own numbers. I kept it simple and kept to nice round numbers to see what my results were.
I invested my fictional $10,000.00 insurance payoff at the age of 24 in a 401K that advertised they had averaged 6% growth over the last two decades. I didn't put another dime in that account.
I figured 6% growth on $10k over 36 years and retired at a spry age of 60. These numbers are with ZERO fees, meaning I managed my account myself. When I turned 60 years old this account is worth $81,472.52 and represents a very decent growth on my money.
Now, I figured this same information but decided to let someone else manage my money for me. I couldn't be hassled with dealing with it. This company charged me a 1% fee on my money over the same period of time. When I turned 60 years old this account is worth $57,918.16. WHAT? 1% cost me $23,554.36 in profits.
One last time. I figured this same information but decided to let someone else manage my money for me. I couldn't be hassled with dealing with it. This company charged me a 2% fee on my money over the same period of time. When I turned 60 years old this account is worth $41,039.33. 2% cost me $40,433.19 in profits.
Those numbers are with a simple fee and no other charges they may make.
Don't believe it? Run them yourself, it's not hard. Again, I'm no expert. I'm just like the rest of you, I'm just starting to wake up to what is going on.
I'd encourage you to watch these videos. One is long, but it's also one of the most prominent financial minds of our time talking, so I pay attention.
The bottom line is this guys. Educate yourself and learn to shelter your money and keep your fees in your own pockets.
I had my own reasons for no longer investing in these type accounts. I started looking and realized how stupid I was about money. How I thought about it, spent it, saved it, invested it. I'm learning and will attempt to leave a legacy of knowledge for my son for his future.
Your government doesn't want you to know these things. Your schools don't either. They have made a habit of teaching you how to dissect a frog but not how money actually works. My son is in a finance course at one of the best high schools this state has to offer. They were told to pick up a paper and choose a stock and invest $x fictional dollars and keep up with it.
I asked him how he was taught what to invest in. Nothing. Just told to randomly pick. No research, no company investigation, no history, nothing. Just pick. That's your school economics and finance courses at work and we wonder why there is so much debt and so little money intelligence.
The disservice we are doing to our children is a tragedy. I'm done being a victim to it and won't allow my family to be victims to it any longer.
Sorry for the rant. I'm a bit passionate about the subject right now.
To be fair, you mentioned nothing about the benefits of having a sound and competent financial advisor. You also left out the fact that many of the fees associated with different products are linked to guarantees, death benefits, multiple investment options and the list could go on.
You may as well educate yourself in anatomy and the law. Start diagnosing your medical issues and represent yourself in legal matters. As with most things in life, you get what you pay for.
I take it you're collecting some fees. No worries. I gave no advice other than educate yourself.
You're saying find an expert and pay them.
To each his own. I'm done paying fees to manage what I can do myself.
Rather than taking offense, tell these guys where what I pointed out was wrong. Were the numbers wrong? There is no shortage of information to support what I said.
Is Bogle wrong? Is he not an expert?
I'm all ears and I'm serious about that.
Character is not developed in moments of temptation and trial. That is when it is intended to be used.
Fatty I agree with you. I can do the same research and invest in good sound companies and come out as good if not better than a lot of these so called financial advisers without the fees. I grew up with and went to school with 3 so called financial advisors and I would not let them manage my pocket change. Then again I don't know any that are millionaires. Most are making a living off of fees kinda like insurance salesmen.
I was really shocked when I looked at mine. 8% this year with the market at record levels. 32% last year....... No changes on my part. Just wish I was 59 1/2 years of age.
Just like before the mortgage bubble burst I am on the sidelines waiting for a correction. Once the every 5 to 7 yr bubble bursts again I'll get back in and ride it for about 3 or 4 years then pull back again. The market is rigged against buying and selling on any regular basis with the high speed programmed trading by the big boys getting in front of any transactions.
"Arguing on the internet is like playing chess with a pigeon. You may be good at chess, but the pigeon is just going to knock all the pieces down, take a crap on the table, and strut around like its victorious."--Anonymous
Rather than taking offense, tell these guys where what I pointed out was wrong. Were the numbers wrong? There is no shortage of information to support what I said.
Is Bogle wrong? Is he not an expert?
I'm all ears and I'm serious about that.
Just checking in to see if you got a response.
Take your kids hunting instead of hunting your kids.
I'd rather be LOST in the woods than FOUND in the city.
Drive a hybrid, I need your gas.
Your mind is your primary weapon. Never let it get rusty.
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I take it you're collecting some fees. No worries. I gave no advice other than educate yourself.
