The Cost of Investing

On this episode of A Wiser Retirement Podcast, Casey Smith, Matthews Barnett, CFP®, ChFC®, CLU® and Brad Lyons, CFP® talk about the cost of investing. A lot of people don’t want to talk about fees. Many people say that their investment portfolio is free, that they don’t care, or that they just don’t understand it. It comes down to two things: the fee you pay for the advice and the fee you pay for the product. Understanding how much you are paying for investment advice and portfolios is important.

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The Opportunity Cost Lost

Brad calculates the cost of using your cash to pay a higher fee vs letting that money grow in the portfolio. He finds that there is a staggering difference in this portfolio over twenty years. It’s not just that you didn’t earn anything, but when it was not invested, it was also not earning a return on it’s own.

Types of Fees

Transaction fees, commission, markups, sales loads, surrender charges, oh my! We see a lot of clients with recently purchased annuities that are upset when they realize the steep surrender charges. A lot of big firms cover up their commissions and transaction fees in trading. Here are some examples of ongoing fees: advisory fees, annual operating expenses, 401k fees and then the annual variable annuity fees.

Questions to Ask Your Advisor

What fees will I get charged in this account directly and indirectly? Every advisor should be able to give you a disclosure on all fees charged to the account. Suitability is the guideline most firms operate under, and most firms put you in the accounts that are most suitable for you. Another thing to ask an advisor is how they get paid: is it commission or the amount of assets you manage?

Someone to Give You Advice

Vanguard says that having an advisor gives you a 3% higher rate of return. Not only because of investment advice, but also because of behavioral coaching. Pulling all of your assets out at every crisis will destroy a portfolio. There are lots of ways we can help give you peace of mind – rebalancing, selling losses for gains, padding portfolios with bonds, and many others strategies. Warren Buffet said it best: “The way to invest in the stock market is to stay strong at the bottom.”

Download our FREE guide on “3 Ways to Grow and Protect Your Portfolio”:


5:12 The Opportunity Cost Lost

7:30 Types of Fees

17:49 Questions to Ask Your Advisor

22:00 Someone to Give You Advice


Learn more about Casey Smith and connect with him on Twitter.

Learn more about Brad Lyons.

Learn more about Matthews Barnett.


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Learn more about the Wiser Wealth Management Roundtable podcast and access previous episodes.


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