Is the Role of an Advisor in Selecting Your Retirement Investments Redundant? Yes, They will Soon be Obsolete.

Happy businessmen
With the advent of the Internet, retirement investors can now take control of their nest-eggs with the proper tools and research
With the advent of the Internet and easy access to information, many people are now buying airplane tickets and booking hotels online. The intermediary, the travel agent, has been eliminated in many transactions. Why? One can obtain the same thing through less money and through their own research, perhaps delivering a better vacation by exploring the alternatives that best fit their life styles.

Not On My Nickel believes with the proper tools, real education and transparency, retirement investors can get engaged and pick their own portfolio managers. Why is this so critical today?

No Transparency

(1) In most cases you have no idea what the performance will be for the selections that your financial advisor is recommending for your retirement nest egg. See Not On My Nickel’s Blog on the lack of audited performance standards for Advisors. They are using asset allocation models and placing you in so many asset classes, you really do not know if it is better or worse for your returns.

Redundant Fees that Deliver No Value

(2) You are paying the financial intermediary in most cases an unnecessary fee and you are guaranteed to do worse than an index fund, if you are in an index fund, as a result of this fee.

Advisor Created Obfuscation in Employer Plans – Get A Simple Straightforward List of the BEST Portfolio Managers, with Proper Education, at Not On My Nickel

(3) If you are provided a simple list of the very, very few top portfolio managers/mutual funds that have outperformed the index for many years, after fees, you will most likely do better, since you are saving the advisor fee and your returns are not being diluted by poorly performing funds.

Advisors Subject Your Savings to Potential for Fraud - Not On My Nickel Eliminates the Risk of Advisor Fraud

(4) You eliminate the risk of Ponzi schemes! Here is a another one reported recently in Investment News: FINRA alleged that from December 2010 to January 2013, he converted customer assets in two trust accounts, using at least 50 transactions falsely characterized as loans, and transferred the money to two of his friends. One victim was a 77-year-old retired homemaker with Alzheimer’s who lived in a nursing home, FINRA said in the settlement agreement. Mr. Thornes diverted about $1.7 million from the homemaker’s $2 million trust account, FINRA said.

Why Hasn’t The Retirement Investor Taken Charge Sooner?  Workplace Financial Education Has Been Designed To Move Your Towards Hiring a Financial Advisor

Assume for a moment you go to your 401(k) menu selections, how do you know which one to pick?

• Does the financial education package provided by your employer, as mandated by the Department of Labor, show you how to select the best fund for your
needs? Not normally.

• Does the financial education package provided by your employer, as mandated by the Department of Labor highlight the additional costs and risks of going
with a Target Date Fund? (Read SEC Investor Advisory Committee’s List of Risks with Target Date funds here –  It is a long list!)

• Does your financial education package encourage you to get help in picking a mutual fund?  No, there is no employer provided education on how to measure what mutual fund is best for you!  Here is the typical response you get for any employer plan option:  “Yes, click here to hire an advisor.”

• Does your prospective financial advisor show you your monthly returns for your total portfolio after all fees, including the advisor fee, before you choose to invest with them? If not, it is time to take over.

Example – a Fidelity 403(b) Plan

One Employer’s Defined Contribution offers 353 options! Wow, where do you begin?

Now for this plan, administered by Fidelity Investments, it does provide a good screening option for the investments they offer. Say you want to select a Balanced Fund, with low fees. You run Fidelity’s screener using low expenses and here is what you get, shown in the Chart Below:

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Do not hit the button after you take a look at this graph – “I need help, I need a financial advisor!”  Through Not On My Nickel’s real financial education curriculum, that is hands-on, pragmatic and straight-forward, you will be on your way. It is the first and only retirement curriculum designed for you to take charge of your retirement savings, without an unnecessary layer of a financial advisor that operates in their interest.  Learn through Not On My Nickel straight-forward curriculum how to read this chart, what each item means and how to make the choices in your best interest.  Learn why you would never want to select the Target Date Option. Learn how much money you are losing if you are in the Target Date Option.  Learn the fees associated with each option.

Remember from NOMN’s last week’s Blog Post on audited performance standards, if your financial advisor does not post their performance standards monthly on their website, and are measured against an approved index, caution. Note that is a red flag and cause for concern.

Learn more about Not On My Nickel tools, educational services and how to research the select few top performing mutual funds for your retirement nest egg today. Invest a few hours of time and you will be on your way to taking charge of your retirement nest-egg with portfolio managers you believe in, without the high fees and associated risks of the unknown.

Brokerage Window

Remember, if you are in a 401(k) plan with options that have high fees and poor performance, you have an alternative today!  You may use your 401(k) Plan’s Brokerage Window with the research and education provided by a Not On My Nickel subscription, whose annual costs are less than the Load Charge on a typical mutual fund and provides the tools, research and education to eliminate all these fees detracting from the performance of your retirement savings.

 

 

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