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Strategies & Market Trends : Dividend investing for retirement

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To: Raptech who wrote (20152)	6/28/2014 12:33:22 PM
From: E_K_S	Read Replies (2) of 34328

If I calculated their return correctly, it comes out at 11.9%. That's quite high especially when selling different investment products that must factor in the salesman's commission. I wonder what the breakout is for their expenses on annuity products and their company run mutual funds. It must be high over 20% possibly. For me, I would just do better buying an index fund. Not to pick on Edward Jones, but a somewhat similar thing happened to my sister (a doctor) through Schwab and their financial advisers (independent contractors). My sister was wondering why her small portfolio was not doing that well. It turned out that every year the financial adviser was taking his cut ( I think 3%-5% of the portfolio value as a management fee) and had also put her into a family of Schwab owned funds (where the adviser received a commission). So her portfolio was actually down during 2009-2012 it could also have to do with some timing on sales too. I think she eventually just bought a few of the Vanguard Index funds w/ low annual expenses and closed out her Schwab account. Like other professions, many believe that these "professionals" can always beat the market. My dad always told me to be skeptical and look to see if there were any conflicting interests in what they were trying to sell me. Many of these expenses are not one time fees but reoccurring fixed percentages of the portfolio year after year. I guess it took my sister a few years to figure out that her adviser was not earning his fee. At least it was obvious what he was charging and she could see the amounts paid at the end of each year. With many of these products (and mutual funds) they are all hidden expenses and fees. EKS

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