Financial Planner & Fees
Current working with a financial planner associated with Schwab. He has done a lot in terms of consolidating our accounts. It was a huge task as my wife and I had numerous financial products with several advisors. We have had him since late 2017. He takes a quarterly fee based on our balances. I’m just not sure what he is doing to earn his fee. I am wondering if we end the relationship and keep our funds with Schwab, will there really be any difference. We have our money invested in IRA’s, both traditional and Roth. Have about 1.6 million with a fee of 4k per quarter. His rate is 0.25.
Terry Says
Is this a CERTIFIED FINANCIAL PLANNER? Is he a FIDUCIARY, who promises to fully disclose all fees and commissions, and put your interests first?Did he fully disclose all fees when you moved the accounts and reinvested?
And did you do your math? $4,000 per quarter is $16,000 per year — which is one percent! That’s not too high — as long as he put you in the lowest cost mutual funds. So ask about the underlying fund fees as well as the initial fees to invest. He is obligated to fully disclose ALL fees and commissions– beyond that 1% fee.
As for paying ongoing management fees, what did he promise to do each year? Review all your investments and make recommendations? Did he advise on other ongoing financia planning topics such as taxes, estate planning, retirement withdrawal planning, etc. If you are speaking with him quarterly, and he is keeping watch over all these investments, 1% is not too much to pay.
