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Portfolio advisory services fees vs gain

By Terry Savage on November 11, 2019 | Financial Planning / Retirement

Hi Terry, My husband and I have 2 of our IRA’ s with Fidelity portfolio advisory services for years. I am questioning the fees paid compared to the portfolio increase. i.e. past year my $200K IRA earned $4200 net; fees were $2114 so they earned half of what mine did. Also funds are primarily Fido strategic advisor funds with separate fees; I am told they discount those fees but not sure how much we are losing to fees. My husband is 73 and I am 68, both retired with total $1M in our portfolios, we each have $275K in our recent employer 401K plans that are balanced among the available funds. I hesitate to roll over to a managed account due to fees. Also struggling to learn since my husband will not handle finances. Have met with Financial engines, Chase bank private client , VALIC (tied to my last employer AIG) in recent years but unable to make decision. Who can I trust ? I need help to consolidate our hard earned money ! Thank you so very much Terry

Terry Says

That’s surprising to me — first that you only earned $4200 in your Fidelity account last year — and second that the fees were so high. (Perhaps, though, that’s an anomaly because if you’ll remember we had a year-end crash that actually had the stock market posting a total return of MINUS 4.75% last year!) So it depends on where and how you measure!
And how did you get the calculation of $2114 for “total fees” paid at Fidelity? That really sounds out-of-whack. So, even if you don’t use them in the future, contact Fidelity– ask to speak to a manager, and make them explain. If there isn’t a good explanation, they should return the fees! Do let me know what happens.

Going forward I think you would benefit from a conversation with a fee-only financial advisor, one who does not sell commissioned products. I’m assuming you live in the Chicago area. Go to Wealthramp.com and go through the process. The advisors there are all FIDUCIARIES. And you need to make some other decisions about your retirement lifestyle, expenses, withdrawal rates, etc — Any one of these advisors can help you through the process.



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