Wealth Management Unwrapped, Revised and Expanded. Beyer Charlotte B.. Читать онлайн. Newlib. NEWLIB.NET

Автор: Beyer Charlotte B.
Издательство: John Wiley & Sons Limited
Серия:
Жанр произведения: Зарубежная образовательная литература
Год издания: 0
isbn: 9781119403678
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and so on.

      Watch out! Because of this attitude of entitlement, many advisors do not enjoy working with ultra‐high‐net‐worth investors —unless there is a big payoff, such as a nice fee or commission that goes along with new assets to manage!

You’re the boss

      When it comes to your wealth, you are the newly appointed CEO of My Wealth, Inc.4– whether you want to be or not. If you are to be a successful CEO, you need to consider what you will pay for, and what you will be lucky enough to get for free. Then consider the cost of this so‐called free advice. What hidden incentives are being paid to your advisor so he or she will push a particular product that includes a big payout? Is that investment the best one for you – or just the most lucrative one for the person selling it to you?

      An investment that is not appropriate for you should not be sold to you. Once you finish this book, you will be smart enough not to buy it!

Free lunch, anyone?

      Advertisements try to convince you that you can get something for nothing – a free lunch. You are invited to have your investments/retirement/401(k) receive a complete “analysis” – for free. Many firms invite you to a “free” dinner where “investment secrets” will be shared, or offer “free” referrals to top managers or funds. Unfortunately, these offerings are usually bundled into a commission or an incentive fee, or “given away” to gain you as a client. Because you are so grateful, impressed, or eager to do something (anything!), you decide to place assets with the firm.

      Let’s put this “free lunch” another way: If you do not want to pay for excellent advice (as opposed to products), what firm will even attempt to provide it to you? Advice without an investment product embedded in it often gathers dust on the shelf of the financial services supermarket. Recent research on mega–concert ticket prices seems to prove that we tend to pick the lowest price even if the exclusions – like shipping or other fees – are added in later.5

      Once you read this book, you will know how to tally up the cost of advice and decide if it’s worth it.

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      1

      Throughout this book I have included verbatim comments from investors whose identities are kept confidential by request. Some are from inside the online community of IPI; others are from IPI programs or in conversations where investors or advisors relayed their stories. I have paraphrased certain comments to protect confidentiality.

      2

      Can advisors really help clients earn an added 3 percent? It seems so according to one study authored by Vanguard’s Fran Kinniry in 2014. Another study in 2017 by Russell Investments has claimed advisors can add value of 4 %. An excerpt from Kinniry’s paper: “This 3 % should not be viewed as an annual val

1

Throughout this book I have included verbatim comments from investors whose identities are kept confidential by request. Some are from inside the online community of IPI; others are from IPI programs or in conversations where investors or advisors relayed their stories. I have paraphrased certain comments to protect confidentiality.

2

Can advisors really help clients earn an added 3 percent? It seems so according to one study authored by Vanguard’s Fran Kinniry in 2014. Another study in 2017 by Russell Investments has claimed advisors can add value of 4 %. An excerpt from Kinniry’s paper: “This 3 % should not be viewed as an annual value‐add, but is likely to be intermittent: Some of the most significant opportunities to add value occur during periods of market duress or euphoria, when clients are tempted to abandon their well‐thought‐out investment plan.” Retrieved from www.financial‐planning.com/news/3‐advantage‐show‐clients‐what‐youre‐worth.

3

Winning the Loser’s Game illustrates how to be a better client and is now in its seventh printing.

4

A one‐page op‐ed by the author, “Five Things You’d Never Do as CEO,” adds a few more insights. Retrieved from www.campdenfb.com/article/five‐things‐youd‐never‐do‐ceo‐so‐why‐does‐your‐financial‐adviser‐let‐you‐do‐it.

5

Years of consumer research seemed to indicate hidden fees revealed at checkout were the single biggest annoyance to customers purchasing concert tickets on popular ticket reseller StubHub. Three months after adopting all‐in pricing, the company found its sales had taken a hit and speculated customers were gravitating to sites with lower listing prices, failing to account for the added fees. Karp, Hannah (2014, March 26), “StubHub Sings the Blues after Shifting Fees,” Wall Street Journal. Retrieved from www.wsj.com/articles/SB10001424052702303949704579459902559659002.


<p>4</p>

A one‐page op‐ed by the author, “Five Things You’d Never Do as CEO,” adds a few more insights. Retrieved from www.campdenfb.com/article/five‐things‐youd‐never‐do‐ceo‐so‐why‐does‐your‐financial‐adviser‐let‐you‐do‐it.

<p>5</p>

Years of consumer research seemed to indicate hidden fees revealed at checkout were the single biggest annoyance to customers purchasing concert tickets on popular ticket reseller StubHub. Three months after adopting all‐in pricing, the company found its sales had taken a hit and speculated customers were gravitating to sites with lower listing prices, failing to account for the added fees. Karp, Hannah (2014, March 26), “StubHub Sings the Blues after Shifting Fees,” Wall Street Journal. Retrieved from www.wsj.com/articles/SB10001424052702303949704579459902559659002.