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Personal Investment & Financial Planning Q`s/professional paid advice for retirement account?


Since retirement about 3 years ago my wife and myself have used Fidelity and their "strategic advisor" services which we were talked into upon roll over our 401K funds to retirement.  Through being extremely conservative for the 20 years before retirement and handling things myself my funds grew at a very slow and steady rate to be now quite substantial amount.  Because of this handling of things myself I have been quite uneasy paying fidelity and these "strategic advisor" such a large amount each quarter.  It amounts to about 3600.00 per year that is given to them to handle things.  Most is in bonds and as conservative as possible but they still seem to make my portfolio make serious dips in its value.  I have no complaints with Fidelity other then this and wonder about your advice on whether I could just put it in 3-5 funds instead of the 25 or so they have it in...Simplify a very large handling fee.............Thank you John for your time on this..........

Hi Adrian,

Thanks for reaching out. Since I am an advisor myself that gets paid for services, I can appreciate your question about whether or not paying a fee is worthwhile. Obviously, getting paid to provide services means I think the right services are worth paying for, however, paying an advisor for advice is not for everyone. From my perspective, if an investor is paying an advisor ONLY for performance, then they should rethink the relationship. There is more to being a good financial advisor than just offering advice about investments. With that being said, I can also say that it is very well documented through all types of financial studies that "do it yourself" investors underperform those that pay for financial advice. However, the reasons may surprise you; it is not because financial professionals on average perform better than the markets, it is because the average "do it yourself" investor makes irrational decisions at the wrong time. In other words, its not about getting it right all of the time it is instead about not getting it too wrong too often an often times the best way to accomplish this is to have an outside person involved to keep a check on the emotions.

With all of this being said, I personally do not think its what you are paying that is bothering you; instead, it may be that you do not feel you are getting enough for your money. I have realized over time that people typically aren't opposed to paying for advice and instead they want to simply feel like they are getting their money's worth. From an account performance perspective, if you feel you can not be your own worst investment enemy and keep your emotions in check, then a properly diversified portfolio of 3-5 low cost mutual funds could do just as well as a large basket of 25. I hope this helps.

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John D Smith, CFP


I can answer detailed questions regarding mutual fund investing, retirement planning, education planning and related comprehensive wealth management and investment concerns.


I have been providing fee only investment management and comprehensive wealth management services for the past 19 years.

I have a degree in Financial Planning & Counseling and I am also a Certified Financial Planner practitioner.

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