Personal Investment & Financial Planning Q`s/Retirement account


Hi John:

I am 63 and retired.  I have a diversified portfolio in a conservative account with a financial planning firm.  The firm charges 1.3% in fees. Supposedly, there are no other fees.  For the last 1 1/2 years, (since I opened the account), my investment capitol has stood still.  However, I have spent approximately $2000.00 in fees.  Is it better to have funds in a fixed interest account with less fees but steady gains?

I have to overcome the 1.3% fee before I make any money. If there is a recession at some point, I would lose money and perhaps, at my age, not be able to recover my investment.

Is my analysis off base?  Any recommendation for a sound investment strategy?

Appreciate any advice?

Thank you,

Hi Bob. There are a couple of different things to address here, so I hope I capture them all.

Your comment is an accurate one in that, yes, you will need to earn on average more than the 1.3% in fees before you make any money. This is the main reason why keeping expenses low (and taxes low) is very important over time. The fact that you have not made any $$ over the past couple of years may have more to do with the market dynamics than the work itself your advisor is doing. If I were you, I would simply ask your advisor for a detailed explanation as to what has been driving the poor returns so you can determine if it is market related or advisor related. In other words, if the major stock markets have been flat since the time you started and bonds have only gone up modestly, then depending on your allocation, you should expect to be flat or only up  modestly as well. Regarding your question about is it better to go into fixed interest and drop the fees - the issue here is that investing only i fixed interest guarantees that you will always only earn a very modest return. Can you meet your financial goals knowing you will only and always earn a modest return? In  other words, if you need to earn something more on your money than a fixed account will pay in order to meet your goals, then you will need to take on some sort of risk by investing in other investments in order to give yourself the chance to earn something greater in return. Whether you do this on your own or hire a professional is a personal choice and if you choose to hire a professional and pay a fee, then you want to be assured and feel comfortable knowing you are in good hands.

Its difficult to offer any advice more specific than this since I know very little about the situation, however, I hope these thoughts are helpful. I am happy to expand my views in any way that I can if you have more specific questions.  

Personal Investment & Financial Planning Q`s

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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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