Are you saving for your future, or someone else's?
There’s an old joke about a visitor to New York who, admiring the gin palaces of the bankers and brokers, asked ‘Where are all the customers’ yachts?’ It’s funny, until you’re the customer whose unintended generosity and, perhaps, naivety, funded the gleaming cruiser bobbing gently at its mooring.
The first step to ensuring that you are saving for your own future, rather than funding someone else’s, is to make sure that you understand what your fees are paying for, and why.
There are two big areas where you should think about this.
1. The person who gives you financial advice.
The truth is that a lot of advice, in all parts of life, is basically worthless if not downright dangerous. The only person whose advice you should ever really follow is an expert – and this is something we all work out.
Whether it’s trying to teach a teenager to drive, helping a mate out with DIY car repairs, or looking around nervously when the cabin crew ask ‘Is there a doctor on board?’, we know that while we are all entitled to a point of view, there are times when only a true expert will do - an expert whose knowledge is based on formal learning, good judgement, intelligence and genuine skills.
Sadly, there are a lot of people giving advice in financial services who have none of these attributes.
Watch out for them - sometimes they are easy to spot (they’ll turn up for their meeting looking a lot richer than you’ll ever be… guess who paid for that enormous watch, or who really bought that Bentley?), other times they hide.
But be on your guard, because they really are out there, and they really do want your money.
2. This is less dangerous, but can still catch you out – hidden fees.
It’s less obvious, but still important.
The simple version is that many fees, even when charged by reputable, honest investment managers, simply aren’t worth paying.
Many charge 3% per annum or more – and the record shows that they simply can’t beat their benchmarks.
We have a lot to share on this – but suffice to say that a smart and successful investor achieves his returns by deciding with great care when fees are justified, and how much they can sensibly be.
So what do you do?
First, do some basic self-education. Read and start building a picture of what works and what doesn’t, and what the common investment mistakes are.
Next is to find an adviser you can trust or, better still, make your own investment decisions and avoid completely the risk of theft and terrible advice.
There is a huge, new and exciting world of low-cost, highly efficient investments that allow you to quickly and easily make and exit investments in most markets.
Many advisers will prefer not to tell you about them – they’re the ones with the yachts.
Unsure if the fees you are paying are worth it? Get answers today with our X Ray Report.
One of our qualified professionals will take a look at your current portfolio set-up and give you an honest assessment. What do you have to lose? The answer is thousands.
P.S. You may not think you are paying any hidden fees, but what if you are? Request for a X-Ray Review today and find out »
