Transparency is Essential!

Transparency is an essential factor for developing a successful relationship with a wealth advisor and a proper investment strategy, and it is what I pride my practice on. In actuality, what does this mean in the investment world?

It means: understanding all of the fees you are paying.

What are your custodial fees, trading costs, and maintenance costs? Do you own Mutual Funds or Exchange Traded Funds? What are their respective expense ratios?

Unfortunately, my industry is notorious for hiding fees and making things way too complicated. Have you tried to understand your monthly statement? Sometimes, I have to read them two or three times to explain them correctly, and I have 16 years of experience in this industry.

Often time working with a Fiduciary will help with many of these issues. A fiduciary is any investment professional or financial advisor who is required by law and practice to act solely in the interests of and with undivided loyalty to their clients.

In my firm we break down our investment management fees into three simple categories;

  1. What are you paying to have your money managed?
  2. What are the underlying expense ratios of the underlying holdings?
  3. What are the custodian and transaction fees?

Every investor should be able to answer these questions relatively quickly and, at the very least, gather this information from the investment institution with which they are working.

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