Fee Overload: How I Was Sold a Costly Pension Plan with Hidden High Fees and Poor Performance
I went to see one about setting up a private pension because I don't get one through my employer (employed through an offshore company). Got charged about 150 quid for them to go away and "research" some options for me (probably very little research to be done; they already have a standard set of funds that they use through Openwork). For the first year they wanted 35% of my contributions.
The fund that they "found" for me (something Graphene, can't remember the name of it and I'm not at home to check) consisted of several individual funds to apparently lessen the risk of a single fund manager going to shit. In total the funds consisted of about 70% UK equities (why?), had rubbish past performance when compared to a global index tracker and would've cost me well over 2 or 3% per year (can't remember the exact number sorry), plus about 1% per year to the financial advisor for "management" after the initial 35% for the first year.
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Nokia will rule the cell phone market
My 1 experience with a financial advisor 18 years ago. I did my high school senior project on investing. So my “mentor” was this financial advisor. I had 5k from my grandmothers to invest in (my great grandmother has mutual funds for all the grandkids so I cashed mine out and my grandma also threw in $1,000 for me)
Anyway.
His can’t miss these are about to be the next big thing picks were Nokia and Pioneer energy services. So Nokia only ever went downhill, I bought I think around $16 and sold at $5 some years later. Pioneer it actually had tripled at one point to $18 then a year later it was $2 then they went bankrupt so bye bye to that money.
I was really into computers back then, I had built my own and talked to him about how everyone in gaming was using Nvidia GeForce graphics cards. He has no interest in it. I can still hear his whiny voice saying how computer industry moves so fast and there will always be some new better faster thing on the market so that would be bad to invest in. And how Nokia was going to rule the cell phone market for years and years.
Just realized how much we are paying for financial advisor
We are invested with a big name financial investment company but have a good relationship with our financial advisor. Until today I never thought about how much it cost. The rate is 1.35%. I always thought that was 1.35% of the profit but apparently it’s the entire balance. Our rate of return last year was -8%. Yes that is negative.
Well on top of this we were charged our fee of $3600. I have no idea what to do. My husband and I both have IRAs a few stocks, a CD, 2 529s for our kids. How do I get this money out and how can I invest this. I had luck with vanguard in the past when I was single but had some tax issues once we got married that is when we went to the financial advisor. Edit: so the -8% is actually April 2022-April 2023. My actual rate for jan 2022-dec31 2022 was -23.4% plus they still charged the 1.35% so in actuality in 2022 I was down 24.75%!!!!! I feel like such an idiot.
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