Leave the clowns at the circus
Put it this way, have you ever been to a circus? You have! Well, remember those people who made you laugh? Finance advisers can also do this. But they can also make you cry. Here’s a funny story—true as well.
We had a clown, visited us as they do for many years, charging us fees, etc. Also, fees that were not revealed to us, which we discovered later. Well, after 13 years of having him sponge off us, we realized he had F.C.ED us, big style. He said the investments were not taxable as they were a specific type of investment.
Well, we realized these were taxable when we questioned him, asking, "Why did you set these investments if they are taxable?" He ran away and left us with a tax bill of 13 years, plus interest.
People will say, "Why did you not make your own enquiries into what is taxable and what is not?" Well, the answer to that is because we were paying a professional.
Well, it cost us dearly, so make sure it doesn’t happen to you. Leave the clowns in the circus!
Related Horror Stories
My financial advisor seems to ghost me, is this normal?
My partner put 50k into investments via a well known financial services company during Covid and saw a decent profit (unexpectedly quick, but that’s Covid I guess). We have only seen shrinkage since then.
I put about 100k down about 2 years ago, it has only dropped since. My FA has never spoken to me, in fact he moved off my account without telling me, and the new advisor didn’t even intro themselves. When me and my partner tried to get time to speak to the new person it took weeks.
When we eventually got them on a call they were fine but didn’t give us much concrete, there were follow ups to be done, the FA has not followed up in 3 weeks. I emailed a week ago asking for a date for these, no response. Is this normal for FAs? In my industry I would be fired immediately by my clients for this level of service (specifically talking about the service not the profit on the investments as I’m aware that’s a long game).
Are all FAs generally incredibly slow and hard to reach? I ask as this person belongs to a large reputable firm. This far they have taken my money and charged me fees despite my investment never generating profit and never speaking to me either. While my wife has had slightly (she has spoken to the advisor once before I invested) better service, and had profit a while ago, the service is so poor.
"Safe investments"
Just filed my taxes and I’m looking more closely at my finances. I’m pretty good with the basics but feel completely out of my depth with investments.
In 2021 I started a Morgan Stanley investment account with the financial advisor who has been managing my parents’ money for many years.
I invested $67,000 in 2021 and let the advisor choose the stocks/bonds/funds/etc, telling them that I’m extremely risk adverse and I needed safe investments. On Jan 1, 2022, the value was $71,950. On Dec 31, 2022, the value was $58,587. In 2022, I paid $1,025 in trade commissions and $984 in service/advising fees. So basically I paid my advisor $2,000 for her to lose me $13,363 over the course of 2022.
Is this normal? Every time I ask my parents or advisor they tell me “the market is down for everyone.” But my parent love their advisor and thinks the sun shines out her butt and my advisor has a financial incentive to keep me.
Not sure if I should trust financial advisor
I recently started seeing a financial advisor at First Command I met through a mutual family friend. The advisor is obviously very knowledgeable about retirement and investing, but I can't help but think the funds they are suggesting I invest in are more for their profit than my well-being.
They suggested a couple of accounts through Fidelity Advisor that have large percentages to invest in (some of the percentage goes to the advisor). The funds have a good history, but I can't tell if it's a smart move for me or if they are just trying to profit. Additionally, the advisor suggested a whole-life insurance plan.
They explained how they profit from it (basically, the cash value goes to them the first 2 years), but it still seems like a good plan to me.
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