A recent article by Motley Fool took dead aim at the cost of working with a financial advisor. The title says it all: “The Invisible and Brutal Cost of Using a Financial Advisor.” The premise of the article can be summarized as follows:
1. A hypothetical advisory fee of 1 percent of assets per year significantly reduces net returns over time.
2. Net returns are further reduced by the loss of the opportunity to invest fees deducted by the advisor.
The Motley Fool piece damns advisors with this faint praise: “I am not saying financial advisors are wicked people nor am I saying many advisers don’t provide a deeply valuable service. However, if you do use a financial advisor or money manager, take a long, hard look … and ask yourself, ‘Am I getting my money’s worth?’”
Read the rest of the article on US News.