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Nov 05 2012

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Calling Fee-Based Financial Advisors


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I want to profile (and encourage business for) financial advisors acting as true fiduciaries to their clients.

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It’s extremely profitable for advisors to sell variable annuity products or actively managed mutual funds with sales commissions or deferred sales loads.

But the good men and women who act as true financial fiduciaries don’t sell those products.  And they deserve to be recognized.

If you fit the bill, I want to hear from you.

If you build:

  • passive (indexed) portfolios for clients and 
  • charge a 1% annual fee or less,

I want to interview you in a series titled, Financial Advisors With A Conscience.  I’ll also make your profile easily accessible on my homepage. 

If you fit the bill, please get in contact from my contact page with your name, firm’s name, web site address and I’ll contact you. 

Don’t be shy.  You deserve to be recognized.  And people want to find you!

Cheers, Andrew

About the author

andrew hallam

I'm a freelance finance writer, lucky enough to have been nominated as a finalist for two Canadian National Publishing Awards. I'm also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School, a book explaining how I became a millionaire on a teacher's salary, while still in my 30s. Working to empower people financially, I'm available to motivate and inspire people on basic retirement planning and index investing. I'm happy to comment on your questions, first, please read the Terms of Use.

Permanent link to this article: http://andrewhallam.com/2012/11/calling-fee-based-financial-advisors/

51 comments

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  1. avatar
    ACMZ

    You are showing Jan 01, 1901 as posted date.

  2. avatar
    Barry

    Hi Andrew

    I'll have to have a look around, but there used to be a guy in our nick of the woods Travis Morien who posted on the Bogle Forums also.

    His old web-site and FAQ was a veritable font of information

    Fee Based seems to be the way things are going in Australia

    Barry

  3. avatar
    Rob aka Captain and

    For Canadians I can recommend Garth Turner while he's best known as Canada's best known housing bear he is also a very good investment adviser. I've met him personally and like his take on investing. While his blog is mostly focused on the coming Canadian housing meltdown he does talk enough about investing to show he knows what he's doing.

    Generally speaking if you have less than 500,000 in liquid assets it's probably not worth seeing him.

    Feel free to contact me if you have any more questions

    1. avatar
      Andrew Hallam

      Thanks Rob,

      Does Garth build portfolios of passive funds and are they diversified? If you feel he does so for less than 1% per year, and if you feel that he isn't a market timer, I will give him a shout.

      1. avatar
        Rob aka Captain and

        On the second his fee is 1% and on the first I believe he does. I've followed his blog for several years and met with him once, but you'll have to check with him on the specifics.

        Hope that helps

  4. avatar
    ACMZ

    HI Andrew,

    Just wondering how Harry is doing with his account. From what I remember he was taking some of the capital out to keep a small plane flying. His wife was still working at the time and therefore had a revenue coming in. Just curious.

    Regards,

    ACMZ

  5. avatar
    Barry

    From the website

    "Australian Independent Financial Advisers operates on a 100% fee for service basis, avoiding or rebating commissions to clients.

    The fee is a fixed pre-determined amount or an hourly rate. The cost of the advice will be proportional to the skill and knowledge required for the type of work, the degree of responsibility applicable to the work and the time required to prepare your Statement of Advice"

    See also some index investing articles here http://www.aifa.com.au/author/travism

    Barry

  6. avatar
    Aram Durphy

    Hello Andrew,

    I'm not sure my business qualifies, but thought you might be interested. I have a buy-and-hold strategy with a diversified value based approach to individual stocks and bonds. I'm fee-only. I charge on a sliding scale starting at 1.4% and on down.

    Regards,

    Aram

    1. avatar
      Andrew Hallam

      Thanks for asking Aram,

      Your fee-based structure is certainly one of the better ones.

      I'm looking for fee-based advisors charging 1% or less, who use a globally diversified, passive approach. Such an approach has higher odds of success and greater diversification than a portfolio selected by an individual stock picker.

      Cheers,

      Andrew

      1. avatar
        Aram Durphy

        Hello Andrew,

        OK, sounds good. Thanks for the explanation.

        Regards,

        Aram

  7. avatar
    Walker

    I know Rick Ferri, who posts frequently on the Bogleheads forums runs an operation called "Portfolio Solutions" that charges something like 0.25% but I'm pretty sure it's only available (or at least worth it) for high net worth clients.

    I would be interested to see if there are any advisors out there who charge that low of a fee for people with much less than the typical $500,000 minimum or so that most places seem to require. I guess for them, it's probably a lot better to get some sound advice (maybe charged hourly?) and then once they find out how simple things can be just set it up for themselves.

    1. avatar
      Andrew Hallam

      Thanks Walker,

      I don't think Robert Wasilewski has a minimum account size requirement. And Assetbuilder requires just $50K

      Cheers,

      Andrew

  8. avatar
    The SPY Surfer

    Hi Andrew,

    I manage my own money and share my method on the net for free.

    It's here http://www.thespysurfer.com

    It's based on six global, low-correlated asset classes, including cash.

    Not sure it fits the bill though I thought you might be interested…

    Happy 2013!

    Cheers,

    FL

  9. avatar
    stock trading

    I don't think Financial advisers should get paid a fee, they should only work off ccommision. Pay for performance

  10. avatar
    PJ

    Andrew Great Blog, Great Book

    UK national based in Myanmar (posted under the British Expat section).

    I am just about to kick start my balanced index portfolio under the guidance of Robert Wasilewski.

    Excellent !!! even though I had to get up at 5am due to the time difference but well worth the effort. He has really helped clear the mist all very transparent… provided me with great direction and will check in on me as I need it.

    Highly reccomend his services: WEB: http://www.rwinvestmentstrategies.com, BLOG: http://rwinvesting.blogspot.com

    PS: this is not one of those "TripAdvisor" Hotel owner posing as a guest…. ;-)

    I can highly reccomend him contact me directly if you would like to confirm pjkab@hotmail.com

    1. avatar
      Andrew Hallam

      Thanks PJ,

      Robert is a gem.

      Cheers,

      Andrew

  11. avatar
    Brett Evans

    Hi Andrew,

    we certainly fit the bill. Feel free to have a look at our website and to contact me.

    Cheers,

    Brett

    1. avatar
      Andrew Hallam

      Hi Brett,

      I searched your website for indication that you use a passive platform, but found this instead:

      “By filtering the research we are able to get a concise view of what the markets opinions are and then decipher what the most pertinent research is.”

      Passive strategies involve using and rebalancing broad based indexes. Such strategists don’t look for or utilize market opinions.

      Cheers,

      Andrew

      1. avatar
        Brett Evans

        Hi Andrew,

        Thanks, for your reply. We actually use the research for our macro asset allocation more so than actual stock picking e.g. What percentage of iShares S&P500 to allocate to our clients portfolios rather than trying to work out whether to buy Apple or Caterpillar.

        We find that by being able to draw on global research and feedback even though we are Australian based we are able to make a more informed decision for our clients.

        Kind regards,

        Brett

  12. avatar
    Mike Finley

    What I do is a bit different, Andrew, but it might be of interest to you. I am retired and I currently teach financial literacy at the University of Northern Iowa in Cedar Falls, Iowa. I started a club there to inform the next generation how make wise choices with their money. I use my website to further that education and I am currently followed in 8 countries and most of the United States. Rather than making money off the average person, I give money to the average person. This makes me “crazy,” but I know it makes me happy as I share this valuable message with others. Keep up the good work. I really enjoyed your book and I recommend it often, especially to the future teachers that I speak to. Long live financial literacy!

    1. avatar
      Andrew Hallam

      This is fantastic Mike. Sorry for taking so long to get back to you. Please send me a link to your site!

      Andrew

      1. avatar
        Mike Finley

        My website is: http://www.thecrazymaninthepinkwig.com . You will notice on my recommended reading list the name of your book. Keep up the good work. As I speak to future teachers, your message and your book continues to inspire them. They refuse to be “poor” just because they are choosing the field of teaching. Give me a call if you are so inclined. 580-483-5811

  13. avatar
    Raymond

    Hi Andrew, I do agree with you that fees and charges have a great impact on returns in the long run. However, regarding the performance of local (SG)mutual funds/unit trusts, I'm not really sure if the majority really under performs the indices, cause most of the related studies on this matter are based in the US. This is because it is not hard to find one that beats the index from the performance charts (bid to bid). An example is the Aberdeen Singapore Equity Fund. The only other charge involved is the one time sales charge of around 1% if you buy through a distributor like dollardex. What are your views on this?

    1. avatar
      Andrew Hallam

      Most of the active funds in Singapore (as my book shows examples of) have under-performed the market Raymond. The Aberdeen Singapore Fund has an expense ratio charge AND a 1% sales fee, so it's more expensive than most active funds in the U.S.

      This is how it works in every market Raymond:

      1. The collective return of all active investors will average (as they must) the market return

      2. By that, half of professionally managed money will outperform the market, half will under-perform it, because they represent the market

      3. After fees, more than half fall under the wire–as they must, because before fees, the average professional investor will equal the market

      This is the result in every market, during every five to ten year period, always. Just like gravity, it's an unavoidable reality.

      Cheers,

      Andrew

  14. avatar
    Jamie Montpellier

    Hi Andrew,

    Wow! What a great book you've written! I am a former business student, mutual fund representative turned high school teacher ten years ago and I must say your means to deliver a great message to high school students is formidable.

    I have since purchased my own e-series funds and dumped a very expensive/costly actively managed fund which was put together by a so-called great advisor. I wanted to pick your brain about a future transaction I wish to undertake. Like everyone else, I'm looking to purchase a home here in Canada and I'm putting a way a down payment which currently resides in a TFSA savings account. I know I'm basically at the mercy of inflation earning a whopping 0.1% but I wanted to know if you would consider TDCanadian Bond Index too volatile to nest a mortgage down payment with a possible horizon of 1-2 years.

    Cheers,

    JM

  15. avatar
    Andrew Hallam

    Mike,

    It's so great to hear about what you're doing. I'm sure you're finding the greatest reward of all comes from the people you're helping. It's great to know that there are guys out there like you.

    Cheers!

    Andrew

  16. avatar
    Amelia Greenhall at

    Andrew – We'd love to be interviewed as part of the "Financial Advisors with a Conscience" over at FutureAdvisor. (http://futureadvisor.com)

    FutureAdvisor is an online investment advisor that builds diversified, low-fee index fund portfolios for clients, and helps with rebalancing and keeping on track over the long-term.

    Clients get free advice by connecting their 401k and brokerage accounts for analysis – our algorithm identifies high fee funds to be replaced, and recommends buys and sells to get to their personal asset allocation. Our premium service, which is the same flat fee of $16/mo for everyone, makes the trades to enact the recommendations automatically, and watches the portfolio to rebalance and invest new cash as necessary.

    FutureAdvisor founder Bo Lu is the go-to guy for interviews around here – you can reach him at: bo@futureadvisor.com

    Cheers,

    Amelia

    1. avatar
      Andrew Hallam

      Thanks Amelia!

      Your platform sounds fantastic. I'll give Bob a shout once I've put some questions together.

      Thanks again!

      Andrew

      1. avatar
        Amelia Greenhall at

        Great, Andrew!

        It's Bo, not Bob – an unusual name, to be sure! He's excited to chat w/ you – loves your mission.

  17. avatar
    Andrew

    Hi Andrew,

    Your book has been inspirational in guiding me as I begin to invest. Thank you.

    Can you recommend any financial advisors in Singapore that follow your books principles and can work with Canadian expatriates living in Singapore?

    Thanks for your time.

    Sincerely,

    Andrew

  18. avatar
    Steven J Fromm

    Andrew, you are doing a great service in raising this issue. There is obviously a built in conflict of interest here. There are very few fee only planners or those interested in the client first and foremost. Great post.

    1. avatar
      Andrew Hallam

      Thanks Steven,

      They’re definitely in the minority, but they deserve all the publicity we can give them.

      Cheers,

      Andrew

  19. avatar
    rabidfool

    Are there such advisors in Singapore? Would love to work with one. I have a full time job and have bought investment-linked policies (ILPs) via AIA in the past. Totally not happy with the performance of these ILPs but stuck with them because I haven’t found a better option.

  20. avatar
    Matt

    Hi Andrew,

    I’m also after any such advisors in Singapore you could recommend. I met up with one last week and told him about my direction in following a passive investment style and he basically told me that in that case he doesn’t think we should work together!

    Matt

  21. avatar
    Jarrad Brown

    Hi Andrew,

    I work with clients with investment portfolios of SGD 500,000 + charging 1% per annum to create globally diversified portfolios using various ETFs.

    Please let me know if this fits the bill. My email is jbrown@ippfa.com and the firm I represent is IPP Financial Advisers.

    Best regards,

    Jarrad Brown

    1. avatar
      Andrew Hallam

      Hi Jarrad,

      It does fit the bill. Thanks for contacting me. I will shoot some questions off to you soon for a profile interview.

      Cheers,

      Andrew

      1. avatar
        Jarrad Brown

        Thank you Andrew.

  22. avatar
    Tuula

    Hi Andrew!
    Do you have a list of these fee-based financial advisers you would recommend somewhere? I’m trying to find one from Singapore. I noticed you mentioned doing profile interviews with some.
    Thanks!
    -Tuula

    1. avatar
      Andrew Hallam

      Hi Tuula,

      If you have $500,000 you could check out Jarrod Brown, whose contact you can see above. If your account is smaller, he may have suggestions where else you could go.

      Cheers,
      Andrew

    2. avatar
      Jarrad Brown

      Hi Tuula,

      Feel free to email me at jbrown@ippfa.com and Andrew has highlighted, I’m happy to recommend a solution depending on the size of your account if I can not assist you directly.

      Best regards,

      Jarrad

  23. avatar
    Mark Hebner

    We have been fiduciaries for wealth since 1999. Check us out at http://www.ifa.com and see our videos at http://www.ifa.tv. Enjoy, Mark

    1. avatar
      Andrew Hallam

      Thank you Mark,

      I’m actually giving a presentation to overseas Americans this Thursday, and will be mentioning your firm. Likewise, I’ll be explaining your firm (among a few others) in my upcoming book on Investing for Expatriates. You’re providing a service that many American expats could surely use!

      Thanks again Mark!

      Andrew

  24. avatar
    Michael

    Hi Andrew,
    Many thanks for your great book, as a matter of fact it has encouraged me to read and learn more in the area of financial investments.

    Having worked in Singapore for some time I was willing to do “something” with the money earned here before moving further to Australia.
    So I’ve come up with an idea to invest in corporate bonds (such as Skandia EB) for a period of 5-10 years, also partly to avoid paying high CGT Down Under (as long as bond is not encashed when I am in Australia). I’ve considered such investment as rather safe and not requiring any activity from my side.
    I would have actually invested in bonds but… (so called) professional financial advisers prevented me from doing so! Most of their recommendations were pretty straightforward, they wanted me to go for ILPs (Generali, Standard Life, Zurich, Prudential to name a few) locking me in for 25 years into a fairly expensive product together with horrendous surrender fee.
    I’ve been trying to find a fee based investment adviser who could also help with taxation aspect of investing (tax efficient investing is Singapore by Australian tax resident), but I drew a blank.

    Today I tried to setup a DBS Vickers account but I failed in that area as well, I did not meet the “wholesale client” criteria (have they introduced it recently?) as it is required for Australian residents (current and future) to setup such trading account at DBS.

    So I will try (recommended) Standard Chartered soon, if it does not work as well, I might end up with transferring cash from Singapore to Australia, just to set up a trading account in Australia which is probably not the best idea.

    May I have your thoughts on that?
    Many thanks!

    Michael

    1. avatar
      Brett Evans

      Hi Michael,

      there are actually a number of incentives for aussie expats to invest in Australia whilst they are still classified as a non-resident for tax purposes.

      A couple of them include no CGT and low withholding tax rates which can all but be removed by offsetting with the franking credits created by the dividends. Also if you own listed securities and no physical property in Australia there is no requirement to lodge a Australian tax return.

      Drop me an email at brett.evans@atlaswealth.com.au if you have any questions.

      Kind regards,

      Brett

  25. avatar
    Rich

    Andrew,

    Don’t know if you are still doing these interviews, but if so, I’d love to introduce you to http://www.wealthminder.com. We are a new entrant in the “robo-advisor” space. In many ways, we have similarities to FutureAdvisor who posted here earlier, but Wealthminder also have some important differences that I’d love to highlight.

    Thanks,
    Rich

    1. avatar
      Andrew Hallam

      Thanks for contacting me Rich. I would love to continue this series. But I have a pressing book deadline to meet first. After that, I will contact you, if that’s OK.

      Thanks,
      Andrew

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