American Funds Losing Ground To Education

andrew hallam

andrew hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (Wiley 2011) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use.

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3 Responses

  1. diy investor says:

    Thanks for the mention. I actually only keep 30% of my clients longer than 6 months. Once they see that investing on their own is not difficult and doesn't take a lot of time they do it themselves. I do the nitty gritty of setting it up etc. Sometimes that isn't easy – they may hold a fund that has 2 years remaining on the backload and we have to talk about whether it makes sense to hold on and avoid the 2% charge or just eat it. Other times they may have stocks with large unrealized gains that we have to work around. But once these issues are dealt with and they understand the value of low cost diversified funds they see that investing is very straightforward. Your book and others help immensely in this process.

    I'd point out also that human resources people who choose fund providers etc. are fiduciaries in the U.S. They have legal responsibilities to provide appropriate 401(k) choices at low cost. This realization is part of the reason that load funds are diminishing. Also, this year the Department of Labor is requiring 401(k) funds to spell out in detail all the costs to fund participants.

  2. Anybody who buys a loaded fund these days is nuts. The fund marketplace has changed so much in the last 40 years. Is there any better deal out there than buying the entire stock market for no load and a .07% expense ratio? How sweet is that to get instant diversification!

  3. Sharon says:

    Do you recommend investing in mutual index funds or ETF index funds?

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