Assuming the quality of the item is the same (or even better), is there anyone out there who wouldn't want to save thousands of dollars on an investment in a big ticket item like a car or boat or house? I didn't think so.
Then why don't some of those same people care about saving thousands of dollars on maybe the biggest ticket item in their lives, their assets/investment/savings?
Folks, it's just this simple: If you work with a commission-based financial advisor, you will likely pay thousands more for financial 'advice' than you would if the advisor is fee-based, and the commission-based advisor will be of no better quality.
Make no mistake, in a commission-based environment, the investor pays the commissions, often as high as 5%. It may be an upfront charge, as in the case of a commission-based brokerage account, or it may be buried in fees and happen over the course of a few years, as in the case of many different insurance products the 'advisor' purchases for you within the account. (That's why such products, notably annuities, have big annual fees and multi-year surrender charges - you can't leave until you reimburse the financial institution for their costs.) Regardless, the investor pays more in this financial model.
On the contrary, if you work with an independent fee-based registered investment advisor, your investing costs will be far less, and the quality of the advice is likely to be far superior. The fee-based advisor isn't required to sell you something to keep making money. Your success is their success. And if you aren't happy with the results you can just leave and not have to worry about surrender charges or other fees. It also helps if the person is a Certified Financial Planner - they don't cost more, and at least you know they have the professional credentials to do what they do.
Save yourself thousands. Don't just accept the local only-guy-in-town or the friend of a friend. Find, interview, and use an independent registered investment advisor.
Friday, August 28, 2009
Tuesday, August 25, 2009
Stupidity Is Easy
As I do on a lot of weeknights, late last night I was flipping the TV back and forth between The Tonight Show with Conan O'Brien and The Colbert Report (with Stephen Colbert). Two funny guys with great shows - but not my point.
Conan's first guest was Bill Maher, the politically opinionated comedian. They talked about a recent controversy involving comments Maher made about Americans being stupid, and a piece he eventually wrote to defend that opinion. It's a must read at
http://www.huffingtonpost.com/bill-maher/new-rule-smart-president_b_253996.html
Of course, it's inflammatory and an over-generalization to say Americans are stupid. But statistically speaking, it has the element of truth. As I've said before, we are in many ways a nation of sheep, allowing other people to tell us what to believe in or what is good for us without thinking about it for ourselves. It sort of comes naturally to us over time, as each generation learns to do what is easy and avoid what is hard. And it's a lot easier to know nothing than it is to know something.
America survives and will continue to thrive because unlike so many other countries, individuals have the freedom and tools to reach their potential, however limited that may be. As Carl the groundskeeper says in the movie Caddyshack, "So I got that going for me. Which is nice."
Conan's first guest was Bill Maher, the politically opinionated comedian. They talked about a recent controversy involving comments Maher made about Americans being stupid, and a piece he eventually wrote to defend that opinion. It's a must read at
http://www.huffingtonpost.com/bill-maher/new-rule-smart-president_b_253996.html
Of course, it's inflammatory and an over-generalization to say Americans are stupid. But statistically speaking, it has the element of truth. As I've said before, we are in many ways a nation of sheep, allowing other people to tell us what to believe in or what is good for us without thinking about it for ourselves. It sort of comes naturally to us over time, as each generation learns to do what is easy and avoid what is hard. And it's a lot easier to know nothing than it is to know something.
America survives and will continue to thrive because unlike so many other countries, individuals have the freedom and tools to reach their potential, however limited that may be. As Carl the groundskeeper says in the movie Caddyshack, "So I got that going for me. Which is nice."
Thursday, August 20, 2009
Medicine And Marijuana
The Iowa Pharmacy Board is presently holding open hearings around the state to determine whether or not to make a legislative recommendation to legalize medicinal marijuana, as 13 other states have done.
Only 13 other states have done this? What is everybody waiting for? We definitely should make pot legal as a means to reduce physical pain and suffering, as we often do with other controlled substances. The question isn't whether we should legalize pot for medical needs, the question is whether we should make it legal, period.
If we wouldn't be such a repressed society, we'd decriminalize pot altogether. It's no more mind altering or addicting than alcohol, or for that matter certain prescription drugs. Let's legalize it and regulate it, just like we do with with so many other mind-altering substances, and stop incarcerating users who are not a threat to society. As for those disingenuous people who argue that we'll become a nation of stoners if pot is legalized, please - I don't see those same folks arguing that we've become a nation of alcoholics.
If Iowa is progressive enough to allow gay marriage, we surely ought to be progressive enough to allow medicinal marijuana, and we probably ought to be progressive enough to legalize it, period.
Only 13 other states have done this? What is everybody waiting for? We definitely should make pot legal as a means to reduce physical pain and suffering, as we often do with other controlled substances. The question isn't whether we should legalize pot for medical needs, the question is whether we should make it legal, period.
If we wouldn't be such a repressed society, we'd decriminalize pot altogether. It's no more mind altering or addicting than alcohol, or for that matter certain prescription drugs. Let's legalize it and regulate it, just like we do with with so many other mind-altering substances, and stop incarcerating users who are not a threat to society. As for those disingenuous people who argue that we'll become a nation of stoners if pot is legalized, please - I don't see those same folks arguing that we've become a nation of alcoholics.
If Iowa is progressive enough to allow gay marriage, we surely ought to be progressive enough to allow medicinal marijuana, and we probably ought to be progressive enough to legalize it, period.
Tuesday, August 18, 2009
A Great Investing Webinar
There is an awful lot of information (and a lot of awful information) out there now about the investment marketplace. Lots of opinions from lots of media outlets, and much of it not substantiated by facts or credentials.
However, for a straightforward look at the effects of recession and government policy on stock prices, how the current market stacks up to previous downturns, and the capital markets in general, go to the webinar found at this link:
http://www.dfaus.com/share/whatshou/
This particular version was posted by a fund company I often work with, and it’s approximately an hour long but separated into six shorter parts. It’s interesting, it’s calming, and perhaps most beneficially, it’s likely to return people’s focus to time rather than timing.
However, for a straightforward look at the effects of recession and government policy on stock prices, how the current market stacks up to previous downturns, and the capital markets in general, go to the webinar found at this link:
http://www.dfaus.com/share/whatshou/
This particular version was posted by a fund company I often work with, and it’s approximately an hour long but separated into six shorter parts. It’s interesting, it’s calming, and perhaps most beneficially, it’s likely to return people’s focus to time rather than timing.
Sunday, August 16, 2009
A Tax On Fat People
In the first 15 minutes of our visit to this year's Iowa State Fair, my wife made an all-too-true observation: Out of the thousands of people there, 9 out of 10 were overweight, and plenty of them would fit the description of obese. It's a very bad thing.
Forget about the obvious physical issues for these folks. Their lack of self/health discipline also burdens others via their lower production and higher health care costs. They are not going to reach their potential as individuals, and we are not going to reach our potential as a country, by being fat. Put into that perspective, it sort of ticks me off.
So how do we get very overwieght people to care more? How do we motivate them to lose weight? I've always advocated a tax on higher fat foods and ingredients. We all know money motivates people. We tax tobacco (as we should), surely we can do it for food.
I suppose that may be treating the symptom and not the disease. In the end, the answer lies in why fat people don't care about how they feel or look. When someone figures that out, please call me. I'll be somewhere exercising.
Forget about the obvious physical issues for these folks. Their lack of self/health discipline also burdens others via their lower production and higher health care costs. They are not going to reach their potential as individuals, and we are not going to reach our potential as a country, by being fat. Put into that perspective, it sort of ticks me off.
So how do we get very overwieght people to care more? How do we motivate them to lose weight? I've always advocated a tax on higher fat foods and ingredients. We all know money motivates people. We tax tobacco (as we should), surely we can do it for food.
I suppose that may be treating the symptom and not the disease. In the end, the answer lies in why fat people don't care about how they feel or look. When someone figures that out, please call me. I'll be somewhere exercising.
Wednesday, August 12, 2009
Health Care Reform and Sheep
To put it nicely, people are showing a lot of passion at these congressional 'town hall meetings' on health care reform. I think it's funny for two reasons:
First, when politicians schedule these things, they think they're going to draw a few mostly friendly folks to chat, just so they can say they met with their constituents, maybe even pickup a campaign contribution or two. You're going to see a lot fewer town hall meetings in the future.
Second, and this is more sad than funny, I'll bet if you asked any of these angry folks against health care reform, you'll find that almost none of them understand how their existing health plan works. Outside of the premiums they pay, they have no clue what a deductible is, or how coinsurance works, or ultimately how much they'll have to pay for a hospital stay. So how can they possibly know if change will be more expensive?
That's right, they don't know. It's just that someone else told them it was that way, either in person or on TV or the internet, so they believe it. (See my first post, lather and rinse.) We are a country of sheep, and there are currently more wolves than any shepherd can handle.
First, when politicians schedule these things, they think they're going to draw a few mostly friendly folks to chat, just so they can say they met with their constituents, maybe even pickup a campaign contribution or two. You're going to see a lot fewer town hall meetings in the future.
Second, and this is more sad than funny, I'll bet if you asked any of these angry folks against health care reform, you'll find that almost none of them understand how their existing health plan works. Outside of the premiums they pay, they have no clue what a deductible is, or how coinsurance works, or ultimately how much they'll have to pay for a hospital stay. So how can they possibly know if change will be more expensive?
That's right, they don't know. It's just that someone else told them it was that way, either in person or on TV or the internet, so they believe it. (See my first post, lather and rinse.) We are a country of sheep, and there are currently more wolves than any shepherd can handle.
Saturday, August 8, 2009
For Atheists, There Is A God (Of Common Sense)
This week's big Des Moines area scandal involved ads on the sides of metro buses that questioned the existence of God, sponsored by an atheist group. Apparently some people (one? ten? fifty?) complained and succeeded in having the ads pulled. Even our intellectually-challenged, political-pandering governor weighed in to say he was disturbed by the ads.
(An aside here. This is the same governor standing in the way of allowing Iowans a referendum vote on whether to overturn the legalization of gay marriage. Now, I don't have a problem with gay marriage, but I have a huge problem with a governor who determines his morality based on whether it wins him support within his party. Like so many politicians, the guy doesn't stand for anything, he only stands for what wins him votes.)
In the end, the god of common sense rose up and defeated the small-minded fools who think their religious beliefs are the only ones protected by free speech. The ads were allowed again, the religious bigots crawled back under their rocks, and the sun came up in the east. Oh, and people were again reminded that while this country was founded on Christian principles, 200 years of evolution later we have a religiously diverse country where not everyone believes in the same thing.
(An aside here. This is the same governor standing in the way of allowing Iowans a referendum vote on whether to overturn the legalization of gay marriage. Now, I don't have a problem with gay marriage, but I have a huge problem with a governor who determines his morality based on whether it wins him support within his party. Like so many politicians, the guy doesn't stand for anything, he only stands for what wins him votes.)
In the end, the god of common sense rose up and defeated the small-minded fools who think their religious beliefs are the only ones protected by free speech. The ads were allowed again, the religious bigots crawled back under their rocks, and the sun came up in the east. Oh, and people were again reminded that while this country was founded on Christian principles, 200 years of evolution later we have a religiously diverse country where not everyone believes in the same thing.
Wednesday, August 5, 2009
Too Much To Do Central Iowa
I get a kick out of people who say it's so boring in Des Moines or Iowa or the Midwest. Usually the whiners are the twenty-somethings who don't have enough nightclubs, or the outdoor adventurers who don't have mountains or beaches. Those folks should move. The fact is, at least for everyone else in central Iowa in the summer, we have more entertainment options than we can handle.
We have festivals every week encompassing things like music, food, the arts, and even hot-air balloons. We have recurring sporting events like triple-A baseball, auto/horse racing, and arena football. We have plenty of golf courses and bike trails and swimming pools and parks. And of course week have the 10-day long Iowa State Fair, which is kind of like everything I just mentioned all rolled into one.
So please, spare me the 'there's nothing to do here' line. If you feel that way, just stay at home with your DVDs and video games - smaller crowds at this stuff would be nice!
We have festivals every week encompassing things like music, food, the arts, and even hot-air balloons. We have recurring sporting events like triple-A baseball, auto/horse racing, and arena football. We have plenty of golf courses and bike trails and swimming pools and parks. And of course week have the 10-day long Iowa State Fair, which is kind of like everything I just mentioned all rolled into one.
So please, spare me the 'there's nothing to do here' line. If you feel that way, just stay at home with your DVDs and video games - smaller crowds at this stuff would be nice!
Monday, August 3, 2009
In Warren Buffett I Trust
I've been a long-time admirer of Warren Buffett, chairman of Berkshire Hathaway and one of the world's wealthiest people. He happened to be in Des Moines last week for the grand re-opening of a furniture store owned by one of Berky's companies, which I attended.
(I attended not because I cared about the furniture, or because I thought he might say something profound, or because I'd never seen him in person. Mostly I attended because I thought there might be a chance to have him autograph my copy of his authorized biography "The Snowball." Didn't happen.)
As I watched the proceedings, I was thinking about how most of the people there simply look at him as this super-rich fellow. They have little knowledge or understanding about his charitable work, his sense of humor, or his often Democratic-leaning opinions about investing and government policy.
Rather than try to summarize that here, everyone should read his annual letters to Berkshire Hathaway shareholders. They can be found at http://www.berkshirehathaway.com/letters/letters.html. These letters are not full of technical financial jargon. They are more like witty short stories on investing, capitalism, and America - and how people sometimes manage to gum them up.
Given his credentials, I'd think people would listen to more of what Warren Buffett has to say. In the end I suppose it's to my advantage. Let everyone else listen to talk radio and its blustery hosts with unsubstantiated opinions. In the meantime, I'll be following the opinions and advice of someone who is perhaps America's greatest success story.
(I attended not because I cared about the furniture, or because I thought he might say something profound, or because I'd never seen him in person. Mostly I attended because I thought there might be a chance to have him autograph my copy of his authorized biography "The Snowball." Didn't happen.)
As I watched the proceedings, I was thinking about how most of the people there simply look at him as this super-rich fellow. They have little knowledge or understanding about his charitable work, his sense of humor, or his often Democratic-leaning opinions about investing and government policy.
Rather than try to summarize that here, everyone should read his annual letters to Berkshire Hathaway shareholders. They can be found at http://www.berkshirehathaway.com/letters/letters.html. These letters are not full of technical financial jargon. They are more like witty short stories on investing, capitalism, and America - and how people sometimes manage to gum them up.
Given his credentials, I'd think people would listen to more of what Warren Buffett has to say. In the end I suppose it's to my advantage. Let everyone else listen to talk radio and its blustery hosts with unsubstantiated opinions. In the meantime, I'll be following the opinions and advice of someone who is perhaps America's greatest success story.
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