Warning: Misleading Fees Are Costing You Thousands

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Warning: Misleading Fees Are Costing You Thousands

Рет қаралды 15,706

Күн бұрын

➡️Our financial planning services: www.parallelwe...
In this video we'll discuss how some fees may be trapping you in your investments and costing you thousands.
If you have any further questions about this video's topic or any financial planning questions in general, I encourage you to find a certified financial planner in your area or book a consultation with us to get your retirement plan on track.  You can learn more about our services at www.parallelwe...
Financial Resources I personally recommend:
➡️Retirement Income for Life: Getting More without Saving More (Second Edition): amzn.to/3tvIdVN
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OUTLINE
0:00 - Intro
0:49 - 3 Types of Fees
1:33 - Deferred Sales Charge
4:00 - Low Load
4:42 - Example
8:46 - Take Action
9:51 - Transfer Fees
This presentation is intended for information purposes only and does not constitute an offer to buy or sell our products or services nor is it intended as investment and/or financial advice on any subject matter. Every effort has been made to ensure the accuracy of its contents. Certain of the statements made may contain forward-looking statements, which involve known and unknown risk, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Returns are not guaranteed and past performance may not be repeated.
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DISCLAIMER: The videos and opinions on this channel are for informational and educational purposes only and do not constitute investment advice. Adam Bornn is not registered to provide investment advice and as such does not provide recommendations - those looking for investment advice should seek out a registered professional. Adam is not responsible for investment actions taken by viewers and his content should not be used as a basis for investment trades.

Пікірлер: 66

@pwong0227 Ай бұрын

I am glad I parted ways with financial advisor at Investors Group in 2010. 😊

@sandeeptanjore1253 Ай бұрын

So who are you with now? are you managing it on your own through a discount brokerage?

@BillWasylyshyn Ай бұрын

Investors Group had terrible "hidden" fees. I found out why my advisor was constantly getting me to change funds. Moved away from IG over 20 years ago when I realized I was losing money and they were getting fat. Good riddance to them.

@KeithBerry-kg5qc Ай бұрын

I have had 2 IG salesmen and both have caused issues with CRA that have caused me a lot of sleepless nights.

@MonaghanMLOUISE 22 күн бұрын

I disagree with you with all due respect, one needs to work with an expert if you want to make sufficient passive income.. imagine investing 200k and getting 5% profit, thats too low when people are raking up big amounts (like 200%+ profit) with the same capital

@adelineChulack 22 күн бұрын

I started investing on my own and for a long time, the market was really ripping me off. I decided to hire a broker, even though I was skeptical at first, and I beat the market by more than 9%, I thought it was a fluke until it happened two years in a row, and so I've been sticking to investing via an analyst.

@lindabradley78 Ай бұрын

Another home run Adam! I’ve shared before that I was in the industry for nine years and this was one of the industries dirty little secrets. (I was not an advisor!) People need to be aware of how much money they are losing to fees, and they need to make informed decisions about what to do with their money. Thank you once again for educating the public when so many in the financial services industry are not bringing this transparency to their clients, even though the industry has now mandated they do so.

@cksh4182 Ай бұрын

there's not free lunch, clients are happy to pay a fee (long as you are transparent) if you are getting proper services. Not every can do DIY.

@josephkeith6954 Ай бұрын

@@cksh4182 that’s why financial literacy is a must in high school

@celiakulrich255 Ай бұрын

Why my husband didn't make any money investing in the 90's.

@brucegarrod8674 Ай бұрын

I 'get' not everyone wants to DIY. But those 2.5%+ fees are being paid whether it's a good or horrible year. An easy way to dramatically reduce costs is to move to ETF's. Scared? Look at the holdings of your mutual fund. Find an ETF (iShares or other) that has a similar structure. Dump the mutual fund (mindfully to avoid fees) and buy the ETF. Take small steps. Soon your fees will plummet from 2.5% to under 0.05%. i would guide people through this for free at my age; if only I had my license.

@CanadasOceanPlayground Ай бұрын

Excellent advice Adam ! , keep this stuff coming, this is big money disappearing to fund managers.

@ParallelWealth Ай бұрын

Thanks, will do!

@chrisjeanneret5091 Ай бұрын

I used to work client service for a mutual fund company back in the DSC days. Also, I have encountered companies that have an annual fee for locked-in plans, and don't have a waiver for larger balances.

@mlmitchell1502 Ай бұрын

I do not understand this. I have never had an advisor and I always invest in individual stocks. As far as I can tell, I never pay fees to my Investing company, Qtrade, except for small, one time charges for specific transactions. I never pay a cent for periods where I do not make transactions. Early in life, I heard my mother complain about lack of profit from her mutual fund investment, and decided to only invest where I have control of what I purchase. I stick to that decision.

@ScornedRemnant Ай бұрын

You've got it all figured out. 👍 I concentrate on buying stocks of wonderful businesses at fair prices, not stocks of fair businesses at wonderful prices.

@svenhodaka9145 Ай бұрын

Yup, I own some BRK:B too!😉

@Larry_Kabberga Ай бұрын

Self investing in individual stocks is the perfect recipe for disaster

@ScornedRemnant Ай бұрын

@@Larry_Kabberga Sounds a bit dramatic, but I respect your right to your opinion. I've done fine over the years and I'm no genius. I acknowledge my limitations and I use the internet to keep updated on stock opinions from as many expert analysts as possible.

@ScornedRemnant Ай бұрын

@@svenhodaka9145 Me too. It won't shoot the lights out but has a fairly good long term return in my taxable account where it can slumber without having to declare taxable capital gains or dividends.

@josephkeith6954 Ай бұрын

Gosh, forget about mutual funds with complex structures recommended by "financial advisors / aka sales persons" Just buy Vanguard ETFs with low low MER... done. I won't invest if total cost is 0.5% or higher. 2.5% MER is not "fairly expensive" they are crazy expensive after compounding for 10, 20, 30 years. You need to accumulate double or higher money invested with those kinds of MER rate. Money NOT in your pocket. It's a SIN.

@henryhonda8408 Ай бұрын

Finally!!! Someone with some common sense! Hard to find these days.

@harveyellis6758 Ай бұрын

Private equity funds also have handcuffs associated with them and make switching from an investment advisor more difficult.

@rickbold9337 25 күн бұрын

Mutual funds are horrible. I was getting capital gains taxes on years when the funds went down. Way too many fees. ETF’s are better by far.

@vadimrazenberg Ай бұрын

This video should be a wake up call for people in mutual funds. It’s an outdated product. Low fee ETFs that track the big indices are the way to go.

@ScornedRemnant Ай бұрын

I learned years ago to stay away from mutual funds - just my opinion.

@pjm3005 Ай бұрын

they're fine, if you know what you're looking at. The problem is the state of financial literacy is near 0.

@APICSKH Ай бұрын

I made over 8.5% annual average, over the last 27 years in mutual funds with TD, of course fees are the part of stress free investing.

@ScornedRemnant Ай бұрын

@@APICSKH Love it when other people make money too. Who says capitalism is bad?

@henryhonda8408 Ай бұрын

@@APICSKH I've averaged a 27% return the last 5 years with ZERO mutual funds not to mention any useless "financial advisors"!

@cksh4182 Ай бұрын

@@APICSKH Long as you are happy with your return. Do proper planning, why take additional risk when you dont need too.

@josephkeith6954 Ай бұрын

Why even bring up transfer fees? $25-$250 transfer fees or maintenance fees or inactivity fees is peanuts compared to MER 2.5% (plus you gotta pay the advisor too).

@henryhonda8408 Ай бұрын

I totally agree......

@henryhonda8408 Ай бұрын

Just get out of greedy bank mutual fees NOW......... transfer fees are peanuts compared to that! As for advisors, DON'T get me started. 😡😡😡

@ParallelWealth Ай бұрын

Just informing people as many are unaware. Plus for those with smaller accounts it can matter

@josephkeith6954 29 күн бұрын

@@ParallelWealth clients that are rich enough to seek out an advisor for retirement planning will be ready to pay 2K and up per planning incident. i think they probably could care less about $50-$200 fees. what would be an eye opening and beneficial to the public is to illustrate how a 2% fees over a period of 20-30 years impacts the nest egg at the end accumulation period. but that might make you unpopular among the financial planner community :)

@garth217 Ай бұрын

One of your most important video's to date!!

@rshonfield Ай бұрын

I'd be interested in knowing which online discount brokerages do NOT have high transfer out fees. My experience is that they ALL do. Many brokerage firms will cover your transfer fees from the old brokerage but I haven't seen ANY that have low transfer out fees.

@josephkeith6954 Ай бұрын

Certain group RRSP transfer out is $50 :)

@ParallelWealth Ай бұрын

The only one I found so far is Steadyhand.

@dianamirella5854 Ай бұрын

Hi Adam. I have transferred RRSPs and TFSA from RBC. The transfer fees were significant and they charge GST/HST which is not covered by the new investment company or bank. I learned that the hard way.

@cksh4182 Ай бұрын

was your account small in value?

@collinyoung7603 Ай бұрын

Bank you’re transferring to should pay those fees…

@dianamirella5854 Ай бұрын

@@collinyoung7603 Correct but what they don’t tell you is that those transfer fees are subject to GST, which is not covered.

@PJBHolden 22 күн бұрын

This isn’t rocket science folks. You can manage your own money

@jovicrazed Ай бұрын

World Financial Group sold these DSC funds. There are SO many issues with that company. Would never recommend them

@Finenubian Ай бұрын

Thank you Adam for this Timbit 👏 👏

@ParallelWealth Ай бұрын

My pleasure!

@RobertLendvai Ай бұрын

If you’re paying more than 1 to 1.25% annually in Canada, you’re getting hosed.

@scotbarlow213 24 күн бұрын

@adam: do investment firms "have" to include their yearly fee in their statements? I can never see it there but have been told what my fee is. I would just like to see it in the statement.

@ParallelWealth 24 күн бұрын

Nope.

@Spp235. Ай бұрын

DSC Funds should have been banned a while ago. BUT while you did a great job criticizing this, I think you didn’t fairly explain why the DCS is necessary… The advisor gets 5% commission up front and the Investor DOES NOT pay anything up front. How is this possible? Well a bank provides a behind-the-scenes loan for the 5% in exchange for an assignment of the DSC. Ultimately the DSC and the annual sales commission is used to repay the bank loan. So to ensure that there are enough fees generated, the DSC needs to be in place for a few years. Bottom line - there is a lot of complexity and different parties taking slits on the fees behind the scenes. But the investors get to invest without any up front deduction and earn returns on the entire amount. Still a bad deal but was used to counter objections to up-front or transparent investment fees. And yes, the advisors are often predatory but that is what happens when they are not required to be “fiduciaries”

@josephkeith6954 Ай бұрын

Even for fiduciaries CFPs, how do you verify / confirm they are working in your best interest and not they own self interest? Sure, if you are financially savvy they know when to back off. But if a client has a low financial literacy, he/she is at the mercy of the financial advisors - fiduciaries or not. Is there a process to proof the degree of bias that the advisor is working on the client's interest? can you sue them in court and how to proof it? I don't think this "fiduciaries" make sense at all... it's like a marketing strategy...

@ParallelWealth Ай бұрын

Hard to make this argument nowadays. The advisor could invest the money with no DSC and collect 1% roughly ongoing. Smaller accounts may require DSC, but I feel like an advisor doing this is living 20 years ago...

@MattViklund Ай бұрын

Hey Adam, love the content, brother. What are your thoughts on Wealth Simple's Private Credit? It's only available once you have 100k invested and minimum investment is 10k. There are limited withdrawal windows from what I've read - but the fund did achieve 11% net fees last year...

@scotbarlow213 Ай бұрын

Thanks Adam. I presume investment first have to disclose fees in statements? Not sure if this is required or not

@davdride4850 Ай бұрын

Banks mean. Fees fees fees and a few more fees

@ScornedRemnant Ай бұрын

Ya can't beat 'em so buy their shares and get a piece of the action.

@davdride4850 Ай бұрын

Thanks adam

@dougtratch8260 Ай бұрын

Hello Adam. Very interesting topic. Who knew fees could run so high. So my question to you is, if you do run into DSC or LL funds, are there mechanisms to ween off of your planner, or are you stuck with them for the 2 to 7 years depending on the plan? Is it a situation that when your DSC or LL fee schedule expires, you are able to jump ship and go to another firm, such as Parallel Wealth? Thanks Doug in Richmond.

@ParallelWealth Ай бұрын

Often you can transfer to another firm in kind and slowly sell at that point. But be careful because some funds are proprietary and can only be held at the original firm. I would push back against the advisor on why they put you in DSC and have them cover the fees to transfer....

@RobertLendvai Ай бұрын

@@ParallelWealthThis is an important point. Most don’t understand that every thing can be negotiated. Shouldn’t the first question you ask a “financial advisor” be “are you a fiduciary” that’ll put my interests ahead of yours?