Financial Advisors - Fees

W@P

W@P

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Ok so first of I am not asking for financial advice nor am I giving any.

I want to share my situation and get opinions from you all.

With my father passing away in Jul 2024 I am busy with all the affairs that goes with it.
It has come to my attention that me, my father in his personal capacity, and the family trust are paying north of R400k per year on advisor fees for all the combined investment portfolios held at one of the big players. This is what I am aware of it could still be more as I keep on discovering things.

My father was always persistent with me regarding the fees and % financial advisors charge. He always made it clear to me to always make sure of the fees.
FFS. Now I know why.

So I had a heated discussion with our FA and made it clear to him that I would terminate all the agreements he has with myself and the trust. There is no way I am going to carry on paying those kinds of fees.

I asked him WTAF he does every month to receive said fees. On one investment that is in USD, they are charging, on average, a $900 advisor fee p/m.
Then there are no transactions taking place. The initial investment was done and since then just fees every month.

Sure there was growth.

Or am I missing something?
 
W@P said:
Ok so first of I am not asking for financial advice nor am I giving any.

I want to share my situation and get opinions from you all.

With my father passing away in Jul 2024 I am busy with all the affairs that goes with it.
It has come to my attention that me, my father in his personal capacity, and the family trust are paying north of R400k per year on advisor fees for all the combined investment portfolios held at one of the big players. This is what I am aware of it could still be more as I keep on discovering things.

My father was always persistent with me regarding the fees and % financial advisors charge. He always made it clear to me to always make sure of the fees.
FFS. Now I know why.

So I had a heated discussion with our FA and made it clear to him that I would terminate all the agreements he has with myself and the trust. There is no way I am going to carry on paying those kinds of fees.

I asked him WTAF he does every month to receive said fees. On one investment that is in USD, they are charging, on average, a $900 advisor fee p/m.
Then there are no transactions taking place. The initial investment was done and since then just fees every month.

Sure there was growth.

Or am I missing something?
Click to expand...
You're 100% correct. Drop that scamsters ass. I'm willing to pay upfront but not a chance I'm paying a monthly/annual percentage.
 
most investment type arrangements allow for initial and ongoing advice fees based on AUM (assets under management)

Krokodille met wit skoene is the expression that was used back in the day

They get you in, leave you alone and collect fees...

Maybe he gave good advice to earn the initial fee. but ive always had this issue with ongoing fees. He's earning off your sweat so to say

If you are not getting services commensurate to the fees, chop him
 
Assuming a 3% per annum fee, that implies that the trust is worth more than R12mil. You don't need to respond, but is that the approximate investment size (reasonability check)

The questions that came to mind.

What is the actual percentage paid? I assume it differs per product?
Are you sure it is all advise fees and not the total of advise, platform and management fees? (from your post above you seem well versed, but easy to get tripped up with such a large amount involved).
 
PhreakBoy said:
Assuming a 3% per annum fee, that implies that the trust is worth more than R12mil. You don't need to respond, but is that the approximate investment size (reasonability check)

The questions that came to mind.

What is the actual percentage paid? I assume it differs per product?
Are you sure it is all advise fees and not the total of advise, platform and management fees? (from your post above you seem well versed, but easy to get tripped up with such a large amount involved).
Click to expand...
Was just going to say, without knowing the size of the investment it’s very hard to say if this is unreasonable or not.

A breakdown of all fees would also help.
 
SauRoNZA said:
Was just going to say, without knowing the size of the investment it’s very hard to say if this is unreasonable or not.

A breakdown of all fees would also help.
Click to expand...
There's no reason to pay any advisor a recurring fee though. Why pay someone every year for something they suggested 10 years ago?
 
Speedster said:
There's no reason to pay any advisor a recurring fee though. Why pay someone every year for something they suggested 10 years ago?
Click to expand...
I agree, if it’s passively managed, but I’m not sure these are necessarily those fees. This sounds more actively managed with additional services involved.

I don’t believe in advisors at all, could have retired by now if not for them, but of you have to pay them up front.
 
There are platform fees, advisor fees, and administration fees.

The platform fees I get. No problem.
It is the other 2 that bugs me.

It is the same as you going for an operation to fix a broken arm, as long as the arm is working you now pay a monthly fee to the doctor who did the op. GTFO.

The fees are just over 1%.
 
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Not actively managed, no trading going on. Invested in funds of funds etc.
 
W@P said:
There are platform fees, advisor fees, and administration fees.

The platform fees I get. No problem.
It is the other 2 that bugs me.

It is the same as you going for an operation to fix a broken arm, as long as the arm is working you now pay a monthly fee to the doctor who did the op. GTFO.

The fees are just over 1%.
Click to expand...
1% total? Or just the advise parts?

Hopefully they aren’t locked into “products” and you can just get rid of this guy.
 
SauRoNZA said:
1% total? Or just the advise parts?

Hopefully they aren’t locked into “products” and you can just get rid of this guy.
Click to expand...
Just over 1% in total.

He tunes me the one investment grew by $200k and then asks me if R200k in fees is too much to pay on one investment.

EK sal fokken iets oorkom.
 
He goes on about how he has been with my family for 15 years and we would not be in this financial position if it was not for him.
Fokof man. You gave advise. These investments were started and left to grow over the years. You did fokol in between.

Tunes me about how much experience he has and how educated he is. Fakoff.

This is without the share portfolio.
 
SauRoNZA said:
In all honesty that’s cheap as chips if that includes everything.
Click to expand...
Yes, I agree it is not too bad. IF there were actually active transactions done. Or whatever.

I still feel wtf should I be paying those fees?
 
W@P said:
He goes on about how he has been with my family for 15 years and we would not be in this financial position if it was not for him.
Fokof man. You gave advise. These investments were started and left to grow over the years. You did fokol in between.

Tunes me about how much experience he has and how educated he is. Fakoff.

This is without the share portfolio.
Click to expand...


Max fees are.
3.45% including vat for initial
1.15% including vat for ongoing

I can see why your dad went with an adviser as his family don’t know much at all about investing.
 
If you know the funds you can always self manage yourself and kill the ongoing fee?
Admin fee will always be there sadly
 
Pegging said:
Max fees are.
3.45% including vat for initial
1.15% including vat for ongoing

I can see why your dad went with an adviser as his family don’t know much at all about investing.
Click to expand...
Have you got skin in the game?
I know nothing you are right.

Are you happy to pay that amount of money for nothing?
 
W@P said:
Have you got skin in the game?
I know nothing you are right.

Are you happy to pay that amount of money for nothing?
Click to expand...
There’s no reason you should be paying anywhere close to the max fee. Bigger portfolios should normally be offered much-reduced fees.
 
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