I've been with my financial planner at Morgan Stanley for about 13 years. She has been really great to me, calling to check on me, reminding me to invest, teaching me about funds, giving me lots of sober advice. I feel lucky to have her because I'm not a wealthy guy and normally her clients have much more money under management than I do (I happened to get passed to her when my original advisor quit.)
My problem is I've been learning a lot that makes me concerned I'm not earning the returns I need to retire on time. For example, I found out my fees are 1.45 percent which is pretty high. I thought I could live with that because her guidance and advice is valuable to me. But I've also learned that managed funds (which is what she has my money in) almost always underperform the market, like 90% of the time; a fund manager just can't reliably beat the overall market returns. And even if they do, they have to beat the market by a lot to also make up for that management fee they charge. I've been learning about John Bogle and low-cost index funds and that really seems a way to shrink my fees drastically, while also earning steady market returns.
My fiancé says I should just talk to her and tell her I want to do, and it's just business. I'm hesitating because I don't want to lose her as a resource, and I also wonder what if my managed fund happens to be one of the lucky few that does beat the market? Is there an easy/understandable way I can see if my fund ("Trak") is really a good one or just mediocre?
I'm concerned about making a mistake and because I'm in my 40s, I don't have endless years to make up what I'll need in my 60s.
Has anyone else made the move from high-fee managed funds to index funds? Was it a good idea? Anything I should know or do to not be sorry later?
Thanks in advance for any advice or perspective!
Submitted August 03, 2017 at 06:20AM by FunboyFrags http://ift.tt/2u3wrl6
