Fisher Investments - Help a family member leave

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RetireSomeday5
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Fisher Investments - Help a family member leave

Post by RetireSomeday5 »

My uncle currently uses Fisher Investments. He told me he is going to one of their meetings tomorrow (I assume some additional sales pitch). I want to give him a list of questions to ask and thought the board may have some good ideas.

Here is what I have:

1) What is the expense adjusted return over the last 1, 5, 10, 15 and 30 years spans vs a broad based index fund such as Vanguard Total Stock Index
2) Why are you recommending 100% stocks for someone over 70 years old?


Thanks all
deltaneutral83
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Re: Fisher Investments - Help a family member leave

Post by deltaneutral83 »

RetireSomeday5 wrote: Mon Nov 26, 2018 4:22 pm My uncle currently uses Fisher Investments. He told me he is going to one of their meetings tomorrow (I assume some additional sales pitch). I want to give him a list of questions to ask and thought the board may have some good ideas.

Here is what I have:

1) What is the expense adjusted return over the last 1, 5, 10, 15 and 30 years spans vs a broad based index fund such as Vanguard Total Stock Index
2) Why are you recommending 100% stocks for someone over 70 years old?


Thanks all
I can take #2, because you have 50x+ expenses in equities
The Wizard
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Re: Fisher Investments - Help a family member leave

Post by The Wizard »

Questions aren't needed, just facts.
How did Fisher recommended portfolio compare to S&P 500 total return year by year over past decade?
End of discussion...
Attempted new signature...
psteinx
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Re: Fisher Investments - Help a family member leave

Post by psteinx »

RetireSomeday5 wrote: Mon Nov 26, 2018 4:22 pm My uncle currently uses Fisher Investments. He told me he is going to one of their meetings tomorrow (I assume some additional sales pitch). I want to give him a list of questions to ask and thought the board may have some good ideas.
Is there some special reason you think he would be receptive to, or particularly in need of, your criticism (direct or implied) of his financial choices?
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RetireSomeday5
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Re: Fisher Investments - Help a family member leave

Post by RetireSomeday5 »

The Wizard wrote: Mon Nov 26, 2018 4:51 pm Questions aren't needed, just facts.
How did Fisher recommended portfolio compare to S&P 500 total return year by year over past decade?
End of discussion...
I agree...hence why I'm on this site--and that's basically what my #1 was, except you used the S&P and I used a broader base. I want him to ask the questions so he'll hear the response (or lack thereof) and realize their fee isn't worth it.
Last edited by RetireSomeday5 on Mon Nov 26, 2018 4:59 pm, edited 1 time in total.
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RetireSomeday5
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Re: Fisher Investments - Help a family member leave

Post by RetireSomeday5 »

psteinx wrote: Mon Nov 26, 2018 4:55 pm
RetireSomeday5 wrote: Mon Nov 26, 2018 4:22 pm My uncle currently uses Fisher Investments. He told me he is going to one of their meetings tomorrow (I assume some additional sales pitch). I want to give him a list of questions to ask and thought the board may have some good ideas.
Is there some special reason you think he would be receptive to, or particularly in need of, your criticism (direct or implied) of his financial choices?
Yeah, he asked me what I think since I have a financial background.
psteinx
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Post by psteinx »

OK, so you're an "invited guest", so to speak. :)

How long has he been with Fisher, to your knowledge? What was he doing before that?

Were I in your shoes, I'm not sure I'd be very open-ended about any proposed questions - that just invites further salesmanship from Fisher. Does he really understand the costs involved - in particular Fisher's AUM fee(s), and fund ERs, transaction costs, and tax impacts. [EDIT - What I meant here is, direct questions with reasonably objective answers "What are your AUM fees?" may be more productive to your apparently desired goal (getting him to switch from Fisher) than more open-ended or ambiguous questions.]

I think (not sure of this), that AUM fees have moved, with the late 2017 tax changes, from "often deductible" to "rarely (or perhaps never) deductible". In turn, for a taxable investor, this increases the amount that a portfolio must outperform to overcome AUM fees (if Fisher was even outperforming for him anyways - in any case, it may have increased the effective drag of any AUM fees.)

===
*May 2019 edit (If anyone still reading this) - With more reading, if I understand correctly, as things currently stand for 2019-2024, AUM fees are not deductible, BUT, for pre-tax IRAs, you can pay the AUM fee portion that covers management of that pre-tax IRA with pre-tax dollars from that pre-tax IRA.
===

That said, for some investors, using an advisor, even a relatively pricey one, may be worthwhile, IF the alternative is worse. i.e. If an individual is one who would otherwise self-manage their finances very badly. So how much you may choose to push against Fisher should perhaps depend on how you see this uncle's DIY capabilities, realistically, or, if there is a hand-holding advisor who would be cheaper and/or better.

And keep in mind that any interference on your part may have a negative outcome, if the alternative that the uncle switches to turns out badly ex-post, even if ex-ante it seemed reasonable.
Last edited by psteinx on Thu May 02, 2019 1:43 pm, edited 2 times in total.
123
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Re: Fisher Investments - Help a family member leave

Post by 123 »

If you uncle is currently happy with Fisher Investments giving him all the questions in the world is not likely to change his mind.

You might not be happy with him using Fisher investments and we might not be happy with him using Fisher Investments but his vote counts a whole lot more than ours. Investments Advisers often perform a service for people in that they will appear to listen to what the investor is saying, sometimes they are one of the only/few people that some folks believe they have a dialog with.

If you convince your uncle to go with something other than Fisher Investments and the market tanks he could very well blame you for his losses.

Why did he move to Fisher Investments from his prior adviser(s)? The answer to that question may tell you a lot.
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columbia
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Re: Fisher Investments - Help a family member leave

Post by columbia »

If you are successful is convincing him to move his assets, it seems like....Fidelity would be a good choice.

I never have any need to call Vanguard, by many here seem to be less than impressed.

The last thing you need is your uncle getting mad at you, after a bad customer service experience.
Last edited by columbia on Mon Nov 26, 2018 5:25 pm, edited 1 time in total.
Jack FFR1846
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Re: Fisher Investments - Help a family member leave

Post by Jack FFR1846 »

1) Name every single fee you charge me. Please put that into dollars per year. Include everything. ER, AUM, trading fees, loads, every other fee.

This alone will knock him off his chair, so perhaps put the chair back against a wall to minimize injury.
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straws46
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Re: Fisher Investments - Help a family member leave

Post by straws46 »

Fisher is a fiduciary and only charges a flat fee based on assets under management. They charge no other fees, so that question won't elicit the response you anticipate. Their flat fee is pretty healthy, however.
Greenman72
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Post by Greenman72 »

https://www.youtube.com/watch?v=G3b5U_zNQXY

I don't know why all the hate. They only do well when you do well, they don't charge commissions, and they don't make sales calls.

What's not to love?
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David Jay
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Re: Fisher Investments - Help a family member leave

Post by David Jay »

Jack FFR1846 wrote: Mon Nov 26, 2018 5:19 pm 1) Name every single fee you charge me. Please put that into dollars per year. Include everything. ER, AUM, trading fees, loads, every other fee.

This alone will knock him off his chair, so perhaps put the chair back against a wall to minimize injury.
For those of you who are mentioning things like ERs and Loads, Fisher Investments typically purchases stock of individual companies for their client's portfolios. They are not big users of mutual funds.

And if I have to say one good thing about Ken Fisher, he hates annuities.
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Re: Fisher Investments - Help a family member leave

Post by MJW »

It may not go the way you think it will. Chances are whoever he talks to has been trained on overcoming objections and is prepared for this sort of conversation, complete with knowing smiles and patronizing head nods. Your uncle having a rudimentary understanding of what to ask based on your coaching will in all likelihood be no match for this advisor. There is probably an equal to better chance he will walk away from the conversation feeling better about Fisher.
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beyou
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Re: Fisher Investments - Help a family member leave

Post by beyou »

psteinx wrote: Mon Nov 26, 2018 5:06 pm That said, for some investors, using an advisor, even a relatively pricey one, may be worthwhile, IF the alternative is worse. i.e. If an individual is one who would otherwise self-manage their finances very badly.
Lifestrategy or Target Date funds can help anyone do better on their own. Dont see how the alternative is ever worse than paying advisor fees, given this option.
moehoward
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Re: Fisher Investments - Help a family member leave

Post by moehoward »

RetireSomeday5 wrote: Mon Nov 26, 2018 4:22 pm My uncle currently uses Fisher Investments. He told me he is going to one of their meetings tomorrow (I assume some additional sales pitch). I want to give him a list of questions to ask and thought the board may have some good ideas.

Here is what I have:

1) What is the expense adjusted return over the last 1, 5, 10, 15 and 30 years spans vs a broad based index fund such as Vanguard Total Stock Index
2) Why are you recommending 100% stocks for someone over 70 years old?


Thanks all
I see these posts about helping other people and friends with their current advisor. IMHO, its a wasterof time. If they want to change they can. Typically, they come back from these lectures and are more hyped up about their advisor than before they left. Fisher (like most of them) are expert at answering any concerns you have.
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Re: Fisher Investments - Help a family member leave

Post by Dottie57 »

straws46 wrote: Mon Nov 26, 2018 5:24 pm Fisher is a fiduciary and only charges a flat fee based on assets under management. They charge no other fees, so that question won't elicit the response you anticipate. Their flat fee is pretty healthy, however.
The fee is charged whether the advisor does well or not for his r her client. Year after year after year.
MittensMoney
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Re: Fisher Investments - Help a family member leave

Post by MittensMoney »

Any questions he asks are going to be answered to perfection, Fisher's people are very good at what they do. If you're serious about him moving his money, ask if he's willing to share the actual data within his account - I expect showing him how much he is paying, and how his investments have compared to what you're doing, will be the strongest argument.
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Doom&Gloom
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Re: Fisher Investments - Help a family member leave

Post by Doom&Gloom »

RetireSomeday5 wrote: Mon Nov 26, 2018 4:57 pm
psteinx wrote: Mon Nov 26, 2018 4:55 pm
RetireSomeday5 wrote: Mon Nov 26, 2018 4:22 pm My uncle currently uses Fisher Investments. He told me he is going to one of their meetings tomorrow (I assume some additional sales pitch). I want to give him a list of questions to ask and thought the board may have some good ideas.
Is there some special reason you think he would be receptive to, or particularly in need of, your criticism (direct or implied) of his financial choices?
Yeah, he asked me what I think since I have a financial background.
Then don't give him questions to ask a salesman; tell him what you think. If that is to stay with Fisher, tell him that. If it is to go full Boglehead, refer him to this site, etc. If it is something else, tell him that.

As others have said, the salesman is adept at maneuvering against a list of questions. It is a losing game for your uncle and will result in him having a false sense of satisfaction.
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Re: Fisher Investments - Help a family member leave

Post by texasdiver »

I happen to live in Camas WA a few blocks from the Fisher Headquarters. This is suburban Portland by the way, we are 20 minutes from downtown Portland when there's no traffic. They moved up here from CA a few years ago to take advantage of Washington's regressive tax structure (all sales tax, no income tax) so Ken Fisher and the other highly compensated executives could reduce their sizeable CA income tax bills. It's a big glass office structure set way back from the road behind a forest of trees and high security gates more reminiscent of a military installation or NSA type building than a typical suburban office building. You can only barely see it from the road in winter when the leaves are gone and no way to get closer and during the summer you can't even see it at all. It's very clandestine. Fisher has been pouring big money into local and state GOP politics so he's become something of a local political lightning rod. Our own local Charles and David Koch if you will.

Our neighborhood is full of Fisher guys...they all seem to be guys, I haven't met a single woman who works there. Best as I can tell it is a reasonably decent place to work and they do very old-school style investing mainly in stocks like an old school Merrill Lynch before they got bought out by BofA. I run into them all the time at social events, dads on my daughters soccer team, that sort of thing. At least they never try to sell to you socially like the Edwards Jones or Amway types so there's that.

They are big on selling their "secret sauce" of stock picks and that sort of thing so very much the opposite of low fee index funds. You pay a hefty AUM fee comparable to a bad 401k and that's pretty much it. You don't get nickeled and dimed with a lot of hidden nonsense like you get with Edward Jones. They aim more for higher-end clients above 500k. The fees are between 1 and 1.5 percent so probably about typical for an actively managed individual stock portfolio. It's definitely the opposite end of the spectrum from the Boglehead approach.

I would think that if you want to sell your uncle on leaving Fisher what you really need to do is sell him on a completely different approach to investing. If all he wants, and is comfortable with, is having his "guy" manage his money then he isn't going to wind up in a much better place if he leaves Fisher. If you can sell him on the boglehead approach then he will leave on his own accord. If not then he's an adult and can make his own decisions. You will have zero chance of making that argument if you are sitting in on a Fisher investment meeting. And you aren't going to catch the Fisher pro in some kind of "gotcha" moment. This is what they do for a living. If it were me in your shoes, I'd take my uncle out for coffee and explain what YOU are doing with your investments and why, what kinds of fees you pay, what kind of results you get. If he is interested he can follow up. If not, he's a big boy.
Klaxton
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Re: Fisher Investments - Help a family member leave

Post by Klaxton »

straws46 wrote: Mon Nov 26, 2018 5:24 pm Fisher is a fiduciary and only charges a flat fee based on assets under management. They charge no other fees, so that question won't elicit the response you anticipate. Their flat fee is pretty healthy, however.
WRONG. Fisher, thru their "custodians such as T. Rowe or Fidelity or America Funds, charge trading costs as well.
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unclescrooge
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Re: Fisher Investments - Help a family member leave

Post by unclescrooge »

psteinx wrote: Mon Nov 26, 2018 5:06 pm OK, so you're an "invited guest", so to speak. :)

How long has he been with Fisher, to your knowledge? What was he doing before that?

Were I in your shoes, I'm not sure I'd be very open-ended about any proposed questions - that just invites further salesmanship from Fisher. Does he really understand the costs involved - in particular Fisher's AUM fee(s), and fund ERs, transaction costs, and tax impacts. [EDIT - What I meant here is, direct questions with reasonably objective answers "What are your AUM fees?" may be more productive to your apparently desired goal (getting him to switch from Fisher) than more open-ended or ambiguous questions.]

I think (not sure of this), that AUM fees have moved, with the late 2017 tax changes, from "often deductible" to "rarely (or perhaps never) deductible". In turn, for a taxable investor, this increases the amount that a portfolio must outperform to overcome AUM fees (if Fisher was even outperforming for him anyways - in any case, it may have increased the effective drag of any AUM fees.)

That said, for some investors, using an advisor, even a relatively pricey one, may be worthwhile, IF the alternative is worse. i.e. If an individual is one who would otherwise self-manage their finances very badly. So how much you may choose to push against Fisher should perhaps depend on how you see this uncle's DIY capabilities, realistically, or, if there is a hand-holding advisor who would be cheaper and/or better.

And keep in mind that any interference on your part may have a negative outcome, if the alternative that the uncle switches to turns out badly ex-post, even if ex-ante it seemed reasonable.
I'm positive Fisher outperformed any reasonable allocation for a 70 year old in 2017. Mainly because stocks did exceedingly well.

The main drawback is their 1.5% fee and 100% allocation to stocks, which is inappropriate for most people who qualify for their minimums and has tax consequences in taxable accounts.
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sperry8
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Re: Fisher Investments - Help a family member leave

Post by sperry8 »

The Wizard wrote: Mon Nov 26, 2018 4:51 pm Questions aren't needed, just facts.
How did Fisher recommended portfolio compare to S&P 500 total return year by year over past decade?
End of discussion...
That's not a fair comparison. They may have the OPs relative in foreign stocks, etc. So one has to look at the proper benchmarks to get a true idea of how Fisher did vs the portfolio. Now Fisher does show their returns against benchmarks however, they use the wrong benchmarks. For example, when I used them they used a World Index without Emerging. At the time emerging was beating foreign as a whole - so their benchmark of choice was artificially low and the Fisher portfolio beat it. But of course it didn't beat a true Global Index with Emerging. When I pointed this out they said that emerging wasn't part of their portfolio a few years prior and they can't just modify their benchmark all the time. They need something consistent. Boggles the mind.

Having used Fisher in the past it wasn't easy to leave. They have very hard sell tactics and make it very difficult on you emotionally to leave (at least they did in my case). Your relative will need more than questions. Their reps are very smart and will talk circles around people who are not quite prepared.
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aspirit
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Re: Fisher Investments - Help a family member leave

Post by aspirit »

David Jay wrote: Tue Nov 27, 2018 1:17 pm
Jack FFR1846 wrote: Mon Nov 26, 2018 5:19 pm 1) Name every single fee you charge me. Please put that into dollars per year. Include everything. ER, AUM, trading fees, loads, every other fee.

This alone will knock him off his chair, so perhaps put the chair back against a wall to minimize injury.
For those of you who are mentioning things like ERs and Loads, Fisher Investments typically purchases stock of individual companies for their client's portfolios. They are not big users of mutual funds.

And if I have to say one good thing about Ken Fisher, he hates annuities.
I Disagree! Wholeheartedly!
Ken Fisher is a salesman, period!

I do not care what some salesman on Fisher Investment adds lie about. 20yrs 'ish ago all FISHER INVESTMENTS sold was annuities, annuities, and more annuities.
I suspect they've modified their business model to stay feasibly competitive.

I'd also suspect anyone seriously considering FISHER INVESTMENTS will be introduced to annuities in their sales pitches first contact as annuities are now ONLY AVAILABLE as a specialized option(for the qualified*). Everyone like to think their qualified*. Citing mutual and index funds are for anyone else. Humans being the creatures they are most want specialized options and becoming qualified* for creating additional personal wealth, certainly more than the masses in mutual & index funds. :wink:


I do not care if or how they've(FISHER INVESTMENTS) manipulated their wiki information.
Over >20yrs ago all they sold was annuities, my aunt purchased one back then and I'd researched their products.
Last edited by aspirit on Wed Nov 28, 2018 6:01 pm, edited 1 time in total.
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mhalley
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Re: Fisher Investments - Help a family member leave

Post by mhalley »

Doesn’t Ken say he’d die and go to hell before he would sell an annuity? Yet he invest heavily in cos that sell them.

https://www.investmentnews.com/article/ ... -companies
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Re: Fisher Investments - Help a family member leave

Post by Righty »

RetireSomeday5 wrote: Mon Nov 26, 2018 4:57 pm Yeah, he asked me what I think since I have a financial background.
And you can only come up with two questions?
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Re: Fisher Investments - Help a family member leave

Post by sabhen »

Dottie57 wrote: Tue Nov 27, 2018 1:53 pm
straws46 wrote: Mon Nov 26, 2018 5:24 pm Fisher is a fiduciary and only charges a flat fee based on assets under management. They charge no other fees, so that question won't elicit the response you anticipate. Their flat fee is pretty healthy, however.
The fee is charged whether the advisor does well or not for his r her client. Year after year after year.
yup. Portfolio returns come and go. But (high) fees are forever.
EnjoyTheJourney
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Re: Fisher Investments - Help a family member leave

Post by EnjoyTheJourney »

The following might work.

Walk him through a simple way of comparing investment returns on a theoretical Boglehead portfolio, set up in an excel worksheet. Then ask him to plug in his own numbers (with or without you present, it's his money and his choice). Then he can look at the final figure in his portfolio and see how well a Boglehead portfolio with similar monetary inputs and timing did when compared to his Fisher portfolio. Let him know that he can do that same calculation over and over, just by adding in the most recent data to what he already has on hand. Then have a conversation about risk, so he has the importance of risk-adjusted returns in mind.

Then let him know that if he wants to talk about alternatives to Fisher Investments then he's welcome to do that.
NotWhoYouThink
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Re: Fisher Investments - Help a family member leave

Post by NotWhoYouThink »

Most of these "Should my family member stay with a high cost advisor or become a boglehead like me?" threads have more to do with asset allocation than investment costs. When you pay for a managed portfolio, you are outsourcing the asset allocation decision. Your advisor chooses the risk level. Those who have had equity-heavy portfolios for the last 9 years have done splendidly well, even net of fees, because they took on risk. They may have thought they were not taking on risk because the advisor's superior investment picking skills was protecting them, but regulars on this forum know they were taking on risk. And they've probably made money.

So what to do about it? Maybe nothing. What would your relative do if left to his/her own devices? Probably not spend hours reading through the wiki and posting questions on this board. Probably your relative would fearfully pick something, anything to get the decision over with, then either ignore the portfolio or agonize over it. Is that better?

If the relative can be persuaded that the advisor is adding not just cost but risk and will be satisfied with an all-in-one fund, there may be something useful to do. But people making bad investment decisions are generally no more open to advice than people making bad fashion or body art or life partner decisions. Smile and nod.
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