Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
The Caller said he was considering investing in a fund with a 4.65% load?
Old 01-09-2016, 09:47 AM   #1
Thinks s/he gets paid by the post
 
Join Date: May 2014
Posts: 1,048
The Caller said he was considering investing in a fund with a 4.65% load?

Today, Saturday morning I'm shaving and listening to a nationally syndicated investment/retirement show... The Caller said he was considering investing in a fund with a 4.65% load?
I would have said are you kidding? Why would you ever buy a load fund. Objective study after study has shown that generally is only good for the guy pushing the load? (You do know the load goes to the salesman right?). The advisor doesn't say word one about the load.

The show guy does what ever he can to get you to call him off air so his people can sell you something with fees, fees fees. I find it vulgar.


Sent from my iPad using Early Retirement Forum.
__________________

__________________
rayinpenn is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 01-09-2016, 10:20 AM   #2
Thinks s/he gets paid by the post
 
Join Date: Feb 2014
Posts: 1,049
I remember when loads were 8.5% on a lot of funds. I always said to myself who would buy such a fund? Well I guess brokers need to eat and have nice cars.
__________________

__________________
jim584672 is offline   Reply With Quote
Old 01-09-2016, 10:26 AM   #3
Thinks s/he gets paid by the post
DrRoy's Avatar
 
Join Date: Dec 2015
Location: Michigan
Posts: 1,714
Why not flush 4.65% down the toilet? How about putting it on the fire? There are so many options.
__________________
"The mountains are calling, and I must go." John Muir
DrRoy is offline   Reply With Quote
Old 01-09-2016, 10:35 AM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Apr 2013
Posts: 5,565
IIRC, American Funds who only sells their loaded retail funds through advisors is still number 3 in AUM.
__________________
MRG is online now   Reply With Quote
Old 01-09-2016, 10:35 AM   #5
Thinks s/he gets paid by the post
 
Join Date: May 2014
Posts: 1,048
I couldn't sell load funds ...wasting good trusting folks precious retirement funds. God has something special planned for those folks.

Similarly
My wife takes the family car into Toyota for an oil change and new battery (battery is years old and I don't want to risk it). The dealer checks the battery and says yeah it need to be replaced. Then he wants me to have my vents cleaned - mold and mildew you know - he wants to clean the throttle body too.. I say no thanks. I have had cars now for 40 years never once cleaned the vents... Scam? Yeah I'll clean the throttle body when the car has a need.

Seems all they want to do is pad the bill.


Sent from my iPad using Early Retirement Forum.
__________________
rayinpenn is offline   Reply With Quote
Old 01-09-2016, 10:39 AM   #6
Thinks s/he gets paid by the post
target2019's Avatar
 
Join Date: Dec 2008
Posts: 3,705
I ask the dealer to print out the estimate for add on work. Drive to auto parts store and get the filters and blades. Then just install parts on a nice day.
__________________
target2019 is offline   Reply With Quote
Old 01-09-2016, 10:39 AM   #7
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 8,804
Quote:
Originally Posted by jim584672 View Post
I remember when loads were 8.5% on a lot of funds. I always said to myself who would buy such a fund? Well I guess brokers need to eat and have nice cars.
I remember when my 401k (small employer) only offered funds with 5-8% loads. Fortunately, that was a shorter term job (less than 2 years) so I wasn't stuck in those funds very long - and able to roll them out.

I had a post here several years ago - DH's 401k had loads ranging from 3.5-5%. But to get the match - you needed to participate.

I hate loaded funds.
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 7%, rental income 18%
rodi is offline   Reply With Quote
Old 01-09-2016, 10:52 AM   #8
Thinks s/he gets paid by the post
DrRoy's Avatar
 
Join Date: Dec 2015
Location: Michigan
Posts: 1,714
Quote:
Originally Posted by rayinpenn View Post
My wife takes the family car into Toyota for an oil change and new battery (battery is years old and I don't want to risk it). The dealer checks the battery and says yeah it need to be replaced. Then he wants me to have my vents cleaned - mold and mildew you know - he wants to clean the throttle body too.. I say no thanks. I have had cars now for 40 years never once cleaned the vents... Scam? Yeah I'll clean the throttle body when the car has a need.

Seems all they want to do is pad the bill.


Sent from my iPad using Early Retirement Forum.
I had a similar experience 20 years ago. I took my 2 year old car to a place that advertised a good rate for an oil change. While the car was there, I get a call and they say that the hoses and belts need to be replaced for a couple hundred bucks. I said no and never went back there. I had the car for 8-9 more years and never needed to replace any hoses or belts.
__________________
"The mountains are calling, and I must go." John Muir
DrRoy is offline   Reply With Quote
Old 01-09-2016, 12:30 PM   #9
Recycles dryer sheets
 
Join Date: Mar 2008
Posts: 103
A few years ago, I interviewed a financial planner. He said that he charges 2-4% to manage a portfolio. When I told him that I doubted he could beat my cheap index funds, he waffled and I walked out. No thanks! It's just not that difficult.
__________________
frank2009 is offline   Reply With Quote
Old 01-09-2016, 01:04 PM   #10
Thinks s/he gets paid by the post
 
Join Date: Feb 2014
Posts: 1,049
I think these load funds are such a rip off, however. if a person has decided not to do any homework, and they agree to it, they get what they deserve.
__________________
jim584672 is offline   Reply With Quote
Old 01-09-2016, 02:58 PM   #11
Full time employment: Posting here.
GalaxyBoy's Avatar
 
Join Date: Jul 2009
Location: The Beautiful Blue Ridge Mountains
Posts: 846
My EX-employer's 401k SDBA touted many funds that had no transaction fees. Of course, they were all load funds. Including index funds with 4%-5% loads.

I chose a Vanguard ETF since mutual funds not on the list had a $50 fee per transaction. Would've gotten a bit pricey over 26 pay periods per year.

Perhaps it goes without saying the alternatives in the base 401k account were unacceptable as well.
__________________
GalaxyBoy is online now   Reply With Quote
The Caller said he was considering investing in a fund with a 4.65% load?
Old 01-09-2016, 03:41 PM   #12
Thinks s/he gets paid by the post
 
Join Date: May 2014
Posts: 1,048
The Caller said he was considering investing in a fund with a 4.65% load?

Quote:
Originally Posted by GalaxyBoy View Post
My EX-employer's 401k SDBA touted many funds that had no transaction fees. Of course, they were all load funds. Including index funds with 4%-5% loads.

I chose a Vanguard ETF since mutual funds not on the list had a $50 fee per transaction. Would've gotten a bit pricey over 26 pay periods per year.

Perhaps it goes without saying the alternatives in the base 401k account were unacceptable as well.

How to run most American companies
1) pay as little as possible to all but the top 5/10/100
2) always choose the cheapest alternative
3) cut benefits and rationalize it by stating it is the industry standard
4) focus on short term planing
5) don't pay for training
6) provide needlessly costly/ underperforming 401k investment options because he's a golf buddy.
7) tout the ceo as the great messiah even if the stock price hasn't moved and he/she lost billions on bad decisions.

Tell your employees they work for a special great company and don't ask if they agree or explain why? (By the by they know it isn't true)



Sent from my iPad using Early Retirement Forum.
__________________
rayinpenn is offline   Reply With Quote
Old 01-09-2016, 03:52 PM   #13
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,880
Evidently 4.65% is the cost of financial ignorance.
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 01-09-2016, 07:16 PM   #14
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,411
IMO anyone who buys a load fund is a fool.

While it is tempting to add that anyone who sells a load fund is a thief... this is still a free country.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
The Caller said he was considering investing in a fund with a 4.65% load?
Old 01-09-2016, 07:52 PM   #15
Recycles dryer sheets
 
Join Date: Nov 2013
Posts: 355
The Caller said he was considering investing in a fund with a 4.65% load?

Unfortunately I was one of those fools. :-(


Sent from my iPad using Tapatalk
__________________
jabbahop is offline   Reply With Quote
Old 01-09-2016, 08:30 PM   #16
Thinks s/he gets paid by the post
Souschef's Avatar
 
Join Date: Dec 2015
Location: Santa Paula
Posts: 1,177
I had a trust where I could withdraw 5% of the principal every year. The lawyer who set it up said in 20 years you will have withdrawn it all. That is why he is a lawyer not a CPA
My wife was rolling over a 10 year annuity, and the guy said if you roll it over we give you a 9% bonus. I looked at the small print, and the service charge was higher if you took the one with the bonus! By year 8 you were in the hole
Last Year I was switching funds and I had a choice of a load or no load option. The broker said the service charge on the no load fund was higher, so I ran a spreadsheet, and found you would never make back the money paid in the load,even with the lower service charge. I told the broker that and they were amazed.
__________________
Retired Jan 2009 Have not looked back.
AA 95%/0/5
WR 2% SI 2SS & 2 Pensions
Souschef is online now   Reply With Quote
Old 01-10-2016, 01:47 PM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,880
Quote:

The broker said
This may be the root of your difficulties.
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 01-10-2016, 01:52 PM   #18
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
travelover's Avatar
 
Join Date: Mar 2007
Posts: 9,877
Quote:
Originally Posted by Souschef View Post
........I told the broker that and they were pretended to be amazed.
Fixed it for you
__________________
Yes, I have achieved work / life balance.
travelover is offline   Reply With Quote
Old 01-11-2016, 09:34 AM   #19
Recycles dryer sheets
Bryan Barnfellow's Avatar
 
Join Date: Feb 2004
Location: Switzerland
Posts: 338
In my first year of marriage in 1985 I hired the husband of a w*rk colleague do our taxes. The tax guy recommended a friend of his who could advise us on investing. Wow..me an investor, with actual investments! My ego was rising to the stratosphere.

So, the advisor met with us and presented a rosy scenario of about 12% annual growth using funds he could get us into. Reading over the brochures that evening I noticed some fine print about fees. I was trained as an economist in grad school, so numbers weren't difficult, but I started to learn about new concepts such as loads, marketing fees, after tax performance, etc. Wow, did we look THAT stupid? So, I sent a note saying we weren't interested. A week later, My colleague said that her husband's friend just couldn't figure out why I was passing up such a great deal. I determined that year to always do my own investing and my own taxes!

Skip ahead 30 years. In April of 2015 my wife and I retired (in Switzerland no less) on income from our home made portfolio. We have had to hire tax accountants however to navigate the US and Swiss tax declarations -- we have to file and pay in both countries. It just too complicated, especially when one isn't in English.

-BB
__________________

__________________
FIREd, April 1, 2015. My Retirement Benefits Package includes: 6 months vacation, twice a year.
Bryan Barnfellow is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Scam Call? Caller ID said "US GOVT" BBQ-Nut Other topics 53 06-15-2015 12:30 PM
Front-load mutual fund O2Bfree Stock Picking and Market Strategy 32 03-16-2015 08:11 AM
Caller ID and Privacy tangomonster Other topics 28 06-09-2008 11:59 AM
Caller ID Strangeness TromboneAl Other topics 10 10-24-2007 10:03 AM
Washer:Front load versus Top Load gwix98 Other topics 11 12-09-2006 03:39 PM

 

 
All times are GMT -6. The time now is 10:04 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.