The impact isn't a direct reduction of the WR by the amount of the FA fee... it is a 1% reduction in net investment return... the impact on WR is about 0.5% for a 1.0% increase in expenses.
Take Firecalc with default assumptions, change stock from 75% to 40% and solve for spending at 95% success... result is $29,583 or 3.94% WR. Then change fees from 0.18 to 1.18 and recalculate... result is $25,986 or 3.46% WR.
Yes, that’s the way to accurately model the effect on how it lowers the SWR.
Yes, my earlier 'static model' is true for a portfolio that maintains its buying power over time. In that case, the 1% is a constant, inflation adjusted hit to the portfolio.
When you plug it into FIRECalc, with a 1% higher fee, and investigate for success rates, you are measuring the effect on a dwindling portfolio that goes to zero. For me, it would be cold comfort to say that the draw from fees wasn't so bad as thought, because it caused my portfolio to drop faster than DIY, and therefore the fees went to zero too!
Also, if you care about heirs, that money is gone, regardless of your success.
Another view - 100% safe for 40 years was a $33,413 initial withdraw, with the default 0.18% fee. But draw the same, with a 1.18% fee, and success drops to 92.6% with a max minus 574K balance (although negative balances may not accurately reflect reality - I think the negative gets multiplied by stock returns).
You're not telling him/her they can't trade. You're telling them they can't trade without telling you their plans in advance. ....
Even for an FA who you have directed to be an active trader in your behalf, there should be some written guidelines he/she must stay within.
Or maybe I'm just a control freak.............
Well, it was the money you earned, scrimped and saved for, and invested carefully - I think you should be in control of it!
-ERD50