I always think it is dumb to hand money over to someone and let him/her do whatever that s/he wants to do to invest with that money. As far as I'm concerned, this is especially true if these people don't even know the track record of the "advisers" handling their money. Fact is no one has more interest in that money than the owner.
I'm a big proponent of passive investments such as the Total Market Index Fund and the S&P 500 Index Fund at one of the discount brokerage firms that does not charge a commission to buy in and has very low expense ratios. Another important fact is there is little to no buying and selling of the stocks these index funds hold. So the investor pays less tax. Actively managed mutual funds have lots of buying and selling, therefore, they generate lots of short-term capital gains that are taxed at ordinary income tax rates.
http://blogs.wsj.com/moneybeat/2014/07/11/financial-advisers-show-us-your-numbers/
I'm a big proponent of passive investments such as the Total Market Index Fund and the S&P 500 Index Fund at one of the discount brokerage firms that does not charge a commission to buy in and has very low expense ratios. Another important fact is there is little to no buying and selling of the stocks these index funds hold. So the investor pays less tax. Actively managed mutual funds have lots of buying and selling, therefore, they generate lots of short-term capital gains that are taxed at ordinary income tax rates.
http://blogs.wsj.com/moneybeat/2014/07/11/financial-advisers-show-us-your-numbers/
