Money Matters

Last Week Tonight with John Oliver: Retirement Plans & Financial Advisors

22 Jun 2016 by: jhurley 

Recently a late night show on HBO took on the subject of financial advisors and retirement plans.  Last Week Tonight with John Oliver, a witty British host known for his sarcasm and sharp tongue, mercilessly exposed many of the problems in the financial services and retirement plan industry.

Mr. Oliver is right – there are many problems in the financial services industry.  Fortunately, as a firm, CCMI has built its reputation on the premise that clients deserve honest, transparent, low cost solutions to their financial planning and investment management needs.  CCMI acts as fiduciary to our clients, meaning that we are required to put our clients’ interests above our own. This is something that John Oliver noted is the first thing anyone should ask of their advisor.

Below is a quick summary of the comments made in the 20 minute segment and how CCMI’s service model compares to the perils that Last Week Tonight cautions against:

Last Week Tonight urged consumers to… The CCMI Approach…
Seek advisors who are Fiduciaries. We are Fiduciaries to all of our clients, and we support the fiduciary requirement.
Ask your advisor how they are paid. We are only paid from our clients and do not earn commissions.
Don’t pay high fees to an advisor because fees erode your returns. At most, CCMI’s investment management fees are 1%; our average client fee is much less than 1%.  All of our fees are disclosed and identified in our disclosure statement and on quarterly reports that we send to our clients.
Don’t use investments that have high fees, often over 1.5%. Our investments average an expense ratio of 0.43%.
Be cautious of annuities. We do not sell annuities or any financial products.
Beware of actively managed funds that have high fees. We primarily use funds that are evidence- based, track an index, and are more passive than high cost active funds.  Where we do use actively managed funds, fees are a consideration when we evaluate the fund.
Beware of Financial Advisors without credentials – anyone can say they are a “Financial Advisor”. Our advisors have all earned the CERTIFIED FINANCIAL PLANNERTM
(CFP®) designation, which requires years of preparation and a comprehensive exam. In addition, they comply with the continuing education requirements set by the CFP Board.

Due to the language and tone of this HBO segment, we have not provided a link to it in this blog, but if you’d like to see it simply Google “John Oliver Financial Services Industry” to watch the 20 minute segment on YouTube.  It was broadcast on June 13, 2016.  It is quite funny and on point, but some viewers may find the language and jokes offensive.

CCMI provides personalized fee-only financial planning and investment management services to business owners, professionals, individuals and families in San Diego and throughout the country. CCMI has a team of CERTIFIED FINANCIAL PLANNERTM professionals who act as fiduciaries, which means our clients’ interests always come first.
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