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Does The 4% Retirement Income Rule Still Work For Retirement?
https://www.youtube.com/watch?v=FYaZ-QyUEaU If you don’t know what the 4% rule is, allow me to briefly explain. The 4% rule is a rule of thumb that says 4% of your retirement account is what you can safely spend each year with the likelihood that you will not run out of money in your lifetime. In fact, the original expectation was that [...]
How To Retire Early In Rockford Illinois?
As a Financial Advisor I talk to people every day who have a strong desire to retire early. But this is a difficult goal for many and there is much to consider. One common fear people have about retiring early is running out of money. To watch a short video that can potentially help you avoid running out of money [...]
Can Your Banker Cut You Off? Chase Bank Recently Just Did Exactly That Due To COVID-19
There is an old adage that says, “A Banker is a fella who will lend you his umbrella and then ask for it back when it starts to rain!” Now you might find that saying amusing unless it happens to you. And the risk of this happening may be more prevalent and possible now than in times past. Read on [...]
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Helpful Glossary
The Four Financial Advisor Business Models And How They Charge You
The Stock Broker
The Stock Broker business model is one where the Advisor does not charge you ANY fees at all and simply gets paid a commission for selling you a particular investment.
Mutual Fund / A Shares
Product may charge a Front end load of 3.75% to 5.75% on Average* as an upfront off the top charge in addition to annual management fees of about 1.44% per year**
Variable Annuities
Typically don’t carry a front end charge but in addition to annual management fees usually around 1% they may also charge a Surrender Charge of 6% or higher decreasing over a period of years if you take all of your money out.
Mortality and Expense Fees
Most Variable annuities also charge a fee for Life Insurance that can tack on an additional 1% per year or more on top of the other mentioned fees.
The Insurance Agent
The Insurance agent business model works very similarly to the Stock Broker Model above. The Insurance agent Advisor does not charge you ANY fees at all and simply gets paid a commission for selling you a particular Insurance Product.
Fixed Annuities
Most have a back-end surrender charge that decreases over a period of years. You only pay this charge if you take all of your money out early or withdraw more than the allowed percentage in a given year. Typically you have access to 10% without a fee.
- NOTE: Unlike Variable Annuities Fixed Annuities typically don’t have ANY front end or ongoing annual management fees or life insurance costs built in.
- Life Insurance: Most life insurance plans charge Front end fees and back-end fees as well as ongoing costs to cover the charge for the death benefits.
The Fee-Only Advisor
A Fee-only Advisor business model is one where the Advisor charges a fee for advice or for managing money.
The Hybrid Advisor
A Hybrid Advisor is a business model that is a blend of two or more of the business models above.