I actually thought you were very fair considering the subject is filled with heated arguments either way. I think the problem with financial gurus, or even amatuer bloggers, is that they forget some people just have no interest in learning about “this world.”

It is an often used analogy but could I save a ton of cash if I did my auto repairs, yes, but there is zero chance of that. So I hire an expert, maybe he gets paid hourly (then why would he want to rush the job? this would be akin to the mutual fund expenses) or maybe he gets paid by the job (i.e. just like the fees).

Regardless, great post.

My only point is that before you can decide whether or not to use a given advisor, or whether or not to take their advice, you absolutely must know all of the different ways he or she is being paid.

Seriously, don’t you even make room for the idea that there are folks out there who really want to do what’s best for their clients and thus build a business based on trust and respect? What about those who choose to offer a choice of commission based investments to young couples just starting out and only contributing 50 or 100 dollars per month – thus saving them money over an advisory account?

What about brokers who are driven to find the best deal for their clients because they believe they’ll only stay in business if they can consistently prove they’re doing more than the next guy? Or fee-based advisors who don’t bother doing any research at all because they’ll get paid in any case?

Sure there are some criminals out there who put on the nametag “advisor” every day, but I believe there are dozens or even hundreds of good and responsible financial professionals for every greedy bastard.

And you’re absolutely right about bonds: Most investors have no idea that a pretty juicy commission comes with a bond sale.

Anyway, as far as the financial adviser issue goes, it seems like a lot of the commission problems are solved by going with someone who gets paid a fixed fee instead of a commission.