I have to say, I share your cynicism to a large degree. And it’s my belief that we can create a better way that led me to start Clarifinancial. Is it perfect? No, it’s still missing some functionality. But for most people, it beats the heck out of any other method of buying life insurance because it forces goal-focused objectivity where there might not otherwise be any and it takes the labor away from those who would.

I followed with great interest your “conversation” with John.

Your experience with Merrill Lynch is not at all unique. In fact I wrote “Pity the High Net Worth” based on the real story of a Merrill victim.

As to you question “why should I pay 1% …”, you should not if you read Mike’s book, follow Bogleheads forum and use Vanguard mutual funds. Like John, i am a fee-only advisor. I found I add the most value to those who neither have the time or the interest to do what you are doing. I belief the value I add justify what i charge …

1. I keep them away from Merrill Lynch and the likes.
2. I help them become a better investors.
3. I make sure other aspects of their financial life are taken care of.

Lastly, I can second John’s recommendation of the Garrett Planning Network. Planners in the network are hourly fee only. I also know a couple planners in the network, all upright people.

Michael Zhuang

I’ve found Steve doesn’t necessarily share our belief in passive investing, but he is very well read. It is nice to follow what he reads.

Michael

I happen to enjoy reading academic papers. I try to disseminate some of those information in my blogs: http://www.investment-fiduciary.com

Other than you, I’ve found several other bloggers who keep a close eye on academic research as well, like Larry Swedroe and Steve LeCompte.

http://moneywatch.bnet.com/investing/blog/wise-investing/
http://cxoadvisory.com/blog/

Michael Zhuang

Disclosure – I am not a member of the Garrett Planning Network, but I’ve met many of them in my work with the Financial Planning Association. They mostly have their hearts in the right place and while most don’t have my behavioral finance background, they are more than qualified to render an honest opinion.

What is saddest to me is that it is almost impossible for the average person to tell the difference. The big name, well known firms (who all operate like you experienced) spend big bucks to make you feel that they are trustworthy … but don’t you dare take their word for it. It is pure advertising hype.

If you use a financial advisor – and with a good one you can do better than you can on your own – make certain they adhere to the fiduciary standard and it is in writing. And as Russ says, “understand and be comfortable with [their self interests] and the motivations associated with it.”