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MY LIFE AS A CLIENT
Mike Gnitecki Photo by Angela Duncan Photography

My Life as a Client: Internet Expert

To learn what everyday clients really think about their advisors, and what all advisors can learn from them, we talked to Mike Gnitecki, 33, a paramedic and firefighter in Longview, Texas.

I’ve tried out a few advisors over the years. It seems like they’ve always tried to steer me into investments that turned out to be subpar after I researched them online. Like, I’d check the long-term return history and it would be worse than the overall market performance. And I’d find they had load fees or a high percentage of assets fees. My thought process is that they’re receiving a kickback or a commission of some kind.

My first experience was about 3 years ago at a big bank. I had opened an account there and they asked about my assets. When I discussed the 401(k) I had from a previous job, they suggested I talk to the advisor working at the bank, so I did. She wanted to invest in an odd mix of funds—to steer a certain amount of my portfolio into bonds and another part into a higher risk investment fund with potentially higher returns. I asked her for the names of the funds and did some research when I got home. I was surprised to see that the return over the past 5 to 10 years was below the S&P. We went back and forth for about a month. But, I thanked her for her efforts and decided not to invest at that time.

The next time was a group at an investment firm I was referred to by a friend. I don’t know if there was some kind of referral arrangement. I thought, “sure.” I’ll always talk to any advisor if it’s not going to cost me anything. But I didn’t like them at all. They seemed to take an emotional approach: Are you ready for retirement? We want to make sure you’re ready. When I tried to get hard numbers out of them, it was difficult to obtain that information. I’d ask specific questions and they wouldn’t want to answer. It was just a very sketchy process. I met with them one time in person and talked twice on the phone.

The thing that really made me think, “Man, I’m not giving them any money,” happened on the last call. I was asking all these questions about expense ratios and fees. At one point, I told them what my expense ratio was on the S&P index funds I’ve been investing in and that I wanted to be able to compare. That’s when they said: “Maybe you’re not the right client for us right now.” It was surprising. Overall, I was more informed than they expected me to be.

The biggest thing that’s helped me is an online forum called Bogleheads.org. I started looking at it in 2016, after my previous efforts. Bogleheads has a lot of people in a higher income bracket. They make much more than me, and they almost exclusively use index funds. I had started to investing in index funds in 2009 when I started a new job where they only offered an annuity-based retirement fund. I don’t know much, but I know that’s not the best idea. So I asked my present HR if they could add T. Rowe Price. She actually did, and I started to put my money in their index funds. My experience with them has been very good.

Really, it’s kind of frustrating to see what goes on with advisors. If you contact, say, an attorney, under the law the individual has to work in your interest. But these financial advisors, it seems like they often serve themselves at the expense of the client. That’s just the way I view it.

Read more My Life as a Client stories like this one.

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