Evolution of Retail Investment Management: Automatic for the people.

Time for some reflection. Here is my broad-stroke analysis of the retail investing landscape’s history.

1970s – Individual stock picks @ 4% commission per side from your broker. Ouch.

1980s – Individual mutual fund recommendations from your broker for a 5% load.

1990s – DIY fund/security selection from online trade stations. No more 5% to 8% hits.

2000s – Realizing you need asset allocation advice from an RIA @ 1%.

2010s – Fintech automates asset allocation advice, passive takes hold.

2020s – What is still missing? Lots. The important stuff.

So for the past 45 years, there has been a dramatic reduction in fees associated with many of the “clerical/administrative” pieces of your financial puzzle. Computerization has really provided a big boost to the average investor in doing simple repetitive tasks.

In fact, with Fintech (Internet based financial tools) we are starting to see some progress on strategic issues as opposed to just administrative issues.

So where do we go from here?

The issues that have large impacts on your financial well-being have not really been tackled yet. I’ve listed some of the most important pieces of your financial plan below. Unfortunately, the solutions demanded involve interactions with other humans. You will have to pay for quality coaching. The internet is not going to cut it. Luckily for me, people still have a place in investment management.

  • Comprehensive Wealth Management Services. (savings strategies, tax planning, estate planning, evidence-based investing. Spending Strategies.)
  • Coaching – Implementation Slippage Minimization (ISM – my term) – ensures you execute the plan you have put to paper.
  • Decumulation Strategies – Accumulation is easy. Just do it. Save until it hurts! Not so for spending. There is greater variability in retirement spending preferences than there is in retirement accumulation strategies. You will need a personalized plan.