Morgan Housel: Investors Have No Idea What They're Paying

Matt Trogdon and Morgan Housel talk investing.

Sep 2, 2014 at 9:41AM

"For a lot people, even if you're just moderately wealthy, one of your biggest annual expenses ... is financial fees. And people are totally clueless about it."

That's what Motley Fool columnist Morgan Housel tells host Matt Trogdon in the latest episode of Out On a Limb. It's a theme Housel touched on in his recent column, "Finance is a Strange Industry."

Housel noted the danger average investors face because they don't understand how financial fees work. "A lot of people think they're paying no fees at all because they don't get a bill," Housel says. "But they're paying thousands and thousands of fees that are just being deducted from their assets."

Housel recommends that investors read through the documentation they get from their financial managers in order to get a handle on how much they're paying.

Watch the video below for more of Housel's insights on how investors should handle daily stock market updates.

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A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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