Managing Investment Accounts

The Federal Trade Commission fired off a warning shot to all apartment and single-family rental operators this week: Advertise your all-in pricing (with mandatory fees included) or the FTC "will not hesitate to take action" against you. Here's the background: Last week, the FTC reached a $24m settlement with Greystar that mandates Greystar "clearly and conspicuously display total monthly leasing prices and mandatory fees." (The settlement contains no admission of wrongdoing, but importantly provides clarity where clarity has been lacking.) Then, two days ago, the FTC posted a follow-up on its blog. The letter made it clear that the FTC will apply the same all-in pricing standard to everyone in rental housing -- not just Greystar. Furthermore, the FTC said it expects rental housing owners and managers will ensure all third-party partners (i.e. listing websites) display all-in pricing. Some key points from the FTC's warning: 1) "Know that advertising a rental price that excludes mandatory charges is a violation of the law. So advertise the total cost of renting your unit up front." 2) "Do a thorough compliance check. Review your website and advertisements to confirm they honestly advertise a rental’s price, including any mandatory fees at the property. That includes working with your third-party vendors to make sure they’re accurately advertising the rental price on all their platforms." 3) "Know that the FTC is reviewing harmful practices in the rental housing market and will not hesitate to take action against landlords taking advantage of Americans’ housing needs by hiding mandatory fees." Disclaimer: I'm no lawyer, and this isn't legal advice obviously. But if you're not already discussing this with your company's attorneys, you probably should. While I'm not a fan of legislation through litigation (particularly against a longstanding common practice, and ambiguity around how "fee transparency" is defined given that fees are often included on listings), the end result here provides a win for all parties -- renters and housing providers alike. And that's clarity. For housing providers: Clarity helps even the field. The lack of clarity has allowed your competitors to advertise base rents absent fees. So if you chose to advertise all-in prices, you risk turning off prospective renters who think you're pricier -- even when you're not when fees are included. For renters: Clarity helps expedite the search process. If the inclusion of fees makes a property unaffordable that otherwise would be affordable, it's helpful to know that upfront prior to spending time on an application. Clarity of rules allows for apples-to-apples comparisons of rental properties, and that's a win/win for operators and renters. #renters #fees #ftc

What if a tiny 0.2 % fee could add ₹2 lakh to your retirement corpus? → Expense ratio measures the annual cost of managing a mutual fund expressed as a percentage of assets. In India the average equity mutual fund expense ratio is about 1.5 %. A fund with a 1 % expense ratio charges Rs 10,000 per year on a Rs 10 lakh investment. → Lower expense ratios are linked to higher long‑term returns because fees compound over time. Data from the AMFI shows that funds in the lowest expense‑ratio quartile outperformed the highest quartile by roughly 1.2 percentage points annually over ten years. Passive index funds typically have expense ratios below 0.2 %. → Even a 0.5 % reduction in expense ratio can increase the final corpus by about Rs 2 lakh after twenty years on a Rs 10 lakh SIP. Investors should compare expense ratios alongside performance when selecting a fund.

For years, consumers have faced frustration when purchasing tickets to live events. Hidden service fees, venue charges, and other “junk fees” often inflate the final cost, making it difficult to compare prices and budget effectively. In fact, the Council of Economic Advisers estimate that event ticketing junk fees cost consumers a staggering $7.14 billion in 2023 alone. In response, the FTC has introduced the Trade Regulation Rule on Unfair or Deceptive Fees. This rule is designed to increase transparency in ticket pricing by eliminating “bait-and-switch” tactics and mandating upfront disclosure of the true cost of live-event tickets. With the FTC set to begin enforcement 120 days after publication in the Federal Register, here’s what concert venues, ticketing platforms, and music promoters need to know to stay compliant: 1. The Total Price Must Be Disclosed Upfront: The rule mandates that ticket sellers—whether primary platforms like Ticketmaster and AXS, or resale marketplaces like StubHub and SeatGeek—must display the total price of a ticket upfront. This total price includes the base cost plus all mandatory fees, such as service charges, venue fees, and processing costs. Importantly, the total price must be more prominent than any partial or base price. For example, if a ticket costs $50 but includes $15 in mandatory fees, it must be advertised as $65 total from the start of the purchasing process. This provision directly targets drip pricing, where fees are progressively added during checkout, a practice the FTC has identified as deceptive and harmful to consumers. Compliance will require updates to systems and user interfaces to ensure total costs are displayed clearly and prominently, replacing the practice of advertising artificially low base prices. Failure to comply could result in significant civil penalties under the FTC Act, with steep fines for each violation. 2. Misleading Fee Descriptions Are Prohibited: The rule also bans misleading fee descriptions that can confuse or mislead consumers about the nature or purpose of charges. The FTC now explicitly prohibits vague or deceptive terms like “service fee,” “convenience fee,” or “processing charge” unless they are clearly explained and accurately reflect their purpose. The concert industry must be transparent about the services tied to these fees and cannot mislabel operational costs as “government charges” or taxes unless they are directly mandated by law. This provision also distinguishes between mandatory fees—which must be included in the upfront total price—and optional fees, such as add-ons or upgrades, which can be displayed separately but must still be clearly disclosed before purchase. For example, fees described as “facility charges” or “venue maintenance” must genuinely reflect venue-related expenses. Any inconsistency between the name of a fee and its actual use could be considered deceptive and trigger regulatory scrutiny.

It has been great collaborating with the World Economic Forum on the dialogue to systematically improve the #financialservices industry, and more specifically, to advance wealth management business models to serve clients better. Proliferating properly aligned, “fee-only” conflict-free wealth management will always be core to our mission at Endowus. While awareness of fee-only business models is broad in many markets like the US, UK, Switzerland, Canada, Netherlands, Australia and others, it is nascent in Asia. Even in the wealth hubs of Singapore and Hong Kong, very few firms practice fee-only, and very few clients understand how this positions them for aligned success. A fee-based incentive system is the way to ensure alignment between financial advice, recommended products, and client goals. This is why #Endowus innovated a 100% cashback on trailer commissions - to not only reduce costs for clients, but to ensure that we are serving the clients that pay us, and not receiving commissions to push certain products.  As a #WEFTechPioneer, I recently had the privilege to contribute my views to the #WEF platform, discussing in greater detail, how fee-based models can drive better societal outcomes: https://lnkd.in/gx35wimc #EndowusSG #EndowusHK #FeeOnly #WealthManagement

You rang your gas supplier within days when they raised your direct debit by £12. You've switched broadband three times this year to save £8 a month. Yet you're probably overpaying by thousands of pounds a year annually on your investments. And you probably haven't calculated it once. 📌 The uncomfortable maths: A 1.5% fee difference on £500/month over 40 years equals £425,000 in destroyed wealth. That's the difference between finishing at 60 or working until 67. 📌 Same contributions. Same market returns. One person retires financially free. The other keeps working. The investment industry has perfected the art of charging fees that feel small whilst being systematically large. They've learned that your inertia can be monetised far more lucratively than your engagement. This latest TEBI article explains how multiple fee layers compound against you, and the seven specific actions you can take NOW to stop subsidising an industry that depends on you never checking. Full breakdown 👉 https://shorturl.at/TCpLi #InvestmentFees #RetirementPlanning #FinancialAdvice #PassiveInvesting #InvestorEducation

Fund Managers vs DIY Investors: Why the “Experts” Underperform and How You Can Do Better Investors often entrust their pensions and ISAs to professional fund managers or financial advisors, expecting expert results. Yet, research consistently shows that most actively managed funds underperform the market, weighed down by high fees, closet indexing, short-termism, and misaligned incentives. If fund managers struggle to beat simple index funds, can individual investors do better? The answer is yes—if they avoid the industry’s pitfalls and adopt smart, long-term strategies. The Systemic Issues Holding Fund Managers Back 1️⃣ High Fees Eat Into Returns: Most actively managed funds charge 1-2% in annual fees, plus transaction costs. Studies show that, on average, mutual funds underperform the market by roughly their expense ratio—meaning they add little to no value after fees. 2️⃣ Closet Indexing = Guaranteed Underperformance: Many active fund managers hold portfolios that closely mirror their benchmark index to avoid deviating too much from peers. Yet, they still charge “active” fees. If a fund is 95% the FTSE 100 but charges 1%+, you’re effectively paying for nothing. 3️⃣ Short-Termism and Excessive Trading: Fund managers face quarterly performance pressure, leading to constant trading, which increases costs and hurts long-term returns. A famous study found that the most frequent traders earned 11.4% annually vs. 17.9% for the market—overactivity can be disastrous. 4️⃣ Misaligned Incentives & Herd Mentality: Fund managers prioritise job security over bold stock picking. They often hug benchmarks, avoid contrarian bets, and hold excess cash in downturns—all decisions driven by career risk, not client performance. 5️⃣ Conflicted Advice in the IFA Sector: Many financial advisors previously earned commissions on fund sales, steering clients into high-fee products. Even after regulatory changes, conflicts persist, as some advisors favor in-house products or funds that benefit their firm. 6️⃣ Regulatory Constraints Limit Flexibility: Pension funds, in particular, are restricted in their asset allocation—often unable to invest in small-cap stocks, venture capital, or other high-growth opportunities. This limits their ability to generate excess returns. Bottom Line: The typical actively managed fund or advised portfolio is burdened with high fees, index-hugging behaviour, and short-term pressures. Underperformance is the norm, not the exception.

Why does #OpenFinance matter? Over the last 20 years in the UK, the responsibility for financial security in old age has moved from our employers (defined benefit pensions) to us (defined contribution pensions). With this risk transfer we have so much more responsibility, but do we have the tools to manage this money? I would argue we don't and Open Finance solutions could be the answer. This very simple example shows the impact of seemingly minor decisions on the value of your pension pot when you need it. Let's say a person has £100,000 today and the market grows at a constant annual rate of 5% (if only!), which would give them £265,330 in 20 years. Now let's look at the effect of fees. I'm going to compare two relatively moderate examples of Self Invest Personal Pensions (SIPP), nothing out of the ordinary or wildly expensive. Example 1 "Moderate fees" - Mutual fund charge 0.50% p.a. - SIPP administration charge of 0.40%. Example 2 "Low fees" - Mutual fund charge of 0.20% p.a. - SIPP administration charge of £200 p.a. The difference is a staggering #£27k. There is a lot you can do with that kind of spare change! This outsized impact is driven by a double effect. Every £1 you spend in fee costs £1 but also the potential gains from reinvesting that £1 over x years at 5%. Let's bring this back to Open Finance. Wouldn't it be great if Fintechs could monitor the cost of your SIPP and switch Adminstrator or Fund to minimise cost given your investment risk tolerance? Even better if it could do this with a set mandate and without manual intervention. Ultimately, many people spend more time comparing the cost of a pair of trainers online with price comparison sites than they do on the most important financial investments of their lives. It's never going to be fun to manage your pension, but perhaps it's time for #regulation to unleash a wave of innovation to at least make it easy? #Openfinance #Openbanking #insurance #pensions #investments

A 1% fee over 50 years means you're giving your advisor 40% of your wealth" is so brain-dead I don't even know where to start. But let's do some math anyway. Here's what that formula assumes you avoid for 50 years: 1. The Behavioral Tax: Research shows DIY investors underperform by 3% annually due to bad timing decisions. • On $2M, that's $60K per year in lost returns • Over 30 years at 7% growth: $5.7M destroyed • A 1% fee on the same portfolio: $1.8M Net difference: You're $3.9M better off WITH the advisor. 2. The Tax Optimization Miss: Early retiree making $150K doesn't understand MAGI limits. • Misses ACA subsidies worth $15K/year for 10 years = $150K gone • Converts entire IRA to Roth in one year, jumps 3 tax brackets = $200K+ mistake • Doesn't tax-loss harvest = $30K-50K over retirement Total tax fumbles: $400K+ in a single retirement 3. The Panic Sell: Market drops 30% (happens every decade or so). • Investor sells everything at the bottom. • Misses the recovery, locks in permanent 30% loss. • On $2M portfolio: $600K gone. Takes years to psychologically get back in. Add it up: Advisor fee over 30 years: ~$1.8M Cost of going it alone: $3.9M (behavior) + $400K (taxes) + $600K (panic) = $4.9M That 1% fee just saved you $3.1M. Oh – and that's assuming a 1% fee, which is not necessarily standard and it just one of a ton of different ways you can work with an advisor. I know it's ironic to call out a social media post for lacking nuance on social media, but this sort of "gotcha" content does way more harm than good. Careful who you take advice from. 

He has $1.5M with a “wealth advisor.” Pays 1% annually ($15k/year). Advisor calls once a year to review performance. No tax planning. No Roth conversions. No QCD strategy. No coordination with his CPA. Just “your portfolio is up 8% this year.” Meanwhile his friend switched advisors. In one meeting we saw: • $80k Roth conversion opportunity (saved $22k in future taxes) • QCD strategy for $30k donations (will save $13k in taxes per yr) • Backdoor Roth for him and his wife (tens of thousands in future tax free growth) First meeting, future tax savings in the 100k+ range The math: Old advisor fee $15k, zero tax strategy = $15k cost. New advisor fee $12k, saved $100k+ in taxes = getting paid to have an advisor. You’re not paying for portfolio performance. You’re paying for someone to think proactively about your entire financial life. May sound obvious but needs to be said… If your advisor isn’t providing more than their fee in value, fire them.

If you've stayed away from taking financial advice (the real conflict-free fee-based financial advice - think of SEBI RIAs) because you think it's expensive, you'll be surprised at the options available. True, if you are wealthy and want not just a financial plan but also estate planning, help with investment-related transactions etc., then % fee-based RIAs could be your go-to option. Be willing to pay, 0.5 -1.5% of your assets under advice as fee. But, if all you want is a good financial plan and recommendations on uncomplicated investment products for a reasonable cost, fixed-fee RIAs that charge a flat fee (irrespective of your asset base), can be an option. There are RIAs who charge as little as Rs 20,000 and many that go up to Rs 40-50,000 for the 1st year for a complete financial plan. 2nd year fee is lower. Of course, if you have many complicated financial issues to deal with and need greater assistance, you are better off going to a fixed fee RIA who charges a higher fee (SEBI caps the fee at Rs 1.51 lakh a year) or a % fee-based RIA. Deepti Bhaskaran Mint