RETIREMENT FEES

The John Oliver show recently did an interesting spot on the costs incurred when using financial advisors of most kinds. Unless the advisor is an actual "fiduciary" they have no obligation to work on your behalf and, in fact, can profit immensely at your expense. If you decide to view the amusing video below, watch out for bad language, poor taste, and some ugly factoids.

As I make financial choices for my retirement, I am drawn toward low cost index funds and more bonds. My current savings have had all kinds of unexpected fees, penalties, and lower than index growth. Everywhere in the financial world I find that there are new ways to take my money. I recently decided to pay off the last couple of months of my mortgage and found that there were $60 in fees in order to do this. Why is it that I cannot suddenly tell my mortgage company that I am going to charge them $60 as partial payment for the other $200,000 that I have had to pay in interest on a house that I bought in 1987 for $60,000?

Apparently if I want to draw $10,000 from my retirement 401K, I have to pay 13,3000 to cover 25% taxes this year. I thought that would be $12,500 but when you look closely you have to pay tax on the amount of tax that you have to take out. Too many surprises like this I am afraid. And yes, I am afraid.