How Investment Fees Destroy Retirement Plans

If you are using a simple Monte Carlo analysis to analyze your retirement projections, you could be setting yourself up for a HUGE disaster. Worst off, is that this disaster may occur when it’s just too late to change anything!

Why is this? Because Monte Carlo analysis doesn’t include investment fees or taxes.

As I stated repeatedly, investment fees and taxes are the biggest detriments to your portfolio strength.

So, consider using this FREE tool at While it won’t give us insight into taxes you may pay, it most certainly can allow you to adjust your portfolio for the fees you pay.

In this example I show what a retirement portfolio with a .18% looks like as compared to a more typical portfolio with a fee of 1.50%.

It’s not a pretty comparison. Not in the least.

Factor in taxes and it’s going to get even uglier. When it comes to retirement planning, ugly is not your friend; we want the prom queen. The easiest way to dance with her? Reduce fees and taxes!

For the video on this topic click here.

Investment fees are one of the two biggest detriments to successful investing. I discuss this in detail when it comes to using Monte Carlo analysis to determine one’s ability to retire in my podcast here.

In this video though I show you how a portfolio with an all-in fee of .18% has a 95.7% retirement success. Whereas the exact same portfolio with a 1.50% fee has a 74.4% success.

Everything is the same. I use the calculator at if you want to run your own numbers.

The lower cost portfolio not only had a 28% higher success than more expensive one but its average account balance after 30 yrs was over $1 million.

The higher fee portfolio average account balance after 30 yrs was less than $500k.

So, if an advisor were running a monte carlo analysis based on this portfolio and NOT taking into consideration investment fees that advisor would provide a very misleading end-result.

Now, the one drawback of is it does not take TAXES into consideration. So you’ll have to do your homework on that. Taxes are a big deal and should not be overlooked.

However, for what it’s worth offers the best financial planning calculator on the web when it comes to retirement projections.

You can change your scenario a bunch of different ways. Too many ways to get into here.

I can not recommend this tool enough.

As always if you have questions, thoughts or concerns, please let me know.

© Copyright 2018 Heritage Wealth Planning