July 19, 2007

I help my clents with insurance and investments.

I am a strong believer that the most economical way for a client to obtain help with their investments is to pay for the service via a 12b-1 fee. Without revenue from this fee (twenty five basis points), I could no longer afford to provide service to my investment clients, and would have to switch to a fee for assets under management. Because of the greater amount of work this would entail, that fee would have to be considerably higher, so the client would end up paying another fifty or seventy-five basis points.

Moreover, the fee is automaticall disclosed to client because it's included in the annual management fee charged by the mutual fund, which is something we always discuss with clients.