For 19 years and 335 days, I worked for one of the best financial planning firms in the country.

Now, while it was one of the best and seen as “cutting-edge”, it was actually very archaic, slow, and inefficient.

You know what it’s like to work for a large organization. Change is very slow, if it ever happens at all.

But, that’s not why I left 1 month prior to 20 years.

The reason I left was because the firm had recommitted to fully adopting the model of using outsourced traders to manage client accounts.

Yes, outsourced traders.

They did this under the guise that the outsource trader was some special money manager that would improve the after-tax/risk adjusted results of the client’s investments, but really it was just a way to recuse the firm of trading risk and free up their advisors’ time to find more clients (grow the firm).

That terrible, BUT that’s not the worst part.

The part that I could no longer swallow was that they caused us to charge the clients an extra fee to use the outsourced trader.

Their cover was that all the largest investment firms were already doing the same thing and charging the clients to do it. Unbelievable.

This outsourcing can go by a lot of names including:

Private client

Private banking

Premium access

Portfolio manager

Separately managed account (SMA)


and many other clever names that make it sound like it is some exclusive platform and hide the fact that they are pawning the responsibility off onto another firm.

In reality, you’re just paying an extra fee to hire an outsourced trader to trade your account.

You see, the large investment firms discovered that clients only pay attention to their advisor fee and/or internal expense ratios, not the all-in fees.

And that’s where they hide hidden fees.

That’s how the large investment firms make their money.

I couldn’t take it anymore, so I walked out.

And I wish I would have left earlier. Now I can help my people without the regret.

So why am I telling you this?

Because I want to recommend that you have a conversation with your advisor and ask them for a strategy without the added fee of an outsourced money manager (or private client, or whatever special name they have given it).

If you would like some fodder for this conversation, you can download my guide “How to Tell if Your Advisor is on the Ball” HERE.

People ask me if I regret not staying till 20 years on the dot, and I don’t. One less month feeling bad and all I missed was the expensive watch they would have given me (I do like nice watches, but…).

We’d like to hear from you. Email us at

Similar Posts