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No. of Recommendations: 1
Once you retire and start withdrawing money, if you pay a 1% management fee, which means that they are charging you 25% of your income or more with hidden fees. If you invest for 25 years like simple model above, you will have already lost 22% and when these are combined, you will only have 60%(.78*.75) of the retirement income that you could have had without the fee. The sad thing is that the people selling the plans like this know how badly they are gouging their customers and the real situation is often worse because of theadditional and hidden fees.

A good advisor will help clients avoid mistakes that are *extremely* common, mistakes that would be far greater than a 1% fee. It is an unfortunate truth that most investors underperform the mutual funds that they are invested in because they get scared out of them when they decline and they get back in after they have risen (they do this with stocks as well). Far too many investors let their emotions affect their decisionmaking. A good advisor will help them avoid this. This isn't to say that everyone needs an advisor, but there are clearly *many* investors who would benefit from an advisor.

That said, I think it is important to understand the fees and expenses that you will be charged, which are often hidden as you said. A good advisor will try to keep your costs down.
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