[manaboutown]

Interesting comment by Coach about portfolio managers' compensation.

Ten or fifteen years ago long time professional musician friends of mine sold a huge home on acreage in Mesa, AZ to downsize. They had (and still have) a financial advisor who they trust and like. She was upset they wanted to use part of the proceeds to buy a Bosendorfer grand piano for $80,000. The piano was in terrific shape, had been played in The Blue Note, autographed by Herbie Hancock and was worth the price. The lady of the house teaches piano and violin and plays both in gigs all over the PHX area so I am sure the piano could be depreciated to offset their income taxes. The advisor seemed to protesteth too much. It felt to me like the advisor was in part compensated by the size of their portfolio and did not want to see it reduced in any way, even for a good purpose.

In another thread I posted I had recently sold a real estate property and put the proceeds into a brokerage account. For years it had been a relatively small account and what I added was sizable by most people's standards. The very next business day a financial advisor at the firm both phoned and emailed and wanted to meet with me. I have to chuckle as no one from the firm had ever previously contacted me for any reason over the many years my account was small. lol. He offered to be my "contact", help me use the website, answer any questions I had and so on. I said OK, he could be my contact. He then went on and started to ask the usual qualifying questions about my investment experience and whether I wanted growth, value, blah, blah, blah. I told him I was 80 years old, had invested in the stock market on my own since I was in high school and was doing just fine, that I was mostly a real estate guy but planned on selling a couple more properties to simplify my life. When I casually mentioned I had bought a few shares of BRK back in the '80s he thought that was the price I paid! I said, no, I had bought some during the 1980s. I told him I had a couple other brokerage accounts which held most of my stock. He then repeatedly asked me to consolidate and it put it all into his firm. I declined and told him I had seen banks and brokerage houses go under and would never put all my eggs in one basket. What astonished me was the pressuring to put it all with his firm. Bingo, more bucks for him.