Most investment funds are deceptive, they try to hide commissions with jargon and terms that we do not understand, they use excessive commissions that undermine our retirement and financial freedoms as explained by Tony Robbins in his book Money: Master the Game.

In chapter 2.2 on commissions, Senator Peter Fitzgerald mentions how investment funds are the largest fraudulent operation in the world, a 7 trillion dollar mine in which funds, brokers and other insiders take a large portion. of our money.

This sector moves 13 trillion dollars and the average cost of a fund is 3.17% in the United States.

Let's use the example that Tony gives in his book about the impact of commissions on our final balance:

Pedro: USD$ 100,000 at 7% – 3% annual commissions = USD$ 324,340

Matthew: USD$ 100,000 at 7% – 2% annual commissions = USD$ 432,1

Maria: USD$100,000 at 7% – 1% annual commissions = USD$574,349

With most funds in the United States you pay up to 3,000% more in commissions and we are the ones who assume all the risks with our capital and they always win no matter what happens.

I share with you a summary of the hidden costs that investment funds usually have.

NOTE: Commissions work as base points, for example 0.5 is equivalent to 50 base points.

The solution

You're probably wondering, what is the solution?

We have to take charge of our investments and take care of our money because no one really wants to help us, everyone seeks their own benefit in some way.

I share with you some practical tips that Tony tells us in the book:

  • Reduce costs to at least 1.25%

  • Hire low-cost index funds (0.05 – 0.25% annually)

  • Pay an advisor by the hour, never by percentage, this way we will save costs on commissions.

In my opinion, investing in stocks through index investment funds is a good idea to diversify, as long as they have low commission costs so that you don't end up angry and frustrated in the end.

Crypto vs Stock Market

Unlike the traditional market, with cryptocurrencies you don't have to worry so much about the fine print, it is much easier to realize the commissions you can pay for transactions (they are the only ones you will pay) by doing a few tests with a minimum amount like 30 dollars, for example, in any exchange house or decentralized finance protocol.

You will not encounter surprises regarding commissions for maintenance, subscription, disbursement, etc. That's what makes cryptocurrency investments and decentralized finance unique.

You are in 100% control of your money and without hidden costs that try to sabotage your financial independence or your peaceful retirement.

Although the cryptocurrency market is volatile and emerging, it offers large profit margins and a great opportunity for investors.

I hope this article has been helpful in your decision making about your investments, and if so I would love to read your comment, follow me so you don’t miss anything and share.

We continue reading,

Erika Espinal

CEO Invest-E-Capital