I joined Rebalance because what it does is everything that I believe in. It believes in broad diversification. That’s just something I have believed in all of my life. It believes in low expenses. And low expenses not only in the funds that are bought, but in the overall fund. You know, one of the problems is in the investment advisory business, what happens is an investment advisor will often, in addition to what you pay the expense ratio for the fund you buy, will charge an additional fund for putting the portfolio together. And that could be another two percentage points.
If you go to a broker, the broker will tell you, “It’s okay. No commissions. We’re gonna really take care of you and we’ll have a so-called wrap fee of two percentage points.” Well, that comes off in addition to the expense ratio of what that broker buys you, or what that investment advisor buys you. So you get expenses plus expenses, and there’s very little left for the investor. So it’s just—what Rebalance does is exactly the kind of thing that I believe in.
And let me just mention one other thing about investment advisors. Not only will they charge these extra expenses, but they are conflicted. When they want to put a mutual fund into your retirement account, many of the high expense mutual funds will pay that advisor some extra amount to sell you that mutual fund. So they tend to be conflicted, and they tend to put funds in your portfolio that they get the most income from.
And what I love about Rebalance is very, very low overall fees, using index funds, taking advantage of dollar-cost averaging, taking advantage of rebalancing. It’s exactly the kinda thing that I believe in, and I’m just delighted to be a part of it.