The National Association of Personal Financial Advisors (NAPFA) has long been opposed to “hidden fees” being charged to clients.  One example is the sales commissions paid to stockbrokers when clients buy into mutual funds.  Another is the mysterious “12b-1” fee paid each year to stockbrokers.  Another is the value of exotic vacations for stockbrokers and their spouses for putting client money into the favored funds.  Another is selling bonds into a client portfolio for more than the purchase price, making a substantial profit on each investment of client funds, which is called a “mark-up.”  And, the list goes on . . .

That is one primary reason that all investors should have a “NAPFA-Registered Financial Advisor” and the confidence they are not being charged any hidden fees.

NAPFA has encouraged the adoption of a “fiduciary standard” which means the stockbroker must put the clients interest first . . . and not a free exotic vacation with their spouse, for example.  The choice of a mutual fund should actually be based on the needs of the client.  After years of lobbying, the Obama Administration ordered that all retirement accounts be managed according to a fiduciary standard beginning next January.  Of course, stockbrokers are fighting mad!

But, the notion of a fiduciary standard has confused many investors.  Leave it to a comedian to explain it in a way that is both funny and understandable.  Unfortunately, the messenger can sometimes over-shadow the message, especially with coarse language.  If such language offends you, please don’t click on this link for a 20-minute explanation: