Tuesday, February 17, 2004

More Letters... 
The article on First Command generated quite a bit of email.

Here's one from a CPA:

you might want to mention the effect of a 50% commission and large 12b-1 fees on the ability to compound the original amount. At 7% it would take you ten years to get back to even.

With no commission
1-10 3,000 to 6000
11-20 12,000
21-30 24,000
31-40 48,000

with a 50% commission
1-10 1,500 to 3,000
11-20 6,000
21-30 12,000
31-40 24,000

simplistic but an untimate cost of $24,000 is a lot of money for bad advice.


I guess "First Command" is the new name for "USPA/IRA", which was the 50% hammer financial folks when I served from 89-93. I could not believe people signed up with them. I would see O5s walking around proudly with their USPA/IRA coffee mugs and it would immediately change my opinion of them ever so slightly, because I knew they were at least financially gullible. In the early 90s, I read one issue of Changing Times n/k/a Kiplingers, and made nice cash in biotech stocks (for a couple years).
I never understood the logic of people paying so much to one company.


Haven't heard from First Command yet. But you can read fundalarm.com's take on First Command here.

(scroll down a bit to the paragraph that begins "Here are some facts." Brutal. :) )

Splash, out


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