I've been trying to really determine if the 0.73% annual fee I pay to Fidelity is a waste of money, or are they doing better than I could.
I withdraw money from several accounts (it's complicated) but I have a $300K IRA that Fidelity manages that I haven't touched since March 2022. I looked at the balance on March 1 2022 and then on August 1 2024, this is a true measure of growth, and it includes the management fees taken every quarter. No calculations, no predictions, this is just what I started with and what it's grown into in 2.5 years.
I then backtested the exact 3-fund lazy portfolio I would have used (45/25/30) with the rebalancing strategies I'd consider (annual, semi, quarterly) with the exact starting balance on March 1 2022 and looked at the value on August 1st 2024.
They were identical to within like $100 on a $300,000 portfolio. Differences were totally insignificant.
So did Fidelity beat the lazy portfolio? No. But I had someone else deal with everything, no rebalancing needed, no thoughts or worries, and I had a dedicated guy in our local branch. And even with their fees I had the exact same amount in my account as if I'd done it myself. So it feels like I got great value for my fees.
Is it possible that this 2.5-year period was just a fluke, and Fidelity got lucky? Or could it be that the shuffling they do behind the scenes actually does provide some value? I love this forum but I don't want to hype myself into a "self-managed is always better" mantra that makes me ignore the results in front of me, which is that Fidelity earned their fees here.
I withdraw money from several accounts (it's complicated) but I have a $300K IRA that Fidelity manages that I haven't touched since March 2022. I looked at the balance on March 1 2022 and then on August 1 2024, this is a true measure of growth, and it includes the management fees taken every quarter. No calculations, no predictions, this is just what I started with and what it's grown into in 2.5 years.
I then backtested the exact 3-fund lazy portfolio I would have used (45/25/30) with the rebalancing strategies I'd consider (annual, semi, quarterly) with the exact starting balance on March 1 2022 and looked at the value on August 1st 2024.
They were identical to within like $100 on a $300,000 portfolio. Differences were totally insignificant.
So did Fidelity beat the lazy portfolio? No. But I had someone else deal with everything, no rebalancing needed, no thoughts or worries, and I had a dedicated guy in our local branch. And even with their fees I had the exact same amount in my account as if I'd done it myself. So it feels like I got great value for my fees.
Is it possible that this 2.5-year period was just a fluke, and Fidelity got lucky? Or could it be that the shuffling they do behind the scenes actually does provide some value? I love this forum but I don't want to hype myself into a "self-managed is always better" mantra that makes me ignore the results in front of me, which is that Fidelity earned their fees here.
Statistics: Posted by steveosteveo — Fri Aug 23, 2024 6:57 am — Replies 13 — Views 804