Up here in Queensland a debate between recreational fisherman and professional fishermen often flairs up.  The recreational fishermen often say that pro's are taking too many fish and depleting resources.  Similarly, the recreational fishermen are blamed by the pros for taking too many fish.  However, I wonder that the real problem might be the destruction of breeding habitat for fish through constant development? 

At least with my fishing abilities you can be sure it is not me depleting fish stocks.

In the same way the debate in the financial services industry might be too focussed on whether a fee based model or commission based model is the best for clients - and might overlook the fact that too many clients of the financial services industry (and not just clients of financial advisers) might be paying too much in fees!

I often see prospective clients paying fees of 2.5% or more in their financial situation.  Many people think that in low inflation times the returns from growth assets will only be 9% to 10% a year.  A fee of 2.5% gives away a quarter of the expected returns from a portfolio!

The reality is this - if you are paying too much in fees you will not have a successful investment experience.  It is possible to overlook the importance of costs when markets are booming as they are at the moment.  The reality is that these times won't last forever, and fees really matter!

Cheers

Scott Francis