Investment Ideas from an Athlete-Investor’s trek to the top
Excess Baggage (2 of 5):

Welcome to #2 in a series of 5 blog analogies that came to me during the Kendall Mountain half marathon this weekend in Silverton, CO.


With a 2.5 hour ascent and about 2 hours to get down, I had many reflections on life, investing and the uniqueness of humanity. What a terrific group of runners/athletes that participated in the race.

Excess Baggage: To Cut or NOT to Cut, that is the question…. (2 of 5):

Baggage? What kind of baggage? Well there are a few kinds, actually. Since this blog series reveals my investment ideas I will not leave you hanging…excess baggage, in the investing world is really only one thing; excessive investing fees. In the world of athletics its two things; equipment and just plain extra baggage, in the form of, ahem…pounds).

As I am slogging up Kendall Mountain at a snail’s pace (did I mention its 6 miles straight up and an elevation gain of about 3,750 feet?) I realize my pace is hindered by two forms of excess baggage and that the same is true with investor’s portfolios. Some baggage I want and need and some, well, quite frankly could stand to not be with me next year when I endeavor to beat my time by 30 seconds.

The bad baggage, is, well–the 15-20 pounds that I could stand to lose. The good baggage: my beloved comfort items that add confidence to my race; my camelback filled with part mountain dew, part water (yes, I admit it, and trust my kids won’t read this anytime soon), my trekking poles for the 1/4 mile scramble up to the summit in tough terrain and my raincoat for the standard late morning shower.

Could your portfolio stand to lose some baggage? Did you realize that in paying an extra 1% per year (which adds up quickly) that you could be pre-spending up to 28% of your retirement nest egg? 28%! That’s a baggage fee, alright. And I thought United was bad. The forms of excess baggage in your portfolio are:

1.) Your Advisor’s fee and/or your annual trading costs
2.) the average expense ratio (annual fee) that the investments in your portfolio take from your returns each year.

Here’s where Shakespeare comes in: To Cut baggage or Not to Cut baggage?….THAT is the question. As I have said before, the game of investing is personal—so only you can know what to cut. However, I wouldn’t cut the baggage that ADDS confidence to your strategy–dont cut the raincoat that will help you weather rough times in the market. The raincoat…THAT is usually your advisor. You can still ask them to reduce their fees, however.

See to it that you are not paying more than 1% per year for your advisor AND the transaction/trading costs that they will usually include in their fee (1% total). OR, see to it that if you dont have an advisor, that trading costs are less that 1% per year. The place to cut, more times than not, is in the cost of your investments. Go to and view their low-cost ETFs that charge as low as .06% per year—if you have an advisor, ask he or she to get your investment fees below .50% per year. All in, your annual fees should always be less than 1.5% for your advisor, the investments and the trading costs/commissions.

For me, I will drop some pounds for next year’s race, but I am keeping the confidence boosters; my poles, my hydration and my foul weather gear.

Want help assessing your fees? Download our free ebook, The Liberated Investor and the first tool that we’ll send you will help you cut your portfolio’s excess baggage. Stop paying for things that don’t improve you race time—its time to move up in the pack. Get Liberated!