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What is normal? What traits involving personality, memory, happiness, leadership, creativity, intelligence, stability, and so on, makes one average?

Average by itself is a confusing concept. The arithmetic mean is the sum of all divided by the number of quantities. For example: 91 + 84 + 56 + 90 + 70 + 65 + 90 + 92 + 30 = 668. 668 divided by 9 = 74. Median represents the middle score, which in the example is 84. Then there’s mode, which is the most common, of which 90 is it.

Now let’s use 7.4, 8.4, and 9.0 as normal rates of return for a brokerage account with a value of $10,000. After 10 years of 9% returns, the account is worth $23,673. The 8.4% account is at $22,402, and the 7.4% one is worth $20,414. Over $3,000 difference between the arithmetic and mode average.

Words & Meanings

Words should have specific meanings. Using the wrong words to describe this or that can have a tremendous impact. Now consider Mr. 9% with a 0% assets under management commission and Mr. 7.6% with a 1.5% commission. Mr. 7.6% is now at $17,740, and over the next ten years, he will be at $31,471 to Mr. 9%, who will be at $56,044.

This is a mathematical version of advisor, agent, banker, broker, and financial planner (AABBFP). Each has it’s own specific meaning, duties, responsibilities, laws, rules, and regulations. Lumping AABBFPs into one is wrong, just as it is to say the different averages are all the same.


Can you use a calculator? Do you have a finger? Congratulations, you are a financial planner. “Oh come on,” you say. “Yes,” I say, it’s not difficult to push the buttons on a calculator, and it’s not difficult to do your own financial planning. What is hard is doing what one sets out to do. The planning is easy, the execution is hard. This is why we focus a lot of our effort on the intangible aspect of wealth, and the non-financial tangible wealth components. As every professional athlete will tell you, the game is 90% mental.

The 25% Average Return

Bob has $10,000 and nails it with a 100% return for 2019. Bob now has $20,000. In 2020 Bob blow it and loses 50%. Bob made 100%, then lost 50%, and so, 100 minus 50 equals 50. Since Bob invested for 2 years, he is averaging a 25% return. And yet, Bob is back to $10,000. Never mind the details, Bob’s proud of himself and his average return when talking to his buddies.

Help us help you to unbundle the expensive financial products you most likely have in your brokerage account. The advisory commission on top of the internal commissions charged by mutual funds, ETFs, annuities, and partnerships can easily cost you hundreds of thousands to millions of dollars in lost wealth.

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