Fisher Investments Review
If you're considering Fisher Investments as your financial advisor, you're not alone.
Fisher serves more than 155,000 individuals, businesses, and employees around the world and manages over $276 billion in assets, as of the time of this writing.
But is Fisher Investments the right financial management firm for you? Is it worth the fees?
Here's everything you need to know about Fisher Investments, how to know if it's the right firm for you, and 3 alternatives you should consider before choosing a financial advisor.
What is Fisher Investments?
Ken Fisher founded Fisher Investments in 1979. He is an innovator in investment theory who wrote the Portfolio Strategist column for Forbes for 30+ years.
The company still has the same goal 40 years later: to “help clients achieve their investment objectives with tailored solutions, a high degree of care, and a transparent fee structure.”
While the firm offers some 401(k) solutions and works with a few institutional investors, it primarily serves private clients.
Fisher is known for its personalized asset allocations and active approach to money management. It creates unique investment mixes for each client and frequently adjusts client portfolios based on the firm's constantly evolving market outlook.
Fisher is a fee-only firm, meaning it only makes money by charging a percentage fee on the assets it manages (more details below). Fee-only firms are more likely to maintain their fiduciary responsibility to always work in your best interest.
How does Fisher Investments work?
Below is an overview of what to expect when working with Fisher, including the target clientele, the new client process, the company's investment philosophy, and the fee structure.
Target clientele
Fisher Investments has a minimum requirement of $500,000 of investable assets. Investable assets are defined as any funds in brokerage, retirement, or cash accounts.
The firm targets high-net-worth individuals and those at or approaching retirement age. It also wants clients who agree with its long-term, goal-oriented investment philosophy, which is discussed in more detail below.
For high earners, Fisher also offers WealthBuilder accounts. These accounts have a $200,000 account minimum and are only approved on a case-by-case basis.
New clients
New clients will meet with their assigned Investment Counselor either in person or online. Fisher has offices in several U.S. states as well as a few global offices.
This person will start by getting a general understanding of your financial situation.
From there, they will help you set up an account with a custodian (such as Schwab or Fidelity), make an asset allocation recommendation, and then help implement that recommendation.
Investment philosophy
Fisher offers 3 things to its clients:
- Personalized service
- A portfolio tailored to your goals
- An asset management approach based on their investment philosophy
As mentioned above, Fisher starts by assessing each client's current financial situation and goals.
From there, they will create an investment strategy based on your age, risk tolerance, current needs, and future objectives. The strategy will be composed of stocks, bonds or other securities.
Unlike some fee-only advisors, Fisher takes an active management approach. Its Investment Policy Committee (IPC) monitors economic conditions and market sentiment to regularly devise new investment strategies and update its strategies.
For example, if the IPC determines international equities are undervalued, it may decide to tilt several of its growth strategies more heavily toward stocks outside of the U.S.
In my opinion, if you're deciding whether or not to use Fisher Investments, the entire decision comes down to whether you have confidence in Fisher's IPC.
Worth noting, the company does not publicly disclose its strategies' returns.
Fee structure
Fisher Investments charges an annual fee based on the total amount of assets it manages on your behalf. Here's its fee structure:
- The first $1 million: 1.25%
- The next $4 million: 1.125%
- Anything over $5 million: 1%
This is a progressive, bracketed fee structure (similar to the U.S. tax system). So, if you have a portfolio of $15 million, you will be charged:
- 1.25% on $1 million = $12,500
- 1.125% on $4 million = $45,000
- 1% on the remaining $10 million = $100,000
In this scenario, your total annual fee would be $157,500.
If you have a portfolio of $2 million, your annual fee would be $23,750:
- 1.25% on $1 million = $12,500
- 1.125% on $1 million = $11,250
The company also charges $7-10 per trade, though this is a pass-through commission that goes to its broker.
These fees are higher than the industry average. Some people will find the higher fees worthwhile to gain exposure to Fisher's active investment style, while others will find the above-average cost isn't justified.
Fisher Investments is a fee-only advisor, meaning it only makes money based on the value of your assets.
Other money managers may earn both fees and commissions from investment products they place in your portfolio, which may create a misalignment of incentives.
For example, if an advisor would earn a $1,000 commission for Product A but believes Product B, which would not earn them any commission, is a better fit for your portfolio, they may be tempted to use Product A to the detriment of your goals.
If you do choose to work with a financial advisor, either Fisher Investments or another firm, be sure they are fee-only.
Why I don't recommend Fisher Investments
As a former financial advisor, I don't recommend Fisher investments for most people even though they do a lot of things right.
To sum up the pros and cons:
- Pros: Fee-only advising, strong reputation, experienced advisory team
- Cons: Misaligned business model and so-so new client experience
In my opinion, the cons outweigh the pros, which I expand on below.
Business model
I don't like the structure of Fisher Investments, and I find its marketing to be misleading.
The firm is a crossover between a product creator — the IPC builds and actively manages investment strategies and products — and a financial advisor.
Fund managers create mass-market products (which is why you'll see them advertised on TV). Real financial advisors provide highly individualized services, which are hard to scale. The two shouldn't be combined.
By combining the two, Fisher can charge financial advisor fees (1.5%) while operating and marketing like a fund manager, which rarely charge fees this high.
Some high quality fund managers with similar strategies charge less than 1%, oftentimes much lower.
The model is highly lucrative — Ken Fisher is the wealthiest financial advisor in the world, with a net worth of more than $8.1 billion.
But if you sign up expecting holistic advisory services and not just investment recommendations, you will be sorely disappointed.
New client experience
When someone becomes a new client at Fisher, they're assigned an Investment Counselor. To me, this feels backward.
If you want a financial advisor, you should find someone you like and trust. I think people should interview multiple financial advisors before choosing one, preferably face-to-face, which isn't what happens at Fisher.
I'm sure you could request a new Counselor, but that misses the point — it's selling the brand when you should be “buying” a financial advisor, someone who really knows and cares about you and will take the time to make recommendations tailored to you.
While Fisher may not be selling “cookie-cutter portfolios,” the advice you're receiving is far less customized and much less holistic than you'd get from a local financial advisor.
That said, if you're a big believer in Ken Fisher and the rest of the IPC, and are confident the performance it'll deliver will be worth the fees, 155,000+ people feel the same way.
Three alternatives to Fisher Investments
Here are three recommended alternatives to Fisher Investments:
1. Financial advisors
In my opinion, most independent financial advisors are much better options than Fisher Investments.
As mentioned above, Fisher Investments places each one of its clients into a different "model" based on their age, risk tolerance, and portfolio size.
Good financial advisors, on the other hand, build a unique plan for each of their clients. These plans are highly customized to their clients' lifestyles and financial goals.
Additionally, good financial advisors go into much more depth than Fisher Investments.
In addition to offering investment management services, they may provide tax guidance, insurance recommendations, and advice on any real estate or other investments you may have.
Plus, they typically charge between 0.70-1.20%, lower than Fisher's fees.
While I'm a big proponent of self-directed online investing, there are good reasons to choose a financial advisor instead:
- Convenience: If you have no interest in learning how to manage your money or simply don't want to spend the time, a good financial advisor is a great investment.
- Financial advice: While you can learn everything your financial advisor knows, it's helpful to receive regular advice on your full financial life — estate planning, tax planning, insurance, charitable giving, and more.
- Emotional barrier: As you can see in the image below, most investors underperform the market because they are constantly jumping from asset to asset, chasing returns and selling at market lows. A financial advisor acts as a buffer between you and your money, something that can more than make up for the fees they charge.
Source: J.P. Morgan Asset Management. This chart shows that the average investor gets returns of 2.5% per year, compared to 8.7% for a 60/40 portfolio or 9.9% for the S&P 500.
If you are going to use a financial advisor, find one that is fee-only and knows about tax planning. You want someone who will oversee your entire financial picture, not just your investments.
After meeting that criteria, find someone you like and trust. Interview multiple advisors and choose your favorite.
Scratch Capital is a fee-only financial advisor located in Boise, Idaho. The firm serves individuals and families across the US. I interviewed Scratch's founder, Drew Lunt, for this section of the article.
To get a free, custom financial plan built by Drew, fill out this form.
2. Self-directed investing
If you talk to a financial advisor who is truly honest, they will tell you there's nothing they do that you can't do on your own.
You just need two things:
- Information and a willingness to learn
- Discipline
If you have these two things, I would recommend learning how to manage your own money and not using a financial advisor.
There are many books, articles, videos, and other resources you can use to plan and manage your own retirement, and all will cost you a lot less than the 1%+ a financial advisor will charge.
1% may not sound like much, but that's $5,000/year on a $500,000 portfolio, not to mention the (much higher) cost of lost compound interest. If you are at all interested in managing your own money, it can be one of the highest ROI skills to learn.
As for where to manage it, you can use either a free or paid portfolio tracker to get a good overview of your assets, returns and net worth.
For example, Empower's free Financial Dashboard can help you aggregate your net worth and easily manage all of your investments in one place:
Empower also offers a Retirement Calculator, Investment Checkup, and more, all completely free.
3. Robo-advisors
Robo-advisors are computer algorithms that create portfolios based on your age, investment horizon, and future objectives.
In my opinion, they do at least 85% (if not much more) as well as a financial advisor for lower fees — typically between 0.25–0.50%.
The one caveat: You won't receive personal financial advice about your specific situation. Robo-advisors are good at designing investment portfolios, but they cannot help you with tax or estate planning or recommend insurance products.
So, if you're young and don't want to manage your own money, a robo-advisor is probably the right option for you (I like Betterment).
If you have a larger net worth or are nearing retirement and want to take a hands-off approach, you should probably consider using a financial advisor.
Final verdict
As a former financial advisor myself, I would not use Fisher Investments.
Any financial advisor that advertises on TV has a mass-market business model that cannot effectively create the most customized solutions for its clients.
In my opinion, most people would be better off learning to become their own money managers (using free tools like those offered by Empower), hiring a local financial advisor, or using a robo-advisor.
Frequently asked questions
Below are a few more questions people often ask about Fisher.
How trustworthy is Fisher Investments?
Fisher Investments has been in business for more than 40 years, has a large client base, and continues to grow. Reviews about the company are mixed, with some good and some bad, which isn’t uncommon for financial advisors.
Is Fisher Investments worth the fee?
This is a matter of opinion. I personally do not think it’s worth it, but many of Fisher’s clients are more than happy to pay the fees, which are slightly higher than the industry average.
What is the average return on Fisher Investments?
The firm does not share performance data publicly, though it does disclose it uses the MSCI World Index for many of its private clients’ stock portfolios.
What do people say about Fisher Investments?
Fisher Investments has 3/5 stars on Trustpilot, which isn’t uncommon for financial advisors. Its quality of service is best demonstrated by its large list of 135,000+ clients.
How does Fisher Investments make money?
Fisher Investments is a fee-only advisor, which means it makes money by charging a percentage fee based on its clients’ assets.
