Knowledge Marketplace
My First Million

My First Million

The best business ideas come from noticing what's working and doing it better, faster, or for a different audience.

Back to Takes

Wealth managers are fundamentally used car salesmen whose job is selling financial products, not understanding markets or generating returns

Spiciness
industry_critique

The Reasoning

Wealth managers profit from fees and commissions, creating incentive misalignment where they benefit from churning assets rather than optimizing returns

What Needs to Be True

  • Fee structures reward asset sales over performance
  • Wealth managers lack genuine market expertise
  • Simple index investing outperforms managed strategies
  • Clients can self-manage with basic knowledge

Counterargument

Professional wealth managers provide valuable diversification, risk management, and behavioral coaching that individuals cannot replicate

What Would Change This View

Finding wealth managers who consistently beat simple index strategies after fees and provide genuine value-add services

Implications for Builders

Self-manage investments using simple strategies

Avoid complex financial products pushed by advisors

Focus on low-cost index funds and treasuries

Educate yourself rather than relying on intermediaries

Example Application

High net worth individual manages $50M portfolio using Google Sheets with simple allocation: treasuries, index funds, and direct investments rather than paying wealth management fees.