Price and value are two different things.
Don’t rely on labels to paint the full picture. Most think all processed foods are bad news. There’s a chasm between Plain Greek Yogurt and Twinkies.
Not all processed foods are similiar. Minimally processed foods like frozen fruit and vegetables, canned beans, and Greek yogurt provide your body with nutrients.
Ultra-processed foods are another story.
According to Arnold’s Pump Club:
Ultra-processed foods are a different category entirely: packaged snacks, sugary drinks, and products engineered for maximum palatability with minimal nutritional payoff. When research links “processed food” to health problems, it’s almost always referring to that second group. Lumping frozen spinach in with Doritos isn’t just imprecise; it pushes people away from some of the cheapest, most convenient healthy options available.
It gets more nuanced within this category. It turns out texture is a major factor in the toxicity of each bite. We eat significantly more when we consume a soft, ultra-processed version than when we consume a hard, minimally processed one: 789 calories vs. 483.
Eating pace is a key component of overeating. Harder food forces you to chew more, which slows your chewing. Fullness signals operate on a lag of about 15-20 minutes before signaling satiety.
In other words, not all processed foods have an equal destructive effect on your body. Some add value depending upon their context.
The same applies to investment fees.
Not all fees are created equal. Ultra-processed fees are unnecessary and harmful to your portfolio’s long-term health.
Some examples include:
- Closet Index Funds: These funds charge active management fees but mimic the performance of a basic index fund. Some of these fund versions of Doritos charge between 0.75% and 1.25%, while investors can get the same returns from a total market ETF for around 0.03%.
- Wrap Fees: This is a bundled investment fee that layers a typical 1% advisory fee on top of fund expenses as high as 0.75%. These are often static asset allocations that require little energy to maintain. It’s never wise to pay a full-time chef to microwave your meals.
- Variable Annuity Riders: These are insurance add-ons that drive up costs but are often unnecessary. Things like Mortality & Expense and Investment Subaccount costs can drive total expenses to 3%, making it virtually impossible to earn money on your investmentwhwn taking inflation into account.
Over the years, we have rescued clients from conflicted financail advisors who charged them 2-3X more than our fees. These firms provided little value. Basic financial planning, estate, and tax advice were often nonexistent.
Most importantly, we provided guardrails to filter hyperbolic media and their own irrational behaviors. Besides averting catastrophe by turning concentrated positions into diversified global portfolios, we provided the following rescue matrix;
- Preventing them from doing stupid things like trading currencies, buying naked options, and investing in friends’ and family’s business ideas that had very little chance of success.
- Advising them to set a goal of maxing out their retirement plan contributions by dollar-cost averaging, funded from their monthly paychecks. The tax savings and compounding over time were priceless.
- Stopping them from selling their stock positions during market downturns and avoiding catastrophic losses
Sometimes you have to spend money to make money. The services we provide pay for their cost many times over. You don’t have to believe me. Vanguard completed a study that determined a good advisor can add up to 3% to investors’ returns annually.
Be careful about what you eat and how you compensate those who give you financial advice.
Not all costs provide the same outcomes.
