Graham Bentley: Beware reverse compounding from fees

As Bob Dylan sang in 1964, "the times they are a-changin'". The generation he was singing to forms today's wealthy clients - the ‘Born in the 50s' beneficiaries of plummeting interest and inflation rates. Enhanced by a strong motivation to save in their 30s - the savings ratio in the 1980s was 14%, as opposed to 5% today - today's retirees have most of the wealth but now they are withdrawing it. Meanwhile, nascent clients building up their wealth should expect lower returns at this stage in their investment journey than their parents had, while saving less. Fewer clients with less mon...